Commercial Law, 2017 Bar — Question IX-A

ESSAY

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.

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