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Template:M intro repack negotiable instrument: Difference between revisions
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There is some authority from Canada that bearer bonds are not promissory notes, but we are bound to say we are not persuaded by it. The suggestion is as follows: | There is some authority from Canada that bearer bonds are not promissory notes, but we are bound to say we are not persuaded by it. The suggestion is as follows: | ||
{{quote| | {{quote| | ||
A bond is not an unconditional promise to pay, but the bond itself ... is a promise to pay subject to all the conditions referred to in the bond.<ref> | A bond is not an unconditional promise to pay, but the bond itself ... is a promise to pay subject to all the conditions referred to in the bond.<ref>''Weidman Bros v Guaranty Trust Co'' [1955] 5 DLR 107.</ref>}} | ||
But this is to make a category error. There is conditions in the sense of [[conditions precedent]] before the satisfaction of which the obligation does not arise, and then there are conditions in the sense of terms and conditions of a bond, which may include, for example, “this is an unconditional promise to pay upon demand”. A document containing no conditions of the second kind is not a contract or instrument of any kind. | |||
===Negotiability=== | ===Negotiability=== | ||
All this is further confused if the holder of a bill of exchange is entitled to negotiate it — to sell it, effectively, in the secondary market to a random third party. | All this is further confused if the holder of a bill of exchange is entitled to negotiate it — to sell it, effectively, in the secondary market to a random third party. | ||