Business Law Exam#4

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Author:
carmenafro
ID:
28662
Filename:
Business Law Exam#4
Updated:
2010-08-01 21:26:31
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Business Law Vocabulary Exam
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Description:
Vocabulary, Business Law, Exam#4
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  1. Acceptor
    Person who agrees to pay a draft
  2. Allonge
    Paper so firmly attached to instrument as to be part of it.
  3. Alteration
    Unauthorized change or completion of negotiable instruments to modify obligation of a party.
  4. Bad Check
    Check the drawee bank refuses to pay.
  5. Bank Draft (Teller's Check)
    Check drawn by one bank on another.
  6. Bearer Paper
    Negotiable instrument payable to bearer.
  7. Bond
    Sealed, written contract obligation with essentials of note.
  8. Cancellation
    Act that indicates intention to destroy validity of an instrument.
  9. Certificate of Deposit
    Acknowledgement by bank of receipt of money with engagement to repay it.
  10. Check
    Draft drawn on bank and payable on demand.
  11. Collateral Note
    Note secured by personal property.
  12. Coupon Bond
    Bond with detachable individual coupons representing interest payments.
  13. Dishonor
    Presentment made, but acceptance or payment not made.
  14. Draft ( Bill of Exchange)
    Written order by one person directing another to pay sum of money to third person.
  15. Drawee
    Person ordered to pay draft.
  16. Drawer
    Person who executes a draft.
  17. Fiduciary
    A person in a relationship of trust and confidence
  18. Holder
    Person in possession of instruments payable to bearer or that person.
  19. Holder in Due Course (holder through)
    Holder for value and in good faith with no knowledge of dishonor, defenses, or claims, or that paper overdue; acquires rights superior to original owner.
  20. Hybrid Defense:
    Several defenses may be either universal or limited depending on the circumstances of a case.
  21. What circumstances fall under Hybrid Defense?
    • Duress* Obtaining consent by means of threat-Duress nullifies a contract the defense is universal.
    • Incapacity other than Minority* The effect if the incapacity makes the instrument void.
    • Illegality* Specifies that instruments Based on such transactions are unenforceable
    • Alteration* Unauthorized change or completion of negotiable instrument to modify obligation of a party.
  22. Indorsement
    Signature of holder on back of instruments with any directions or limitations.
  23. Indorser
    Payee or holder who signs back of instrument
  24. Limited Defenses ( Personal Defenses)
    Certain defenses are limited to being raise against ordinary holders and cannot be raised against holders in due course.
  25. Limited Defenses include?
      • 1. ordinary contract defenses

      • 2. fraud that induced the execution of the
      • insturment

      • 3. conditional delivery

      • 4. impropercompletion

      • 5. payment or part payment

      • 6. nondelivery

      • 7. theft
  26. Maker
    Person who executes a note
  27. Money Order
    Instrument issued by business indicating payee may recieve
  28. Negotiable Instrument
    Document of payment, such as a check.
  29. Negotiation
    The act of transferring ownership.
  30. Order Paper
    Negotiable instrument payable to order
  31. Payee
    party to whom instrument is payable.
  32. Presentment
    The demand for acceptance made upon the maker.
  33. Primary Liability
    Liability without conditions for negotiable instrument that is due.
  34. Promissory Note
    Unconditional written promise to pay sum of money to another.
  35. Registered Bond
    Bond payable to specific person, whose name is recorded by issuers.
  36. Renunciation
    Unilateral act of holder giving up rights in the instruments or against a party to it.
  37. Setoff
    A claim by the party being sues against the party sueing
  38. Trade Acceptance
    Draft drawn by sellerin purchaser of goods
  39. Universal Defenses Include?
    • 1) Minority
    • 2) Forgery
    • 3) Fraud as to the nature of the instrument or its essential terms
    • 4) Discharge in bankruptcy proceedings.
  40. Vocher Check
    Check with voucher attached
  41. Types of Checks?
    • 1) Cashier's Check*Check drawn by bank on it's funds in bank
    • 2)Certified Check* Check accepted by bank's writing "Certified" on it.
    • 3) Stale Check* Check presented more than six months after its date
  42. Requirements for Negotiability
    • 1) The instrument must be in writing and signed by the party executing it
    • 2) The instrument must contain either an order to pay or a promise to pay
    • 3) The order or the promise must be unconditional
    • 4) The instrument must provide for the payment of a fixed amount of money
    • 5) The instrument must be payable either on demand or at a fixed or definite time.
    • 6) The instument must be payable to order of a payee or to bearer.
    • 7) The payee ( unless the instrument is payable to bearer) and the drawee must be designated with resonable certainty.
  43. Types of Drafts
    • Inland Draft* Draft drawn and payable in the U.S.
    • Foreign Draft* Draft drawn and payable outside the U.S.
    • Sight Draft* Draft payable on presentation of the holder
    • Time Draft* Draft payable a certain number of days or months after date or presentation.
  44. Types of Indorsements
    • Blank Indorsement* Indorsement consisting of signature of indorser.
    • Restrictive Indorsement* Indorsement that restricts use of instrument.
    • Qualified Indorsement* Indorsement that limits liability of indorser.
    • Special Indorsement* Indorsement that designates particular person to whom payment is to be made.

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