Nicholas Fredich placed an advertisement in a
newspaper seeking applications for the job of
bookkeeper. He then stole the résumé and identity
of one of the respondents and used the person’s
information to apply for a bookkeeping position
at Clean World Engineering, Ltd. After two weeks
of working at Clean World, he claimed he had an
emergency and he took several days off. Then it
was discovered that many checks were missing and
Fredich had forged the checks. Fredich had complete
access to the checks during his employment
at Clean World. Some of these forged checks were
deposited into a bank and paid by MidAmerica
Bank. MidAmerica did not contest the fact that it
paid the checks bearing the forged signatures, but it
argued that Clean World did not exercise ordinary
care. Given these facts, who should bear the loss,
MidAmerica or Clean World? [ Clean World Engineering,
Ltd. v. MidAmerica Federal Savings Bank,
341 Ill. App. 3d 992, 793 N.E.2d 110 (2003).]
Solution
Given the facts, since Nicholas was in the employment of Clean World, when he forged the
checks and encashed them from MidAmerica Bank, it is clear that the losses owing to the
forged checks should be borne by Clean World only. The bank is clearly absolved of its
liability, since it considered the cheques to be be genuinely issued and hence encashed the
same..
Nicholas Fredich placed an advertisement in anewspaper seeking app.pdf
1. Nicholas Fredich placed an advertisement in a
newspaper seeking applications for the job of
bookkeeper. He then stole the résumé and identity
of one of the respondents and used the person’s
information to apply for a bookkeeping position
at Clean World Engineering, Ltd. After two weeks
of working at Clean World, he claimed he had an
emergency and he took several days off. Then it
was discovered that many checks were missing and
Fredich had forged the checks. Fredich had complete
access to the checks during his employment
at Clean World. Some of these forged checks were
deposited into a bank and paid by MidAmerica
Bank. MidAmerica did not contest the fact that it
paid the checks bearing the forged signatures, but it
argued that Clean World did not exercise ordinary
care. Given these facts, who should bear the loss,
MidAmerica or Clean World? [ Clean World Engineering,
Ltd. v. MidAmerica Federal Savings Bank,
341 Ill. App. 3d 992, 793 N.E.2d 110 (2003).]
Solution
Given the facts, since Nicholas was in the employment of Clean World, when he forged the
checks and encashed them from MidAmerica Bank, it is clear that the losses owing to the
forged checks should be borne by Clean World only. The bank is clearly absolved of its
liability, since it considered the cheques to be be genuinely issued and hence encashed the
same.
![Nicholas Fredich placed an advertisement in a
newspaper seeking applications for the job of
bookkeeper. He then stole the résumé and identity
of one of the respondents and used the person’s
information to apply for a bookkeeping position
at Clean World Engineering, Ltd. After two weeks
of working at Clean World, he claimed he had an
emergency and he took several days off. Then it
was discovered that many checks were missing and
Fredich had forged the checks. Fredich had complete
access to the checks during his employment
at Clean World. Some of these forged checks were
deposited into a bank and paid by MidAmerica
Bank. MidAmerica did not contest the fact that it
paid the checks bearing the forged signatures, but it
argued that Clean World did not exercise ordinary
care. Given these facts, who should bear the loss,
MidAmerica or Clean World? [ Clean World Engineering,
Ltd. v. MidAmerica Federal Savings Bank,
341 Ill. App. 3d 992, 793 N.E.2d 110 (2003).]
Solution
Given the facts, since Nicholas was in the employment of Clean World, when he forged the
checks and encashed them from MidAmerica Bank, it is clear that the losses owing to the
forged checks should be borne by Clean World only. The bank is clearly absolved of its
liability, since it considered the cheques to be be genuinely issued and hence encashed the
same.](https://image.slidesharecdn.com/nicholasfredichplacedanadvertisementinanewspaperseekingapp-230325053511-2d7ec32d/85/Nicholas-Fredich-placed-an-advertisement-in-anewspaper-seeking-app-pdf-1-320.jpg)
