Which of the Following Actions by the Holder Causes an Impairment

question 16

Multiple Choice

Which of the following actions by the holder causes an impairment of the right of recourse?

• A) releasing an obligor party from liability
• B) withholding collateral that would benefit that party
• C) writing "canceled" on the face of the instrument
• D) destruction of the instrument with the intent of eliminating the obligation

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Definitions:

Presupposed Conditions

Implicit assumptions or prerequisites believed to be true, forming the basis upon which further ideas, policies, or actions are built.

Allocate Delivery

Allocate Delivery refers to the process of assigning specific goods or services to be delivered as part of the fulfillment of a contract or agreement.

Contractual Duty

An obligation agreed upon in a contract that one party must perform for the other.

Revocation

The official cancellation of a decree, decision, or promise.