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Which two methods of discharge in section 82 of the Negotiable Instruments Act, 1881 expressly include…

Clauses (b) and (c) expressly name the maker. Release operates in relation to the releasing holder and those deriving title under that holder after notice. Payment in due…

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Which two methods of discharge in section 82 of the Negotiable Instruments Act, 1881 expressly include the maker among the persons who may be discharged?

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Answer and explanation

Correct answer D

Clauses (b) and (c) expressly name the maker. Release operates in relation to the releasing holder and those deriving title under that holder after notice.

Payment in due course of the amount due under clause (c) discharges liability to all parties where the instrument is payable to bearer or has been indorsed in blank.

Clause (a) expressly refers to cancellation of the acceptor’s or indorser’s name.

Option feedback

Option A

Release names the maker, but the cancellation clause names the acceptor or indorser.

Option B

Qualifying payment names the maker, but the cancellation clause names the acceptor or indorser.

Option C

Qualifying payment names the maker, but dishonour is not a method of discharge under section 82.

Option D

The release and payment clauses both expressly include the maker, subject to the conditions stated in each clause.

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