SU #19.3 Flashcards
Endorsement
is a signature that
- Negotiates the instrument
- Restricts payment
- Incurs endorser’s liability
Liability of Endorsers are
in the order in which their signatures appear
Blank Endorsement
It may consist of the signature of the endorser, it identifies no particular payee, when one only writes ones name on the back of the check
” it becomes payable to bearer”
Special Endorsement
identifies the person and becomes payable to the order of the special endorsee and requires his or her signature for further negotiation
Restrictive Endorsement
may restrict or further limit the negotiation of the instrument
- conditional endorsement
- Endorsements prohibiting further transfer or negotiation
- Endorsements for deposit or collection
- Endorsement to a fiduciary
Conditional Endorsement
Intent to make the rights of the endorsee subject to happening or non-happening of a special event
” pay to Paula Payee, provided that she completes painting my house”
Endorsement Prohibiting Further Transfer or Negotiation
Pay Paula Payee ONLY
Endorsement for Deposit or Collection
Forces the instrument into the banking system for deposit or collection
- For Deposit Only
- For Collection
- Pay Any Bank
Qualified Endorsement
Disclaims or limits contractual liability on the instrument
1. Pay to Paula Payee without Recourse
Unqualified Endorsement
usually guarantees payment of the instrument if the primarily liable party does not pay
Anomalous Endorsement
is made by a person who is not the holder as an accommodation
Becomes a (HDC) Holder in Due Course if holder takes the instrument
- Good Faith
- For value
- Without notice of dishonor of the instrument or that it is overdue
- Without notice of an alteration or an unrealized signature
- Without notice of any defense
