Which of the following is the best description of an indorsement?
A) a signature that creates no new legal obligations
B) a signature that often creates potential liability for the indorser
C) a transfer that creates no new legal obligations
D) a signature that creases no potential liability for the indorser, unless the indorsement is a "special" indorsement
E) a payment of an instrument that discharges the liability of the maker or drawer

Question

Quizplus · Accepted Answer

An indorsement is a signature on the back of a negotiable instrument that transfers ownership or gives authorization to another person to do the same. Depending on the type of indorsement, the indorser may be liable for the payment of the instrument. Therefore, option B is the best description of an indorsement.

Which of the Following Is the Best Description of an Indorsement