Demand Note Presented Immediately
Pacific Bank issues a promissory note to Portia Price that contains no maturity date. Price presents the note for payment the next day. The bank must pay because the instrument carries no stated time for payment.
Also known as: pays on demand · paid on demand · paying on demand · payable on demand · demand payment
Written by attorneys · grounded in primary & secondary sources — see below
A feature of a promise or order on a negotiable instrument that permits the holder to require payment at any time. The feature exists when the instrument states it is payable on demand or at sight, indicates payment at the holder's will, or states no time of payment.
Pacific Bank issues a promissory note to Portia Price that contains no maturity date. Price presents the note for payment the next day. The bank must pay because the instrument carries no stated time for payment.
Patricia Patel holds a note from Pablo Perez that states it is payable on demand. Patel makes proper presentment on Monday. Perez refuses to pay that day. The note is dishonored and Patel may pursue enforcement remedies.
Phuong Pham executes a note to Pamela Phillips that is payable ninety days after issuance. The due date arrives and Pham fails to pay. The note is dishonored because it is not payable on demand and payment was not made when it became due.
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Phoebe Park sells equipment to Pulse Media under a contract calling for payment of the price on demand. Park sues for the price without first requesting payment. The court allows recovery because the demand language merely fixes the start of interest accrual and is not a condition precedent to suit.
An instrument payable on demand becomes overdue at the earliest of the times specified in UCC § 3-304(a).
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A demand note may be sued upon without prior presentment when the quoted language merely fixes the time after which interest begins to run.
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A limited partner who extends a demand loan stands in the same position as any nonpartner unsecured creditor and may enforce the note under ordinary debtor-creditor rules.
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The instrument is dishonored and the holder may pursue the maker or other parties liable on the instrument.
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