Contracts and Sales

Question 1

What are the right of a Holder in Due Course?

Answer 1

A transfer of negotiable instrument to a HDC cancels or cuts off all personal defenses against a HDC.

Question 2

What are the exceptions of the right of a HDC?

Answer 2

Real (or Universal) defenses are assertable against a HDC.

Question 3

What are types of personal defenses?

Answer 3

1- Breach of contract
2- Lack of failure of consideration
3- Prior payment
4- Unauthorized completion
5- Fraud in the inducement
6- Non delivery
7- Ordinary duress or undue influence, Mental incapacity, Illegality

Question 4

What are types of real (or universal) defenses?

Answer 4

1- Infancy (early childhood) (minority of the maker)
2- Forgery (unauthorized signature)
3- Fraud in execution
4- Material Alteration

Question 5

What is a trade acceptance?

Answer 5

Is a special draft in which a seller of goods extends credit to the buyer by drawing a draft on that buyer directing the buy to pay the seller a sum of money in a specified date. The seller became the drawer and the payee.

Question 6

What to prove that demonstrate some one is a done beneficiary?

Answer 6

Can prove that the terms of the contract and surrounding circumstances manifest a clear intent to benefit her/him.

Question 7

What to look for in a risk of lost case?

Answer 7

The intent of the parties manifested in the contract. The risk of loss is independent of title under UCC