John writes a check for $100 on his account at the Sacred Heart Bank to repay the $100 he owes Perry. He gives the check to Eliot and tells her to hand it over to Perry. However, Eliot loses the check before she can give it to Perry. Later, John realizes that he had not written Perry's name on the lost check. According to the provisions of the Uniform Commercial Code (UCC), on which of the following parties should the risk of loss of the check be placed?

Question

Quizplus · Accepted Answer

According to the provisions of the UCC, the risk of loss falls on the person who wrote the check, which in this case is John. Since John did not write Perry's name on the check, it is still technically his property until it is properly endorsed by Perry. Therefore, John bears the risk of loss. Neither the bank nor Eliot can be held responsible for the loss of the check.

John Writes a Check for $100 on His Account at the Sacred