1) There are three parties to a bill:
i. Drawer one who give the order
ii. drawee person to whom the order is given and if the drawee accepts the bill by signing it he's called the acceptor
iii. recipient person to whom the payment is to be created (by the drawee/acceptor).
iv. generally one person may take on 2 roles e.g. wherever he attracts a bill owed to himself or payable to the drawee e.g. a person drawing a cheque on a bank and owed to the bank itself
2) the bill must be an unconditional order to payee.
i. missive of invitation /authority to pay isn't a bill of exchange e.g.
ii.we herewith authorize you to pay on our account is not a bill of exchange.
iii. The order must be unconditional. If conditional not bill of exchange. E.g.: the order that gives remunerator the discretion to pay X if satisfied with the products delivered or on or before jan one, 2007
3)The bill must be in writing
i. can be printed or written
ii. However, it's advisable not to write in pencil to avoid fraudulent alteration
4) The bill must be addressed by one person or body of person to another.
i. Body of person = company, partnership etc
ii. remuneration must be known with reasonable certainty. e.g. : Mr. X and Mr. Y, not Mr. X or Mr. Y
iii. Section 5(2) provides that if the drawer and therefore the remuneration area unit the same person the holder may treat the document either as bill of exchange or a promissory note.
5) The bill should be signed by the drawer or his authorized agent.
i. Signature by means of rubber stamp is acceptable provided it's affixed with the intention of being the drawer's signature.
6) The bill should order payment of a add certain in cash, not in goods or services
i. If the order is to pay by bond or gold, it's not a bill of exchange.
ii. The sum is also payable with interest or by explicit installments, or per specified rate of exchange.
iii. wherever there's a difference between the amount stated in words and figures, the sum stated in words is that the amount payable.
7) The bill must be payable on demand or at a fixed or determinable future time
i. payable on demand the holder is entitled to payment immediately upon demand. This includes bills payable on sight or on presentation or in which no time for payment is stated
ii. fastened or determinable future times payment on expiration of the period after date or sight after the happening of such event that is for certain to happen tho' the time of happening is also unsure e.g thirty days after date/sight/ death are valid.
i. Drawer one who give the order
ii. drawee person to whom the order is given and if the drawee accepts the bill by signing it he's called the acceptor
iii. recipient person to whom the payment is to be created (by the drawee/acceptor).
iv. generally one person may take on 2 roles e.g. wherever he attracts a bill owed to himself or payable to the drawee e.g. a person drawing a cheque on a bank and owed to the bank itself
2) the bill must be an unconditional order to payee.
i. missive of invitation /authority to pay isn't a bill of exchange e.g.
ii.we herewith authorize you to pay on our account is not a bill of exchange.
iii. The order must be unconditional. If conditional not bill of exchange. E.g.: the order that gives remunerator the discretion to pay X if satisfied with the products delivered or on or before jan one, 2007
3)The bill must be in writing
i. can be printed or written
ii. However, it's advisable not to write in pencil to avoid fraudulent alteration
4) The bill must be addressed by one person or body of person to another.
i. Body of person = company, partnership etc
ii. remuneration must be known with reasonable certainty. e.g. : Mr. X and Mr. Y, not Mr. X or Mr. Y
iii. Section 5(2) provides that if the drawer and therefore the remuneration area unit the same person the holder may treat the document either as bill of exchange or a promissory note.
5) The bill should be signed by the drawer or his authorized agent.
i. Signature by means of rubber stamp is acceptable provided it's affixed with the intention of being the drawer's signature.
6) The bill should order payment of a add certain in cash, not in goods or services
i. If the order is to pay by bond or gold, it's not a bill of exchange.
ii. The sum is also payable with interest or by explicit installments, or per specified rate of exchange.
iii. wherever there's a difference between the amount stated in words and figures, the sum stated in words is that the amount payable.
7) The bill must be payable on demand or at a fixed or determinable future time
i. payable on demand the holder is entitled to payment immediately upon demand. This includes bills payable on sight or on presentation or in which no time for payment is stated
ii. fastened or determinable future times payment on expiration of the period after date or sight after the happening of such event that is for certain to happen tho' the time of happening is also unsure e.g thirty days after date/sight/ death are valid.
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