In commercial usage the term bill, or bill of exchange, is practically synonymous with the draft or accepted draft. Where the words notes, drafts, and bills of exchange are used, the term "notes" covers direct obligations between persons of the kind already referred to; the term "drafts" usually means orders drawn upon a bank or by one bank upon another, while the term "bills," or bills of exchange, is used to include drafts, whether accepted or unaccepted, growing out of transactions in goods.

Lawyers usually apply to the economic class of credit instruments the term "negotiable paper." Negotiable paper is not exactly identical with credit instruments, the concept of the lawyer being rather different from that of the economist or of the individual business man. Works on legal relationships and commercial paper usually state that there are to be included under the term "negotiable instruments," or "negotiable paper," checks, drafts, and bills, the last named being either accepted or unaccepted. Negotiability is defined by lawyers as the power to transfer title absolutely and without the necessity of notice incurring liability on the part of the recipient. For example, if A gives B a check, B may indorse the check and transfer it to C ,who may then cash it without paying any attention to the question whether B had come by the instrument lawfully or whether he was indebted to others who may have been conceived to have a prior claim or not.

The parties to negotiable paper are said to be the maker or drawer, the drawee, and the various 3indorsers. Thus if A borrows $500 from B and gives B a note for $500, A is the maker of the note which evidences the transaction. If, however, B draws on A for $500, B is the maker or drawer of the draft and A is the drawee. If B then accepts the draft he is the acceptor. A party who comes into possession of an instrument before its maturity through legitimate means, and with the belief in its legality, is known as the "bona-fide holder" or "holder in due course."