A draft may be presented to the drawee for acceptance as well as for payment. This flexibility is particularly important when a draft is not yet due. The holder is given the opportunity to test the drawee's willingness to honor the instrument. When a draft is presented for acceptance, the drawee is asked to become primarily liable on the instrument. The drawee is asked to agree now to pay the amount of the draft when it is presented for payment at a later date. To accept a draft, the drawee signs the instrument (usually perpendicularly) across its face. It is customary, also, to write the word accepted and the date along with the drawee's signature. When a drawee bank accepts a check, it stamps the word certified across the face of the instrument and signs it. This instrument is known as a certified check.
Although, in most cases, a draft may be presented for either payment or acceptance, there are three situations in which a draft must be presented for acceptance:
• where the draft states that it must be presented for acceptance,
• where the draft is payable elsewhere than at the residence or place of business of the drawee, and
• where the date of payment depends upon presentment, for example, when the draft contains a statement like: "Thirty days after sight pay to the order of…"
Dishonor means to refuse to pay a negotiable instrument when it is due or to refuse to accept it when asked to do so. An instrument is dishonored when proper presentment is made and acceptance or payment is refused. Dishonor also occurs when presentment is excused and the instrument is past due and unpaid. The presenting party has recourse against endorsers or other secondary parties after notice of dishonor has been given.
If an instrument has been dishonored, the holder must give notice of the dishonor to the drawer and to the endorsers before midnight of the third full business day after the date of dishonor. Unless notice is excused, any endorser who is not given notice within the specified time is discharged. A drawer who is not given notice within the specified time is discharged if the drawee cannot pay because of insolvency. Notice of dishonor may be given, by or on behalf of the holder, to any person who may be liable.
Unless excused, protest of any dishonor is necessary to charge the drawer and endorsers of any draft that on its face appears to be drawn or payable outside the jurisdiction A protest is a certificate of dishonor that states that a draft was presented for acceptance or payment and was dishonored. It also states the reasons given for refusal to accept or pay. It is required for drafts drawn or payable outside the state and optional in all other cases with the holder. A protest is made under the hand and seal of a state consul or vice-consul or of a notary public or other person authorized to certify dishonor by the law where dishonor occurs.
Endorsers who write demand and notice waived or protest waived above their endorsements or across the face of an instrument are liable for payment without subsequent presentment or notice of dishonor. Prior endorsers are excused from their liability to such endorsers.
If a waiver of notice or protest is stated on the face of the instrument, it is binding upon all parties; when written above the signature of an endorser, it binds only the endorser.
Exercise 1. Comprehension questions:
1. What is a shelter provision designed for?
2. When can be personal defence used?
3. In what way may be the contract breached?
4. When does the holder have notice of a claim or defence?
5. What is the difference between lack of consideration and failure of consideration?
6. What are the kinds of frauds?
7. When does the drawer have the defence of conditional delivery?
8. In what case a person is not liable on negotiable instrument?
9. What should be done to be sure that a drawer would be liable on an instrument?
Exercise 2. Find in the text English equivalents to the following:
Отпадение основания договора; законный владелец; недостаточность возмещения; правовая защита против ограниченного круга держателей ценных бумаг; предъявление векселя к акцепту или оплате; первичное обязательство; опротестовывать вексель; универсальная защита против неограниченного круга держателей ценных бумаг; субсидиарная ответственность.
Exercise 3. Consult recommended dictionaries and give words or phrases to the following definitions:
Приобретательная давность; непрерывно владеть; давность владения; течение срока; истечение срока; наличие вины; непреодолимая сила; чрезвычайные и непреодолимые обстоятельства.
Exercise 4. Be ready to talk on one of the following topics:
1. Describe the special protection given to a holder in due course.
2. Name six personal defenses.
3. Explain the significance of a real defense.
4. Name six real defenses.
5. Differentiate between primary liability and secondary liability.
Exercise 5. Make up your own dialog on the case: In Norman v. World Distributors, Inc., the court stressed that the purchaser of the note "knew enough of the seller's referral plan to require it to inquire further" and secondly that he knew that the seller had been doing business under three different names during the year in which the note was transferred. Those two facts in addition to a substantial discount led the court to find the purchaser was not a holder in due course.
Unit 14
Checks and Bank Collections
Чеки и инкассирование
Чеком признается ценная бумага, содержащая ничем не обусловленное распоряжение чекодателя банку произвести платеж указанной в нем суммы чекодержателю (п. 1 ст. 877 ГК).
Законодательство и практика чекового обращения знает несколько разновидностей чеков: по субъектам различаются чеки предъявительские, ордерные и именные; с точки зрения инкассации (получения денег) чеки подразделяются на кассовые, расчетные и кроссированные.
Участниками отношений по чеку являются чекодатель, чекодержатель и плательщик. Чекодателем считается лицо, выписавшее чек; чекодержателем – лицо, являющееся владельцем выписанного чека. Плательщиком по чеку является банк, где чекодатель имеет средства, которыми он вправе распоряжаться путем выставления чеков (это могут быть деньги, находящиеся на банковском счете, учтенный вексель, даже открытый кредит). Использование чеков в качестве инструмента безналичных расчетов должно основываться на чековом договоре между плательщиком и его банком, а также между банками – участниками чековых расчетов.
List of key terms and word combinations:
– bank draft – тратта, выставленная одним банком на другой
– cashier's check – чек, выписанный банком на себя
– certified check – удостоверенный чек (с надписью банка о принятии к платежу)
– collecting bank – банк-инкассатор
– depositary bank – банк-депозитарий
– electronic fund transfers (EFTs) – система электронного перевода платежей
– forgery – подлог или подделка документа
– intermediary bank – банк-посредник
– overdraft – овердрафт (сумма, получаемая по чеку сверх остатка на текущем счете); превышение кредита (в банке)
– payor bank – банк-плательщик
– presenting bank – банк-представитель
– remitting bank – банк, переводящий средства
– stale check – просроченный чек
– subrogation – суброгация; замена одного кредитора другим
– teller's check – чек, выписанный банком на другой банк и подписанный кассиром банка, выписавшего чек
– traveler's check – дорожный чек
– uttering – переуступка; выпуск в обращение; сбыт
A check is a draft drawn on a bank and payable on demand. It is the most common form of a draft. It is drawn on a bank by a drawer who has an account with the bank to the order of a specified person or business named on the check or to the bearer. A check is a safe means of transferring money, and it serves as a receipt after it has been paid and canceled by the bank.
In the check shown in Figure 1, Ms. Sharova is the drawer; she has an account in the Sun Trust Bank. John Doe is the payee. Sun Trust Bank, on which the check is drawn, is the drawee.