Assume that Mike signs a promissory note to Carl,who in turn negotiates the instrument to Luke.Of the three,Mike is the only person who has primary liability.

Question

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Under the concept of negotiable instruments, the person who signs the promissory note (i.e., the maker) is the one who has primary liability to pay the instrument when it is due. In this case, Mike signed the promissory note, so he is the one with primary liability. Carl and Luke may have secondary liability if they endorse or guarantee the instrument, but they do not have primary liability.

Assume That Mike Signs a Promissory Note to Carl,who in Turn