Negotiable documents are written documents that represent a certain right and enable the exercise of that right. The owner of the valuable document is the person holding the document. If the valuable document is lost or stolen, the owner's right is also in danger. For this reason, it is important to protect and transfer valuable papers.
Some features of negotiable documents are:
- Negotiable documents should be arranged in accordance with the form and content rules determined by law. Otherwise, it will not be considered valid.
- Negotiable documents are the only proof of the right written on it. The existence and scope of the right depends on the negotiable instrument.
- Valuable documents allow the transfer of the right. When a valuable document changes hands, the owner of the right also changes.
- Valuable documents facilitate the exercise of the right. Upon submission of the valuable document, the right owner can take his receivable or demanded performance.
The types of negotiable instruments can be classified as follows:
- Debt bonds: These are the valuable documents in which the debtor undertakes to pay a certain amount of money to the creditor. For example; such as bills, bills, checks.
- Bills of Rights: These are the negotiable instruments that ensure the delivery or performance of a particular good or service. For example; such as stocks, bonds, coupons.
- Bonds of guarantee: These are valuable documents that guarantee the payment of a debt. For example; such as a mortgage, a pledge.
Negotiable instruments law includes the rules regarding the issuance, transfer, use and cancellation of these documents. Negotiable instruments law plays an important role in increasing the confidence and speed of commercial life.