What is the difference between Lien and Pledge?
Basically, lien and pledge are forms of the right to retain goods for the same purpose i.e. both are security interest options for payment of a debt. Though they look identical; there are certain differences which this article identifies herein. Lien: Lien is akin to bailment. It is the right to retain goods or securities…
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Difference between Assignment and Negotiation
An assignment is when the rights, title, and interest in debts due or accruing due to a person are transferred to another person. The debts which are sought to be assigned may be present, future, conditional or contingent charge by way of assignment can be created under actionable claim. Transfer of Life Insurance Policy, National…
Read article What is the effect of “not negotiable” mark on a cheque?
Section 130 of Negotiable acts 1881 provides that ‘a person taking a cheque crossed generally or specially bearing in either case the words ‘not negotiable’ shall not have and shall not be capable of giving a better title to the cheque than that which the person from whom he took it had’. According to above…
Read article Paying banker’s responsibilities
The section 85(1), 85(2), 128 of negotiable instrument acts provide statutory protection to paying banker for making payments of order cheque, bearer cheque or crossed cheque in that order. Payment of order cheque Section -85(1) of N.I.Acts 1881 provides that “Where a cheque payable to order purports to be endorsed by or on behalf of…
Read article What is ‘better title to Holder in due course’?
The difference between the rights of ‘Holder’ and ‘Holder in due course’ is that the holder in due course gets a better title than the person from whom he acquired the title as he holds the instrument free from any defect of title of prior parties. For example, a stolen cheque was negotiated by the…
Payment in due course – explained
Sec 10 of the Negotiable Instrument Act defines ‘Payment in due course” as ‘payment in accordance with the apparent tenor of the instrument in good faith and without negligence to any person in possession thereof under circumstances which do not afford a reasonable ground for believing that he is not entitled to receive payment of…
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