A Draft Is Payable "To the Order of Joe Jones

question 41

Multiple Choice

A draft is payable "to the order of Joe Jones or to bearer." Sally finds it and demands payment. Should the drawer pay Sally?

• A) No, unless Joe Jones's name is crossed off.
• B) No, unless "bearer" is handwritten.
• C) Yes, since the word "or" is contained in the instrument, either Joe Jones or the bearer of the draft may obtain payment.
• D) No, the terminology is ambiguous and therefore the draft must be paid only to the order of Joe Jones.