When an instrument fails to meet the technical requirements necessary to qualify as a negotiable instrument,which of the following statements is true?
A)The instrument is still enforced as a negotiable instrument if the holder can establish detrimental reliance based on a reasonable belief that the instrument qualified as a negotiable instrument.
B)The instrument is still enforced as a negotiable instrument if it has been accepted by a bank.
C)The instrument is still enforced as a negotiable instrument if it has been transferred to a holder in due course.
D)The instrument is null and void and of no use to the holder.
E)The instrument may qualify as an enforceable contract.

Question

Quizplus · Accepted Answer

A)If an instrument fails to qualify as a negotiable instrument,that does not mean it
fails to be a perfectly good and enforceable contract.All it means is that the special rules regarding negotiable instruments do not apply.
B)If an instrument fails to qualify as a negotiable instrument,that does not mean it fails to be a perfectly good and enforceable contract.All it means is that the special rules regarding negotiable instruments do not apply.
C)If an instrument fails to qualify as a negotiable instrument,that does not mean it fails to be a perfectly good and enforceable contract.All it means is that the special rules regarding negotiable instruments do not apply.
D)If an instrument fails to qualify as a negotiable instrument,that does not mean it fails to be a perfectly good and enforceable contract.All it means is that the special rules regarding negotiable instruments do not apply.
E)If an instrument fails to qualify as a negotiable instrument,that does not mean it fails to be a perfectly good and enforceable contract.All it means is that the special rules regarding negotiable instruments do not apply.

When an Instrument Fails to Meet the Technical Requirements Necessary