Kline is holding a promissory note in which he is the payer and Breck is the promissor. One of the terms of the note states that payment is subject to the terms of the contract dated March 1 of the current year between Breck and Kline. Does this term destroy negotiability?
a. No, if the contract is readily available.
b. No, since the note can be enforced without regard to the mentioned contract.
c. No, as long as the terms in the mentioned contract are commercially reasonable.
d. Yes, since this term causes the note to have a conditional promise.
Answer: D
CPA Exam
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