Banking law key definitions Flashcards
Acceptor
The person who signs the bill in the capacity as drawee and becomes liable on it. Only bills can be accepted.
Bill
An unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand, or at a fixed or determinable time in the future, a sum certain in money to a specific person, or his order, or his bearer.
Bearer
A person in possession of a bill that does not specify a named payee, such as “Pay Cash”, which means that anyone in possession of the bill can claim payment on it.
Contract
An agreement entered into between two or more persons with the intention of creating a legal obligation and one which the law recognises as being a binding agreement between the parties.
Cheque
A bill drawn on a bank and payable on demand.
Drawer
The person who writes out a cheque that will be paid from his account because he is the creator of the cheque.
Drawee
The person to whom the order to pay the cheque is addressed. Usually the bank in the case of pre-printed cheques
Holder
A person who is the payee, indorsee, or bearer of a bill and is usually entitled to payment.
Indorser
The payee who, by signing, the bill, can negotiate it to someone else and, by signing, becomes a party to the bill.
Indorsee
The named person (X) that the indorser has negotiated the bill to, whose name appears on the bill as “Pay X”.
Nemo plus iuris
One cannot transfer more rights than you own.
Mandator
A person who instructs someone else to do something on her/ his behalf.
Mandate
A contract wherein a mandator instructs a mandatory to perform a task on the mandator’s behalf.
Mandatory
A person who receives the instruction to from the mandator to perform on his behalf
Transferor
Person who transfers value/ money/ assets.
