The courts will never presume a negotiation of order paper was intended; the parties must clearly indicate a negotiation or else the courts will presume an assignment was intended.

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Courts can presume negotiation for order paper if it is endorsed and delivered properly, as negotiation is the typical method for transferring order papers, unlike bearer paper which does not require endorsement. The specific intentions for negotiation versus assignment must be clearly indicated, but the default assumption for order paper transfers can be negotiation if it meets the formal requirements.

The Courts Will Never Presume a Negotiation of Order Paper