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Monday 7 October 2013

Types of Negotiable Instruments

Types of Negotiable Instruments
Drafts and checks are 3 party instruments: Drawer, Drawee and Payee.
§ Checks (cashier’s, teller’s and traveler’s) are drafts on a bank.
§ Trade acceptances seller is drawer and payee.
Case 24.1:  Flatiron Linen v. First American State Bank  (2001).
Promissory Notes are two party instruments:
§ Maker (Promisor) and
§ Bearer (Promisee).
Certificates of deposit (CDs): two party instruments. 

Case 24.2: U.S. v. Durbin (1999).

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