CHAPTER 29 - CHAPTER SUMMARY CONTRACTUAL LIABILITY General...

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CHAPTER SUMMARY CONTRACTUAL LIABILITY General Principles Liability on the Instrument no person has contractual liability on an instrument unless her signature appears on it Signature a signature may be made by the individual herself or by her authorized agent Authorized Signatures an agent who executes a negotiable instrument on behalf of his principal is not liable if the instrument is executed properly and as authorized Unauthorized Signatures include forgeries and signatures made by an agent without proper power; are generally not binding on the person whose name appears on the instrument but are binding on the unauthorized signer Liability of Primary Parties Primary Liability absolute obligation to pay a negotiable instrument Makers the maker guarantees that he will pay the note according to its original terms Mann CH 29- 1
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Acceptors a drawee has no liability on the instrument until she accepts it; she then becomes primarily liable Acceptance
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