Cengage Advantage Books: Fundamentals of Business Law Today 10th Edition by Roger LeRoy Miller

Exercise 8

A Question of Ethics-Death or Incompetence of a Customer. New York resident Esther Braunstein worked as an usher at Lincoln Center, held an administrative position at a bank, was a school crossing guard, and volunteered at area hospitals assisting disabled persons and others. Before her death, as a gift, she gave a $5,000 check payable to each of her daughters, Sandra Braunstein and Carol Russo. The checks were drawn on a joint account held in the names of Esther and Sandra. Carol did not cash her check until five months after Esther's death. Sandra filed a suit in a New York state court against Carol to recover the funds. [ Braunstein v. Russo, 42 Misc.3d 147(A) (2 Dept. 2014)] (See The Bank's Duty to Honor Checks. )
1. Is one sister's attempt to recover funds given to another sister by their mother always unethical? Could Sandra have had a positive motive to want to retrieve Esther's gift to Carol? Who is legally entitled to the funds? Discuss.
2. If the check that Carol cashed five months after Esther's death had not been a gift, but instead contained a forged drawer's signature, on whom could liability have been imposed? How might that circumstance have affected the ethics of the situation? Explain.