Question 1

What are the three significant effects resulting from the indorsement of a negotiable instrument?

Accepted Answer

First,indorsement is necessary for the n

Question 2

A holder in due course does not take free of the _____,which go to the validity of the instrument or of claims that develop after he becomes a holder.

Accepted Answer

A)  personal defenses 
B)  relative defenses 
C)  procedural defenses 
D)  real defenses 
A)  personal defenses 
B)  relative defenses 
C)  procedural defenses 
D)  real defenses

Question 3

_____ indorsements indicate that they are effective only if the payee satisfies a certain state.

Accepted Answer

A)  Special 
B)  Conditional 
C)  Qualified 
D)  Blank 
A)  Special 
B)  Conditional 
C)  Qualified 
D)  Blank

Question 4

The negotiation of an instrument made in breach of duty is subject to _____ before the instrument has been negotiated to a transferee who can qualify as a holder in due course.

Accepted Answer

A)  rescission 
B)  remission 
C)  restitution 
D)  reformation 
A)  rescission 
B)  remission 
C)  restitution 
D)  reformation

Question 5

An individual must be acting in good faith in order to become a holder in due course of a negotiable instrument.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following indorsements is a blank indorsement?

Accepted Answer

A)  "For Deposit Only" 
B)  "Mel Gibbs" 
C)  "Pay to Jack Black in Trust for Mel Gibbs" 
D)  "Pay to the Order of Jack Black,Mel Gibbs" 
A)  "For Deposit Only" 
B)  "Mel Gibbs" 
C)  "Pay to Jack Black in Trust for Mel Gibbs" 
D)  "Pay to the Order of Jack Black,Mel Gibbs"

Question 7

Which of the following is NOT a defense specified in Revised Article 3?

Accepted Answer

A)  By way of damages 
B)  Real defenses 
C)  Claims to an instrument 
D)  Claims in recoupment 
A)  By way of damages 
B)  Real defenses 
C)  Claims to an instrument 
D)  Claims in recoupment

Question 8

The transfer of an instrument:

Accepted Answer

A)  vests in the transferee any right of the transferor,to enforce the instrument. 
B)  bars the transferee from attaining the rights of the transferor. 
C)  vests in the payor any right of the transferor,to enforce the instrument. 
D)  bars the transferor to pass on his rights to the transferee. 
A)  vests in the transferee any right of the transferor,to enforce the instrument. 
B)  bars the transferee from attaining the rights of the transferor. 
C)  vests in the payor any right of the transferor,to enforce the instrument. 
D)  bars the transferor to pass on his rights to the transferee.

Exam 32: Negotiation and Holder in Due Course

What are the three significant effects resulting from the indorsement of a negotiable instrument?

A holder in due course does not take free of the _____,which go to the validity of the instrument or of claims that develop after he becomes a holder.

_____ indorsements indicate that they are effective only if the payee satisfies a certain state.

The negotiation of an instrument made in breach of duty is subject to _____ before the instrument has been negotiated to a transferee who can qualify as a holder in due course.

An individual must be acting in good faith in order to become a holder in due course of a negotiable instrument.

Which of the following indorsements is a blank indorsement?

Which of the following is NOT a defense specified in Revised Article 3?

The transfer of an instrument:

The Nature of Law

The Resolution of Private Disputes

Business and the Constitution

Business Ethics, Corporate Social Responsibility, Corporate Governance, and Critical Thinking

Criminal Law and Procedure

Intentional Torts

Negligence and Strict Liability

Intellectual Property and Unfair Competition

Introduction to Contracts

The Agreement: Offer

The Agreement: Acceptance

Consideration

Reality of Consent

Capacity to Contract

Illegality

Writing

Rights of Third Parties

Performance and Remedies

Formation and Terms of Sales Contracts

Product Liability

Performance of Sales Contracts

Remedies for Breach of Sales Contracts

Personal Property and Bailments

Real Property

Landlord and Tenant

Estates and Trusts

Insurance Law

Introduction to Credit and Secured Transactions

Security Interests in Personal Property

Bankruptcy

Negotiable Instruments

Liability of Parties

Checks and Electronic Transfers

The Agency Relationship

Third-Party Relations of the Principal and the Agent

Introduction to Forms of Business and Formation of Partnerships

Operation of Partnerships and Related Forms

Partners Dissociation and Partnerships Dissolution and Winding up

Limited Liability Companies, Limited Partnerships, and Limited Liability Limited Partnerships

History and Nature of Corporations

Organization and Financial Structure of Corporations

Management of Corporations

Shareholders Rights and Liabilities

Securities Regulation

Legal and Professional Responsibilities of Auditors, Consultants, and Securities Professionals

Administrative Law

The Federal Trade Commission Act and Consumer Protection Laws

Antitrust: the Sherman Act

The Clayton Act, the Robinson-Patman Act, and Antitrust Exemptions and Immunities

Employment Law

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