We have two customers, Mr. A and Dr. B. Mr. A was in an accident and went to Dr. B for treatment. Insurance company C issues a check to Mr. A and Dr. B jointly payable. Our bank deposits it into Mr. A's account without Dr. B's endorsement (oops). That happened Febraury 2008. Dr. B began questioning Insurance Co C in April as to his pmt and received a copy of the check showing our goofup. Our bank instructed him to contact Insurance Co C back, asking them to have their bank return the check to our bank for improper endorsement. This is the normal process, right?? This way we could charge the check back to Mr A and refund the insurance company so they, in turn, could refund Dr. B. Even though I have spoken to the insurance company AND their bank, we have yet to see the check back and Dr. B is getting impatient (He seems to think 11 months is too long to get paid. :)) I have finally gotten to a higher up in the insurance company who asked me to put my request in writing and he would review it with his accounting group and get back to me.
The check is for $1160. I could reimburse Dr. B directly and just eat the loss since I would have no recourse against Mr. A without the check or I could wait for the results of the discussion at the insurance company. What would you do?