Asked by Ayesha Tariq on Apr 29, 2024
Verified
A secondarily liable party becomes liable even if a primarily liable party does not dishonor the instrument.
Secondarily Liable
Liable for paying the amount designated on an instrument should the primarily liable party default.
Primarily Liable
The state of being the first or main party responsible for fulfilling a liability or obligation.
Dishonor
In financial contexts, it refers to the refusal or inability to pay a bill of exchange, promissory note, or other negotiable instrument when due.
- Master the varied roles and associated liabilities concerning negotiable instruments, inclusive of the maker, drawer, acceptor, and endorser.
Verified Answer
PN
Princess NessaMay 03, 2024
Final Answer :
False
Explanation :
A secondarily liable party becomes liable only after the instrument has been dishonored by the primarily liable party and proper notice of dishonor has been given.
Learning Objectives
- Master the varied roles and associated liabilities concerning negotiable instruments, inclusive of the maker, drawer, acceptor, and endorser.