Asked by Janice Walker on May 22, 2024
Verified
List the five items that a party warrants when the party transfers an instrument for consideration.
Warrants
Financial instruments that give the holder the right to purchase the company's stock at a specified price before the expiration date.
Instrument for Consideration
A formal legal document that signifies an agreement or contract between parties, often involving the exchange of goods, services, or monetary value.
- Comprehend the principles of correct presentment and the necessary notifications in negotiable instruments.
- Acquire an understanding of the complexities involved in endorser liability and the order of liability between endorsers and drafters of promissory notes.
Verified Answer
AP
ARCHANA PILLAYMay 29, 2024
Final Answer :
When a party transfers an instrument for consideration, he or she warrants that:
(1) The transferor is entitled to enforce the negotiable instrument;
(2) Signatures on the instrument are authentic and authorized;
(3) The instrument has not been altered;
(4) The instrument is not subject to a defense or claim in recoupment;
(5) The transferor has no knowledge of insolvency proceedings against the maker, acceptor, or drawer of the instrument. [UCC 3-416(a)]
(1) The transferor is entitled to enforce the negotiable instrument;
(2) Signatures on the instrument are authentic and authorized;
(3) The instrument has not been altered;
(4) The instrument is not subject to a defense or claim in recoupment;
(5) The transferor has no knowledge of insolvency proceedings against the maker, acceptor, or drawer of the instrument. [UCC 3-416(a)]
Learning Objectives
- Comprehend the principles of correct presentment and the necessary notifications in negotiable instruments.
- Acquire an understanding of the complexities involved in endorser liability and the order of liability between endorsers and drafters of promissory notes.
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