All checks are three-party instruments,but not all three-party instruments are checks.

Question

Quizplus · Accepted Answer

This statement is true. All checks are three-party instruments because they involve three parties: the drawer (person writing the check), the payee (person receiving the payment), and the bank (or financial institution processing the payment). However, not all three-party instruments are checks, as there are other types of negotiable instruments (such as promissory notes and bills of exchange) that may involve three parties as well.

All Checks Are Three-Party Instruments,but Not All Three-Party Instruments Are