- 6 Marks
BL – Nov 2014 – L1 – SB – Q4a – Negotiable Instruments
: Explain the legal issues surrounding the issuance of a cheque that was dishonored due to insufficient funds in Suzee’s account.
Question
Suzee operates a current account with Life Bank Plc. On Monday, she was informed that the credit balance on her account was N125,000. She anticipated that on Tuesday, her mother would lodge cash of N65,000 into her account, but the mother did not do so.
On Wednesday, she issued a cheque in favour of Timmy for the sum of N140,000. On Friday, when Timmy presented the cheque, it was returned unpaid because the credit balance on Suzee’s account still remained N125,000. Timmy is aggrieved and alleges that an offence has been committed.
Required:
Explain the legal issues surrounding Suzee’s act of issuing that cheque.
(Total 6 Marks)
Find Related Questions by Tags, levels, etc.
- Tags: Banking, Cheque Issuance, Dishonored Cheque, Negotiable Instruments
- Level: Level 1
- Topic: Negotiable Instruments
- Series: NOV 2014
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