Assignment:
1. Select ONE of the scenarios below and explain the best solution.
Scenario 1
Angelo purchased a new Samsung 85-inch UHD 4K television for $9,500 from Best Buy. Angelo signed a negotiable note to Best Buy. The note contained all of the notices required by the Federal Trade Commission. Two months after Angelo purchased the television, a capacitor malfunctioned and Best Buy told him to contact Samsung. Andy planned to contact Samsung the next day. Thirty days after selling the television to Angelo, Best Buy negotiated Angelo's note to Acme Financial, a company that took the note in good faith and with no notice of the breach of warranty. Angelo refuses to pay for the television.
• Locate the FTC regulation passed in 1976 covering the Holder in Due Course Rule. Provide a brief explanation of the rule.
• Explain the status of each party (holder, holder in due course, etc.).
• Does the FTC regulation apply to this case? Is Angelo obligated to pay Acme Financial the remaining balance?
• Would the FTC regulation you found apply if Angelo paid for the television with a personal check? If Angelo paid with a personal check would he be required to pay Acme Financial?
Scenario 2
Richard borrowed $1500 from Latoyia on March 1, 2014 and agreed to make payments of $150 each month starting in May. Richard failed to make the May payment, but wrote a check to Latoyia for $150 in June. Latoyia added a zero to the end of the amount and presented the check to Richard's bank, SunTrust. The bank verified that Richard had the funds available and then paid Latoyia $1500. One week after receiving his bank statement, Richard noticed the improper payment and informed SunTrust of the alteration.
• Describe Richard's duty to examine his bank statement and report alterations to SunTrust.
• How much, if any, can SunTrust charge Richard's account?
• If Richard files a lawsuit, will the debt he owes to Latoyia be relevant?
• Are there any ramifications for Latoyia?
2. Select three of the nine topics from the list below. Provide information about how the business you selected in Week 1 will handle issues related to the topics. Justify your selection with relevant laws, cases, or examples.
• Credit cards
• Personal checks
• Third party checks
• Post-dated checks
• Prevention of forgery (internal employees)
• Dishonored (returned) checks
• Acceptance of payment by electronic means, such as PayPal for Internet sales
• Gift cards
• Issuing credit to customers