Forgery

Question 1

Forged maker’s signature

Answer 1

• proported maker isn’t liable
• forger is liable

Question 2

Forged drawer’s signature

Answer 2

• proported drawer isn’t liable
• bank must credit drawer’s account (unless defenses)

Question 3

Bank’s defenses

Answer 3

• drawer negligence
• bank statement rule - duty to inspect (must report within 1 year)
• imposter rule
• fraudulent indorsements by employees