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2) T steals a $250 bearer note from P. T sells the note to B who presents it for payment. Is B rightfully entitled to payment
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Answer #1

Yes, B is rightfully entitled to the payment. A bearer note is a document that entitles the holder of the note right of title or ownership.

Rule of law: Holder in due course is defined as a legal holder of a negotiable instrument such as a bearer note who has accepted the instrument in good faith. A holder of the bearer note takes the bearer note free of the rights of the payor that the note was stolen. Since, in the provided case, B is the holder of the bearer note and has accepted in good faith, therefore, B is entitled to payment.

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