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CHAPTER 30 Discharge of Commercial Paper and Electronic Fund Transfers

CHAPTER 30 Discharge of Commercial Paper and Electronic Fund Transfers. 30-1 Discharge of Commercial Paper 30-2 The Law of Electronic Fund Transfers. 30-1 Discharge of Commercial Paper. GOALS List the ways commercial paper can be discharged

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CHAPTER 30 Discharge of Commercial Paper and Electronic Fund Transfers

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  1. CHAPTER 30Discharge of Commercial Paper and Electronic Fund Transfers 30-1 Discharge of Commercial Paper 30-2 The Law of Electronic Fund Transfers

  2. 30-1 Discharge of Commercial Paper GOALS • List the ways commercial paper can be discharged • Recognize the importance of the status of a holder in due course • Identify the limited and universal defenses Chapter 30

  3. FOCUS • How do I discharge my obligations on the checks and other pieces of commercial paper I have issued? Chapter 30

  4. HOW IS COMMERCIAL PAPER DISCHARGED? • By payment • By cancellation • By alteration • By impairment of collateral • As a contract Chapter 30

  5. Name four means of discharging commercial paper. Chapter 30

  6. COLLECTION OF COMMERCIAL PAPER OBLIGATIONS • Holder in due course • Qualifications of an HDC • Take in good faith and give value • Without knowledge of defense or dishonor Chapter 30

  7. What must a mere holder do to be considered an HDC? Chapter 30

  8. WHAT ARE THE LIMITED DEFENSES? • Breach of contract or failure of consideration • Fraud in the inducement • Temporary incapacity to contract—excluding minority • Ordinary duress • Prior payment or cancellation • Conditional delivery or nondelivery • Unauthorized completion • Theft Chapter 30

  9. WHAT ARE THE UNIVERSAL DEFENSES? • Permanent incapacity to contract and minority • Illegality • Forgery or lack of authority • Alteration • Fraud in the execution of the paper or as to the essential terms • Duress depriving control • Claims and defenses stemming from a consumer transaction Chapter 30

  10. What is the difference between a universal and a limited defense? Chapter 30

  11. 30-2 The Law of Electronic Fund Transfers GOALS • Distinguish the financial transactions that are electronic fund transfers • State the rules controlling electronic fund transfers Chapter 30

  12. FOCUS • Is there a limit to how much I can lose if my ATM card is stolen and unauthorized transfers are made with it? Chapter 30

  13. ELECTRONIC FUND TRANSFERS • Electronic Fund Transfers Act • UCC Article 4A Chapter 30

  14. Name the laws that govern consumer EFTs and business EFTs. Chapter 30

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