9.1

Chapter 9

Performances and Payments

© 2003 by West Legal Studies in Business/A Division of Thomson Learning

9.2

Performances

When should performance be paid?

What was performed?

Who performed?

To whom was the performance made?

Did both parties fully perform?

9.3

Conditions

Triggering condition

Conditions precedent

Concurrent conditions

Conditions subsequent

9.4

Title

Discuss the following terms: Title Identified goods Uncertificated rights Endorsement Commercial paper

9.5

Title

Discuss the following terms: Trusted and reliable third party intermediaries Documents of title Bailees Bills of lading and warehouse receipts Warranty of title

9.6

Risk of Loss

Insurable interest

Mercantile terms FOB, FAS, CIF, C&F, Ex-Ship

Sale on approval

Sale or return

9.7

Third Party Beneficiaries

Obligee

Obligor

Donee third-party beneficiary

Creditor third-party beneficiary

Incidental beneficiaries

9.8

Payment Systems

NotesNotes Promissory, installment, collateral,

mortgage Certificate of deposit

DraftsDrafts Check Time draft Sight draft Trade acceptance

Pay to: $

Harry Havalott852 ElmhurstAnytown, NM Date:

Dollars

Megabux National Bank

893

9.9

Requirements for Negotiability

In writing Signed by the maker or the drawer Contains unconditional promise to

pay Contains fixed amount of money Payable on demand or at a certain

time Payable to order or to bearer Must not contain anything else

9.10

Negotiation and Transfer

Issue

Delivery by transfers

NegotiationNegotiation by a holder

EndorsementEndorsement

9.11

Types of Endorsements

Blank

Special

Restrictive

Unqualified

Qualified

9.12

Negotiation and Transfer

Holder which becomes holder in due course

Shelter rule

Defenses Personal

Real

9.13

Liabilities of the Parties

Contract liability and warranty liability

PrimaryPrimary liability is for makers, drawers, and drawees

SecondarySecondary liability is for endorsers

EndorsersEndorsers become secondarily liable after payment is refused

9.14

International Sales Transactions

International documentary sales Open account Sight or time drafts

Letters of credit Buyer Issuing bank Letter of credit beneficiary Confirming bank

9.15

Electronic Payment Systems

Storehouse of value such as gold and silver

A medium of exchange… Must be widely available

Must be widely accepted

The public must have confidence in it

9.16

Types of Electronic Payment Systems

ATMs

Electronic bill payment and presentment

Automated clearing house facilities

Debit cards

Credit cards

Wholesale funds transfers

9.17Internet and Other (peer-to-peer)

Payments PayPal Electronic customer loyalty point

systems Electronic access and

manipulation of accounts Smart cards Escrow services

9.18

Questions & Discussion