Business Law: Exam #1

Pataasin ang iyong marka sa homework at exams ngayon gamit ang Quizwiz!

False

Even if the bank pays a check in spite of a stop-payment order, the bank will not be obligated to re-credit the customer's account.

True

For a check, a "reasonable time" is ninety days after the date of the check

False

Usually, indorsements are qualified indorsements.

True

With respect to negotiability, an order on an instrument may be addressed to one person or to more than one person, either jointly or alternatively

True

A bank may contractually shift to the customer the risk of forged checks created electronically or by the use of nonmanual signatures.

False

A bank may not charge a postdated check against a customer's account unless the customer notifies the bank, in a timely manner, to pay the check before the stated date.

True

A check is a special type of draft that is drawn on a bank, ordering the bank to pay a fixed amount of money on demand.

False

A customer who fails to report a forged signature within thirty days from the date that the bank statement showing the item was made available for inspection loses the legal right to have the bank recredit his or her account.

True

A forged signature on a check has no legal effect as the signature of a drawer.

False

A holder takes an instrument for value by promising to perform or give value in the future.

True

A holder takes an instrument for value if he or she accepts the instrument in payment of a preexisting obligation.

False

A holder takes an instrument for value if he or she inherits an instrument.

False

A person who takes a negotiable instrument from a thief cannot become an HDC even if he or she acted honestly in the process of acquiring the instrument

True

A restrictive indorsement does not destroy negotiability.

True

A sight draft may be payable on acceptance

False

A signature on a negotiable instrument cannot be made by a device, such a a rubber stamp or a thumbprint

True

A stop-payment order is an order by a customer to his or her bank not to pay a certain check.

True

A symbol can serve as a valid signature

False

A transfer by assignment can make it possible for a transferee to receive more rights in the instrument than the prior possessor had

False

All checks are time instruments.

True

An indorsement is a signature, with or without additional words or statements

False

An indorsement should be identical to the name of the indorsee, regardless of how the name appears on the instrument.

False

An instrument is non-negotiable unless the word "negotiable" is printed on it

False

An instrument payable to two or more persons in the alternative requires the indorsement of both payees for negotiation.

False

An instrument that promises to pay "in goods" can be negotiable.

False

Banks must pay interest based on the full balance of a customer's interest-bearing account on the day the bank posts the interest.

True

Checks are usually three party instruments

True

If a bank pays a check in spite of a stop-payment order, the bank is liable only for amount of the actual loss suffered by the drawer because of the wrongful payment.

False

If a bank wrongfully dishonors a cashier's check, a holder can recover only the amount of the check.

True

In every situation involving a forged drawer's signature or an alteration, a bank must observe reasonable commercial standards of care in paying on a customer's check.

False

Negotiating order instruments requires either delivery or indorsement but not both.

True

Often, whether a holder will be able to obtain payment on an instrument will depend on whether he or she is a holder in due course

False

On a cashier's check, the drawer is also always the payee.

True

On a certificate of deposit, the bank is the maker and the depositor is the payee.

False

The bank is liable to the payee or the holder of check in a civil suit if a check is dishonored for insufficient funds.

True

The checks that you wrote are negotiable instruments that act as substitutes for cash.

True

To avoid the risk of loss from theft, a holder may convert a blank indorsement to a special indorsement.

False

To be negotiable, an instrument cannot be portable.

True

To be negotiable, an instrument must be in writing.

True

To be negotiable, an instrument must be payable in money

True

When a customer makes a deposit, the customer becomes a creditor, and the bank a debtor, for the amount deposited.

False

When receiving a stale check for payment, a bank has no option but to pay the check.

False

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

False

With respect to negotiability, the location of a signature on a document is important


Kaugnay na mga set ng pag-aaral

Assignment 7 - Quiz 1: Glorious Christ and His People

View Set

Anatomy Ch 5 Short Answer Questions

View Set

Adv. Cognitive Neuroscience Exam 2

View Set