Negotiable Instruments Essay

Negotiable Instruments
A negotiable instrument is any written promise or order to pay a sum of money (William Eric Hollowell, 2011). Examples of a negotiable instrument would be a check or a promissory note. A negotiable instrument can be transferred from one person to another.
After test driving a car and returning the car to the lot, Bob handed over a form and pen. The form stated the date, a promise to pay to the order of Bob’s Auto Emporium, and the amount of $20,000 dollars at seven percent per annum. Is this instrument negotiable under the UCC?
From the information provided, this form is a promissory note. A promissory note is a promise by from one to another to pay a specific sum. A promissory note must state a due date.
This note does not meet the requirements of negotiability under the Uniform Commercial Code or UCC. There are a few standards under the code that are not met to make this a promissory note.
First, the form does not state the name of the payer. The form also fails to provide a specified time for the sum of twenty thousand dollars plus seven percent per annum to be paid. The form is not signed; therefore, it is not enforceable under the law.
For the form to become a negotiable instrument, it must meet all of the following requirements: It must be in writing; it must be signed by the maker or drawer; it must be an unconditional promise or order to pay; it must state a fixed amount of money; it must be payable on demand or at a definite time; it must be payable to order or to bearer, unless it is a check (Miller & Hollowell, 2011). This form does not have all six of the requirements to be a negotiable instrument. This form is worthless and not enforceable under the law.

References
Miller, R. L., & Hollowell, W. E. (2011). The Essentials of Negotiability. Business law: text and exercises. (7th ed., pp. 300-313). Mason, Ohio: