Convention on International Bills of Exchange and International Promissory Notes 3

Convention on International Bills of Exchange and International Promissory Notes

 

Article 9

(1) An instrument is deemed to be payable on demand:

(a) If it states that it is payable at sight or on demand or on
presentment or if it contains words of similar import; or

(b) If no time of payment is expressed.

(2) An instrument payable at a definite time which is accepted or
endorsed or guaranteed after maturity is an instrument payable on demand
as regards the acceptor, the endorser or the guarantor.

(3) An instrument is deemed to be payable at a definite time if it
states that it is payable:

(a) On a stated date or at a fixed period after a stated date or at
a fixed period after the date of the instrument; or

(b) At a fixed period after sight; or

(c) By instalments at successive dates; or

(d) By instalments at successive dates with the stipulation in the
instrument that upon default in payment of any instalment the
unpaid balance becomes due.

(4) The time of payment of an instrument payable at a fixed period
after date is determined by reference to the date of the instrument.

(5) The time of payment of a bill payable at a fixed period after sight
is determined by the date of acceptance or, if the bill is dishonoured by
non-acceptance, by the date of protest or, if protest is dispensed with,
by the date of dishonour.

(6) The time of payment of an instrument payable on demand is the date
on which the instrument is presented for payment.

(7) The time of payment of a note payable at a fixed period after sight
is determined by the date of the visa signed by the maker on the note or,
if his visa is refused, by the date of presentment.

(8) If an instrument is drawn, or made, payable one or more months
after a stated date or after the date of the instrument or after sight,
the instrument is payable on the corresponding date of the month when
payment must be made.

If there is no corresponding date, the instrument is payable on the last
day of that month.

Article 10

(1) A bill may be drawn:

(a) By two or more drawers;

(b) Payable to two or more payees.

(2) A note may be made:

(a) By two or more makers;

(b) Payable to two or more payees.

(3) If an instrument is payable to two or more payees in the
alternative, it is payable to any one of them and any one of them in
possession of the instrument may exercise the rights of a holder. In any
other case the instrument is payable to all of them and the rights of a
holder may be exercised only by all of them.

Article 11

A bill may be drawn by the drawer:

(a) On himself;

(b) Payable to his order.

Section 3. Completion of an incomplete instrument

Article 12

(1) An incomplete instrument which satisfies the requirements set out
in paragraph (1) of article 1 and bears the signature of the drawer or
the acceptance of the drawee, or which satisfies the requirements set out
in paragraph (2) of article 1 and subparagraph (d) of paragraph (2) of
article 3, but which lacks other elements pertaining to one or more of
the requirements set out in articles 2 and 3, may be completed, and the
instrument so completed is effective as a bill or a note.

(2) If such an instrument is completed without authority or otherwise
than in accordance with the authority given:

(a) A party who signed the instrument before the completion may
invoke such lack of authority as a defence against a holder who had
knowledge of such lack of authority when he became a holder;

(b) A party who signed the instrument after the completion is
liable according to the terms of the instrument so completed.

CHAPTER III. TRANSFER

Article 13

An instrument is transferred:

(a) By endorsement and delivery of the instrument by the endorser
to the endorsee; or

(b) By mere delivery of the instrument if the last endorsement is
in blank.
Article 14

(1) An endorsement must be written on the instrument or on a slip
affixed thereto (“allonge”). It must be signed.

(2) An endorsement may be:

(a) In blank, that is, by a signature alone or by a signature
accompanied by a statement to the effect that the instrument is
payable to a person in possession of it;

(b) Special, that is, by a signature accompanied by an indication
of the person to whom the instrument is payable.

(3) A signature alone, other than that of the drawee, is an endorsement
only if placed on the back of the instrument.

Article 15

(1) A person is a holder if he is:

(a) The payee in possession of the instrument; or

(b) In possession of an instrument which has been endorsed to him,
or on which the last endorsement is in blank, and on which there
appears an uninterrupted series of endorsements, even if any
endorsement was forged or was signed by an agent without authority.

(2) If an endorsement in blank is followed by another endorsement, the
person who signed this last endorsement is deemed to be an endorsee by
the endorsement in blank.

(3) A person is not prevented from being a holder by the fact that the
instrument was obtained by him or any previous holder under
circumstances, including incapacity or fraud, Duress or mistake of any
kind, that would give rise to a claim to, or a defence against liability
on, the instrument.

Article 16

The holder of an instrument on which the last endorsement is in blank
may:

(a) Further endorse it either by an endorsement in blank or by a
special endorsement; or

(b) Convert the blank endorsement into a special endorsement by
indicating in the endorsement that the instrument is payable to
himself or to some other specified person; or

(c) Transfer the instrument in accordance with subparagraph (b) of
article 13.

Article 17

(1) If the drawer or the maker has inserted in the instrument such
words as “not negotiable”, “not transferable”, “not to order”, “pay (X)
only”, or words of similar import, the instrument may not be transferred
except for purposes of collection, and any endorsement, even if it does
not contain words authorizing the endorsee to collect the instrument, is
deemed to be an endorsement for collection.

(2) If an endorsement contains the words “not negotiable”, “not
transferable”, “not to order”, “pay (X) only”, or words of similar
import, the instrument may not be transferred further except for purposes
of collection, and any subsequent endorsement, even if it does not
contain words authorizing the endorsee to collect the instrument, is
deemed to be an endorsement for collection.

Article 18

(1) An endorsement must be unconditional.

(2) A conditional endorsement transfers the instrument whether or not
the condition is fulfilled. The condition is ineffective as to those
parties and transferees who are subsequent to the endorsee.

Article 19

An endorsement in respect of a part of the sum due under the instrument
is ineffective as an endorsement.

Article 20

If there are two or more endorsements, it is presumed, unless the
contrary is proved, that each endorsement was made in the order in which
it appears on the instrument.

 

Conclusion

Notes

See Also

References and Further Reading

About the Author/s and Reviewer/s

Author: international

Mentioned in these Entries

Duress.


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