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18 Cards in this Set

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