Asked by Julianna Velaj on Jul 20, 2024
Verified
Tom contracts with Susan to build her a shed for $6,000,payable on July 1 when he expects to complete the shed.Tom has assigned his right to payment to National Bank in order to obtain building materials.On July 1,National Bank tries to collect the money from Susan,but she refuses because Tom has not completed the shed.What is the result?
A) Susan must pay Tom on July 1.
B) Susan must pay National Bank on July 1.
C) Tom must pay National Bank on July 1.
D) Susan does not need to pay National Bank until the shed is complete.
National Bank
A type of bank chartered by the federal government and, among other powers, has the ability to issue notes that serve as currency.
Assigned Right
A right that has been transferred from one party (the assignor) to another (the assignee), typically involving rights to receive payments or benefits.
- Identify the responsibilities and duties of parties in transactions that include negotiable instruments.
Verified Answer
SS
Saumya sharmaJul 25, 2024
Final Answer :
D
Explanation :
Susan may assert the fact that the shed is not complete as a defense to paying the bank.As assignee of a simple contract,the bank has only those rights that its assignor,Tom,has and is subject to all claims and defenses that Susan has against Tom.
Learning Objectives
- Identify the responsibilities and duties of parties in transactions that include negotiable instruments.