If an instrument fails to qualify as a negotiable instrument, it means that it could still be an enforceable contract, but the special rules regarding negotiable instruments do not apply.

Question

Quizplus · Accepted Answer

Negotiable instruments are governed by specific rules that facilitate their transfer and the rights of the parties involved. If an instrument does not meet the criteria to be considered a negotiable instrument, it can still be a valid and enforceable contract under general contract law, but it won't benefit from the special provisions and protections that apply to negotiable instruments.

If an Instrument Fails to Qualify as a Negotiable Instrument