Exam 26: Liability of Parties

Jan Arthur writes a $200 check to Bruce Nole who indorses it "Bruce Nole." Bruce gives the check to Anne Tate who indorses it "Without Recourse.Anne Tate." Anne sends the check to Joe Black,MD to pay her medical bill.If the bank refuses to honor the check,Black:

On the due date,Merrel makes proper tender of full payment of a note to Russell,who is entitled to payment.If Russell refuses payment,Merrel is discharged from liability for:

List and generally explain the warranties on presentment.

Sarah has a checking account at First Bank.Orrin steals one of her blank checks,writes a check for $250,and then forges Sarah's signature.He then presents the check to First Bank for payment.First Bank pays the forged instrument.Which of the following statements is correct?

Elder,an authorized agent for Mullins,signs a negotiable instrument,"Mullins,principal,by Elder,agent." Mullins has primary liability and Elder has secondary liability on the instrument.

By indorsing a check,"Without recourse," Pat effectively disclaims both contractual and warranty liability.

A waiver of presentment will waive the requirement of notice of dishonor as well.

Presentment for payment is one step necessary to charge an indorser with the obligation to pay.

Warranties of a person obtaining payment or acceptance of an unaccepted draft include:

A signature may be made by an individual herself or by an authorized agent.

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

Conversion of an instrument will occur if:

Indorsers of all instruments incur primary liability on the instrument.