Bill purchased a new car from Friendly Fred's Autos.Fred indorsed the check to Shirley for value.Shirley presented the check to the bank,and the bank cashed the check.Later,Bill attempted to place a stop-payment order on the check because the car he purchased from Fred was defective.Under these circumstances:

Question

Quizplus · Accepted Answer

In the above case,Bill has no remedy against Shirley and the bank.Here Shirley qualifies as a holder in due course.If the bank paid the check to Shirley over the stop-payment order,Bill would not be able to have his account recredited because Bill would not be able to show that he sustained any loss.

Bill Purchased a New Car from Friendly Fred's Autos