Asked by Staranna Taylor on Apr 29, 2024
Verified
When an instrument is indorsed in blank,the payee becomes a holder in due course and the instrument may be transferred by delivery alone.
Indorsed in Blank
A signature on a negotiable instrument like a check, making it payable to whoever holds the instrument, without naming a specific endorsee.
Holder in Due Course
A party that has acquired a negotiable instrument in good faith and for value, granting them certain protections and rights under the law.
- Become knowledgeable about the steps and effects associated with changing ownership of checks and other negotiable papers.
- Gain insight into the legal framework and ramifications of becoming a holder in due course.
Verified Answer
SA
saeed aijazMay 02, 2024
Final Answer :
False
Explanation :
An indorsement in blank specifies no particular indorsee and makes the instrument payable to bearer, allowing it to be transferred by delivery alone. However, becoming a holder in due course requires more than just possession; it involves acquiring the instrument for value, in good faith, and without notice of any defects.
Learning Objectives
- Become knowledgeable about the steps and effects associated with changing ownership of checks and other negotiable papers.
- Gain insight into the legal framework and ramifications of becoming a holder in due course.