- 1 Marks
Question
The instruction given by the drawer to the drawee to stop the payment of a cheque is
A. Countermand
B. Injunction
C. Memo
D. Order
E. Signal
Answer
A
Explanation:
The correct answer is A. Countermand. A countermand is an instruction given by the drawer of a cheque to the drawee (usually a bank) to stop the payment of a cheque that has not yet been cashed or processed. This is a legal order to cancel the transaction before the funds are transferred, protecting the drawer from unauthorized or mistaken payments.
- Tags: Banking, Cheques, Negotiable Instruments
- Level: Level 1
- Topic: Negotiable Instruments
- Series: MAY 2018
- Uploader: Theophilus