Where a depositor receives a bank statement and the checks the bank has paid, the failure to notify the bank within a reasonable time of forgeries of the depositor's signature may preclude recovery for other forged checks thereafter paid by the bank.

Question

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If the depositor fails to notify the bank of forgeries of their signature in a timely manner after receiving the bank statement and paid checks, they may be precluded from recovering for any other forged checks paid by the bank in the future. This is because the failure to notify the bank could be seen as a lack of reasonable care on the part of the depositor in safeguarding their account.

Where a Depositor Receives a Bank Statement and the Checks