Simple English definitions for legal terms
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Term: WITH RECOURSE
Definition: When someone signs their name on a piece of paper, they might write "with recourse" next to it. This means that if the person who gets the paper can't get paid, they can go back to the person who signed it and ask them to pay instead. It's like a backup plan for the person who gets the paper.
Definition: With recourse means that the person who endorses a financial instrument, such as a check or promissory note, remains liable to the holder for payment. This means that if the instrument is not paid, the endorser can be held responsible for the debt.
These examples illustrate how with recourse works in practice. By agreeing to endorse a financial instrument with recourse, the endorser is taking on additional risk and responsibility for the debt. This can be beneficial for the holder of the instrument, who has more assurance that they will be paid, but it can also be risky for the endorser, who may be held liable for a debt they did not incur.