Asked by
Addison Croushorn
on Nov 01, 2024
Verified
Ted gave Stanley a $300 negotiable note for repairs to his car.Stanley did not do the repairs,but indorsed the note to Nami who did not know of Stanley's lack of work and paid Stanley for its note.Nami gave the note to her daughter,Sopan,for Christmas and Sopan attempted to collect the note.What is Sopan's legal status?
A) Sopan is not a holder in due course,but has the rights of a holder in due course.
B) Sopan is not a holder in due course and has no rights of a holder in due course.
C) Sopan is not a holder in due course,but does qualify as a holder in gift status.
D) Sopan has no rights,since she did not give consideration.
Holder in Due Course
A party who has acquired a negotiable instrument in good faith and for consideration, and thus is protected against certain defenses if payment on the instrument is refused.
Negotiable Note
A financial instrument containing a promise to pay a specific amount of money, either on demand or at a set time, to the holder or assignee.
Legal Status
The standing or condition of an entity or individual in the eyes of the law, including rights, responsibilities, and current legal state.
- Understand the criteria and obligations necessary to achieve holder in due course status.
Verified Answer
PK
Learning Objectives
- Understand the criteria and obligations necessary to achieve holder in due course status.