Asked by Dennis Manalo on Jul 04, 2024
Verified
If the thief of a stolen bearer instrument delivers it to an innocent, third party, negotiation of the item is complete.
Stolen Bearer Instrument
A negotiable financial instrument that was unlawfully taken from its rightful owner and is payable to whoever holds the document.
Innocent
The state of being not guilty of a crime or other wrong act.
Negotiation
The process by which two or more parties engage in discussions to reach a mutually agreed-upon outcome.
- Contrast bearer and order instruments, focusing on the specific requirements for each to be negotiated.
Verified Answer
SL
Sierra LarkinJul 06, 2024
Final Answer :
True
Explanation :
Bearer instruments are negotiated by delivery alone, so if a thief delivers a stolen bearer instrument to an innocent third party, the negotiation is considered complete. The innocent party, assuming they gave value and took the instrument in good faith without knowledge of the theft, can become a holder in due course.
Learning Objectives
- Contrast bearer and order instruments, focusing on the specific requirements for each to be negotiated.