Question

Lisa writes a check on her account at Metro Bank to Niklas to pay a debt....

Lisa writes a check on her account at Metro Bank to Niklas to pay a debt. Niklas negotiates the check by indorsement to O’Leary, who presents it for payment to Prime Bank. If Prime Bank dishonors the check, O’Leary can obtain payment from Niklas​:

.a

​under no circumstances.

b.

​only to the extent that Lisa overpaid her debt to Niklas.

c.

​only if Lisa refuses to pay the check.

d.

​if O’Leary timely notifies Niklas.

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Answer #1

In this case, Lisa becoms Primary Liable and Niklas becomes Secondarily liable to OLeary. So Oleary first claim from Lisa be

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