2017 (Mercantile Law) Bar Exam Questions: Question 9

[Answer/discuss the question below, or see 2017 bar exam Mercantile Law Instructions; Also check the other 2017 Mercantile Law Questions:123456781011, and 12; See also 2017 Bar Exam: Information, Discussions, Tips, Questions and Results]



Alfred issued a check for P1,000.00 to Benjamin, his friend, as payment for an electronic gadget. The check was drawn against Alfred’s account with Good Bank. Benjamin then indorsed the check specially in favor of Cesar. However, Cesar misplaced the check. Dexter, a dormmate of Cesar, found the check, altered its amount to P91,000.00, and forged Cesar’s indorsement by way of a blank indorsement in favor of Felix, a known jeweler. Felix then caused the deposit of the check in his account with Solar Bank. As collecting bank, Solar Bank stamped “all previous indorsements guaranteed” on the check. Seeing such stamp of the collecting bank, Good Bank paid the amount of P91,000.00 on the check.

May Good Bank claim reimbursement from Alfred? Explain your answer. (4%)


In 2006, Donald, an American temporarily residing in Cebu City, issued to Rhodora a check for $50,000.00 drawn against Wells Fargo Bank with offices in San Francisco, California. Rhodora negotiated the check and delivered it to Yaasmin, a Filipina socialite who frequently travelled locally and internationally. Because of her frequent travels, Yaasmin misplaced the check. It was only 11 years later on, in 2017, when she found the check inside a diary kept in her vault in her Hollywood, California house.

Discuss and explain the rights of Yaasmin on the check. (4%)

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