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Banking Law
Copyright 2017, Matthew Bender & Company, Inc., a member of the LexisNexis Group.

5-115 Banking Law 115.syn


Transfer and Negotiation


Professor Dennis Lassila;Kenneth M. Lapine, Esq., Partner, Roetzel Andress, Cleveland, Ohio;Burton V. McCullough, Esq., Los Angeles, California;Paul S. Pilecki, Esq., Partner, Winston & Strawn, Washington, D.C.;Harold Weisblatt, Esq., Murrieta, California

Chapter Summary


This chapter covers the three principal ways a transferor can transfer a negotiable instrument under the Uniform Commercial Code: negotiation, assignment, or operation of law. It discusses how transfers are made, the requirements of a valid transfer, the legal consequences resulting from a transfer, what constitutes a negotiation, what an indorsement must consist of, the proper location of an indorsement on the instrument, bearer and order indorsements, indorsement in blank and special indorsements, the right of a depository institution to supply a missing indorsement, indorsement by representation, the proper mode of indorsement where there are multiple payees, and how an instrument that is payable to a named person with words describing the person as an agent or officer of a specific person is paid.

In addition, this chapter covers the proper manner of indorsement when the name of the person to whom the instrument is payable is misspelled or wrongly designated; the effect of words of assignment, guarantee, condition, or waiver on a transfer; the meaning, effect, and mechanics of a qualified indorsement; the meaning and effect of a restrictive indorsement, as well as the rights, liabilities, and discharge of parties to a restrictive indorsement transaction; the effect of an instrument's rescission; and the rights of a prior party who reacquires an instrument.

Throughout the discussion of transfer and negotiation, this chapter provides informative compliance notes, helpful hints, and fact-specific examples that address real-world transfer scenarios.

Banking Law provides an in-depth analysis of all aspects of banking law and includes detailed discussions of the statutes and regulations governing banks and other financial intermediaries. It covers the organization, operation, examination, regulation, powers, and liquidation of commercial banks; the legal requirements regarding structural changes; the operations of commercial banks; the examination of commercial banks by federal regulatory agencies; and the impact of the federal income tax and the security laws on banks. It consolidates this vast body of law into one comprehensive treatise that is an essential tool for the banking law practitioner.


Banking law,Uniform Commercial Code,UCC,negotiable instruments,negotiation,assignment,operation of law,transfer of negotiable instruments,negotiable instrument transfers,indorsement,bearer indorsement,order indorsement,indorsement in blank,special indorsement,missing indorsement,indorsement by representation,multiple payee indorsement,misspelled indorsor,wrongly designated indorsor,guarantee,condition,waiver,qualified indorsement,restrictive indorsement,rescission of instrument,reacquisition of instrument


Chapter 112 covers the characteristics of checks and other negotiable instruments. Chapter 113 discusses the issuance and delivery of negotiable instruments. For discussion of the signature requirement, please see Chapter 114. For treatment of unauthorized signatures and alterations, please refer to Chapter 124.


For discussion of secured lending transactions, specialized collateral and reorganizations, and other legal and financial issues, including loan workouts, see CommercialFinance Guide (Matthew Bender).

For analysis of commercial loan documentation and the innovations occurring in institutional lending, see Commercial Loan Documentation Guide (Matthew Bender).

For discussion of the controlling law and expert analysis of letters of credit, see Letters of Credit (Matthew Bender).
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