Exam 29: Transfers of Negotiable Instruments and Warranties of Parties

Indorsements may be classified in terms of whether the indorser has added any words to the indorsement and what those words are.

The warranties made by an unqualified indorser guarantee that payment of the instrument will be made.

To enforce an implied warranty of an indorser,the party claiming under the warranty must give the indorser notice of the breach within fourteen (14)days after the claimant learns or has reason to know of the breach and the identity of the indorser.

The transferee has only those rights that were possessed by the transferor of the note when a transfer of an instrument is made by:

Negotiation of bearer paper requires:

An unqualified indorser who receives consideration for the indorsement impliedly warrants that:

Coppersmith executed and delivered negotiable notes to the payee,Charlene.The payee indorsed the notes to Whitehurst but did not deliver them.Instead,she kept the notes in her possession because she wanted to collect the interest during her life and wanted the indorsee to have the notes on her death.After Charlene's death,her executor,Cartwright,found the notes.Both Cartwright and Whitehurst sought to enforce the notes against Coppersmith.Who was entitled to do so?

A holder is also known as an assignee of the paper

A restrictive indorsement specifies the purpose of the indorsement or the use to be made of the paper.

Order paper is converted into bearer paper by the holder's blank indorsement.

The order or bearer character of a paper is determined as of the time when the negotiation is about to take place.

Under the UCC,a negotiation is not effective when it is made by a minor or any other person lacking capacity.

A qualified indorsement is given by using the phrase __________.

An indorsement "for deposit only" is:

A payee or indorsee whose name is misspelled may indorse the wrong name,the correct name,or both.