Cengage Advantage Books: Fundamentals of Business Law 9th Edition by Roger LeRoy Miller

Exercise 14

Indorsements. A check drawn by David for $500 is made payable to the order of Matthew and issued to Matthew. Matthew owes his landlord $500 in rent and transfers the check to his landlord with the following indorsement: "For rent paid. [Signed] Matthew." Matthew's landlord has contracted to have Lambert do some landscaping on the property. When Lambert insists on immediate payment, the landlord transfers the check to Lambert without indorsement. Later, to pay for some palm trees purchased from Green's Nursery, Lambert transfers the check with the following indorsement: "Pay to Green's Nursery, without recourse. [Signed] Lambert." Green's Nursery sends the check to its bank indorsed "For deposit only. [Signed] Green's Nursery." (See pages 389-393.)
1. Classify each of these indorsements.
2. Was the transfer from Matthew's landlord to Lambert, without indorsement, an assignment or a negotiation? Explain.