Reference - Run Around

question 54

Multiple Choice

Reference - Run Around. Millie issues a note to Bob. Bob endorses the note and transfers it to Anne. Anne endorses the note and transfers it to Henry. In a timely fashion, Henry endorses the note and presents it to Millie for payment. When Henry presents the note to Millie, she asks him for reasonable identification. He did not have any identification with him and told her that she had no right to dishonor the instrument. Millie, however, refused to provide him the funds until he returned with proper identification. Nevertheless, when he returned with proper identification, Millie refused to pay the note, claiming that she lacked the funds with which to do so. Henry proceeded immediately to request that Anne pay the note, but she told him that he would have to get his money from Bob, who cannot be found. Which of the following is true regarding Henry's entitlement to payment from Millie?

• A) Henry is only entitled payment from Millie because Anne dishonored the payment.
• B) Henry is not entitled to payment from Millie unless Bob, in addition to Anne, dishonors the instrument.
• C) Henry is never entitled payment from Millie because he must seek recovery only from Anne.
• D) Henry is entitled to recover on the note from Millie.
• E) Henry is entitled to recover on the note from Millie only if both Anne and Bob have filed bankruptcy or cannot be found.

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Definitions:

Alimony

A financial support paid by one ex-spouse to the other after a divorce or legal separation.

Support Payments

Support payments are financial contributions typically made by one individual to another for maintenance, often in the context of alimony or child support following a divorce or separation.

Bankruptcy Estate

A legal term referring to the collective assets and liabilities that are considered part of the bankruptcy process.

Absolute Right

A legal or moral right that is not subject to any limitations or conditions; it must be upheld under all circumstances.