Chapter 403

403.103(2)(g) (g) “Check” — s. 403.104 (6).

403.103(2)(h) (h) “Consideration” — s. 403.303 (2).

403.103(2)(hr) (hr) “Demand draft” — s. 403.104 (11).

403.103(2)(i) (i) “Draft” — s. 403.104 (5).

403.103(2)(jg) (jg) “Endorsement” — s. 403.204 (1).

403.103(2)(jr) (jr) “Endorser” — s. 403.204 (2).

403.103(2)(k) (k) “Holder in due course” — s. 403.302 (1).

403.103(2)(L) (L) “Incomplete instrument” — s. 403.115 (1).

403.103(2)(m) (m) “Instrument” — s. 403.104 (2).

403.103(2)(ng) (ng) “Issue” — s. 403.105 (1).

403.103(2)(nr) (nr) “Issuer” — s. 403.105 (3).

403.103(2)(og) (og) “Negotiable instrument” — s. 403.104 (1).

403.103(2)(or) (or) “Negotiation” — s. 403.201 (1).

403.103(2)(p) (p) “Note” — s. 403.104 (5).

403.103(2)(qd) (qd) “Payable at a definite time” — s. 403.108 (2).

403.103(2)(qh) (qh) “Payable on demand” — s. 403.108 (1).

403.103(2)(qp) (qp) “Payable to bearer” — s. 403.109 (1).

403.103(2)(qt) (qt) “Payable to order” — s. 403.109 (2).

403.103(2)(r) (r) “Payment” — s. 403.602 (1).

403.103(2)(s) (s) “Person entitled to enforce” — s. 403.301.

403.103(2)(t) (t) “Presentment” — s. 403.501 (1).

403.103(2)(u) (u) “Reacquisition” — s. 403.207.

403.103(2)(v) (v) “Special endorsement” — s. 403.205 (1).

403.103(2)(w) (w) “Teller’s check” — s. 403.104 (8).

403.103(2)(xg) (xg) “Transfer of instrument” — s. 403.203 (1).

403.103(2)(xr) (xr) “Traveler’s check” — s. 403.104 (9).

403.103(2)(y) (y) “Value” — s. 403.303 (1).

403.103(3) (3) The following definitions in other chapters apply to this chapter:

403.103(3)(a) (a) “Bank” — s. 404.105 (1).

403.103(3)(b) (b) “Banking day” — s. 404.104 (1) (c).

403.103(3)(c) (c) “Clearinghouse” — s. 404.104 (1) (d).

403.103(3)(d) (d) “Collecting bank” — s. 404.105 (2).

403.103(3)(e) (e) “Depositary bank” — s. 404.105 (3).

403.103(3)(f) (f) “Documentary draft” — s. 404.104 (1) (f).

403.103(3)(g) (g) “Intermediary bank” — s. 404.105 (4).

403.103(3)(h) (h) “Item” — s. 404.104 (1) (i).

403.103(3)(i) (i) “Payer bank” — s. 404.105 (5).

403.103(3)(j) (j) “Suspends payments” — s. 404.104 (1) (L).

403.103(4) (4) In addition, ch. 401 contains general definitions and principles of construction and interpretation applicable throughout this chapter.

403.103 History History: 1995 a. 449; 2003 a. 86; 2009 a. 320.

403.104 403.104 Negotiable instrument.

403.104(1) (1) Except as provided in subs. (3) and (4), “negotiable instrument” means an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order, if all of the following apply:

403.104(1)(a) (a) It is payable to bearer or to order at the time that it is issued or first comes into possession of a holder.

403.104(1)(b) (b) It is payable on demand or at a definite time.

403.104(1)(c) (c) It does not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money, but the promise or order may contain any of the following:

403.104(1)(c)1. 1. An undertaking or power to give, maintain or protect collateral to secure payment.

403.104(1)(c)2. 2. An authorization or power to the holder to confess judgment or realize on or dispose of collateral.

403.104(1)(c)3. 3. A waiver of the benefit of any law intended for the advantage or protection of an obligor.

403.104(2) (2) “Instrument” means a negotiable instrument.

403.104(3) (3) An order that meets all of the requirements of sub. (1), except sub. (1) (a), and otherwise falls within the definition of check in sub. (6) is a negotiable instrument and a check.

403.104(4) (4) A promise or order other than a check is not an instrument if, at the time that it is issued or first comes into possession of a holder, it contains a conspicuous statement, however expressed, to the effect that the promise or order is not negotiable or is not an instrument governed by this chapter.

403.104(5) (5) An instrument is a note if it is a promise and is a draft if it is an order. If an instrument falls within the definition of both note and draft, a person entitled to enforce the instrument may treat it as either.

403.104(6) (6) “Check” means a draft, other than a documentary draft, payable on demand and drawn on a bank or means a cashier’s check, teller’s check, or demand draft. An instrument may be a check even though it is described on its face by another term, such as money order.

403.104(7) (7) “Cashier’s check” means a draft with respect to which the drawer and drawee are the same bank or branches of the same bank.

403.104(8) (8) “Teller’s check” means a draft drawn by a bank on another bank, or payable at or through a bank.

403.104(9) (9) “Traveler’s check” means an instrument that is payable on demand, that is drawn on or payable at or through a bank, that is designated by the term “traveler’s check” or by a substantially similar term, and that requires, as a condition to payment, a countersignature by a person whose specimen signature appears on the instrument.

403.104(10) (10) “Certificate of deposit” means an instrument containing an acknowledgment by a bank that a sum of money has been received by the bank and a promise by the bank to repay the sum of money. A certificate of deposit is a note of the bank.

403.104(11) (11) 

403.104(11)(a) (a) Except as provided under par. (b), “demand draft” means a writing that is not signed by a customer, as defined in s. 404.104 (1) (e), that is created by a 3rd party under the purported authority of the customer for the purpose of charging the customer’s account with a bank, that contains the account number of that account, and that contains at least one of the following:

403.104(11)(a)1. 1. The customer’s name.

403.104(11)(a)2. 2. A notation that the customer authorized the demand draft.

403.104(11)(a)3. 3. The statement “No signature required,” “Authorization on file,” or “Signature on file,” or words to that effect.

403.104(11)(b) (b) “Demand draft” does not include a check drawn by a fiduciary, as defined in s. 403.307 (1) (a).

403.104 History History: 1995 a. 449; 2003 a. 86.

403.105 403.105 Issue of instrument.

403.105(1) (1) “Issue” means the first delivery of an instrument by the maker or drawer, whether to a holder or nonholder, for the purpose of giving rights on the instrument to any person.

403.105(2) (2) An unissued instrument, or an unissued incomplete instrument that is completed, is binding on the maker or drawer, but nonissuance is a defense. An instrument that is conditionally issued or is issued for a special purpose is binding on the maker or drawer, but failure of the condition or special purpose to be fulfilled is a defense.

403.105(3) (3) “Issuer” applies to issued and unissued instruments and means a maker or drawer of an instrument.

403.105 History History: 1995 a. 449.

403.106 403.106 Unconditional promise or order.

403.106(1) (1) 

403.106(1)(a) (a) Except as otherwise provided in this section, for the purposes of s. 403.104 (1), a promise or order is unconditional unless it states any of the following:

403.106(1)(a)1. 1. An express condition to payment.

403.106(1)(a)2. 2. That the promise or order is subject to or governed by another writing.

403.106(1)(a)3. 3. That rights or obligations with respect to the promise or order are stated in another writing.

403.106(1)(b) (b) A reference to another writing does not of itself make the promise or order conditional.

403.106(2) (2) A promise or order is not made conditional by a reference to another writing for a statement of rights with respect to collateral, prepayment or acceleration or because payment is limited to resort to a particular fund or source.

403.106(3) (3) If a promise or order requires, as a condition to payment, a countersignature by a person whose specimen signature appears on the promise or order, the condition does not make the promise or order conditional for the purposes of s. 403.104 (1). If the person whose specimen signature appears on an instrument fails to countersign the instrument, the failure to countersign is a defense to the obligation of the issuer, but the failure does not prevent a transferee of the instrument from becoming a holder of the instrument.

403.106(4) (4) If a promise or order at the time that it is issued or first comes into possession of a holder contains a statement, required by applicable statutory or administrative law, to the effect that the rights of a holder or transferee are subject to claims or defenses that the issuer could assert against the original payee, the promise or order is not thereby made conditional for the purposes of s. 403.104 (1); but if the promise or order is an instrument, there cannot be a holder in due course of the instrument.

403.106 History History: 1995 a. 449.

403.107 403.107 Instrument payable in foreign money. Unless the instrument otherwise provides, an instrument that states the amount payable in foreign money may be paid in the foreign money or in an equivalent amount in dollars calculated by using the current bank-offered spot rate at the place of payment for the purchase of dollars on the day on which the instrument is paid.

403.107 History History: 1995 a. 449.

403.108 403.108 Payable on demand or at definite time.

403.108(1) (1) A promise or order is payable on demand if any of the following applies:

403.108(1)(a) (a) It states that it is payable on demand or at sight, or otherwise indicates that it is payable at the will of the holder.

403.108(1)(b) (b) It does not state any time of payment.

403.108(2) (2) A promise or order is payable at a definite time if it is payable on elapse of a definite period of time after sight or acceptance or at a fixed date or dates or at a time or times readily ascertainable at the time that the promise or order is issued, subject to any of the following rights:

403.108(2)(a) (a) Prepayment.

403.108(2)(b) (b) Acceleration.