According to Revised Article 3, the Risk of Loss from Fraudulent

question 40

Multiple Choice

According to revised Article 3, the risk of loss from fraudulent indorsements by employees:

• A) should fall on the holder in due course.
• B) should fall on the employer.
• C) should fall on the bank.
• D) should fall on the employee.

Understand defenses available against payment and conditions affecting the negotiability of instruments.

Recognize various types of checks and drafts, and their unique characteristics and purposes.

Grasp the requirements for an instrument to be considered negotiable, including the necessity of a fixed amount and the absence of conditions to payment.

Learn about the impact of specific phrases and conditions on the negotiability of an instrument.

---

Definitions:

Serous Membrane

A thin, transparent tissue that lines certain internal cavities of the body, secreting a lubricating fluid.

Integument

The covering of the body, including skin, hair, feathers, scales, and nails, which serves as protection from external damage.

Transitional Epithelium

A type of epithelium that can stretch and contract, found lining organs such as the bladder.

Pseudostratified Epithelium

A type of tissue lining some air passages and glands, appearing layered due to cell nuclei at different levels, though each cell contacts the basement membrane.