Big Auto Sales hired Expert Repo to repossess a Subaru Forester automobile owned by Maria who was in default on the associated promissory note. Expert Repo assigned the job to its field manager, Paul, and gave him an address where the vehicle could be found. On the morning of February 6, 2010, Paul went to the address and saw the automobile. Paul left the address to buy a soda and a Slim Jim from the nearby 7-11 store. Unseen by Paul, Maria left the house and helped her two sons, ages ten and six, into the back seat of the Subaru for the trip to school.
As Paul was returning to the house, Maria ran back into her house to pick up her cell phone. After Paul saw Maria run into the house, it took him only thirty seconds to back his tow truck to the Subaru, hook it to his truck, and drive away. Paul did not know that the two children were inside. When Maria emerged from the house, the Subaru, with her children, was gone. Maria began screaming, telephoned 911 [same as the Australian 000], and called her husband at work to tell him the children were kidnapped.
Meanwhile, on an adjacent street, Paul stopped the tow truck, got out, and heard a sound from inside the Subaru. Looking inside, he discovered the two children. After he persuaded one of the boys to unlock the vehicle, Paul drove the car back to Maria’s house. He returned the keys to Maria, who was crying outside her house. By the time emergency personnel and Maria’s husband arrived, the children were back home and Paul had left the scene. In this case, Maria owed a sum of money which was used for the purchase of a car. The company now wants the car back and hired Paul for the job.
When Paul took away the car, it had Maria’s children in it. Maria panicked and called the authority alleging that her children had been kidnapped. Paul acted as per the law as the obligator in this case. Maria cannot act against improper repossession against the company as they acted under the law. The company had the security agreement of the car and they can take the repossession of the car on due date. The due date arrived and Paul took the repossession. This case depends on the notice served by the company. If the company did not give notice to Maria, then it cannot repossess the car.
(UCC: Uniform Commercial Code, n. d. ) Octopus National Bank was impressed with your advice in Question One and thus has also hired you to advise the CEO on some commercial paper issues confronting ONB. ONB is considering the purchase of several promissory notes and drafts. However, the CEO is concerned that ONB might not be able to obtain the protection of holder in due course status because the instruments may not be negotiable. The holder in due course will be the person or the company in the middle of the transaction path as depicted in the diagram below:
In this case, the bank does not want to hold the instruments as it may not be negotiable. The situations are depicted below for which the advice has been asked for: The note does not have a handwritten signature. Instead, the maker’s signature was computer generated: In the case of a negotiable instrument to be valid there should be the actual handwritten signature of the payer. The note contains the statement, “I promise to pay to the order of William Bell USD $1,000 if I make the highest mark in USA Commercial Law at La Trobe University during the Winter 2010 term.
This conditional statements are not allowed in the case of the negotiable instruments. The note contains the statement, “This note is subject to the contract I signed with the payee, Paula Prince, on May 1, 2010. ”: This is not allowed as in the case of the negotiable instruments, any thing underlying another contract will not be valid. The note contains the statement, “This note is in payment for a Sony television which I have purchased from the maker. ”: The name of the receiver of the payment has to be mentioned in the negotiable instrument to make it valid.