Exam 23: Holder in Due Course and Transferability

Which of the following is true of a bearer paper?

A(n)________ is an indorsement that includes the notation "without recourse" or similar language that disclaims liability of the indorser.

Under the UCC's ________ requirement, a person cannot qualify as an HDC if he or she has noticed that the instrument is overdue.

Nonnegotiable instruments are negotiated by holders in due course.

The transfer of rights under a nonnegotiable contract is known as a(n)________.

Which order paper when indorsed becomes a bearer paper?

A separate piece of paper attached to an instrument on which an indorsement is written is known as a(n)________.

If a transferred negotiable instrument failed to qualify under the article 3 of the UCC, it is known as a(n)________.

An indorsement that contains some sort of instruction from the indorser is known as a(n)________.

An indorsement with just the indorsee's signature on it, and a specific payee would be an example of a nonrestrictive indorsement.

If the transferor is a holder in due course then the transferee becomes a holder in due course.

Tilda purchases an automobile from Ronston.At the time of sale, Ronston tells Tilda that the car has had only one previous owner and has been driven only 25, 000 miles.Tilda, relying on these statements, purchases the car.She pays 10 percent down and signs a promissory note to pay the remainder of the purchase price, with interest, in fifteen equal monthly installments.Ronston transfers the note to Patty.Then Tilda discovers that the car has actually had three previous owners and has been driven 250, 000 miles.If Patricia is an HDC, which of the following is the legal outcome?

Value has been given by the holder if he or she acquires a security interest in or lien on the instrument.

An indorsement that does not specify a particular indorsee is known as a(n)________.

A person who is in possession of a negotiable instrument that is drawn, issued, or indorsed to him or to his order, or to bearer, or in blank is referred to as a(n)________.

Which of the following indorsements can be negotiated just by delivery?

Which of the following is true for a special indorsement?

The transfer of a negotiable instrument by a person other than the issuer to a person who thereby becomes a holder is referred to as ________.

A special indorsement is negotiable by indorsement and delivery.

Which of the following is true for a qualified indorsement?