Rock Island Auction Sales, Inc. v. Empire Packing Co.

Rock Island (plaintiff) deposited a check from Empire (defendant) with its own bank, which forwarded it to Empire's bank, Illinois National, on September 27. Illinois National sat on the check until October 2, then returned it for insufficient funds and wired notice of dishonor — well past the midnight deadline set by UCC § 4-302. The check was never paid. Rock Island sued Illinois National (and Empire, later stayed due to bankruptcy) for the amount of the check, and the trial court held Illinois National liable. Illinois National appealed.