Sullivan signs a check "pay to the order of Tilly" drawn on Sullivan's account in Universal Bank.Velma forges Tilly's indorsement,Washington Bank cashes the check.Velma disappears.Universal pays Washington and debits Sullivan's account.Most likely,the ultimate loss will fall on
A)Sullivan.
B)Tilly.
C)Universal Bank.
D)Washington Bank.

Question

Quizplus · Accepted Answer

Washington Bank is most likely to bear the ultimate loss because it cashed the check with a forged indorsement, making it liable for accepting a check with a defective title.

Sullivan Signs a Check "Pay to the Order of Tilly