Article 3 — Negotiable Instruments · Section 3-303
This study guide covers UCC § 3-303 pertaining to the characteristics and requirements of negotiable instruments.
Source: U.C.C. § 3-303
A promise or order is negotiable if it is in writing and signed by the maker or drawer, contains an unconditional promise or order to pay a sum certain in money, is payable on demand or at a definite time, and is payable to order or to bearer.
UCC § 3-303 states that for an instrument to be considered negotiable, it must be a written and signed document that promises to pay a specific amount of money, either on demand or at a set time, and it must be payable either to the holder or to a designated person.
A written document that promises a payment of a specific amount to the bearer or a specified party.
The person who creates a promissory note.
The person who writes a check or drafts a bill of exchange.
Example 1
A check issued by a bank that is payable to the order of a specific person and that is signed by the account holder.
Example 2
A promissory note that states that 'I promise to pay $1,000 to John Doe on or before December 31, 2025.'