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BLT Quizzer (Unknown) - Law On Negotiable Instruments
BLT Quizzer (Unknown) - Law On Negotiable Instruments
c. Preparation
d. Negotiation
c. qualified
d. restrictive
11. The following are requisites in order that a person can be considered a holder in due
course; except
a. that the instrument is complete and regular upon its face.
b. the instrument is not yet overdue or no notice of dishonor
c. holder for value and in good faith
d. none of them.
12. Which of the following is not false?
a. a holder for value is not necessarily a holder in due course
b. only person whose signature appear in the instrument can be held liable therein
c. forgery is both real and personal defense
d. an accommodation party is liable only to a holder in due course
13. Real defenses are those that attached to the instrument itself and can be set up even
against holder in due course. Which of the following is not considered real defense?
a. fraud in factum
b. forgery
14. The existence of the payee and his then capacity to indorse is a warranty of:
a. the maker
b. acceptor
c. drawer
d. all of them
c. drawer
d. person negotiating by mere delivery
20. A check is not presented for payment within a reasonable length of time after issue is
called
a. certified
b. Stale
c. memorandum
d. crossed
21. Signification by the drawee of his assent to comply with the order of the drawer is:
a. Indorsement
c acceptance
b. delivery
d. presentment for acceptance
22. Presentment for acceptance is required when
a. the bill is payable after sight
b. the bill requires it
c. the bill is drawn payable elsewhere than the residence of the drawee
d. all of them
23. Protest is required when this bill is dishonored:
a. domestic/local
b. foreign
c. trade acceptance
d. all of the above
c. certificate of deposit
d. none of them
28. Pay to Maria or order P 20,000 upon demand, signed by A as drawer and addressed
to B. Maria negotiated the bill to C, C to D, E stole the bill from D and indorsed it to F by
forging the signature of D. F in turn indorsed the bill to G & G to H. Which of the
following is false?
a. all indorsers prior to the forgery are discharged
b. the drawer is liable to H
c. F is liable to H
d. Forgery is real defense
29. M is the maker of a note payable to J. Cruz or order for P 5,000 due July 30, 2009.
Cruz borrowed P 2,000 from C payable July 31, 2009 and pledged the note by indorsing
it to C. Which of the following is correct?
a. a promissory note cannot be pledged without the consent of the maker
b. On July 30, 2009 C can collect from M only P 2,000
c. on July 30, 2009 C can collect from M P 5,000
d. partial indorsement is allowed
30. A is the drawer of a bill addressed to B, payable to C or order 10 days after
acceptance for P 8,000. C negotiated the bill to D, to E and E to F. The bill was accepted
by B when presented by F. If the signature of A is forge, which of the following is false?
a. B is required to pay F even if the signature of A is a forgery
b. B is not required to pay F since he has the defense of forgery
c. Forgery is considered a real defense
d. If B dishonors the bill by non-payment F may give to any indorse
31. M is the maker of a note, payable to C or order for P 10,000. C negotiated the note to
D, D to E, E to F, F to G and G to H. M dishonored the note when presented by H for
payment. H gave notice of dishonor to F. Which of the following is true.
a. all indorsers prior to F are discharged
b. only G is discharged
c. H is required to notify M
d. F in turn can give notice to G
32. Pay to Pedro Reyes or order P 20,000 ten days after sight
SIGNED
By A drawer as agent of B
To: B
Pedro Reyes negotiated the bill to C, C to D and D to E. B dishonored the bill by non
payment. E gave notice of dishonor to all prior parties except B. Which of the following
is not correct?
a. The drawer is not liable to E
b. The drawer is liable to E since he was duly notified of the dishonor
c. if D paid E , C becomes liable to D
d. this bill maybe considered as a note
33. M signed a promissory note payable to C or order for P 5,000 ten days after date. C
indorsed the note to D, D to E and E to F. F, without authority from the prior parties,
altered the amount to P 15,000 then indorsed the note to G.
a. the unauthorized alteration renders the note void
b. G cannot require M to pay anything
c. G can require M to pay only P 5,000 if G is a holder in due course
d. G can require M to pay P 25,000 if G is a holder in due course
34. Drawer A addressed a bill to B for P 20,000 payable to C or order 20 days after
acceptance. B made a conditional acceptance in this case:
a. the bill becomes non-negotiable
b. it is still negotiable notwithstanding the conditional acceptance
c. the holder cannot refuse to take a conditional acceptance
d. B is considered a constructive acceptor
35.M is the maker of a note for P 30,000 payable to C or bearer. C negotiated the note to
D, D to E, E to F and F to M. Which is correct?
a. the note is discharged
b. the noted is not discharged since there is no payment
c. M cannot re-issued the note
d. The indorsers are not dischaged
36. Drawer A addressed a bill to B payable to C or bearer for P 60,000 upon demand. C
negotiated the note to D, D to E, E to F and F to G. Upon proper presentment, B paid the
bill. Which of the following is true?
a. the bill is discharged
b. persons secondarily liable are likewise discharged
c.the bill is not required to be presented for acceptance
d. all of the above
Suggested Answers
1. a
2. a
3. a
4. a
5.d
6.d
7. d
8. d
9d
10. c
11. d
12. a
13. c
14. d
15. d
16. d
17. d
18. d
19. a
20. b
21. c
22. d
23. b
24. d
25. c
26. b
27. b
28. b
29. c
30. b
31. c
32. b
33. c
34. b
35. a