Sharp Finance Company Has Furnished Keith with Some Pre-Printed Forms

question 24

Essay

Sharp Finance Company has furnished Keith with some pre-printed forms for customers to sign to finance repairs on their homes. After the customers sign the notes naming Keith as the payee, he sells them to Sharp Finance. Sometimes Keith is busy and does a poor job on the homes so he can get on to the next job. When customers complain, he says he'll get around to fixing the problems. If the customers don't pay the note, Sharp Finance sues them. Can the customers use the defenses they have against Keith against Sharp? Explain.

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Definitions:

Inventory Sale

The process of selling goods that a company has produced or purchased for resale.

Book Value

The net value of a company's assets minus its liabilities, often used to estimate the company's value if it were to be liquidated.

Accounts Receivable

Money owed to a company by its debtors for goods or services that have been delivered or used, but not yet paid for.

Source of Cash

Various origins from where a company or individual receives cash, including operations, financing activities, investments, and external funding.