The owner of goods or chattels in consummating a sale frequently accepts a check in exchange, only to discover that the check is worthless and that in the brief interval before dishonor the goods have been resold to a bona fide purchaser for value. On ascertaining the whereabouts of the goods, the initial owner seeks to repossess them or recover their reasonable value from the holder. A judicial question as to the relative rights of two innocent parties must therefore be determined.
This legal problem has received the attention of law review commentaries' and text writers and has been annotated in detail; nevertheless, the number of appellate cases dealing with the problem has increased, and the problem remains difficult of solution. Varying viewpoints have become even more marked as the proposed Uniform Commercial Code receives attention from the various state legislatures. The problem requires additional consideration, for the solution proposed by the Uniform Commercial Code conflicts with the approach evidenced in a major portion of American decisions; and if the Code is adopted, it will, within this area, result in many reversals.
Attention first will be given to the historical development of the problem within the United States; then to the legal solutions now adopted, as contrasted with the Uniform Commercial Code proposal; finally, for purposes of evaluation, to comparative foreign law and the moral and social factors involved.
Calvin W. Corman,
Cash Sales, Worthless Checks and the Bona Fide Purchaser,
10 Vanderbilt Law Review
Available at: https://scholarship.law.vanderbilt.edu/vlr/vol10/iss1/1