Jones refused because he said he had put the payment in the vault on November 17. Who is correct? Why?

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Jones refused because he said he had put the payment in the vault on November 17. Who is correct? Why?

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Tom Jones owed Bank of Cleveland $10,000 on a note due November 17, with 1 percent interest due the bank for each day delinquent in payment. Jones issued a $10,000 check to Bank of Cleveland and deposited it in the night vault the evening of November 17. Several days later, he received a letter saying he owed one day’s interest on the payment because of a one-day delinquency in payment. Jones refused because he said he had put the payment in the vault on November 17. Who is correct? Why?

Explanation & AnswerSolution by a verified expert

Explanation

Payment made by Individual T on the night of November 17 will be considered to be received by the bank on November 18 as the shift generally ends during day time. So, Individual T will be liable to the bank for the payment of interest of one day.

Verified Answer

Individual T made the payment at night, which will be considered to be paid the next day, so the bank can charge interest for one day from Individual T.

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