When Agents sign negotiable instruments Flashcards

1
Q

The Principal’s liability

A
  1. The principal is not bound if the agent did not have the authority to sign on the principal’s behalf
  2. The principal may ratify the agent’s unauthorized signature if the principal adopts the signature and fails to deny the validity of it
  3. The principal may be estopped from denying liability against a HDC if the principal negligently contributed to the agent’s unauthorized signature
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2
Q

For an unauthorized signature

A

The agent will be liable

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3
Q

For an authorized signature

A
  1. The principal is liable when the agents signs the principal’s name only
  2. An authorized agent who signs an instrument that clearly indicates that the agent is signing in his capacity as an agent will not be liable on the instrument
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4
Q

Forged Makers signature

A

Forger will be liable, not the “maker”

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5
Q

Forged Drawer’s signature

A

Forger will be liable, not the “drawer”

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6
Q

Forged indorsers signature

A

Forger will be liable, not the “indorser”

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