A Person Who Takes an Instrument Containing a Restrictive Indorsement,"Pay

question 47

Multiple Choice

A person who takes an instrument containing a restrictive indorsement,"Pay to Jack Black in Trust for Mel Gibbs,":

• A)may not pay the proceeds to the indorsee without the due approval of the indorser.
• B)may pay the proceeds to the indorsee paying due regard to whether the indorsee violates a fiduciary duty to the indorser.
• C)may pay the proceeds to the indorsee without regard to whether the indorsee violates a fiduciary duty to the indorser.
• D)may pay the proceeds to the indorser only with the approval and concurrence of the indorsee.

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Definitions:

True Value

The actual, inherent worth of an asset, not influenced by market conditions or sentimental perceptions.

Legal Acceptance

The formal agreement to the terms of a contract, making the contract legally binding and enforceable.

Ownership

The legal right to possess, use, and dispose of something, whether it be physical property, intellectual property, or another asset.

Trade Secret

Information, including a formula, practice, process, design, instrument, pattern, or compilation of information, not generally known or reasonably ascertainable, by which a business can obtain an economic advantage over competitors or customers.