Legal Representative
A Legal Representative is a person who legally inherits the property of a deceased person or who represents the estate of such a person. The legal representative is entitled to recover the amount of the instrument due to the deceased, and such a legal representative may also give a valid discharge.
In this case, Section 29 of the Negotiable Instrument establishes that “a legal representative of a deceased person who signs his name on a promissory note, bill of exchange, or cheque is personally liable thereon unless he expressly limits his liability to the extent of the assets received by him as such. He may also exclude him from liability by adding the word ‘without recourse on without recourse to one personally’ on the instrument. In case he fails to do so, he shall be personally liable.” Even in a case where the payee is a dead person, in ignorance of his death, the legal representative can enforce such a payment. Even a notice of dishonor can be given to a legal representative.
Capacity of Parties under Negotiable Instruments Act
A negotiable instrument is a signed document that promises a particular payment to a specified person or holder of the instrument. In India, negotiable instruments are governed under the umbrella of the Negotiable Instruments Act, 1881. This is a significant law that governs all means of negotiable instruments in India. The act establishes a regulatory framework for promissory notes, bills of exchange, and cheques. The act was enacted to provide uniform legal regulations to cover all aspects of negotiable instruments in India. Several times, the act has been amended to make sure that it is in line with changing business practices and new judgments.
According to Section 26 of the Negotiable Instruments Act, 1881, “Every person capable of contracting, according to the law to which he is subject, may bind himself and be bound by the making, drawing, acceptance, endorsement, delivery, and negotiation of a promissory note, bill of exchange, or cheques.” However, a minor may draw or endorse any instrument, and this will bind all parties except himself.
Geeky Takeaways:
- A negotiated instrument is a signed document that promises a particular payment to a specified person or holder of the instrument.
- The Negotiable Instruments Act, 1881 is the governing act to provide a regulatory framework for all types of negotiable instruments.
- It is important to understand the capacity of the parties while making, drawing, accepting, and endorsing any negotiable instrument, as the rights, obligations, and eligibility differ from case to case.
- The capacity to incur liability as a party to a bill has the same scope as in the case of the capacity to contract.
Table of Content
- Capacity of Parties under Negotiable Instruments Act, 1881
- 1. Minor
- 2. Insolvent
- 3. Joint Stock Company
- 4. Agent
- 5. Legal Representative
- Conclusion
- Frequently Asked Questions (FAQs)