Simon Sharpe executed and delivered to Ben Bates a negotiable promissory note payable to the order of Ben Bates for $500. Bates indorsed the note “Pay to Carl Cady upon his satisfactorily repairing the roof of my house,
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Simon Sharpe executed and delivered to Ben Bates a negotiable promissory note payable to the order of Ben Bates for $500. Bates indorsed the note “Pay to Carl Cady upon his satisfactorily repairing the roof of my house, (signed) Ben Bates” and delivered it to Cady as a down payment on the contract price of the roofing job. Cady then indorsed the note and sold it to Timothy Tate for $450. What rights, if any, does Tate acquire in the promissory note? |
Explanation
According to the revision of Article 3, all conditional endorsements have been made invalid. Because of this reason, the conditional endorsement by Individual B is also Invalid. Individual C transferred the check to Individual T, giving Individual T all rights to the instrument irrespective of the fact that Individual C fulfills the condition mentioned in the instrument.
Verified Answer
Individual T acquires complete rights over the promissory note as the conditional endorsement made by Individual B is invalid. Individual T is the indorsee of the instrument and has full rights over it.
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