LAW 529 Midterm: LAW 603 MIDTERM 2.docx
12 Jul 2014
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Chapter 14 special contracts: negotiable instruments: when you pay for something with a cheque, you are dealing with a negotiable instrument, negotiable instrument consists of a contract that contains an obligation to pay money. Negotiable instruments can improve (depending on circumstances) as it passes from 1 person to next. 5 requirements must always be met before bills of exchange act can apply on pg. Signed/written, parties identified, certain sum of money, time of payment & unconditional obligation. Promissory note created when 1 person gives another person a written promise to pay a specific amount of money; maker person who creates instrument. Although payment may be postponed under a promissory note, payee could have received payment immediately if he/she had sold note to a 3rd party. If note did not say anything about place of payment, payee could collect money at maker"s office. Step 1: evaluate/identify holder, step 2: determine defences available to that person.
