On July 1, 2015, ROE executed a negotiable Promissory Note for $4,000.00 to DOE,

Question

On July 1, 2015, ROE executed a negotiable Promissory Note for $4,000.00 to DOE, payable on November 1, 2015, in exchange for a car that DOE sold him. DOE negotiated the Note to PETE SMITH on August 1, 2015, in exchange for SMITH replacing DOE's roof. SMITH'S work was faulty and SMITH knew it. On August 5, 2015, SMITH negotiated the Note to WILSON as a gift. On September 12, 2015, WILSON negotiated the Note to JONES as a gift. On November 1, 2015, JONES presented the Note to ROE for payment. ROE refused to pay. On November 3, 2015, JONES notified WILSON of the dishonour. On November 5, 2015, WILSON notified SMITH of the dishonour. On November 9, 2015, SMITH notified DOE of the dishonour. What are JONES' chances to get payment from ROE? Explain fully. What are JONES" chances of getting payment from WILSON, SMITH, or DOE? Explain fully

Explanation / Answer

1.

The negotiable promissory note is made by the maker (a person who promises to pay the amount) and provided to payee or holder (to whom the amount must be paid). The terms and conditions of the promissory note vary from case to case. In this case, it is evident that the promissory note has passed on many hands and finally, rested in the hands of Jones. The simple criteria of the promissory note is to pay amount to the person who provides the note, provided that specific terms has to be made between the maker and the payee. In that case, Jones is eligible to collect the payment from ROE and in other case, Jones is eligible to gain his payment from Wilson, who has issued him the note in interest of the payment from ROE.

Moreover, the date on which the note was presented was the due date on which ROE agreed to make payment on the promissory note made. Even from that perspective, Jones is eligible for collection of payment.

2.

Jones holds the complete right of acquiring the payment from Wilson, who has exchanged the note as a gift. As discussed above, the rights of the other persons are limited as per the provisions that are determined while making a promissory note. The liability of all the persons in payment to Jones is low when compared to Wilson, who has issued the note and ROE, who is the maker of the note and promised to pay the amount by Nov 1st, 2015 – which is the same day Jones had presented it for payment.

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