Exam 27: Kinds of Negotiable Instruments and Negotiability

A promissory note that is payable "on the date of my marriage" is nonnegotiable even if the maker of the note marries.

A(n) __________ instrument's terms are enforceable, but the instrument is treated simply as a contract governed by contract law.

An action taken by a person on behalf of another is called:

A certificate of deposit is a written promise made and signed by the maker to pay a sum certain in money to the holder of the instrument.

The person to whom the order in a draft is addressed is known as the:

A nonnegotiable instrument's terms are not enforceable.

If a check is made payable to Paolo, and Paolo signs on the back of the check, Paolo is:

An acceptor is a drawer who has accepted the liability of paying the amount of money specified in a draft.

The drawer is the person on whom the order to pay a draft is made.

George was the maker of a written promissory note that stated that $500 would be paid on the sale of George's automobile. George initialed the note instead of writing his full name. The promissory note stated that it would be payable six months from the date. The promissory note was not dated. You now have come into possession of this note. Is this note negotiable? Discuss the elements of negotiability and whether each one has been met.

The bank is the drawee on a check and has no liability until it has accepted the instrument.

When ambiguous language in an instrument exists: