Asked by Brittany Hoffman on Jun 06, 2024
Verified
Mike authorizes his agent,Ben to borrow a sum of $10,000 on his behalf from the National Bank.Ben signs his name to a note without disclosing that the signature was on behalf of Mike.Who is liable on the note?
A) Only Mike is liable.
B) National Bank is liable.
C) Both of them are liable.
D) Only Ben is liable.
Authorizes
To grant permission or power to an individual or organization to take specific actions within defined parameters.
Note
A written promise to pay a specific sum of money to a specific person or bearer on demand or at a specified future time.
National Bank
A financial institution chartered and regulated by the federal government, usually involved in commercial banking services.
- Comprehend the principles of primary and secondary liability associated with negotiable instruments.
- Distinguish among the responsibilities of the maker, drawer, and endorser in the context of negotiable instruments.
Verified Answer
JJ
Jasmyn JamesJun 10, 2024
Final Answer :
D
Explanation :
For example,if Principal authorizes Agent to borrow money on Principal's behalf and Agent signs her name to a note without disclosing that the signature was on behalf of Principal,Agent is liable on the note.
Learning Objectives
- Comprehend the principles of primary and secondary liability associated with negotiable instruments.
- Distinguish among the responsibilities of the maker, drawer, and endorser in the context of negotiable instruments.