Robbie, in response to an advertisement in a magazine, orders computer equipment by mail from someone named Zeke Jones for $2,500. Under the terms of the order. a bill will be sent for the equipment within 30 days. One day while Robbie is in the office, someone enters and identifies himself as Zeke Jones, shows Robbie a bill and demands payment for the computer equipment. Robbie writes a check to this person for $2,500. Unbeknownst to Robbie, the person is Jake Smith, an impostor. Smith endorses the check "Zeke Jones" and gives it to Sally in exchange for a used car. Sally deposits the check in her account at Big Bank. Then the real Zeke Jones approaches Robbie, demanding payment, and Robbie realizes that he was tricked. Which of the following statements is true?
A) Sally will bear the loss in this case
B) Robbie wont bear the loss because he was deceived
C) The endorsement by Jake Smith was effective
D) The endorsement by Jake Smith was ineffective.
Tom sold 100 cases of tomato soup to Louie for $1,500. Louie gave Tom a promissory note, which stated "I promise to pay to the order of Tom the sum of $1,500 three months from date, together with 5% interest." Tom negotiated the note, making it payable to Sally, in exchange Sally's trampoline. Later, Louie discovers that the tomato soup was spoiled and is worthless. When Sally presents the note to Louie for payment, Louie refuses. Which of the following statements is true?
A) Louie has to pay Sally because she is a holder in due course.
B) Louie doesn't have to pay Sally but would have to pay Tom if Tom presented the note.
C) Louie doesn't have to pay Sally because the tomato soup was spoiled
D) Louie has to pay Sally, but she is a holder
John signs a promissory note in favor of Carl that states, "I promise to pay Carl the sum of $500 on demand." Carl gives the note to Sally in exchange for a television set. Which of the following is true?
A) Real defenses may be asserted against Sally.
B) Personal defenses may not be asserted against Sally.
C) Sally is a holder in due course
D) Sally isn't a holder.