Exam 25: Transferability and Holder in Due Course

A negotiable instrument can be transferred by assignment.

Petra signs a check payable to Quincy, who in?dorses the back, gives it to Regional Credit Union, and receives cash. The transfer of the check from Quincy to the credit union is

An allonnge is required to negotiate a bearer instrument.

A person can become an HDC only by acquiring an instrument that is so incomplete as to lack an element of negotiability.

Dona transfers an instrument to First National Bank. This transfer is not a negotiation unless

Blythe, an accountant for Credits & Debits, acquires a negotiable instru?ment from Eton by promis?ing to pay its face value in thirty days. Blythe ac?quires the status of an HDC when she

Bruce acquires a series of notes with successive maturity dates that Cody issued on May 15 for a loan from Delta Credit, Inc. At the time of Bruce's acquisition, he learns that Cody defaulted on one of the notes. Bruce is

Joan signs a note that states, "Payable in thirty days." The note is dated March 2. Kent buys the note on April 3. Is Kent an HDC of the note?

Bob receives a check from Chris. Without Bob's knowledge, Dan indorses it in his own name and deposits it in his account at East Bank. In Bob's subsequent suit against East Bank for the money, the court will most likely rule in favor of

Parkdale Roofing Company receives a check from Quik Mart for fixing its roof, and indorses the check to Repair Supplies, Inc. (RSI). Stef, RSI's owner, gives the check to Tiny as a gift. In this situation, the party who is not an HDC of the check but who acquires HDC rights under the shelter principle is

Eppie gives a check to Fund Investments to buy 100 shares of stock in GR8 Tech Corporation for Eppie. The price of the shares is constantly fluctuating. Fund Investments asks Eppie to leave the amount of the check blank and allow it to fill in the price when making the purchase. Eppie agrees. Fund Investments buys the stock when the price is $4,000, but fills in the check for $5,000. The check is negotiated as payment for a $5,000 debt to Hasty Accounting Services, which takes the check in good faith and without no?tice of Fund Investments's act. Hasty later learns that Fund Investments was not author?ized to fill in the check for $1,000 over the price. Is Hasty an HDC? If so, for how much?

Pola wants to transfer a check to Quin. The check is defective if it

A person can become an HDC only if a defense against payment is appar?ent on the face of the instrument.

Jill, in good faith and for value, gets from Kit a check "payable to the order of bearer." Jill does not know that Kit stole the check. Jill is

Ollie negotiates an order instrument to Phil by

Edie is the payee of a bearer instrument-a promissory note in the amount of $1,000. Frank offers to irrigate Edie's ranch next week in ex?change for the note. Edie agrees and delivers the note to Frank. Frank is

The recipient of a negotiable instrument becomes a holder regardless of the form of the transfer.

A holder takes an instrument for value if he or she gives a check as pay?ment for it.

If a note is payable in thirty days, payment is due by midnight on the thir?tieth day.

A blank indorsement can consist of a mere signature.