Promissory Notes
It’s a New Car
First before I address the question, I want to know what dealership or car lot would let a potential customer borrow a car for a week to decide whether she or she likes the car, and if there is such a car lot that does where it is?
Now to answer the question, the instrument that is used here is called a promissory note, meaning I promise to pay such and such amount by this date.
In this particular case the document that states: “I promise to pay to the order of Bob’s Auto Emporium $ 20,000 with interest at the rate of 7% per annum “, granted it is a promise, but this one is not negotiable. For a promissory note to be negotiable is has to be in writing, it must be signed by the preparer, it must be an unconditional promise or order to pay, it must state a fixed amount, it must be payable on demand or state a specific time in which the amount is to be paid, it must be payable to order or to bearer, unless it’s a check.
This document obviously is in written form and was prepared for a signature by the maker, which is Bob’s Auto Emporium, it is a promise to pay and does state a specific amount, however it doesn’t state whether the amount is to be paid in site or by a certain time, which by the UCC requirements makes this promissory note non-negotiable.
On a personally note like I stated earlier what and where is a car lot that would let a person borrow a car for a week, because I’ve been to several car lots and all of them want a driver’s license, a blood sample and a small child for collateral, ok so I may be exaggerated on the blood sample and small child part. And why would any sane person actually sign such a document? If someone asked me or told me that I have to sign such a paper after they let me borrow a car for a week, I would say “ well you shouldn’t of let me borrow it then “. This is indeed a promissory note; however it doesn’t meet the requirements set by the UCC to make it negotiable.
References:
Miller, R., & Hollowell, W.
First before I address the question, I want to know what dealership or car lot would let a potential customer borrow a car for a week to decide whether she or she likes the car, and if there is such a car lot that does where it is?
Now to answer the question, the instrument that is used here is called a promissory note, meaning I promise to pay such and such amount by this date.
In this particular case the document that states: “I promise to pay to the order of Bob’s Auto Emporium $ 20,000 with interest at the rate of 7% per annum “, granted it is a promise, but this one is not negotiable. For a promissory note to be negotiable is has to be in writing, it must be signed by the preparer, it must be an unconditional promise or order to pay, it must state a fixed amount, it must be payable on demand or state a specific time in which the amount is to be paid, it must be payable to order or to bearer, unless it’s a check.
This document obviously is in written form and was prepared for a signature by the maker, which is Bob’s Auto Emporium, it is a promise to pay and does state a specific amount, however it doesn’t state whether the amount is to be paid in site or by a certain time, which by the UCC requirements makes this promissory note non-negotiable.
On a personally note like I stated earlier what and where is a car lot that would let a person borrow a car for a week, because I’ve been to several car lots and all of them want a driver’s license, a blood sample and a small child for collateral, ok so I may be exaggerated on the blood sample and small child part. And why would any sane person actually sign such a document? If someone asked me or told me that I have to sign such a paper after they let me borrow a car for a week, I would say “ well you shouldn’t of let me borrow it then “. This is indeed a promissory note; however it doesn’t meet the requirements set by the UCC to make it negotiable.
References:
Miller, R., & Hollowell, W.