Q&As

In relation to promissory notes, is it possible to record the discharge of the note obligations in manuscript on the note itself? Does the release wording need to acknowledge the manner in which the note obligations were discharged? Would an agreement for the note obligations to be transferred to a specific party and discharged by way of set-off undermine their legal status as promissory notes?

read titleRead full title
Published on LexisPSL on 23/04/2018

The following Banking & Finance Q&A provides comprehensive and up to date legal information covering:

  • In relation to promissory notes, is it possible to record the discharge of the note obligations in manuscript on the note itself? Does the release wording need to acknowledge the manner in which the note obligations were discharged? Would an agreement for the note obligations to be transferred to a specific party and discharged by way of set-off undermine their legal status as promissory notes?

In relation to promissory notes, is it possible to record the discharge of the note obligations in manuscript on the note itself? Does the release wording need to acknowledge the manner in which the note obligations were discharged? Would an agreement for the note obligations to be transferred to a specific party and discharged by way of set-off undermine their legal status as promissory notes?

We refer you to the following which you may find useful for your purposes.

  1. Bills of Exchange and Promissory Notes (2000) 5 JIBFL 168

As the above article discusses, many instruments which are called a promissory note fail to meet the statutory criteria for being a promissory note eg because there is a floating rate of interest or other payment obligation which makes the amount to be paid by the obligor not a sum certain. See section 83 of the Bills of Exchange Act 1882 (BEA 1882). If any provision of the instrument takes the instrument outside of the definition of promissory note, it

Popular documents