Exam 13: Negotiable Instruments, Credit, and Bankruptcy

In Fordyce Bank v. Bean Timberland, where the bank had a security interest in proceeds from the sale of timber by Bean, the court held that timber buyers had no knowledge of the bank's interest so were not responsible for its loss on the loan to Bean.

When real estate itself is used to secure a debt obligation it is evidenced by a:

If a customer does not pay a judgment entered against her by a court, the party that won the judgment may seek a writ of exoneration.

Most large certificates of deposit are:

For a check, the bank is the drawee.

The procedures for using liens are generally determined by:

Under Article 3 of the UCC, a draft is a conditional promise to pay that involves three parties in distinct capacities: drawer, drawee, and payee.

Debts of the bankrupt under Chapter 13:

An "acknowledgment by a bank" that it has received money from a customer with a promise by the bank that it will repay the money received at a date specified or, in some instances, on demand is a:

In a(n) ____, the debtor makes a minimum monthly payment and more debt can be added to the account over time.

A "draft drawn on a bank and payable on demand" is a:

What defense(s) is (are) available to sureties?

A sight draft is:

When the maker promises to repay the note in specified installments, the note is a(n):

Brandon files for a Chapter 11 bankruptcy on behalf of his company, Brandon's B-B-Q. The company is allowed to continue its operations. During this period Brandon is:

Refer to Fact Pattern 12-1. After Gena defaults on her loan, Fidelity should be able to seize which property to help settle the debt?

When personal property is used to back up a note, it is called a collateral note.

A check is a draft drawn on a bank and payable on demand.

Inventory may be used as collateral for a loan. If it is, the inventory is classified as:

The party who agrees to make a payment to another party, based on a document presented to it, such as a bank, is called the drawer.