na roke aaj humey koi, dard mein

na roke aaj humey koi, dard mein doob jaane de jitney bhi ansoo kaid hain, aaj unko bahaane de suna hai humney, pani ki dhaar se patthar bhi kat jate hain dekhenge, haal pe mere kya sang dil bhi pighal jatey hain…

Rivo Mobile Driver for window 7 and window 8,8.1

Rivo mobile driver download free for window. rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager rivo mobile manager

Transferability and Holder in Due Course


Negotiable instruments can be transferred to others by negotiation or by assignment.


Transfer by negotiation creates a holder, who at the very least receives the rights of a previous possessor.
A holder in due course (HDC) acquires more rights in the instrument than the previous possessor. This means defenses that can be raised against the transferor may or may not be able to be raised against the transferee.

Two Ways to Negotiate

Negotiating Order Instruments endorsement and delivery required.
Negotiating Bearer Instruments—delivery only.

  • Converting Order to Bearer and vice versa.
  • Converting Order Instruments to Bearer Instruments, and Vice Versa.

  • Must be done at the time of negotiation.


Signature with or without additional words or comments:

  • Blank Indorsements.
  • Special Indorsements.
  • Qualified Indorsements.
  • Restrictive Indorsements.

Miscellaneous Indorsement Problems

Misspelled Names. Indorsement should generally be identical to name on instrument.

  • Misspelled name OK.
  • Instruments Payable to Legal Entities.

  • Negotiable by authorized representative of the entity.
  • Alternative or Joint Payees.

  • In the alternative – either may indorse.
  • Jointly – both must indorse.
  • Case 25.1: GMAC v. Abington Casualty (1992).

    Holder vs. HDC

    Holder is one in possession of order or bearer paper and the instrument is drawn or indorsed to the holder.
    Holder in Due Course (HDC) results if the holder also meets the following requirements:

    • Takes for Value.
    • Takes in Good Faith.
    • Takes without Notice of a Defense to Payment.

    HDC: Taking for “Value”

    No value if gift or inheritance. Not the same as consideration.
    Holder can take for value by:

    • Performing the instrument’s promise.
    • Acquiring a security interest or other lien in the instrument.
    • Taking instrument in payment for an antecedent debt.
    • Giving a negotiable instrument as payment.
    • Giving irrevocable commitment as payment.

    HDC: Taking in “Good Faith”

    Good faith is honesty in fact and the observance of reasonable commercial standards of fair dealing.”
    Only applies to holder, not transferor.
    Case 25.2: Maine Family Federal Credit Union v. Sun Life Assurance (1999).

    HDC: “Taking With Notice”

    Holder takes the instrument with notice if he knows/has reason to know:

    • Instrument is overdue.
    • Instrument has been dishonored.
    • Actual knowledge or any suspicious event.
    • That a claim or defense exists.
    • So irregular, incomplete, or bears such evidence of forgery.
    • Case 25.3: Travelers Casualty and Surety v. Wells Fargo Bank (2002).

    Holder through an HDC

    “Shelter Principle”: Person is not an HDC but derives title through HDC.
    Limitations on the shelter principle: no fraud, illegality, claim or defense.

    HDC in International Context

    Good Faith and Protected-Holder Status.
    UN approved Convention on International Bills of Exchange and International Promissory Notes (CIBN)
    CIBN affords Greater Protection for Protected Holders. .posttext h4 { margin-bottom: 5px; }

The Function and Creation of Negotiable Instruments

Articles 3 and 4 of the UCC

A “negotiable instrument” is a signed writing containing an unconditional promise to pay an exact sum of money. History of negotiable instruments began in England “bills of exchange” so that merchants were able to exchange money while keeping their money safe in the banks.
Today, UCC Article 3.

The Function of Instruments

To function as a substitute for money or credit device.
In order for an instrument to operate practically, it has to be easily transferable.
Laws of assignment did not allow for ease of transfer because the assignee was always subject to the defenses that could be used against the assignor. Article 3 provided that some defenses could not be used against certain assignees.

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).

Requirements for Negotiability

Writing signed by the maker or the drawer. Unconditional promise or order to pay a fixed amount of money.
Payable on demand or at a definite time.
Acceleration and Extension clauses.
Be payable to order or to bearer, unless it is a check. Case 24.3: Barclay’s Bank v. Johnson (1998).

Factors Not Affecting Negotiability

  • Omission of date.
  • Postdating or antedating.
  • No place for payment: address or Drawee or maker or, if none, place of business or, if none, residence.

Factors Not Affecting Negotiability

  • Handwritten over typewritten or printed.
  • Words over numbers.
  • With interest = judgment rate.
  • Mention of collateral.