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18 Cards in this Set
- Front
- Back
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Negotiability
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invests instruments with a high degree of marketability and commercial utility by conferring upon certain good faith transferees immunity from most defenses to the instruments
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Drafts
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a draft involves three parties: the drawer orders the drawee to pay a fixed amount of money to a payee
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Drawer
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issuer of an order to pay
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Drawee
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party ordered to pay a draft or a check
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Payee
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person to receive payment by an instrument
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Demand
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request for payment made by the holder of an instrument
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Promissory Note
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a written promise by a maker to pay a payee
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Maker
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issuer of a promissory note or certificate of deposit
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Certificate of Deposit
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a specialized form of note that is given by a bank or thrift association
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Formal Requirements
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negotiability is wholly a matter of form, and all the requirements for negotiability must be within the "four corners" of the instrument
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Writing
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any reduction to tangible form is sufficient
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Signature
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any symbol executed or adopted by a party with the intention to validate a writing
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Promise to Pay
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an undertaking to pay, which must be more than a mere acknowledgment or recognition of an existing debt
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Order to Pay
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instruction to pay
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Unconditional
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an absolute promise to pay that is not subject to any contingencies
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Reference to Another Agreement
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does not destroy negotiability unless the recital makes the instrument subject to or governd by the terms of another agreement
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Particular Fund Doctrine
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an order or promise to pay only out of a particular fund is no longer conditional and does not destroy nhegotiability
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No other undertaking or instruction
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a promise or order to do an act in addition to the payment of money destroys negotiability
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