§ 41-03-04 — (3-104) Negotiable instrument

1. "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 it:
a. Is payable to bearer or to order at the time it is issued or first comes into
possession of a holder;
b. Is payable on demand or at a definite time; and
c. 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, except that
the promise or order may contain an undertaking or power to give, maintain, or
protect collateral to secure payment, an authorization or power to the holder to

confess judgment or realize on or dispose of collateral, a waiver of the benefit of
any law intended for the advantage or protection of any obligor, a term that
specifies the law that governs the promise or order, or an undertaking to resolve
in a specified forum a dispute concerning the promise or order.
2. "Instrument" means a negotiable instrument.
3. An order that meets all of the requirements of subsection 1 except subdivision a and
otherwise falls within the definition of "check" in subsection 6 is a negotiable
instrument and a check.
4. Notwithstanding subsection 1, a promise or order other than a check is not an
instrument if, at the time 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.
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", the person entitled to
enforce the instrument may treat it as either.
6. "Check" means a draft, other than a documentary draft, payable on demand and
drawn on a bank or 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".
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.
8. "Teller's check" means a draft drawn by a bank on another bank or payable at or
through a bank.
9. "Traveler's check" means an instrument that is payable on demand, is drawn on or
payable at or through a bank, is designated by the term "traveler's check" or by a
substantially similar term, and requires, as a condition to payment, a countersignature
by a person whose specimen signature appears on the instrument.
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.
11. "Demand draft" means a writing not signed by a customer that is created by a third
party under the purported authority of the customer for the purpose of charging the
customer's account with a bank. A demand draft must contain the customer's account
number and may contain any or all of the following:
a. The customer's printed or typewritten name.
b. A notation that the customer authorized the draft.
c. The statement "No Signature Required" or words to that effect.
A demand draft may not include a check purportedly drawn by and bearing the
signature of a fiduciary.