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76 Cards in this Set

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DEFINITIONS (DRAFT):

When I write out a CHECK (aka "draft") to Sallie Mae to pay the monthly installment of my student loan payments, who is the drawee, who is the payee, and who is the drawer?
DEFINITIONS (DRAFT):

The bank is the DRAWEE, Sallie Mae is the PAYEE, and I am the DRAWER.
KEY WORDS:
(1) Drawee
(2) Payee
(3) Drawer
DEFINTIIONS (NOTE):

When I give my friend Jeff a promissory note for a loan he gave me, what are our respetive titles under Article III?
DEFINITIONS (NOTE):

I am the MAKER (not "promisor"), he is PAYEE (not the "promisee") and the promissory note is the NOTE.
KEY WORDS:
(1) Maker
(2) Payee
(3) Note
DEFINITIONS (DRAFT/NOTE):

What is the essential difference between a note and a draft?
DEFINITIONS:

A note has a minimum of TWO parties, a draft has a minimum of THREE.
KEY WORDS:
(1) Two
(2) Three
DEFINITIONS (NEGOTIABLE INSTRUMENT):

What is the DEFINITION of a negotiable instrument?
DEFINITIONS (NEGOTIABLE INSTRUMENT):

A SPECIALIZED contract for the PAYMENT of money, which is UNCONDITIONAL and capable of TRANSFER ("NEGOTIATION").
KEY WORDS:
(1) Specialized
(2) Payment
(3) Unconditional
(4) Transfer
(5) Negotiation
DEFINITIONS (NEGOTIABLE INSTRUMENT):

What are the ELEMENTS of a negotiable instrument?
DEFINITIONS (NEGOTIABLE INSTRUMENT):

(1) WRITTEN & signed by the maker or drawer.
(2)Contains UNCONDITIONAL promise or order to pay;
(3) A FIXED amount of money;
(4) PAYABLE on demand or at a definite time; and
(4) Payable to a specific person or to "BEARER."
KEY WORDS:
(1) Written
(2) Unconditional
(3) Fixed
(4) Payable
(5) Bearer
DEFINITIONS (DISHONOR):

Give the meaning of "dishonor."
DEFINITIONS (DISHONOR):

When a note or draft is PRESENTED for PAYMENT and the maker or drawee bank REFUSES to pay or "HONOR" the debt represented by the instrument.
KEY WORDS:
(1) Presented
(2) Payment
(3) Refuses
(2) Honor
MISCELLANEOUS (POST-DATED CHECKS):

Who bears liability if a post-dated check is improperly cashed too early?
MISCELLANEOUS (POST-DATED CHECKS):

It depends. If the drawer gave the bank NOTICE of the post-dating, then the bank is liable. If the drawer did not give notice, then the drawer is liable.
KEY WORDS:
(1) Notice
MISCELLANEOUS (POST-DATED CHECKS):

What is NOT "notice" of post-dated check?
MISCELLANEOUS (POST-DATED CHECKS):

Merely writing the future date on the line of the check.
MISCELLANEOUS (CONFLICTING PROVISIONS):

Which amount is a bank required to honor on a check --the written or the numerical?
MISCELLANEOUS (CONFLICTING PROVISIONS):

The written words.
MISCELLANEOUS (FOREIGN CURRENCY):

Can a negotiable instrument be paid in a foreign currency?
MISCELLANEOUS (FOREIGN CURRENCY):

Yes. Payment on foriegn curreny will not DESTORY NEGOTIABILITY, despite its fluctuation in relation to the US ddollar.
KEY WORDS:
(1) Destroy
(2) Negotiability
MISCELLANEOUS (STOCK):

Is an instrument negotiable if it is payable in shares of stock?
MISCELLANEOUS (STOCK):

NO, because one of requirements for a negotiable instruments is that it contains a promise or order to pay a fixed amount of money.
DEFINITION (NEGOTIABLE INSTRUMENT):

If A gives B a promissory note in return for B's payment of $50 and A says the note is payable on a date with B's sister, is the note negotiable?
DEFINITION (NEGOTIABLE INSTRUMENT):

Yes, because there condition on the promise to pay was ORAL - not WRITTEN.
KEY WORDS:
(1) Oral
(2) Written
FORGERY:

(1) If a thief steals A's checkbook and WRITES $1,000 worth of checks, how much is A liable for?

(2)Why?
FORGERY:

(1) Nothing.

(2) FORGERY of the drawer's name PRECLUDES a subsequent holder from becoming a HOLDER IN DUE COURSE. Only a holder in due course has the RIGHT to ENFORCE an instrument.
KEY WORDS:
(1) Forgery
(2) Precludes
(3) Holder in Due Course
(4) Right
(5) Enforcement
STATUTE OF LIMITATIONS:

(1) What is the Statute of Limitations for demanding payment on a NOTE that is payable on a PARTICULAR DATE?

(2) What is the SOL if that effort is dishonored.
STATUTE OF LIMITATIONS:

(1) The payee has TEN years from the date of the note's creation to demand payment.

(2) IF the maker does not honor the note, then the payee has SIX years to bring suit.
KEY WORDS:
(1) Ten
(2) Six
STATUTE OF LIMITATIONS:

(1) How long does the RECIPIENT of a CERTIFIED CHECK (e.g. tellers, cashiers, travelers) have to demand payment on the instrument?

(2) To bring suit if the instrument is dishonored?
(1) There is NO limit on the time they have to demand payment.

(2)But if, they try to enforce it and it is dishonored, then the holder has THREE years to bring suit.
KEY WORDS:
(1) No
(2) Three
STATUTE OF LIMITATIONS:

(1) What is an UNACCEPTED DRAFT?

(2) What is the statute of limitations on it?
STATUTE OF LIMITATIONS:

(1) A check that has not been PRESENTED to the DRAWEE BANK.

(2)If the payee does not demand payment for TEN years, the draft is UNEFORCEABLE.
KEY WORDS:
(1) Presented
(2) Drawee
(3) Bank
(4) Ten
(5) Unenforceable
DEFINITION (RESTRICTIVE ENDORSEMENT):

(1) What is meant by a restrictive indorsement?

(2) What is its effect?
DEFINITION (RESTRICTIVE ENDORSEMENT):

(1)An indorsement that places CONDITIONS on the PAYMENT of instruments.

(2)If the transferee fails to ABIDE by the RESTRICTION, they will not be a HOLDER IN DUE COURSE.
KEY WORDS:
(1) Conditions
(2) Payment
(3) Abide
(4) Restriction
(5) Holder in due course
DEFINITIONS (QUALIFIED INDORSEMENT):

(1)When is a QUALIFIED indorsement?

(2) What is its effect?
DEFINITIONS (QUALIFIED INDORSEMENT):

(1) When the TRANSFEROR SIGNS her name and writes "WITHOUT RECOURSE" below the signature.

(2)The INDORSER will not be LIABLE to ANY future transferee should payment be REFUSED on the negotiable instrument.
KEY WORDS:
(1) Transferor
(2) "Without Recourse"
(3) Indorser
(4) Liable
(5) Refused
MISCELANEOUS (LIABILITY):

(1) When is a drawee bank liable on the DRAFT?

(2) What does that entail?
(1) When the drawee has actually ACCEPTED the draft.

(2) Acceptance occurs when the drawee bank SIGNS the FACE of the DRAFT.
KEY WORDS:
(1) Accepted
(2) Signs
(3) Face
(4) Draft
MISCELLANEOUS (COMMERCIAL NEGOTIATION):

What does it mean for a piece of commercial paper to be negotiated?
MISCELLANEOUS (COMMERCIAL NEGOTIATION):

TRANSFER of ENTITLEMENT to PAYMENT.
KEY WORDS:
(1) Transfer
(2) Entitlement
(3) Payment
NEGOTIATION:

(1) What is a blank indorsement?

(2)What is its effect?
NEGOTIATION:

(1) The SIGNATURE of the TRANSFEREE without further INSTRUCTIONS.

(2)This CONVERTS an order into a BEARER instrument.
KEY WORDS:
(1) Signature
(2) Transferee
(3) Instructions
(4) Converts
(5) Bearer
NEGOTIATION:

How is a commercial instrument NEGOTIATED?
NEGOTIATION:

It depends.

If it is a BEARER instrument, then negotiation occurs by INTENTIONAL TRANSFER to the subsequent holder.

If it is an ORDER instrument, then it must be INDORSED by the transferor and INTENTIONALLY TRANSFERRED.
KEY WORDS:
(1) Bearer
(2) Intentional
(3) Transfer
(4) Order
(5) Insorsed
INDORSEMENT:

How is a commercial instrument indorsed?
INDORSEMENT:

It is SIGNED on the BACK.
KEY WORDS:
(1) Signed
(2) Back
INDORSEMENT (SPECIAL):

(1) What is a SPECIAL indorsement?

(2) What is its legal effect?
SPECIAL INDORSEMENT:

(1) If the INDORSER signs their NAME and writes "PAY to a (THIRD PARTY)."

(2) This converts it into an ORDER instrument, that the Third party would need to indorse to deposit or to negotiate.
KEY WORDS:
(1) Indorser
(2) Name
(3) Pay
(4) Third Party
(5) Order
INDORSEMENT:

How do you convert a bearer instrument into an order instrument?
INDORSEMENT:

SPECIAL indorsement by the RECIPIENT.
KEY WORDS:
(1) Special
(2) Recipient
INDORSEMENT:

How do you convert an order instrument into a bearer instrument?
INDORSEMENT:

BLANK indorsement by the Recipient.
KEY WORDS:
(1) Blank
(2) Recipient
INDORSEMENT:

When is it unnecessary to indorse an order instrument for negotiation? Why?
INDORSEMENT:

For DEPOSIT in YOUR BANK. Because the bank is your AGENT, so their STAMP is tantamount to your SIGNATURE.
KEY WORDS:
(1) Deposit
(2) Your
(3) Bank
(4) Stamp
(5) Signature
INDORSEMENT:

Who is the only party who can indorse when an instrument carries the special indorsement "for deposit only?"
INDORSEMENT:

The BANK.
INDORSEMENT:

How long is an INDORSER liable after indorsing the check?
INDORSEMENT:

THIRTY days.
KEY WORDS:
(1) Thirty
HOLDER IN DUE COURSE:

What are the elements of a HOLDER IN DUE COURSE?
HOLDER IN DUE COURSE:

HOLDER of a negotiable instrument who TAKES instrument for VALUE, in GOOD FAITH, without NOTICE that it is in any way INVALID.
KEY WORDS:
(1) Holder
(2) Takes
(3) Value
(4) Good Faith
(5) Notice
(6) Invalid
HOLDER IN DUE COURSE:

Define "holder" as used in the definition of holder in due course?
HOLDER IN DUE COURSE:

PHYSICAL posession of the negotiable instrument.
KEY WORDS:
(1) Physical
HOLDER IN DUE COURSE:

Define "value" as used in the definition of holder in due course?
HOLDER IN DUE COURSE:

Something GIVEN by the TRANSFEREE in EXCHANGE for the INSTRUMENT.
KEY WORDS:
(1) Given
(2) Transferee
(3) Exchange
(4) Instrument
HOLDER IN DUE COURSE:

Define "Good faith" as used in the definition of a holder in due course?
HOLDER IN DUE COURSE:

(1) HONESTY in fact
(2) OBSERVANCE of REASONABLE COMMERCIAL standards of FAIR DEALING
KEY WORDS:
(1) Honesty
(2) Observance
(3) Reasonable
(4) Commercial
(5) Fair Dealing
HOLDER IN DUE COURSE:

Define "without notice" as used in the definition of a holder in due course. How is this measured?
HOLDER IN DUE COURSE:

Without ACTUAL notice, RECEIPT of notice, or CONSTRUCTIVE (should have known based on facts and surrounding circumstances) notice. By a subjective and an objective standard.
KEY WORDS:
(1) Actual
(2) Receipt
(3) Constructive
HOLDER IN DUE COURSE:

Define "invalid" as used in the definition of a holder in due course.
HOLDER IN DUE COURSE:

The instrument is:
(1)Overdue
(2)Dishonored
(3) Altered
(4) Unauthorized
(5) Accelerated
(6) Subject to a real defense
KEY WORDS:
(1) ODAUAD
HOLDER IN DUE COURSE:

(1) What is the legal signifigance of a holder in due course?

(2) And a holder?
HOLDER IN DUE COURSE:

(1)A holder in due course has the POWER and the RIGHT to ENFORCE an instrument.

(2)A holder only has the POWER.
KEY WORDS:
(1) Power
(2) Right
(3)
HOLDER IN DUE COURSE:

IF I get my packcheck, and indorse it in blank and give it to my bartender, A. A gives me cash in exchange. The check is then stolen by B, who without indorsing, gives the check to his landlord for last month's rent. Is the landlord a holder in due course?
HOLDER IN DUE COURSE:

Yes, because he took the check, in good faith, for value, and without any knowledge that the check was defective. Moreover, at the point the check was stolen, it was a BEARER instrument, so negotiation to the landlord was possibile by transfer alone.
KEY WORDS:
(1) Bearer
HOLDER IN DUE COURSE:

What is the effect of buying a negotiable instrument through bulk transfer or at a judicial sale?
HOLDER IN DUE COURSE:

The buyer cannot become a HOLDER IN DUE COURSE and is thereby subject to REAL and PERSONAL defenses.
KEY WORDS:
(1) Holder in due course
(2) Real
(3) Personal
SHELETER DOCTRINE:

Define the "shelter doctrine."
SHELFTER DOCTRINE:

The RECIPIENT of a NEGOTIABLE instrument stands in the SHOES of the TRANSFEROR of that instrument, if the transferor is a HOLDER IN DUE COURSE and the recipient is not.
KEY WORDS:
(1) Recipient
(2) Negotiable
(3) Stands
(4) Transferor
(5) Holder in due course
SHELTER DOCTRINE:

When does the shelter doctrine NOT apply?
SHELTER DOCTRINE:

Cases of FRAUD.
ENFORCEMENT:

Is it a defense to enforcement that the enforceer paid less than face value?
ENFORCEMENT:

No. If A pays B $4000 for a $5000 note, that does not impair A's ability to enforce the note.
ENFORCEMENT:

(1) Provide the PERSONAL defenses that may NOT be asserted to prevent payment to a HOLDER IN DUE COURSE?

(2) What is the remedy for these?
ENFORCEMENT:

(1)
- Failure of consideration
- Theft
- Unconscionability
- Fraud in the inducement
- Prior dicharge of the instrument.

(2)The remedy is sue the maker or drawer.
5 personal defenses (FTUFP)
ENFORCEMENT:

Provide the real defenses that MAY be asserted to prevent payment a HOLDER IN DUE COURSE and a regular HOLDER?
ENFORCEMENT
(1) Infancy
(2) Duress
(3) Lack of capacity
(4) Illegality
(5) Fraud in the factum.
(6) (Drawer or maker's)insolvency.
(7) Statute of limitations.
7 personal defenses (IDLIFS).
Remember "factum" = "fine" to assert against a HDC.
SATISFACTION:

(1)If a payee loses a check, that she does not indorse, may he demand another check from the drawer?

(2)Why?

(3) When would answer be different?
SATISFACTION:

(1)Yes.

(2) A DEBT is only SATISFIED once the check is actually PAID to the PAYEE.

(3)The answer would be different if the Payee had indorsed the check, however.
KEY WORDS:
(1) Debt
(2) Satisfied
(3) Paid
(4) Payee
SATISFACTION:

IF a check has been made out to a specific payee (an order instrument) is stolen before it reaches the payee and is cashed by a thief - may the payee demand another check from the drawer?
SATISFACTIION:

Yes. The drawer will have to issue the payeee another check because the money was not paid to the payee.
MISCELLANEOUS (AGENCY):

Is an agent liable on a check if he signs his own name but indicates that he is signing on behalf of a PRINCIPAL?
MISCELLANEOUS (AGENCY):

No. The only party liable is the PRINCIPAL.
KEY WORDS:
(1) Principal
DEFINITION (PRIOR DISCHARGE):

Define "prior discharge of the instrument."
DEFINITION (PRIOR DISCHARGE):

The maker or drawer has HONORED the DEBT presented by the instrument and are no longer obligated to pay it.
KEY WORDS:
(1) Honored
(2) Debt
LIABILITY (MAKER):

What is the liability of a maker of a note?
LIABILITY (MAKER):

A maker of a note is DIRECTLY liable on an instrument that BEARS her SIGNATURE if a transferee:

(1) presents the note for payment;
(2) it is dishonored; and
(3) the transferee gives timely notice of the dishonor.
KEY WORDS:
(1) Directly
(2) Bears
(3) Signature
LIABILITY (INDORSER):

What is the liability of an indorser of a draft?
LIABILITY (INDORSER):

ONLY if the BANK does not pay.
KEY WORDS:
(1) Only
(2) Bank
SATISFACTION:

(1)What may a drawer do if it learns a check has been stolen before it has been paid?

(2)How long will this be valid?
SATISFACTION:

(1)Issue a STOP payment ORDER to the bank.

(2)An oral order will be valid for 14 days. A written order will be valid for 6 months, after that the check will be stale and no bank will honor it.
KEY WORDS:
(1) Stop
(2) Order
(3) 14
(4) Six
ENFORCEMENT:

Who are all the people who have a right to enforce a negotiable instrument?
HOLDER IN DUE COURSE:

(1) A holder
(2) A non-holder w/ rts. of a holder
(3) A person not in posession but entitled to enforce.
FORGERY:

(1) If a bank pays a check on INDORSEE'S (aka DRAWER'S) signature has been forged, can the bank lawfully charge the drawer's account?

(2) Does it matter if the forgery is accurate?

(3) What happens if the bank charges the drawer's account?
FORGERY:

(1) No. The bank may not charge the drawer, if the forgery was not the RESULT of the drawer's NEGLIGENCE.

(2) This rule applies even if the forgery looks GENUINE.

(3) The drawer will be ENTITLED to a CREDIT once the forgery and payment by the bank is discovered.
KEY WORDS:
(1) Result
(2) Negligence
(3) Genuine
(4) Entitled
(5) Credit
FORGERY:

(1) When can the bank lawfully charge a customer's account on a forged draft?

(2) What is the max time limit?
FORGERY:

(1) IF the customer does not inform the bank of the forgery with REASONABLE CARE AND PROMPTENESS.

(2)This is no longer than ONE year from the date the drawer received his relevant monthly STATEMENT.
KEY WORDS:
(1) Reasonable Care
(2)Promptness
(3) One
(4) Statement
MISCELLANEOUS (DEATH):

Can a bank honor a customer's checks after it has notice the customer is dead or adjudicated insane?
MISCELLANEOUS (DEATH):

Yes. The bank may honor the checks for TEN days after it gets NOTICE.
KEY WORDS:
(1) Ten
(2) Notice
FRAUD:

(1) What is a "fictitious payee"?

(2) Can a drawer be liable to this person?
FRAUD:

(1) Someone who PRETENDS to be some else to RECEIVE a DRAFT.

(2) A drawer can be liable if he is FOOLED into believing the payee is someone the payee is not and writes a person a check based on that REPRESENTATION.
KEY WORDS:
(1) Pretends
(2) Receive
(3) Draft
(4) Fooled
(5) Representation
FRAUD:

Clerk, on payroll at ABC Corp., drafts a check to a fictitious payee named Ned Flanders. The clerk then has the treasurer of ABC Corp sign the check. Clerk then indorses the check "Ned Flanders" and deposits it into her account. Who will be liable?
FRAUD:

ABC Corp. because of the fictitious payee rule.
FORGERY:

(1) When will a bank customer be liable on a check on which the amount payable has been altered or forged?

(2) What are examples?
FORGERY:

(1) If the customer SUBSTANTIALLY CONTRIBUTED to the alternatiion through their own NEGLIGENCE.

(2) Leaving a signature STAMP in an unocked drawer or leaving a large blank SPACE on a check so that alteration is easily accomplished.
KEY WORDS:
(1) Substantially
(2) Contributed
(3) Negligence
(4) Stamp
(5) Space
THEFT:

(1) Can a thief be a holder of a bearer?

(2) What about an order instrument?
THEFT:

Yes, a thief can be the holder of a bear instrument because anyone in posession of a bearer instrument has the power (but not the right) to enforce.

A thief cannot be the holder of an order instrument because posession and proper indorsement is required to be a holder.
ACCOMODATION:

(1)What is an accomodation party?

(2) When may it arise?
ACCOMODATION:

(1) Someone JOINTLY LIABLE with a maker on a negotiable instrument.

(2) It may arise if the party accepting the note is INSECURE about the MAKER'S ability to PAY.
KEY WORDS:
(1) Jointly
(2) Liable
(3) Insecure
(4) Maker's
(5) Pay
ACCOMODATION:

How does a party acquire the status as an accomodation party?
ACCOMODATION:

(1) CO-SIGNING the note. OR
(2) INDORSING thte note.
KEY WORDS:
(1) Co-signing
(2) Indorsing
ACCOMODATION:

(1) When will an accomodation party be discharged from his obligation?

(2)What does it mean?
ACCOMODATION:

(1) If the COLLATERAL is IMPAIRED.

(2)This means the payee has not perfected their interest in the collateral.
KEY WORDS:
(1) Imapired
(2) Collateral
ACCOMODATION:

What is the effect of an accomodation party writing the words "collection guaranteed" after his signature?
ACCOMODATION:

(1) The accomodation party will only be REQUIRED to HONOR the instrument AFTER the party seeking to enforce has first attempted to COLLECT from the MAKER/DRAWER.
KEY WORDS:
(1)required
(2)honor
(3) after
(4) collect
(5) maker/drawer
WARRANTIES:

(1) What are the WARRANTIES given by each TRANSFEROR of a negotiable instrument?

(2) To whom do the warranties apply?
WARRANTIES:

(1)
-Entitled to PAYMENT
- no KNOWLEDGE of unauthorized signatures
- instrument not ALTERED.
- NO DEFENSE is good against the transferor.

(2)All subsequent transferees if acc. party signs. If no signature, then only to the first transferee.
Three warranties.
KEY WORDS:
(1) Payment
(2) Knowledge
(3) Altered
(4) Defense
WARRANTIES (PRESENTER):

Articulate the warranties given by each PRESENTER of a negotiable instrument.
WARRANTIES (PRESENTER):

(1) TITLE to the instrument
(2) Entitled to ENFORCE the instrument AS WRITTEN.
KEY WORDS:
(1) Title
(2) Enforce
(3) "As Written"
CERTIFIED CHECK:

(1) What is a CERTIFIED check?

(2) Who is primarily liable for payment of the check?

(3) Who may stop payment on the check?
CERTIFIED CHECK:

(1) A certified check is a PERSONAL check that is CERTIFIED for PAYMENT by the BANK.

(2) The bank is primarily liable and only the bank can stop payment on the check.

(3) The person who paid for certification may only REQUEST stopped payment with the AGREEMENT to defend should litigation ensue.
KEY WORDS:
(1) Personal
(2) Certified
(3) Payment
(4) Bank
(5) Request & agree
CASHIER'S CHECK:

(1) What is a CASHIER'S CHECK?

(2) Who is the drawer and drawee?

(3) Why cannot the customer stop payment on the check?
CASHIER'S CHECK:

(1) A check ISSUED and PAYABLE by the BANK.

(2) The bank is the drawer b/c it ORDERS payment. The bank is the drawee because it PAYS on the instrument when presented.

(3) The customer who bought the cashier's check may not stop payment on it because the bank warrants it will pay the instrument as written. The customer may only request to stop payment and agree to defend if litigation ensues.
KEY WORDS:
(1) Issued
(2) Payable
(3) Bank
(4) Orders
(5) Pays
CASHIER'S CHECK:

What rights does the customer have after issue of a Cashier's check?
CASHIER'S CHECK:

None.
PRESENTMENT:

What is meant by "presentment?"
PRESENTMENT:

Presentment occurs when someone who is ENTITLED to ENFORCE an instrument DEMANDS PAYMENT.
KEY WORDS:
(1) Entitled
(2) Enforce
(3) Demands
(4) Payment
DISHONOR:

What is meant by "notice of dishonor"?
DISHONOR:

A NOTIFICATION that a draft or note has been PRESENTED but has NOT been PAID, ie. dishonored, for some REASON.
KEY WORDS:
(1) Notification
(@) Presented
(3) Not
(4) Paid
(5) Reason
DISHONOR:

(1) How long does a bank have to issue a notice of dishonor?

(2) A private person?
CASHIER'S CHECK:

(1) A bank has until MIDNIGHT of the next BANKING day after it LEARNS check is not good.

(2) A private person has 30 DAYS after DISHONOR.
KEY WORDS:
(1) Midngiht
(2) Banking
(4) Learns
(5) 30
(6) Dishonor
SATISFACTION:

Is there any obligation of a person who pays in full a holder in due course?
SATISFACTION:

No.
CASHIER'S CHECK:

What is the effect of paying a DEBT with a CASHIER'S CHECK as opposed to a personal check?
CASHIER'S CHECK:


A cashier's check totally SATISFIES the debt for which it is INTEDED.

A personal check merely SUSPENDS the OBLIGATION to pay until a personal check CLEARS.
Key Words:
(1) Satisfies
(2) Intended
(3) Suspends
(4) Obligation
(5) Clears
INDORSER:

What is the contract that an indorser enters into when she signs her name to an instrument?
INDORSER:

That if the instrument if PRESENTED for payment and DISHONORED, and the indorser is GIVEN NOTICE of the dishonor, that she will PAY on the instrument ACCORDING TO ITS TERMS AT THE TIME OF THE INDORSEMENT.
KEY WORDS:
(1) Presented
(2) DIshonored
(3) Given
(4) Notice
(5) Pay
DRAWER:

What contract does the drawer enter into at the time that it makes the contract?
DRAWER:

That the drawer will PAY the draft ACCORDING TO ITS TERMS WHEN SIGNED.
KEY WORDS:
(1)Pay
(2) According
(3) Terms
HOLDER IN DUE COURSE:

When is the relevant time period for determing whether a holder in due course took with notice?
HOLDER DUE COURSE:

At whichever time is LATER: (1) instrument is TAKEN; (2) the holder gave VALUE.
KEY WORDS:
(1) Later
(2) Taken
(3) Value
HOLDER IN DUE COURSE:

If a holder is not a holder in due course, be sure to check which doctrine?
HOLDER IN DUE COURSE:

The SHELTER doctrine.
KEY WORDS:
(1) Shelter