1.

Winifred had a balance of $100 in her checking account at First Bank. She wrote a check payable to her landlord in the amount of $400. First Bank cashed the check and then attempted to charge her account. May it? Why?

a. Assume in Exercise 2 that Winifred had deposited $4,000 in her account a month before writing the check to her landlord. Her landlord altered the check by changing the amount from $400 to $4,000 and then cashed the check at First Bank. May the bank charge Winifred's account for the check? Why?

b. Assume in Exercise 2 that Winifred had deposited $5,000 in her account a month before writing the check but the bank misdirected her deposit, with the result that her account showed a balance of $100. Believing the landlord's check to be an overdraft, the bank refused to pay it. Was the refusal justified? Why?

c. Assume in Exercise 2 that, after sending the check to the landlord, Winifred decided to stop payment because she wanted to use the $300 in her account as a down payment on a stereo. She called First Bank and ordered the bank to stop payment. Four days later the bank mistakenly paid the check. Is the bank liable to Winifred? Why?

d. Assume in Exercise 5 that the landlord negotiated the check to a holder in due course, who presented the check to the bank for payment. Is the bank required to pay the holder in due course after the stop payment order? Why?