Negotiable Intsruments Quiz

Which of the following is NOT an essential element of a bill of exchange?

• Unconditional order

• Payable on demand or at a fixed future date

• Issued by a bank

• Signed by the drawer

Who is responsible for paying a cheque when presented?

• Drawer

• Drawee Bank

• Payee

• Endorser

A cheque can be crossed to ensure that:

• It is only payable into a bank account

• It can only be cashed by the bearer

• The drawer can revoke payment at any time

• It cannot be used for transactions over R10,000

In which case did the court rule that if there is a discrepancy between words and figures on a cheque, the amount in words prevails?

• Van Tonder v Vorster

• Gilbey Distillers v Absa Bank

• Bank of England v Vagliano Bros

• Dependable Aluminium Windows and Doors CC v Antoniades

What is the main difference between a stop order and a debit order?

• A stop order is set up by the bank, while a debit order is set up by the creditor

• A stop order allows the creditor to withdraw varying amounts, while a debit order is for fixed amounts

• A stop order is authorized by the account holder and can be canceled by them, while a debit order allows the creditor to collect money and cannot be canceled by the bank

• A stop order is a type of electronic funds transfer, while a debit order is a type of cheque

If a customer mistakenly transfers funds to the wrong bank account, what is the bank required to do?

• Immediately reverse the transaction

• Contact the recipient and request a refund

• Obtain the recipient’s consent before reversing the payment, unless fraud is involved

• Freeze the recipient’s account until the issue is resolved

A beneficiary bank owes a duty of care to the originator in an EFT transaction.

• True

• False

The bank is automatically liable if a customer’s PIN is used fraudulently at an ATM.

• True

• False