Exam 27: Transfer and Holder in Due Course

A person who takes a check stamped "NSF" may still be a holder in due course.

Revised Article 3 provides that the impostor rule does not include an impostor who impersonates an agent of a principal and who induces someone to create a negotiable instrument payable to the principal.

A person is never entitled to enforce an instrument if that person is not the owner of the instrument or if that person is in wrongful possession of the instrument.

A(n)____ indorsement is an indorsement made by a person that is not the holder of the instrument.The effect of this indorsement is to make the signer liable on the instrument as an indorser.

Negotiability is destroyed by a qualified indorsement.

The principal advantage of negotiable instruments is the safety.

Which of the following is required regarding indorsements?

Real defenses include all but which of the following?

A bank "gives value" when it allows a depositor to withdraw funds against a deposited item.

Tony is fraudulently induced to issue a check to Rita.Tony has:

Which one of the following is not a personal defense?

The shelter rule applies even if the transferee was a party to fraud or illegality affecting the instrument.

Defenses that may be asserted against a holder in due course are called:

Cynthia Todd is the holder of a check with the indorsement "Judd Solomon." To protect herself,Cynthia may:

Scott buys a television from Kacey's Electronics,giving Kacey a check for $550.Kacey uses a special indorsement and negotiates the check to Rory.Rory carefully changes the amount to read $1550 and loses the check on the way to the bank.Harry picks it up and tries to cash it.What will he get?

Revised Article 3 adopts a definition of good faith that has both a subjective and an objective component.

If Aubree indorses a check "without recourse":

What is the effect of an alteration on a negotiable instrument? Does it make a difference whether the alteration was made fraudulently?

A holder in due course has the same rights under a consumer credit contract as under the UCC as long as a special notice requirement has been met.

Abby needs some quick cash,so she hits upon a scheme.She tells Frank that she is collecting for foreign refugees,so Frank makes out a check for $100 payable to the order of Abby.Abby indorses it and delivers it to Joanne for $90 cash.Joanne gives it to Margaret as a present.Frank discovers Abby's deception and refuses to pay Margaret.Will he win?