Gary writes a check drawn on Hilltop Bank for $400 "payable to Ivan" on May 1. Gary dies on May 3. Ivan presents the check to the bank on May 5. Unaware of Gary's death, the bank
A) must certify the check.
B) may pay the check.
C) must consult with Gary's heirs before paying the check.
D) can do nothing until Ivan claims an interest in the account.

Question

Gary writes a check drawn on Hilltop Bank for $400 "payable to Ivan" on May 1. Gary dies on May 3. Ivan presents the check to the bank on May 5. Unaware of Gary's death, the bank​
A) ​must certify the check.
B) ​may pay the check.
C) ​must consult with Gary's heirs before paying the check.
D) ​can do nothing until Ivan claims an interest in the account.

Quizplus · Accepted Answer

The bank may pay the check since they had no knowledge of the account holder's death at the time of the transaction. The bank is only obligated to refuse payment if they have actual knowledge of the account holder's death or if they receive proper notice of the death before paying the check. Therefore, Ivan can legally receive the $400 check.

Gary Writes a Check Drawn on Hilltop Bank for $400