Joseph obtains a draft that states as follows: "pay to the order of Joseph Daniels the sum of $1000." Joseph wants to negotiate this instrument to Jack Spratt to pay a debt owing to Jack. To negotiate this instrument Joseph must
A) hand over the draft to Jack and get a receipt.
B) endorse and present the instrument to Jack's bank.
C) present the instrument to Jack's bank and have it accepted and then transfer it to Jack.
D) indicate accepted on the draft and then deliver it to Jack.
E) endorse and deliver the instrument to Jack.

Question

Quizplus · Accepted Answer

In order to negotiate the instrument to Jack, Joseph must endorse and deliver it to him. This means that Joseph signs the back of the draft (endorsement) and physically hands it over to Jack (delivery). This transfers ownership and the right to receive payment to Jack. Therefore, choice (E) is the best option.

Joseph Obtains a Draft That States as Follows: "Pay to the Order