First Guaranty Bank v. Northwest Georgia Bank

Beasley, Judge.

This case presents questions concerning Article 4 of the UCC (OCGA § 11-4-101 et seq.), governing the liability of banks as between themselves arising from transactions involving non-negotiable items, as well as commercial paper or negotiable instruments which are governed by Article 3 (OCGA § 11-3-101 et seq.). The central question is whether the collecting bank or payor bank is liable for payment of a non-negotiable certificate of deposit over a forged indorsement.

Facts

In February of 1986, Lucille Knight was abducted from her home in Louisiana and taken to Georgia, where she…