Chapter 16 Flashcards
Agreement to sell
An agreement that title will be transferred at some time in the future
Bill of exchange
A negotiable instrument by which the drawer directs the drawee to pay out money to the payee; drawee need not be a bank
Bill of lading
A receipt for goods in the care of the shipper accompanied by contract of carriage terms to move the goods or deliver identical goods to a designated place
Certified cheque
A means of transferring funds by cheque where payment is, in effect, guaranteed by the bank
Cheque
A negotiable instrument consisting of a bill of exchange drawn on a bank, payable on demand
CIF (cost, insurance and freight) contracts
Sales contracts in which one of the parties has been designated as being responsible for paying the costs involved in the shipping of the goods, as well as arranging insurance
COD (cash on delivery) contracts
Sales contracts in which the seller maintains the proprietary rights or title as well as control over the possession of the goods until they are delivered to the buyer’s premises and paid for
Consumer transactions
Purchases by individuals of goods or services for personal use and not for resale or for business purposes
Cooling off period
A statutorily defined period during which purchasers in door to door sales may change their mind and rescind a contract
Direct sales
Sales made to consumers at their place of business or dwellings
Door to door sales
An example of direct sales
Drawer
The person creating the negotiable instrument
Endorser
The person who signs the back of a cheque, usually assuming the obligation to pay it if the drawee or maker defaults
FOB (free on board contracts)
Sales contracts in which the parties have agreed that the seller will bear the risk until a specified point in the transport process
Holder in due course
An innocent third party entitled to collect on a negotiable instrument despite any claims of the original parties
