Promissory Notes

A promissory note is a written promise to pay a specified sum of money. At the time of the note's issue, that is, when signed and delivered, two parties are connected with it: the maker and the payee. The maker is the person who signs or promises to pay the note, and the payee is the person to whom or to whose order the note is made payable.

Negotiable in a commercial sense means transferable and a negotiable note is a note which can be transferred from one person to another. A note to be made negotiable must contain the word order or the word bearer, that is, it must be payable either to bearer or to the order of the payee.

A non-negotiable note is payable to a particular person only.

A note may be written on any kind of paper in ink or in pencil.

Date of a Note. The date of a note is a matter of the first importance. Some bankers and business men now consider it better to draw notes and time drafts payable at a certain fixed time; as, "I promise to pay on the 10th of March,1912." The common custom, however, is to make notes payable a certain number of days or months after date. A note made and issued on Sunday is void.

The day of maturity is the day on which a note becomes legally due. In most of the states a note is not legally due until three days, called days of grace, after the expiration of the time specified in the note.

The words, "without defalcation" are inserted in Pennsylvania notes.