Study each of the following cases carefully. Briefly state the principle of law and your decision.
Refusal to Pay Draft Higgins was a used car dealer. He purchased a Corvette, giving the seller a draft drawn by him on the First State Bank of Albertville in the amount of $8,115. This draft was later presented by the seller to the bank for payment. Meanwhile, Higgins sold the car to Holsonback, who paid with a draft on the Albertville National Bank in the amount of $8,225. When the Albertville National Bank requested Holsonback to pay the draft, he refused, claiming that there was a problem with the certificate of title. The issue was raised as to whether, under the Uniform Commercial Code, negotiable instruments can be issued conditionally. Did Holsonback have the right to withhold payment on the draft because of the problem with the certificate of title? [ Holsonback v. First State Bank , 394 So. 2d 381 (Alabama)]
Principle of Law:
______________________________________________________
______________________________________________________
Decision:
______________________________________________________
______________________________________________________