Ohio Notary Practice Exam

After how many days is a Drawer discharged from all liability on the instrument, if no notice of dishonor is received?

1. One day

2. Five days

3. Ten days

4. Thirty days

The correct answer is: Thirty days

In the context of negotiable instruments, the drawer is a person who creates a bill of exchange or check. When a check or draft is presented for payment but is dishonored (meaning it is not paid upon presentation), the holder typically has a responsibility to notify the drawer of that dishonor. However, if no notice of dishonor is communicated to the drawer within a specific timeframe, the drawer is discharged from all liability related to that instrument. In Ohio and under the Uniform Commercial Code (UCC), this timeframe is established as thirty days. After this duration, if the holder of the instrument has not given notice of dishonor to the drawer, it is assumed that the drawer is no longer liable for payment on that instrument. This provides a protective measure for drawers, allowing them to have a clear cutoff period after which they can confidently assume they won't be held responsible for the unpaid instrument. This consideration is essential for anyone working with negotiable instruments to understand their rights and responsibilities, as well as the critical timelines involved in the process.