The instrument is both a promissory note and a bearer note. It is lawfully and theoretically negotiable. An instrument with two parties, and in which one of the parties has promised full reimbursement of dues, is known as a promissory note. The two parties are usually the payee and the maker. The maker acknowledges promise to pay a given amount of money under conclusive circumstances to the payee (Markovic, Matic and Karacic, 2007). In this instrument, Phoebe acts as the maker while Quint or bearer is the payee. Phoebe acknowledges promise to pay $ 600 under conclusive circumstances to Quint, making this instrument a promissory note. A note payable to a particular payee is known as a bearer note. In this case, the instrument qualifies to be a bearer note because it is payable to Quint who is the bearer (Legalzoom, 2009).
For an instrument to be negotiable, it must be documented and must contain the maker’s signature. Additionally, it must indicate that the maker is not restricted to pay. In other words, the promise to pay must be unconditional. The instrument must also state clearly, the amount of money that the maker promises to give to the bearer as well as the repayment plan. It also has to clarify that the stated amount of money is payable to the bearer (Jordan, 2009).
This instrument meets all the above stated requirements and is therefore negotiable and enforceable. It is hand-written and contains Pheobe’s signature. The note indicates that Pheobe is not restricted in any way to pay. That is, Pheobe’s promise is unconditional. This instrument states clearly that Pheobe promises to pay $ 600 to Quint or bearer. The repayment plan has also been included and it is ‘on demand’ to the bearer.
A promissory note functions as a security instrument between the maker and the bearer. It provides the maker and the bearer with an opportunity to understand their rights on claims because promissory notes are established by lawyers. This instrument can serve as legal document if its contents are not met as stated. It compels Pheobe to pay Quint or bearer $ 600 on demand without fail. Even though this instrument is just a simple envelope, it is an official document that holds Pheobe accountable for what she has written (Markovic, Matic and Karacic, 2007).
In conclusion, this instrument is a promissory note because it has a maker, Pheobe, who promises to repay a specific amount of money, $ 600, to the payee, Quint. It also qualifies to be a bearer note because it is payable to the bearer. The instrument is a negotiable because it meets all the requirements of a negotiable instrument. Being a promissory note, this instrument acts as a security for the bearer. Additionally, it is an official legal document that is regulated by law. It enables the maker to fulfill his promises and the bearer to demand his or her rights in case the instrument’s contents are not met. It can however be said that this instrument is an abstract because the real nature of legal relationship between the maker and the bearer is not specified.