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Rock Island Auction Sales, Inc. v. Empire Packing Co.

204 N.E.2d 721 (1965)

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Rock Island Auction Sales, Inc. v. Empire Packing Co.

Supreme Court of Illinois

204 N.E.2d 721 (1965)

Facts

Rock Island Auction Sales, Inc. (Rock Island) (plaintiff) received a check from Empire Packing Company, Inc. (Empire) (defendant). Rock Island deposited the check with First Bank and Trust Company of Davenport, Iowa (First Bank) on September 24, 1962. The check was received by the payor bank, Illinois National Bank and Trust Company of Rockford, Illinois (Illinois National) on September 27, 1962. Illinois National held the check until October 2, 1962, then returned the check by mail to the Federal Reserve Bank of Chicago based on insufficient funds in Empire’s account and sent notice of dishonor by telegram to the Federal Reserve Bank. First Bank received the returned check on October 4, 1962. The check was never paid to Rock Island. Rock Island sued Empire and Illinois National for the amount of the check. The action against Empire was stayed after Empire was adjudicated as bankrupt. The circuit court held that Illinois National was liable to Rock Island for the amount of the check. Illinois National appealed.

Rule of Law

Issue

Holding and Reasoning (Schaefer, J.)

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