HANDOUT NO.

1N

DISTINCTIONS

Point of distinction Negotiable Instrument Non-Negotiable Instrument

As to requisites Contains all the requisites
of Section 1 of NIL
As to mode of transferred by negotiation
transfer
As to rights HDC may have rights
acquired better than the transferor
As to warranty Prior parties warrant
payment
As to right of transferree has right of
recourse of the recourse against the
parties intermediate parties
does not or not all
transferred by assignment
transferee acquires only rights
of transferor
prior parties merely warrant
legality of his title
no such right of recourse

Point of distinction Negotiable Instrument Negotiable Documents of

Title
As to subject money goods
As to nature it is a property with value mere evidence of title
As to requisites complies with the does not
requirements of Section 1
of NIL
As to right of holder may run after the intermediate parties are not
recourse secondary parties for secondarily liable if dishonored
payment if dishonored by
primary parties
As to rights HDC may have right better merely steps into the shoes of
acquired than transferor the transferor

Point of distinction Promissory Note Bill of Exchange

As to content unconditional promise unconditional order
As to parties Involves 2 parties Involves 3 parties
involved (maker and payee) (drawer, drawee and payee)
As to liability maker is primarily liable drawer is secondarily liable
As to the only one presentment for generally, 2 presentments -
requirement of payment Acceptance and for payment
presentment

A. Villegas