TP sells franchises in the Old Fast Food chain. TP sells a franchise to Choi for $100,000 by cashier's check. Choi then hears that TP is going out of business and tries to stop payment on the check. TP has already transferred the money to a third party who meets the UCC's requirements for a holder in due course. The bank paid that third party. TP declares it is out of business. In a subsequent
lawsuit:
a. the court will find that the third party is a holder in due course and, despite the fact that TP has defraudedChoi, not require the third party to repay Choi
b. because of the fraud involved, the court will require the third party repay Choi
c. because the instrument involved was a cashier's check and not an ordinary check, the court will not require the third party to repay Choi
d. because the amount in controversy was more than $50,000, the courts will be empowered to view the fraud as a felony and will ignore the requirements of the UCC
e. none of the other choices
a
You might also like to view...
The economic or productive potential of employee knowledge and actions is called
A. human capital. B. labor capital. C. social capital. D. potential capital. E. productivity capital.
If a capital expenditure is incorrectly recorded on a company's books as a revenue expenditure, which of the following statements will be true?
A) Net income will be understated for the year. B) Stockholders' equity will be overstated at year end. C) Total assets will be overstated at year end. D) Net income in the following year will be understated.
The Tokyo Round led to the establishment of the World Trade Organization
Indicate whether the statement is true or false
In the context of limited partnerships, which of the following statements is true of limited partners?
A. Their ultimate authority in the business often compels them to perform tasks or make decisions in areas where they lack expertise. B. They assume unlimited personal liability for debts incurred by the company. C. They are not only liable for their own mistakes but also for that of their partners. D. Their personal wealth is not at risk as long as they do not actively participate in managing the company.