Betty issues a note payable to the order of John for $2,000.John properly indorses the note,but raises the amount to $20,000,and negotiates it to Mary.On the due date,Mary attempts to collect $20,000 from Betty.Betty refuses to pay.Assuming that Mary is a holder in due course,which parties can Mary recover from in a lawsuit?

Question

Quizplus · Accepted Answer

Mary, as a holder in due course, can recover the original amount of $2,000 from Betty, as Betty is liable for the original note amount. Mary can also recover the additional $18,000 from John, who altered the note.

Betty Issues a Note Payable to the Order of John