Charles Alcombrack was appointed as guardian for his son, Chad Stephen Alcombrack, who was the beneficiary of a life insurance policy. The insurance company issued a check for $30,588.39 to “Charles Alcombrack, Guardian of the Estate of Chad Stephen Alcombrack a Minor.” The check was endorsed by “Charles Alcombrack Guardian of the Estate of Chad Stephen Alcombrack, a minor.” However, Charles Alcombrack opened personal accounts with Olympic Bank (the Bank) (defendant) and deposited the check into his personal accounts. The same day, the attorney for the guardianship called the bank to inquire about the fees for guardianship accounts. The bank responded by letter, referencing the “Estate of Chad Alcombrack.” Charles Alcombrack spent substantially all of the trust money for his personal benefit. Subsequently, J. David Smith (plaintiff) was appointed as successor guardian. Smith sued the Bank to recover the trust money. The trial court granted summary judgment to the Bank. The court of appeals reversed and remanded to the trial court in order to determine whether the bank was a holder in due course. The case was subsequently appealed to the Supreme Court of Washington.