Essentials of a valid bill of exchange

Describe five essentials of a valid bill of exchange

Essentials of a valid bill of exchange

• It must contain certain parties;-all three must be certain.
• It must be signed by the drawer – The instrument will be complete only when it is signed by the drawer.
• Addressed by one person to another.
• The sum is payable to a specified person, his order or the bearer.
• It must be in writing – A bill of exchange cannot be oral.
• It must contain an express order to pay – This feature of a bill of exchange distinguishes it from a promissory note.
• The order to pay must be unconditional – The order to pay should not depend upon a condition i.e. not a request.