1. Office Plus Interiors purchased office furniture from Centrac with a certified cheque for $48,000. The Canadian Imperial Bank of Commerce (CIBC) certified that cheque because Office Plus had just deposited a $76,000 cheque into its CIBC bank account. CIBC then learned that the $76,000 cheque would not be honoured, and phoned Centrac to inform Centrac that CIBC had stopped payment on the certified $48,000 cheque. CIBC dishonoured the cheque when Centrac brought it in for payment. Centrac sued CIBC. Who wins in court, Centrac or CIBC?

Centrac Inc. v. Canadian Imperial Bank of Commerce, 1994 CanLII 932 (ON CA)

Please read the case at this website:

http://www.canlii.org/en/on/onca/doc/1994/1994canlii932/1994canlii932.html?autocompleteStr=centrac&autocompletePos=2

	A.	CIBC, because the certified cheque was subject to the strength of Office Plus Interiors bank account
	B.	Centrac, because once certification was made, CIBC had guaranteed payment on the $48,000 cheque
	C.	CIBC, because it is the drawer, and not the drawee, that is ultimately responsible to the holder in due course
	D.	Centrac, because Office Plus had guaranteed payment of the $48,000 cheque once certification was made

2.

Lynch walked into Amanns store. Amanns store was full of television sets. Lynch pointed to a particular television set on display in Amanns store and said, I want a similar TV set in your storage room. At the time of delivery to Lynch, Amann cannot provide good title to the TV. Lynch, in a rush to install the TV, pays Amann and builds the TV into his living room. Two days later, a low quality fuse in the TV burns out, and Lynch seeks to discharge the contract.

If Lynch asserts a claim against Amann for breach of a condition of the contract, the court should find for:

	A.	Amann, because in spite of Amanns breach of an implied condition, Lynchs acceptance acts to cause Lynch to lose the right of discharge
	B.	Amann, because good title is not implied in the Sale of Goods Act
	C.	Lynch, because Amann breached an implied condition under the Sale of Goods Act, and thus allows Lynch to treat the contract as discharged
	D.	Lynch, because the Sale of Goods Act provides as a condition that when goods are sold, they must be of merchantable quality

3.

Jones borrows $5,000 from the bank with his mother as guarantor and then fails to pay. The guarantee is not in writing. In which province is the mother not responsible for the $5,000 debt as guarantor?

	A.	Alberta
	B.	British Columbia
	C.	Ontario
	D.	Most Canadian provinces.