Endorsement means that:
A)if the acceptor is unable to pay the face value on the maturity date,then it is obliged to draw a bill to meet its initial obligations.
B)an agreement between the acceptor and an endorser is reached,whereby the acceptor is obliged to pay the face value on the maturity date if the endorser is unable to pay the subsequent holder of the bill.
C)the endorser has a contingent liability until the bill matures and is paid.
D)none of the given options.

Question

Quizplus · Accepted Answer

Endorsement in the context of bills of exchange or negotiable instruments implies that the endorser guarantees payment to the subsequent holder of the bill if the primary party fails to pay. This creates a contingent liability for the endorser, which remains until the bill is either paid at maturity or the obligation is otherwise extinguished.

Endorsement Means That