LAW 603 Chapter Notes - Chapter 14: Certified Check, Negotiable Instrument, Cheque
11 Feb 2013
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Cash can be inconvenient and dangerous (bulky and usually impossible to recover if lost: essential feature of cash: it is currency, person becomes owner of cash by honestly paying for it. If someone steals , does not own cash, but if buys a stereo with it, the storekeeper who is unaware of the theft, now owns the cash and it cannot be retrieved. Nemo dat quod non habet no one can give what they do not have. If you trade stolen car for neighbour"s boat, victim may recover value of car from neighbour, even if neighbour acted honestly. Negotiable instrument consists of a contract that contains an obligation to pay money: you decide to buy a car, and writing a cheque for it creates a new contract. If bank does not honour cheque, dealer can sue either on the sales contract, or on the cheque itself.
