Two gentlemen walk into your CPA office and tell you that they wish to start a business.The facts as they relate them to you are as follows:

The two men are brothers named John and Bill Harris.John has developed a secret recipe for beer battered fried walleye nuggets.Bill has lots of money and is interested in starting a business with his brother but has no experience in the restaurant field and no interest in learning.Bill just wants to supply the money and eat nuggets.

John has decided to call the business "The Tasty Nugget" and has found a place recently vacated by another restaurant at Newport on the Levee.John is willing to do all the work including using his secret recipe, starting the business and running it so long as Bill supplies all the money.They have agreed to split any profits 60/40 in favor of John.They have also agreed that John will handle the day-to-day decisions but both brothers must agree upon all major decisions regarding the business.The brothers, like you, have taken a very informativeBusiness Law for Accountants course, decidedthat they wish to create a LLC and you have sent them to a very competent attorney.An LLC was created using the name Tasty Nugget, LLC.

Question

Once the stove issue was resolved the business started to boom.Not only did the restaurant have customers waiting for hours to get a table but also local businesses had started to order larger carry out orders.

One-day Billy's Organic Farming Co-op ordered $300.00 worth of nuggets.When the employee of Billy's Organic Farming Co-op - a summer intern - came to pick up the nuggets there proved to be a problem with payment.The intern only had a check made payable to Billy Bob Thornton, the stage name of Billy Johnson in the amount of $300.00.He had been told by Billy Johnson (the owner of Billy's Organic Farming Co-op) to use the check for payment.The check was signed on the back "Billy Bob Thornton AKA Billy Johnson".

The manager at the Nugget took the check as payment but asked the intern to sign the check with "Pay to the order of the Tasty Nugget".The intern did as he was asked and received the nuggets in return.

The check bounced - a stop payment order had been placed on the check.Billy's employees had gotten food poisoning from the nuggets and Billy Johnson refused to pay for what he considered tainted food.To make sure The Tasty Nugget didn't get paid he called the drawer of the check, John Adams and asked him to stop payment.Mr. Adams did as requested.

Is the check a negotiable instrument?Was it properly endorsed?Discuss order and bearer paper issues.Can John Adams be made to pay the check?Who is primarily liable and secondarily liable on the check?Completely discuss all issues presented.