Chap021 - Chapter 021 : Transfer and Discharge of...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 021 : Transfer and Discharge of Commercial Paper Chapter 021 : Transfer and Discharge of Commercial Paper Student: ___________________________________________________________________________ 1. One of the characteristics of commercial paper is the ease with which it can be transferred from one person to another. BT: Knowledge PO: 1 True False 2. An indorsee is the person who writes his or her name on the reverse side of a check. BT: Knowledge PO: 1 True False 3. It is wise for a person concerned about a check being lost or stolen to use a blank indorsement. BT: Knowledge PO: 2 True False 4. The Uniform Commercial Code (UCC) specifically provides that the holder of an instrument may convert a blank indorsement into a full indorsement. BT: Knowledge PO: 2 True False 5. The use of a qualified indorsement affects the negotiability of an instrument. BT: Knowledge PO: 2 True False
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6. In order to ensure the negotiability of commercial paper, the UCC assumes as warranties in every indorsement that all prior parties were qualified to enter into a legally binding contract BT: Knowledge PO: 3 True False 7. An indorser of an instrument is not released from liability by any act that completes the negotiation of the instrument, such as payment. BT: Knowledge PO: 3 True False 8. A defense against payment of commercial paper that claims the instrument was void from the beginning is known as real defense, or absolute defense. BT: Knowledge PO: 5 True False 9. If fraud was used to induce a person to sign a negotiable instrument, the injured person may use this as a personal defense against any person including a holder in due course. BT: Knowledge PO: 5 True False 10. Under the Uniform Commercial Code, distinction is made between lack of delivery of a completed and an incomplete instrument. BT: Knowledge PO: 5 True False 11. Fraud in executing an instrument is a real or absolute defense, but fraud related to the circumstances surrounding the issuing of a paper and not to the paper itself is a personal defense. BT: Knowledge PO: 5 True False
Background image of page 2
12. An incompetent person who makes, signs, and delivers a negotiable instrument cannot be held liable for its payment. BT: Knowledge PO: 5 True False 13. Presentment of commercial paper must always be made in person. BT: Knowledge PO: 6 True False 14. Commercial paper must be presented for payment during business hours on the due date given on the instrument. BT: Knowledge PO: 6 True False 15. The holder of dishonored commercial paper must give notice of the dishonor immediately to the drawer and to all indorsers in order to hold them liable on the instrument. BT: Knowledge PO: 7 True False 16. When the holder of commercial paper signs his or her name, with or without other words, on the back of the instrument, this writing is referred to as a(n): A. acknowledgment. B. indorsement.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/25/2011 for the course GENB 4350 taught by Professor Louis during the Spring '11 term at Houston Baptist.

Page1 / 18

Chap021 - Chapter 021 : Transfer and Discharge of...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online