Any instrument that does not meet the formal requirements for negotiability will be treated as a simple contract rather than a negotiable instrument.

Question

Quizplus · Accepted Answer

This statement is true. In order for an instrument to be considered negotiable, it must meet certain formal requirements outlined in the Uniform Commercial Code (UCC). If an instrument does not meet these requirements, it will be treated as a simple contract instead of a negotiable instrument.

Any Instrument That Does Not Meet the Formal Requirements for Negotiability