Trail Leasing, Inc. v. Drovers First American Bank

OPINION

SIMONETT, Justice.

This case asks whether a bank, defending against a customer’s claim of negligence in the handling of its checks, was a holder in due course. We conclude that it was as a matter of law and reverse the court of appeals' decision to the contrary.

Plaintiff-respondent Trail Leasing, Inc., sues defendant-appellant Drovers First American Bank. Trail Leasing alleges Drovers negligently cashed certain checks drawn on plaintiff’s checking account at Drovers. The facts are stipulated.

Over a period of about 2½ years, Pamela Haas, employed as an assistant bookkeeper by Trail…