- Bills of lading and carriage of goods — Payment obligations of the buyer — Applicable law and transfer of title
This chapter focuses on the concept of negotiation and the transfer of certain negotiable instruments, such as bills of exchange, cheques, and promissory notes. These instruments are defined as negotiable because they are all subject to the special regime for transfer, or negotiation, that represents an exception to the rule that choses in action cannot be transferred at common law. The practice of indorsing bills of exchange as a means of transferring the right to payment from one merchant to another appears to have arisen in the seventeenth century. Prior to that, bills of exchange had represented a means by which two merchants could exchange credit balances standing to their name, typically in different cities or countries. The practice of indorsing bills changed this: now the holder was the beneficiary of the right to payment, even if not a party to the original exchange transaction.