Baxter obtains a check payable to his order from Chanel. For Baxter to negotiate this order instrument to Darlene requires
A) indorsement and delivery.
B) assignment and a promise to pay.
C) presentment and dishonor.
D) good faith and value.

Question

Quizplus · Accepted Answer

In order for Baxter to negotiate the order instrument to Darlene, he must indorse the check and deliver it to her. This is because the check is payable to Baxter's order, meaning it can only be negotiated by his indorsement and delivery to another person. Assignment and promise to pay are not relevant in negotiable instruments, and presentment and dishonor are only necessary in certain circumstances such as when a check is not honored by the bank. Good faith and value are important concepts in negotiable instruments, but they are not necessary for Baxter to negotiate the check to Darlene.

Baxter Obtains a Check Payable to His Order from Chanel