Exam 26: Liability of Parties

David wrote a check to Sage for $3,000 on his account at Greater Good Bank. He then took it to his bank for certification. The bank wrote "certified" on the face of the check. David then gave the check to Sage . When Sage took the check to Greater Good  Bank, they refused to pay, claiming that there was not enough money in David's account to cover the check. Which of the following is correct?

An unauthorized signature may be ratified by the person whose name appears on the instrument.

Transferor's warranties and presenter's warranties are implied warranties imposed only on those who sign an instrument.

Zoron Company purchased a truck from Ace Motors. The sales personnel at Ace know that Anton Green is an executive at Zoron. To pay for the truck, Anton delivered a $26,000 note to Ace and signed it "Anton Green, Agent." In this case:

An accommodation party will always be primarily liable on an instrument.

An acceptor should always indicate on the instrument the amount accepted.

An accommodation party is a direct beneficiary of the value received from lending her credit on an instrument.

When a severe weather warning has been declared, a delay in notice of dishonor is excused to the reasonably diligent holder who was prevented from posting the notice.

Sara has a checking account at Charter Bank. Ethan steals one of her blank checks, writes a check for $250 to himself, and then forges Sara's signature. Ethan then indorses the instrument to Paul in payment of a debt. Paul, who does not know of the forgery, presents the instrument to Charter Bank for payment. At Charter Bank's request, Paul indorses the instrument, and the bank then pays him $250. Which of the following is correct?

Checks, when presented, are automatically certified.

Parties with secondary liability unconditionally promise to pay the instrument.