Biology Forums - Study Force

Requirements for HDC Status. Dennis Bowling was a friend and neighbor of David Dabney. Bowling had no indication that Dabney was financially troubled. Indeed, by all evidence, Dabney was quite well off: he owned four grocery stores; he drove a Cadillac; his wife owned a new sports car; he had race horses and lived in an expensive home. In the fall of 1983, Dabney admitted to Bowling that he had cash flow problems and borrowed 40,000 from Bowling. At the same time, Dabney proposed they become partners in his grocery business, and discussions concerning this prospect ensued over the following weeks. At one point, Dabney asked Bowling for a signed blank check that would be deposited with a new grocery supplier as security and would never be used without Bowling's consent. If it was, Dabney promised, he would reimburse Bowling's account appropriately. Shortly thereafter, Dabney dated and filled out Bowling's blank check for 10,606.79 and gave the check to his major supplier and creditor, E. Bierhaus & Sons. Dabney owed Bierhaus more than 400,000 for past deliveries; and after having received ten to twenty bad checks from Dabney, Bierhaus required cash or cashier's checks from Dabney for any deliveries. Dabney had told Bierhaus about the supposedly imminent partnership with Bowling, and under those circumstances, Bierhaus's agent accepted the 10,606.79 check from Bowling in payment for a delivery of groceries. Bowling's check was returned to Bierhaus, as there were insufficient funds in Bowling's account to cover it. By this time, Dabney had filed for bankruptcy protection. Bierhaus sought to collect the amount of the check from Bowling. Is Bierhaus a holder in due course?

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