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19 Cards in this Set
- Front
- Back
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What is Act 3 |
Involves negotiable instruments, (readily acceptable or cash) |
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What does HDIC mean |
Holder in due course |
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What are the parties in a 2 party instrument |
Payee and Maker |
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Examples of 2 party instruments |
Promisory Notes, CD's |
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3 party instruments |
Payee, Drawer, Drawee |
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Example of a 3 party instrument |
check |
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What are the 6 things needed for a instrument |
1) writing signed by maker or drawer permanent 2) unconditional promise or order to pay 3) Sum Certain (exact $ amount or formula) 4) In money 5) On demand or specific date 6) magic words of negotiability (order or promise bearer) |
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What is type of clauses can be attached to a negotiable instrument |
Acceleration clause and an extension clause |
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What are the 2 methods of negotiation |
Delivery alone (bearer paper) and endorsement/delivery (order paper |
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What does Bearer paper do |
Whoever holds, gets |
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What does endorsement/delivery do |
Delivery just makes transferee |
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4 Types of endorsement |
Bank - bearer paper, special - pay to the order of , qualified - without recourse to , restrictive - for deposit only to account of x |
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Elements of HDC |
1) holder 2) gives value 3) good faith 4) w/o notice of claims |
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What are the two types of defenses |
Real and Personal |
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Difference between real and personal |
Real defenses hold up in court and against HDC Personal dont hold up in court against HDC |
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What is the shelter provision |
If a holder in due course gives to another person, they also become a HDC |
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Difference between primary liability and secondary |
Primary has to be properly presented first, secondary has to be informed of what happened to primary before held liable |
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Who holds liability in a 2 party group and 3 party? |
2 - Maker 3- drawee |
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What is a certified check |
A check that the bank stamps saying funds are available before check is delivered. |
