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Demand Promissory Notes And Commercial Loans: Balancing Freedom Of Contract & Good Faith, George A. Nation Iii
Demand Promissory Notes And Commercial Loans: Balancing Freedom Of Contract & Good Faith, George A. Nation Iii
George A Nation III
Promissory notes are ubiquitous in commercial lending. The promissory note represents the borrowers promise to repay and is governed by the Uniform Commercial Code’s Article 3. Under Article 3, promissory notes are either demand instruments or time instruments. In general, the holder of a demand instrument may decide to demand payment at any time and for any reason, while the holder of a time note must wait for payment until the arrival of the specific repayment date or dates included in the note. For this reason, time notes usually contain an acceleration clause. An acceleration clause allows the holder to …