Question

------------ is a material alteration ?

• A. Crossing a cheque by holder
• B. Changing a generally crossed cheque into special crossing
• C. Conversion of not negotiable crossing into ordinary crossing
• D. Writing the word account payee in crossing

Answer 1

Answer:

C. Conversion of not negotiable crossing into ordinary crossing

A material alteration is a change made to the instrument’s terms that affects its legal validity or rights of the parties. Changing a generally crossed cheque into a special crossing is a material alteration because it modifies the way the cheque can be paid. Other options like writing “account payee” or converting crossings are usually not considered material alterations.