Commercial Paper

Front 1

Commercial Paper UCC?

Back 1

Article 3

Front 2

Negotiable Instrument

Back 2

1. Written and Signed
2. Unconditional
3. Transfer of Money
4. Fixed Amount
5. Words of Negotiability
6. Definite time for payment or on demand
7. No extraneous undertakings (except relating to collateral)

Front 3

Accord and Satisfaction

Back 3

1. Good faith effort to settle bona fide dispute.
2. Full payment noted.
3. Obtains payment.

Front 4

Blank Endorsement

Back 4

Becomes bearer paper.
Simple signature.

Front 5

Special Endorsement

Back 5

Instruction directing payment to a particular person.

Order paper can become bearer paper.

Front 6

Restrictive Endorsement

Back 6

For deposit only.

Front 7

Anomalous Endorsement

Back 7

Surety Guarantor (no consideration)

In IL, release of principal obligor is not a defense.

Front 8

Enforcing Lost or Stolen Instruments

Back 8

terms of the instrument, entitled to enforce it, was holder when lost or stolen, not negotiated or transferred AND maker gets adequate protection

Front 9

Holder In Due Course (HIDC)

Back 9

1. Holder
2. For Value
3. Good Faith
4. No notice of defenses
(or sheltered by HIDC)

Front 10

Real Defenses for HIDC

Back 10

1. Infancy
2. Illegality of Debt
3. Fraud in Factum
4. Discharge in Bankruptcy

Front 11

Liability of Indorsers

Back 11

1. Dishonor
2. Notice of Dishonor
3. No "Without Recourse" Language

Front 12

Indorser/Transferor Warranties

Back 12

1. Entitled to Enforce.
2. Signatures are authentic and authorized.
3. Instrument has not been altered.
4. Not subject to any defenses against transferor.
5. No known maker/drawer bankruptcy.
Cannot be waived on checks, but can on notes.