Exam 19: Negotiable Instruments

Warranty liability arises only from a transferor's signature.

Fiona writes a check "pay to the order of Gerri" drawn on Fiona's account at Hearthstone Bank. Gerri presents the check for payment to Hearthstone, which accepts it. Primarily liable on the check is​

Fact Pattern 19-2 ​LNG Corporation and Midstates Utility Company enter a contract for a sale of liquefied natural gas. LNG draws a draft unconditionally ordering Midstates Utility to pay $50,000 to LNG's order in sixty days. Midstates Utility signs and dates the draft. -Refer to Fact Pattern 19-2. This instrument is

Fanny signs a note "payable to the order of Guaranty Bank." Guaranty indorses the note in blank and negotiates it to Haji, who sells it to Iona. Liability associated with the transfer of the note from Haji to Iona is​

A holder cannot become an HDC if he or she has notice of any claim to the instrument or defense against it.

To finance the purchase of an electric guitar and amplifier from Leon's Guitars, Milo signs an instrument promising to pay to "National Lenders" $1,800 with interest in installments with the final payment due August 15, 2016. To be negotiable, this instrument must include on its face​

Fact Pattern 19-1 ​Erin draws a check payable to "Foodland" to buy groceries. -Refer to Fact Pattern 19-1. With respect to Erin’s check, Foodland is

Any irregularity on the face of an instrument that calls into question its validity will bar HDC status.

O'Malley negotiates an order instrument to Phil by​

A promissory note must name a specific payee to be negotiable.

Fact Pattern 19-3 ​Thalia signs an instrument unconditionally promising to pay to "Union Bank" $7500 with interest in installments with the final payment due June 1, 2017. -Refer to Fact Pattern 19-3. The instrument that Thalia signed is most likely

Dishonor occurs if payment of an instrument cannot be obtained within the prescribed time.