Miller Does the Payroll for Phoenix Company

Multiple Choice

Miller does the payroll for Phoenix Company.In between Adams and Bates,he inserts the name Appleton and makes out a weekly paycheck in that name.He keeps the check for himself,signing "Appleton" and cashing it at a local bank.Auditors discovered the fake payee many months later.May Phoenix require the bank to recredit?

A) No,because of the holder rule
B) No,because Miller is an Phoenix employee and the fictitious payee rule applies
C) Yes,because the indorsement is forged
D) Yes,because the check was,in effect,stolen