Exam 15: Negotiable Instruments

Gwen deposits $5,000 with Home State Bank on July 1, 2016. Home State Bank promises to repay Gwen the $5,000 plus 3 percent annual interest on July 1, 2021. Home State Bank issued to Gwen

Bart, the owner of Clear Cut Corporation, signs an instrument that includes the phrase "payment for this note will be made from the proceeds of next year's timber sale." This instrument is

An instrument payable "with interest" must specify a particular rate to be negotiable.

To finance the purchase of a house from Sander, Tobias signs an instrument promising to pay to "Uno Mortgage Company" $200,000 with interest in installments with the final payment due July 10, 2047. To be negotiable, this instrument must include the signature of

With an interest-bearing instrument, it is necessary to know the exact interval during which the interest will accrue.

Any person in possession of a negotiable instrument payable to bearer is a holder.

Jane signs an instrument using a "J" with a swirl around it. With this mark for a signature, the instrument is

With respect to negotiability, a mere reference to another writing or record makes a promise conditional.

A time draft is payable at a definite future time.

On behalf of Bubbly Drinks Company, Calvin signs an instrument in which he promises to deliver 100 cases of soda as payment to Dispatch & Delivery, Inc., on April 1. This instrument is

On a sheet of paper, Elle writes, without her signature, "I acknowledge that I owe Frank $600, payable out of the proceeds of the sale of my car, a 1995 Honda Civic, which I promise to advertise 'For Sale' next week. Payment is to be made on or before six months from today." What type of instrument is this? Is it negotiable? If not, why not?

Consumer Loans LLC signs an instrument payable to the order of Diana that states, "The maker of this note at the date of maturity, April 1, 2019, can extend the time of payment, but for no more than a reasonable time." This instrument is

To be negotiable, an instrument must have portability.

On a cashier's check, the bank is the drawer.

For an instrument to be negotiable, it must be in writing.

To be negotiable, an instrument must be payable in a certain amount.

The transfer of a negotiable instrument from one person to another is governed by Article 2 of the Uniform Commercial Code.

An undated instrument cannot be negotiable.

Fact Pattern 15-3 To borrow the funds to pay tuition at Alpha College, Bea signs an instrument unconditionally promising to pay to "Country Loan Corporation" $7,500 with interest in installments with the final payment due June 1, 2030. -Refer to Fact Pattern 15-3.The instrument that Bea signed is most likely

A sight draft may be payable on acceptance.