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    1) Introduction

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    Therese Grace Postrero
    This document discusses negotiable instruments and commercial documents under Indian law. It defines negotiable instruments as documents used in business transactions that strictly follow Section 1 of the Negotiable Instruments Act. They are money-like in that they have intrinsic value and the holder can seek recourse from secondarily liable parties if the primarily liable party does not pay. The two main types are promissory notes and bills of exchange. Negotiable documents, in contrast, only evidence title to goods and do not involve secondary liability. Negotiable instruments function as substitutes for money, mediums of exchange, and measures of credit through their negotiable characteristic of passing from hand to hand like currency.

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    1) Introduction

    Uploaded by

    Therese Grace Postrero
    10 views6 pages
    This document discusses negotiable instruments and commercial documents under Indian law. It defines negotiable instruments as documents used in business transactions that strictly follow Section 1 of the Negotiable Instruments Act. They are money-like in that they have intrinsic value and the holder can seek recourse from secondarily liable parties if the primarily liable party does not pay. The two main types are promissory notes and bills of exchange. Negotiable documents, in contrast, only evidence title to goods and do not involve secondary liability. Negotiable instruments function as substitutes for money, mediums of exchange, and measures of credit through their negotiable characteristic of passing from hand to hand like currency.

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    This document discusses negotiable instruments and commercial documents under Indian law. It defines negotiable instruments as documents used in business transactions that strictly follow Section 1 of the Negotiable Instruments Act. They are money-like in that they have intrinsic value and the holder can seek recourse from secondarily liable parties if the primarily liable party does not pay. The two main types are promissory notes and bills of exchange. Negotiable documents, in contrast, only evidence title to goods and do not involve secondary liability. Negotiable instruments function as substitutes for money, mediums of exchange, and measures of credit through their negotiable characteristic of passing from hand to hand like currency.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    10 views6 pages

    1) Introduction

    Uploaded by

    Therese Grace Postrero
    This document discusses negotiable instruments and commercial documents under Indian law. It defines negotiable instruments as documents used in business transactions that strictly follow Section 1 of the Negotiable Instruments Act. They are money-like in that they have intrinsic value and the holder can seek recourse from secondarily liable parties if the primarily liable party does not pay. The two main types are promissory notes and bills of exchange. Negotiable documents, in contrast, only evidence title to goods and do not involve secondary liability. Negotiable instruments function as substitutes for money, mediums of exchange, and measures of credit through their negotiable characteristic of passing from hand to hand like currency.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    of 6

    NEGOTIABLE INSTRUMENTS

    LAW
    INTRODUCTION
    COMMERCIAL DOCUMENTS
    • Documents or instruments used by traders or merchants in order to
    promote business transaction.
    Negotiable Instruments
    • Must strictly follow Section 1 of NIL
    • Subject is money
    • Itself the property with value
    • Holder has recourse against parties secondarily liable if not paid by
    party primarily liable

    • 2 kinds - Promissory Note and Bill of Exchange


    Negotiable Documents
    • Ownership/documents of title
    • Subject is goods
    • Mere evidence of title
    • No parties are secondarily liable

    • Examples: Certificate of Deposit, bonds, letter of credit, postal money


    order, bill of lading, warehouse receipt, certificate of stock
    Functions of Negotiable Instruments
    • Substitute for money – characteristic of NEGOTIABILITY which allows
    it to go from hand to hand in the commercial markets and to take part
    of money in commercial transactions/not LEGAL TENDER/differ from
    money as it is valuable or worthless depending upon the financial
    ability of the parties to them
    • Media of exchange – increase the purchasing medium (coins or bank
    bills) in circulation
    • Medium of credit transaction – measure a person’s credit
    Characteristics or features
    • NEGOTIABILITY – pass from hand to hand similar to money
    • ACCUMULATION OF SECONDARY CONTRACTS – as they are
    transferred from one person to another.

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