Asked by Bethany Allen on May 06, 2024
Verified
When the transfer of an instrument breaches a ________ associated with the instrument, warranty liability results.
A) clause
B) warranty
C) time limit
D) primary liability
E) secondary liability
Warranty Liability
Liability that is attributed when the transfer of an instrument breaches a warranty associated with an instrument.
Transfer
The act of moving or conveying property or rights from one party to another.
Primary Liability
The obligation falls directly on the individual or entity primarily responsible for an obligation, especially in financial transactions.
- Understand the implementation of warranty liability during the exchange of negotiable instruments.
Verified Answer
TC
Tristin ClubbMay 12, 2024
Final Answer :
B
Explanation :
When the transfer of an instrument breaches a warranty associated with the instrument, warranty liability results. This is because warranties are promises or guarantees made about the quality, condition, or performance of the instrument being transferred.
Learning Objectives
- Understand the implementation of warranty liability during the exchange of negotiable instruments.
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