UCC Article 3 Flashcards
If a negotiable demand note is refused to be paid due to forgery the person can demand payment from
The secondary parties the indorsers
If a check is dishonest end the person has
30 days to notify the secondary party after the primary party refuses to pay
If a person does not submit a check in 30 days, the original person who wrote the check is
Not liable
A promissory note is a two party instrument which promises to pay a
Fixed amount. May b payable on demand or a specific point in time.
Negotiability requirements are
Written and signed by maker
Unconditional promise or order to pay a fixed amount
Definite time
A holder in due course must be a person who
Holder of the properly negotiated instrument
Give value to the instrument
Take instrument in good faith
The person who acquire an instrument from a holder in due course does it through the shelter provision which the holder has
No knowledge of defenses
A holder with rights of due course under the shelter provision obtains all the rights from the
Holder in due course.
A holder in due course takes an instrument fee from any personal defenses including fraud in the inducement.
Can claim on all parties related to the instrument
A draft is a
Three party instrument where the drawer (person) orders the drawee (bank) to pay a fixed amount to a payee
A blank endorsement which doesn’t specific an endorse converts order paper to
Bearer paper
An endorsement that specifies a person is a
Special endorsement. Converts bearer to order
A qualified endorsement is when you disclaimed liability
Signed without recourse
When a promissory note is on writing and
signed by the maker
is an unconditional promise to pay a sum certain in money
on demand or a definite date and
is payable to order or bearer is
Negotiable
A instrument is nonnegotiable when it is
Made subject to another agreement
