Chapter 26 - Chapter26:Liability,DefensesandDischarge...

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Chapter 26: Liability, Defenses and Discharge Signature Liability Signature:  any name, including a trade or assumed name or word, or symbol executed  or adopted by a person with present intentions to authenticate in writing Not liable unless: o The person signed the instrument o The person is represented by an agent who signed the instrument Dishonor:  when payment or acceptance of an instrument is refused even though the  instrument is presented in a timely and proper manner  Primary Liability Required to pay the instrument- unless they have a defense to payment Makers o “Promise to pay” on a note  Acceptors o A drawee that promises to pay an instrument when it is presented later for  payment  o When they drawee accepts a draft   primary liability  Acceptance of a check is called  certification Guarantor for payment  Secondary Liability Drawers and indorsers o Will be liable if the party that is responsible for paying the instrument refuses to  do so  Triggered by dishonor Promise to pay only if: 1, The instrument is properly and timely presented Presentment: occurs when a person presents an instrument to the party liable on the note  to collect payment “Proper presentment” o must be presented by the proper person, made is proper manner and must be 
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Chapter 26 - Chapter26:Liability,DefensesandDischarge...

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