Which Rule States That If Someone Issues an Instrument to a Person

question 13

Multiple Choice

Which rule states that if someone issues an instrument to a person who does not exist,then any indorsement in thename of the payee is valid as long as the person who pays the instrument doesnot know of the fraud?

• A)The Imposter Rule
• B)The Indorsement Rule
• C)The Conversion Rule
• D)The Fictitious Payee Rule

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Definitions:

Security Interests

A lawful demand or security interest on assets that have been offered as a guarantee, typically to ensure the repayment of a borrowed sum.

Time of Perfection

The point at which a security interest is legally established against third parties, typically by filing or possession.

Time of Attachment

The point at which an interest, typically a security interest, becomes legally binding on the asset to which it attaches.

Right of Redemption

A legal right that allows a debtor to reclaim their property or mortgaged estate after paying off their debts, even after foreclosure.