Business Law Exam 3-Self Tests
Nina obtains a check payable to her order from Oran. Nina signs the back and gives the check to Patricia. Patricia writes "Pay to Patricia" above Nina's signature. Refer to Fact Pattern 26-1. By writing "Pay to Patricia" above Nina's signature, Patricia...
avoids the risk of loss from theft of the instrument
Laura writes on a piece of paper, "I owe you $400," signs it, and gives it to Max. This instrument is...
not negotiable, because it does not include an express promise to pay
LNG Corporation and Midstates Utility Company enter a contract for a sale of liquefied natural gas by LNG to Midstates. 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 25-2. On this instrument, LNG is
the drawer.
Lindsey, an accountant for Madison & Monroe, acquires a negotiable instrument from Norma by promising to pay its face value in thirty days. Lindsey acquires the status of an HDC when she..
pays the face value due on the instrument.
On the back of a check payable to Nero, he writes "Pay to Odell, without recourse" and signs it. This...
relieves Nero of liability on the check
Emily writes and signs a check payable to "Five Star Cinema." George, Five Star's manager, indorses the check "For deposit only." This is...
a restrictive indorsement
To obtain office supplies for Doctors Medical Clinic, Emma executes a draft in favor of Floyd. A draft is...
an unconditional written order to pay money.
Idina wants to buy a promissory note from Jo. The note is due on April 1. To become an HDC, Idina must buy the note..
before midnight on April 1
Gail owes $5,000 in unpaid taxes. Using the back of an old t-shirt, she executes an instrument for $5,000 that otherwise meets the requirements for negotiability. This instrument is likely...
negotiable
On May 1, Mia signs a check that is payable to the order of Nicole and that is dated July 1. This check is...
negotiable
Jacob signs a promissory note payable to Kent "with interest" on which he conspicuously notes that it is "nonnegotiable." This instrument is...
nonnegotiable, because it includes the notation "nonnegotiable."
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...
nonnegotiable, because it is not payable within a definite 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...
not negotiable, because soda is not a medium of exchange authorized or adopted by a government as currency.
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...
a certificate of deposit
o 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 25-3. The instrument that Bea signed is most likely
a promissory note
Ryan negotiates an order instrument to Selina by..
delivery with any necessary indorsement
At 1 a.m., on the sidewalk in front of EZ Credit Corporation, which is closed, Frank buys a $500 promissory note for $50 from Greg. When presented with Frank's demand for payment, Diane, the maker of the note, could successfully claim that Frank...
did not acquire the instrument in good faith
Mort negotiates an instrument to Nadia. Negotiation is the transfer of an instrument...
in such form that the transferee becomes a holder