Peter draws a check on his account at Wright Bank payable to the order of Stella. Peter asks Wright Bank to certify the check and the bank certifies it. Stella presents the check to Wright Bank for payment. Which of the following statements is true of this case?
A) Wright Bank becomes primarily or absolutely liable on the check.
B) Peter is primarily liable on the check.
C) Wright Bank is secondarily liable on the check.
D) Wright Bank has no contractual liability on the check whatsoever.

Question

Quizplus · Accepted Answer

In this case, Wright Bank becomes primarily or absolutely liable on the check. At the time a check or other draft issues, no party is primarily liable on it. Usually, the drawee bank pays a check when it is presented for payment and no person becomes primarily liable. However, the drawer or a holder of the check may ask the drawee bank to accept or certify the check. If the drawee bank certifies the check, it becomes primarily or absolutely liable for paying the check as it reads at the time of its acceptance.

Peter Draws a Check on His Account at Wright Bank