Exam 18: Holder in Due Course, Liability, and Defenses

Reference - Overextended Debtor. Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments. Three months later, because Dennis had bought a boat, a new car, an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is the proper designation under the UCC for the television?

Which of the following is true regarding the UCC's definition of default?

Which of the following means that bankruptcy relief is ordered and that the bankruptcy proceedings can continue?

Which of the following was the result on appeal in In re Girolamo Afonica, the case in the text in which the debtor, without a certificate of title, transferred a vehicle securing a loan of over $11,000 to another party purportedly because the debtor's ex-wife objected to the presence of the car in the driveway?

Which of the following is formed when a debtor uses borrowed money from the secured party to buy the collateral?

Which of the following is a moratorium for almost all creditor litigation against a debtor in a Chapter 7 bankruptcy?

Which of the following is false regarding Chapter 12 of the bankruptcy code?

Which of the following is true regarding the manner in which a secured party may sell collateral?

Which of the following is called straight bankruptcy?

In which of the following did Congress make comprehensive changes to bankruptcy law?

Which of the following is a writing that demonstrates a right to payment of money?

Which of the following is an example of indispensable paper?

Which of the following is an individual who takes over administration of the debtor's estate?

Which of the following was the ruling by the U.S. Supreme Court in Rousey v. Jacoway, the case in the text involving whether funds in an Individual Retirement Account (IRA) qualify for a federal exemption in bankruptcy proceedings?

Which of the following is true regarding rights of a trustee in a Chapter 7 bankruptcy?

Reference - Claims to Funds. Paul had a great job as a bank executive. Unfortunately, his bank came under scrutiny by federal regulators and while Paul had done nothing illegal, he ended up being fired. Unfortunately for Paul, he had a number of debts. Among his assets were a house worth $250,000 on which he owed $150,000 to a bank which held a security interest; three vehicles; an expensive watch worth $5,000; and $120,000 in an Individual Retirement Account "IRA". He owed $900 per month in child support to his ex-wife Suzy and was behind on payments in the amount of $1,800. He also owed $2,000 in wages consisting of four months of back pay to Bob who took care of Paul's landscaping needs and swimming pool care. Unable to find a job and believing that he had no other option, Paul filed for Chapter 7 bankruptcy. All debtors angrily demanded payment from liquidation of Paul's assets. Paul, on the other hand, claims that he needs all the above mentioned assets and that he should not have to give up anything. Only federal bankruptcy exemptions apply to Paul's case. Which of the following is true in regard to Paul's claim to his IRA account?

Which of the following occurs when a debtor turns over all assets to a trustee?

According to the UCC, value is consideration.

Assuming a purchase-money security interest is not involved, which of the following is true regarding priority when there are two secured parties and neither has perfected?

When _____________ occurs, the creditor becomes the secured party who has a security interest in the collateral.