Term
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Definition
| the ability to transfer particular financial “instruments” to third parties, either with or without consideration. |
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Term
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Definition
| the most common form of draft that is drawn on a bank and payable on demand; the drawer orders the drawee (bank) to pay the payee on demand (upon request of the holder) |
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Term
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Definition
| a written promise by a maker (issuer) to pay a payee a certain sum of money, either on demand or at a stated date. |
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Definition
| a specialized form of note that is given by a bank or thrift association. |
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Term
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Definition
| any reduction to tangible form, including electronic. |
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Term
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Definition
| any symbol executed or adopted by a party with intention to validate a writing. |
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Definition
| an undertaking to pay, which must be more than a mere acknowledgment or recognition of an existing debt. |
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Term
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Definition
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Term
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Definition
| an absolute promise to pay that is not subject to any contingencies. |
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Term
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Definition
| the instrument must contain a determinable minimum principal payment although provisions in the instrument may increase the amount of payment under certain circumstances |
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Term
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Definition
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Term
| Contain No Other Undertaking |
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Definition
| a promise or order to do an act in addition to the payment of money destroys negotiability |
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Term
| Payable on Demand or at a Definite Time |
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Definition
| an instrument is demand paper if it must be paid upon request; an instrument is time paper if it is payable at a definite time |
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Term
| Payable to Order or to Bearer |
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Definition
| a negotiable instrument must contain words indicating that the maker or drawer intends that it pass into the hands of someone other than the payee |
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Term
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Definition
| payable to the “order of” (or other words which mean the same) a named person or anyone designated by that person |
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Term
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Definition
| payable to the holder of the instrument; includes instruments payable (1)payable to bearer or the order of bearer, (2)that do not specify a payee, or (3)payable to “cash” or to order of “cash |
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Term
| Reference to Other Agreements |
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Definition
| does not destroy negotiability unless the recital makes the instrument subject to or governed by the terms of another agreement |
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Term
| The Particular Fund Doctrine |
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Definition
| an order or promise to pay only out of a particular fund does not destroy negotiability. |
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Term
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Definition
| A “holder in due course” may collect from the maker or drawee without regard to most defenses other than fraud or theft! |
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