Definition and Process of Checks and Promissory Notes
Classified in Law & Jurisprudence
Written on in English with a size of 8.49 KB
Check.-
Definition.- is a bill of exchange drawn on behalf of a banker, which is payable on demand by the banker.
Three - party
the person who orders the drawn is the drawer
the person against whom it is drawn is the drawee (the banker) and is ordered to pay
the person to whom the draft is payable is known as the payee.
Process.- The drawer gives the payee a written order that directs the drawee to pay money to the payee or to whomever the payee designates through an appropriate indorsement. The payee must collect the money from the drawee, by physically presenting the draft and demanding payment. Checks are different from other instruments because they are drawn on a bank and are payable on demand.
Notes.-
A promissory note is an unconditional