Question

Brenda Carter borrowed $3,000 from Vincent Vega. Brenda wrote a note that stated “I Brenda Carter owe Vincent Vega $3,000 (three thousand dollars) & agree to pay him back in full. Signed on September 29, 2015.” Both Brenda and Vincent signed the bottom of the note. A year later Vincent filed a suit against Brenda to recover on the note, claiming that he had not been paid. Brenda admitted that she borrowed the money, but contended (without proof) that she paid Vincent in full. Is the note negotiable? Who is likely to win in the lawsuit, and why?

Answer 1

Once a negotiable instrument is paid, the fact that it has been paid should be apparent on the face of the instrument. If Brenda has paid, but has failed to record the payment on the face of the note, then the note is still negotiable. Brenda does not seem to be having any other proof to substantiate her claim.

Therefore, the note is negotiable, and the person who takes it bona fide and for value becomes a holder in due course, and Brenda does not have any action against such holder.

Vincent Vega is likely to win in the lawsuit, as his contention would be that the note has been dishonored by non-payment, and Brenda has nothing in her armory to prove otherwise. The note was an unconditional undertaking signed and issued by her to pay $ 3,000 to Vincent for value recived by her.