Payment in due course

Payment in due course is made at of after the maturity of a bill of exchange. If the bill is defective it is paid anyway (in good faith and without notice).

Payment in due course assumes that person that holds the right to receive payment is entitled to receive payment of the amount mentioned.

In order to satisfy payment in due course some conditions are to be met:

• payment must be in accordance with the apparent tenor of the instrument,
• payment must be made to a legally entitled person in good faith and without negligence,
• payment must be made only against presentation of the instrument for payment.

References

• Chau, P. Y., & Poon, S. (2003). Octopus: an e-cash payment system success story. Communications of the ACM, 46(9), 129-133.