Exam 33: Liability of Parties

Which of the following is true regarding a drawee's liability on a check or a draft?

A person is ________ if he has agreed to pay the negotiable instrument.

The drawee does not have liability on the instrument until it ________ the instrument.

The negotiable instruments of a corporation have to be signed by an agent of the corporation who is authorized to sign the instrument.

Susie Q.signs a promissory note with her typical signature,an "X." Susie's mark will be sufficient to be considered a signature and establish liability in the instrument.

A(n)________ is a person who poses as someone else and convinces the drawer to make a check payable to the person being impersonated.

In Victory Clothing Co.v.Wachovia Bank,N.A. ,the case in the text,which of the following principles did the court use to split the loss between the parties?

Bob authorizes Steward to borrow money on his behalf.Steward signs his name on a note in his individual capacity i.e.without disclosing that the signature is on behalf of Bob. As a result,Steward becomes liable for the note.

Which of the following is true regarding an indorser's liability on a note?

John borrows $3,000 from Town Credit Union to purchase a used boat.The credit union has John sign a promissory note and takes the boat as collateral.It also asks John's brother,William,to sign the note as an accommodation maker.Later,John tells the credit union he wants to sell the boat and it releases it as collateral.What happens to William's obligation?

If the drawee bank mistakenly paid a check with a forged or unauthorized drawer's signature on it:

In which of the following situations is the obligor not likely to be fully discharged from his or her liability on a negotiable instrument?

Revised Article 3 of the UCC provides that the drawer of a cashier's check has the same obligation as the issuer of a note.

All of the following constitute transfer warranties under Article 3 except:

Jones,a purchasing manager at the XYZ Corporation,has authority to make and sign checks drawn on the corporation's account.Jones completes a fake check to the Smith Supply Company for $100,000,signs it for XYZ,indorses it in Smith's name,and sells it to Hirsch,who takes it in good faith.Has the check been negotiated to Hirsch? Assume that the check is a negotiable instrument.

If a person is ________ Article 3 precludes her from using an alteration or lack of authorization as a reason for not paying a holder in due course.

When a person is ________,he or she is released from liability.

Which of the following is true regarding a transferor's liability on a transfer warranty?

Which of the following is not an acceptable manner to dishonor an instrument?

Mila owes Brad (whom she has not met)$4,000.James,claiming to be Brad,gets Mila to issue him a check of $4,000.James forges Brad's indorsement and transfers the check to Hall.Which of the following statements is true?