cheeseman_buslaw7_tif_23

cheeseman_buslaw7_tif_23 - 23 TRANSFERABILITYANDHOLDERIN...

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1) An assignment occurs when a nonnegotiable contract is transferred. Answer: TRUE Diff: 2 Topic: Transfer by Assignment 2) When a negotiable instrument is transferred, the holder has greater rights because he or she is not subject to some of the defenses that could otherwise have been raised against the transferor. Answer: TRUE Diff: 3 Topic: Transfer by Negotiation 3) An instrument that is payable to a specific payee or indorsee is bearer paper. Answer: FALSE Diff: 2 Topic: Negotiating Bearer Paper 4) Bearer paper cannot be converted from order paper, but order paper may be converted to bearer paper. Answer: FALSE Diff: 2 Topic: Negotiating Bearer Paper 5) An indorsement is the signature of a signer, who is also the maker, that is placed on the instrument to negotiate it to another person. Answer: FALSE Diff: 1 Topic: Indorsement 6) When an instrument has no room for an indorsement, it may be written on an allonge. Answer: TRUE Diff: 2 Topic: Indorsement 245 TRANSFERABILITY AND HOLDER IN  DUE COURSE 23
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7) A blank indorsement is one that does not indicate a particular indorsee, and it also creates bearer paper. Answer: TRUE Diff: 1 Topic: Types of Indorsement 8) A blank indorsement is preferred over a special indorsement, as a blank indorsement prevents against theft. Answer: FALSE Diff: 2 Topic: Types of Indorsement 9) According to the UCC, a qualified indorsement is one that disclaims or limits liability on the instrument. Answer: TRUE Diff: 2 Topic: Types of Indorsement 10) A restrictive indorsement is one that has no instructions or conditions attached to the payment of the funds. Answer: FALSE Diff: 2 Topic: Types of Indorsement 11) If a payee's name is misspelled, the payee will be prevented from indorsing the instrument, as it may amount to fraud, depending on the jurisdiction the payee resides in. Answer: FALSE Diff: 2 Topic: Types of Indorsement 12) If Joe Johnson gives an instrument to Sally Smith that reads, "payable to Sally Smith and Roger Reed," either person's indorsement is sufficient to negotiate the instrument. Answer: FALSE Diff: 1 Topic: Multiple Payees or Indorsees 13) If a virgule slash mark is used between two names listed on an instrument, this means that either person may individually indorse and negotiate the instrument. Answer: TRUE Diff: 2 Topic: Multiple Payees or Indorsees 246
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14) A holder is a person in possession of a negotiable instrument regardless of whether it has been properly indorsed to him or to his order. Answer: FALSE Diff: 2 Topic: Holder Versus Holder in Due Course 15) A holder in due course can acquire greater rights than his transferor had. Answer: TRUE Diff: 1 Topic: Holder Versus Holder in Due Course 16) A holder is the same as a holder in due course. Answer:
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This note was uploaded on 12/13/2011 for the course LAW LAW taught by Professor Ricks during the Spring '09 term at Rutgers.

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cheeseman_buslaw7_tif_23 - 23 TRANSFERABILITYANDHOLDERIN...

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