Which of the following statements is true of an indorsement?
A) It applies only to payments made to a depositary bank.
B) It does not affect future attempts to negotiate the instrument.
C) It generally does not make a person liable on the instrument even if he or she is engaged in any illegality affecting the instrument.
D) It makes a person liable on an instrument indorsed by him or her if the person primarily liable on it does not pay it.

Question

Quizplus · Accepted Answer

An indorsement generally makes a person liable on the instrument. By indorsing an instrument, a person incurs an obligation to pay the instrument if the person primarily liable on it (for example, the maker of a note) does not pay it.

Which of the Following Statements Is True of an Indorsement