Which of the following additional terms will render an instrument nonnegotiable?
A)A clause protecting collateral to secure payment.
B)A clause providing authorization to confess judgment.
C)A clause waiving the benefit of any law intended for the protection or benefit of any person obligated on the instrument.
D)A clause that provides for an undertaking in addition to the payment of money.

Question

Quizplus · Accepted Answer

Generally,if an instrument is to qualify as a negotiable instrument,the person promising or ordering payment may not state undertakings or instructions in addition to the payment of money [3-104(a) (3)].However,the instrument may include clauses concerning (1)giving,maintaining,or protecting collateral to secure payment; (2)an authorization to confess judgment or to realize on or dispose of collateral;and (3)waiving the benefit of any law intended for the protection or benefit of any person obligated on the instrument.

Which of the Following Additional Terms Will Render an Instrument