At 1a.m., on the sidewalk in front of EZ Credit Corporation, which is closed, Frank buys a $500 promissory note for $50 from Greg. When presented with Frank's demand for payment, Diane, the maker of the note, could successfully claim that Frank
A) acquired the note with notice that it was overdue.
B) did not acquire the instrument in good faith.
C) did not give value for the instrument.
D) none of the choices.

Question

At 1a.m., on the sidewalk in front of EZ Credit Corporation, which is closed, Frank buys a $500 promissory note for $50 from Greg. When presented with Frank's demand for payment, Diane, the maker of the note, could successfully claim that Frank​
A) ​acquired the note with notice that it was overdue.
B) ​did not acquire the instrument in good faith.
C) ​did not give value for the instrument.
D) ​none of the choices.

Quizplus · Accepted Answer

Since EZ Credit Corporation was closed at 1 a.m., it can be assumed that the promissory note was not properly assigned to Frank before he purchased it from Greg. This means that Frank did not acquire the instrument in good faith, which is something that Diane could successfully claim in court.

At 1aM, on the Sidewalk in Front of EZ Credit Corporation