Question

Suppose Elliot draws a check on his checking account at City Bank​ "payable to the order of Phyllis​ Jones." When Phyllis presents the check for​ payment, City Bank refuses to pay it. Phyllis can collect the amount of the check from Elliot because​ Elliot, the​ _____, is​ _____ liable on the check when it is dishonored.

Answer 1

Answer:

the​ drawer, is​ secondarily liable on the check when it is dishonored.

Explanation:

A check is a legal document and is usually considered as good as cash. When a check bounces (is not paid by the bank) the drawer is liable for the total amount of the check.

If the check bounces because the account does not have sufficient funds, the drawer is responsible and liable. But if the bank bounces the check without any proper reason, then it can be liable for damages.