Transfer Warranties

Question 1

basic idea

Answer 1

• transfer warranties are often the remedy provided when money is paid to an unauthorized party
• consider when thieves- consider whether transfer or presentment warranties are at issue in the question*

Question 2

transfer warranties

Answer 2

-warranties that a transferor makes to a transferee
Warranties include:

1) warrantor is the person entitled to enforce the instrument (breached by a forged drawer’s signature)
2) all signatures on the instrument are authentic and authorized
3) instrument has not been altered
4) there are no defenses or claims that can be asserted against the transferor
5) warrantor has no knowledge of any insolvency proceedings
6) with respect to any remotely created consumer check, the person on whose account the check is drawn has authorized the issuance of the item in the amount for which the item is drawn