LAW 603 Lecture Notes - Lecture 6: Nipple, Settlor, General Partnership
12 Feb 2017
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Document Summary
A negotiable instrument consists of a contract that contains an obligation to pay money. Many of the rules that normally govern contracts do not apply in the same way to negotiable instruments. Consideration consideration normally cannot consist of a promise to perform an obligation that is already owed to the same party. However, that rule does not apply to a check. Privity normally, a contract can be enforced only by someone with privity a stranger, someone who did not participate in the creation of the agreement cannot sue on it. Nevertheless, anyone who holds a check can sue on it. Assignment contractual obligations can generally be assigned to a stranger. A negotiable instrument is more valuable than a simple contract because, like money, it is negotiable. It can be easily transferred from one party to another in a way that may remove any defects. It is a contract that is intended to eventual result in the payment of money.
