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BSL Exam 1|95 Questions with Verified Answers,100% CORRECT, Exams of Nursing

BSL Exam 1|95 Questions with Verified Answers

Typology: Exams

2023/2024

Available from 07/23/2024

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Download BSL Exam 1|95 Questions with Verified Answers,100% CORRECT and more Exams Nursing in PDF only on Docsity! BSL Exam 1|95 Questions with Verified Answers Types of Negotiable Instruments - CORRECT ANSWER Draft, Check, Promissory Note, Certificate of Deposit Drafts - CORRECT ANSWER 3 Party Instrument Party A = Drawer Orders Party B = The Drawee, to pay Party C = The Payee Often times have a credit function Checks - CORRECT ANSWER Always drawn on a bank. Always a demand instrument. Drawer = Customer Drawee = Bank promissory note - CORRECT ANSWER Person Promising to pay = Maker Person being paid = Payee Often times notes are accompanied by a security agreement. Certificates of Deposit (CDs) - CORRECT ANSWER Investments in which an amount of money invested for a specified period of time earns a guaranteed rate of interest. Elements of Negotiability - CORRECT ANSWER 1. Writing 2. Signed 3. Must contain a promise or order to pay 4. Must be unconditional 5. Must be a fixed amount 6. Money 7. Cannot contain another undertaking 8. Payable at a definite time or on demand 9. Be payable to order or bearer In writing - CORRECT ANSWER an intentional reduction to a tangible form Signed - CORRECT ANSWER Present intent to adopt or accept a writing. Location: A lower, right hand signature will always qualify as "adopting or accepting". Agents: Must indicate their representative capacity. Where signing for a corporation one must indicate the state of incorporation. Contain a Promise or Order to Pay - CORRECT ANSWER Promise: Verb that indicates a direct commitment to pay. "Promise" "Will" "Agree" Orders: A verb that indicates an instruction. "Pay" The Promise or Order to Pay Must be Unconditional - CORRECT ANSWER One can refer to: 1. Prepayment Terms 2. Acceleration terms 3. Security Agreement 4. Particular Fund One can remove liability under Art 3 by writing "non-negotiable" "This instrument is not subject to Art 3" Be for a Fixed Amount - CORRECT ANSWER Principal Must be Fixed Money - CORRECT ANSWER A medium of exchange currently authorized or adopted by a domestic or foreign government. Contain no Other Undertaking - CORRECT ANSWER One cannot promise to pay money and have another undertaking. Exceptions: Any undertakings to maintain/protect collateral Authority to confess judgement Waiver of any law protecting the debtor Be Payable on Demand or at a Definite Time - CORRECT ANSWER Demand: The instrument states it is payable on demand/sight or otherwise indicates it is payable at the will of the holder or if it does not state a time for payment. "I promise to pay Harvey $3,000 if Harvey paints my house by June 30, 2025." - Mike - CORRECT ANSWER Not unconditional because there is expressed conditions. "I promise to pay Harvey $3,000." -Mike - CORRECT ANSWER Unconditional, because there are no expressed conditions. "I promise to pay Harvey $100. This obligation is secured by collateral specified in a security agreement dated January 1, 2025." -Mike - CORRECT ANSWER Unconditional, because the exception of an instrument being unconditional is that it refers to a security agreement. "I promise to pay Harvey $100 from my savings account." - Mike - CORRECT ANSWER Unconditional because there is an exception if one refers to a particular fund. Pay to Jane Roe - CORRECT ANSWER Neither payable to bearer nor order. Pay to Jane Roe or Bearer - CORRECT ANSWER Payable to bearer because of the alternative language. Pay to bearer - CORRECT ANSWER Payable to bearer because of the alternative language. Pay to Cash - CORRECT ANSWER Payable to bearer because it is payable to cash. Pay to the order of cash - CORRECT ANSWER Payable to the bearer because cash is not an identified person. Pay to the order of Santa Claus - CORRECT ANSWER Payable to the order because Santa Claus is an identified person. Pay to the order of Jane Roe or bearer - CORRECT ANSWER Payable to bearer because of the alternative language. Pay to Jane Roe or order - CORRECT ANSWER Payable to border because it is payable to an identified person or order. Mike wrote a check to Harvey. The check form had the words printed "Pay to the order of." Prior to delivering the check to Harvey, Mike crossed out the words, "to the order of" and filled in Harvey's name in the blank. - CORRECT ANSWER Payable to the order because although Mike crossed out "to the order of" a check is still an order instrument. I promise to pay to the order of Harvey $100 on demand. -Donna - CORRECT ANSWER Payable on demand because it says so. I promise to pay to the order of Harvey $100. -Donna - CORRECT ANSWER Demand because there was no stated time. I promise to pay to the order of Harvey $100 on January 30, 2025. -Donna - CORRECT ANSWER Definite time because there is a stated date. To: Mike Pay to the order of Donna $100 at sight. -Harvey - CORRECT ANSWER Payable on demand because it states at sight. To: Mike Pay to the order of Donna, 30 days after sight. -Harvey - CORRECT ANSWER Payable at definite time because it is due 30 days after sight. I promise to pay to the order of Rachel $100 on January 30, 2025 subject to the holder's right accelerate if the holder deems itself to be insecure. - CORRECT ANSWER Definite time because there is a date and subject to acceleration. I promise to pay to the order of Harvey $100 on January 30, 2025. I may prepay this note at any time without penalty. - CORRECT ANSWER Definite time because it is subject to prepayment. This note is payable on February 24, 2025, but the holder, at his option, may extend the time of payment to a later date. - CORRECT ANSWER Definite time because it is subject to extension by the holder. This note is payable on January 24, 2025, but at the option of the maker, it may be extended to a later date. - CORRECT ANSWER Definite time because it is subject to an extension to a further definite time at the option of the maker. 3 stages to life of an instrument - CORRECT ANSWER 1. Issuance 2. Negotiation 3. Presentment for Payment/for acceptance Issuance - CORRECT ANSWER First delivery by the maker/drawer for the purpose of giving rights on the instrument to another person. Negotiation - CORRECT ANSWER A transfer of possession by a person other than the issuer in which the transferee becomes a holder. Presentment (for payment or acceptance) - CORRECT ANSWER The person entitled to enforce presents the instrument to the person obligated to pay. Holder - CORRECT ANSWER A person in possession of an instrument made payable to that person's order or to bearer. 2 ways to negotiate - CORRECT ANSWER Bearer Instrument Order Instrument Bearer instrument - CORRECT ANSWER Transfer of possession Order Instrument - CORRECT ANSWER Transfer of possession and an Indorsement Indorsement - CORRECT ANSWER a signature other than that of the maker, drawer, or acceptor Purpose of Indorsements - CORRECT ANSWER 1. To negotiate 2. To incur liability (Signature liability) 3. Restrict Payment Blank Indorsements - CORRECT ANSWER Does not specify to whom the instrument is made payable. Converts order instruments to bearer instrument. - Forged or altered -Subject to claims or defenses -Overdue or dishonored 5. No apparent evidence of forgery or alteration or be incomplete. Holder - CORRECT ANSWER A person in possession of an instrument made payable to that person's order or to bearer. Value - CORRECT ANSWER A holder takes for value by: -Performing the promise for which the instrument was given -To determine when value has been given, one looks to the time of negotiation. Any type of past value will satisfy this requirement, but executory promises will not meet the requirement. Good Faith - CORRECT ANSWER 1. The holder must have obtained the instrument with honesty. 2. The holder must observe reasonable commercial standards of fair dealing. The Holder Must not have notice on the instrument being: - CORRECT ANSWER 1. Overdue or dishonored 2. Subject to claims of ownership or defenses to payment; and 3. forged or altered The instrument should not bear apparent evidence of forgery or alteration or be so irregular or incomplete so as to question its authenticity. - CORRECT ANSWER Irregular - defect that is obvious on its face Incomplete - a term is missing Shelter Rule - CORRECT ANSWER the transferee of an instrument acquires the same rights that the transferor had in the instrument, which is the right to enforce the instrument and any rights as a HDC. -Only has the right to enforce the instrument against the issuer. Real Defenses - CORRECT ANSWER Issuers of instruments may not assert personal defenses against a HDC, but may use real defenses. -If underlying transaction is void then real defense -If underlying transaction is voidable then personal defense Real Defense - Infancy/Minority - CORRECT ANSWER Void Contract - real defense Real Defense - Mental Incapacity - CORRECT ANSWER Where the issuer has been adjudicated mentally incapacitated, the underlying transaction is void= real defense. All other mental incompetencies = are voidable = personal Real Defense - Duress - CORRECT ANSWER an improper threat made to force another party to enter into a contract -Physical threat = void= real defense -Economic threat = voidable = personal defense Real Defense - Illegality - CORRECT ANSWER Illegal contracts are void = real defense Real Defense - Fraud in the Execution - CORRECT ANSWER Where one misrepresents the nature of what is being signed = void = real defense. Real Defense - Discharge in Bankruptcy - CORRECT ANSWER Void = Real defense Real Defense - Forgery and Alteration - CORRECT ANSWER Real defenses that can be used against an HDC unless: 1. There has been ratification (to accept the benefits of the forgery/alteration) or 2. One's negligence makes the forgery or alteration possible. Rules for Unauthorized Alterations - CORRECT ANSWER A complete defense against a holder - The holder gets nothing A partial defense against a HDC -The holder gets the original amount FTC Rule Regarding Consumer Credit Contracts - CORRECT ANSWER Eliminates HDC status arising from certain credit transactions for goods and services purchased for personal, family, or household use. -Applies to contracts with installments of 4 or more; or - Where a finance charge is applied The holder receives a check on May 3, 2022 that is dated January 14, 2022. - CORRECT ANSWER The holder is on notice because it is over 90 days overdue. Checks are overdue once the 90 day mark hits. The holder receives an undated check on May 3, 2022, that was actually drawn 5 months earlier. - CORRECT ANSWER The holder had no notice of the check being overdue. On June 1, 2022, the holder is given a promissory note with a due date of May 15, 2022. - CORRECT ANSWER The holder is on notice because they took the note after its due date. The holder is given a note payable in monthly installments. On the face of the note it says, "First interest payment due on May 1, 2022, WAS NOT PAID." - CORRECT ANSWER The note is not overdue because it was a default on the interest and not the principal amount. On April 17, 2022, the holder is given a note due on May 15, 2022. Unbeknownst to the holder, the note had been accelerated, so as to be due on April 15, 2022. - CORRECT ANSWER There would be no notice in the case that they didn't ask if the note is accelerated. However, they do have a duty to ask if a note is accelerated. Therefore, making the note overdue.