Quiz 25: Creating a Negotiable Instrument
Promissory note: Promissory note is a promise that an individual will pay money. It is used in every loan transaction, when the borrower is purchasing something. Position of the layers in this situation: The lawyers should not be "holders in due course" except they had given value for note. The appeals court ordered the trial court to decide on the value of legal services that the lawyers had performed for corporation at the time the note was given to them.
This is a question of whether delivery has been made to the transferee, RS. Since CW placed the check on the table with a note stating that the check should got to RS, this could be considered constructive delivery. Although it was not personally give to RS, it was clear from the indorsement and the note that CW wanted RS to have it. Arguably, the check was negotiated to RS.
Check: The most general form of draft is check, which orders a particular bank to disburse or transfer money. Check is a draft. Hence, the answer is . Likewise, The drawer of instrument, which orders someone to pay or transfer money, is draft. Hence, the statement (a) ("a draft is always a check") is wrong. Promise to pay money to someone is called note. There are two people involved they are "maker and payee." Hence, the statement (c) ("A note must involve at least 3 people") is wrong. The statement (a) and (c) is wrong. Hence, the statement (d) (all of the above) is wrong.