Endorsements, definition, allonge, kinds of endorsement, blank endorsement, special endorsement.

Endorsements, definition, allonge, kinds of endorsement, blank endorsement, special endorsement.

1. Dr.V.SAKTHIDEVI
Assistant Professor,
Department of Commerce (SF),
V.V.Vanniaperumal College for Women,
Virudhunagar

2. The word ‘endorsement’ can also be spelt
as indorsement. It is derived from the Latin
word ‘indorsum’, which means upon the
back.

3. Endorsement has been defined in sec 15 of
the Negotiable Instruments Act, 1881 as follows:
“When the maker or holder of a negotiable
instruments signs the same, for the purpose of negotiation,
on the back or face their of, or slip of paper annexed thereto
...

4. He is said to have endorsed the same and is
called the endorser”.
Generally, endorsement is made on the
backside of the instrument.

5. Ifthespaceavailableonthebacksideof
theNegotiableInstrumenthasbeencompletely
covered,Apieceofpapermaybeattachedtothe
instrumentandsubsequentEndorsementsmaybe
madeonthatpaper.Thispapersoattachediscalled
allonge.

6. According to the Negotiable instruments Act,
endorsements are of the following kinds:-
Blank Endorsement Sans FraisEndorsement
Special Endorsement FaculativeEndorsement
RestrictiveEndorsement Partial Endorsement
Conditional EndorsementPer-Pro Endorsement
Sans –recourseEndorsement

7. i)If the endorser signs his name only, this
endorsement is called blank endorsement.
ii) It does not specify any name of endorsee.
iii) Blank endorsement is also called as “General
endorsement”.

8. iv) That instrument with blank endorsement
becomes a “Bearer instrument”. It can be
Negotiated by mere delivery.

9. i)Iftheendorsermentionsthenameofthe
endorseeandputhissign,theendorsementiscalled
Specialendorsement.
ii)Specialendorsementisalsocalledasfull
endorsement.

10. Special Endorsement
iii) The instrument with full endorsement is
an order instrument.
iv)Aninstrumentwithablankendorsement
canbeconvertedintoaspecialendorsementbyan
holder.BySpecifyingthenameofanendorseeand
puttinghissign.
Ex: Pay to Siva
-Yogesh

11. Restrictive Endorsement
i) A Restrictive endorsement is one which limits the further
negotiation of the instrument. The endorsee in such cases can not
further endorse it.
ii) Generally, the word “Only” is added after the endorsee’s
name.
Ex; Pay to sivaonly
-Yogesh

12. i)Conditionalendorsementisalsocalled
asqualifiedendorsement.
ii)Anendorsementwithaconditioniscalled
conditionalendorsement.Theendorseecangetthe
money
Ex:Paytosivaifhemarriesseethawithinone
month.
-Yogesh

13. Sans –Recourse Endorsement
i) Sans Recourse means without liability.
ii) Sans Recourse endorsement limits the liability of
the endorser. So this endorsement renders the endorser free
from all liability to any subsequent holder.
Ex: Pay to sivawithout recourse to me
-Yogesh

14. Sans FraisEndorsement
i)Sansfraismeanswithoutexpenses.
ii)InSansfraisendorsementtheendorseraccepts
hisliabilityfortheamountoftheinstrument,buthedoes
notwantanyadditionalexpenseslikenothingchargesto
bebornebyhim
Ex:PaytoSiva,Withoutexpensetome.
-Yogesh

15. Facultative endorsement
It is an endorsement whereby, the endorser waives
some of his rights on the instruments.
Ex: Pay to siva, notice of dishonourwaived.
-yogesh

16. Partial endorsement
i) If only a part of the amount of the instrument is
endorsed it is called partial endorsement.
ii) Partial endorsement is not valid
Ex: A Chequefor Rs.500 is endorsed but
Pay to sivaRs.100 /-only
-Yogesh

17. Per Pro Endorsement
i) It is an endorsement made by an authorised agent of
the endorser.
ii) Prior information about the delegation of authority to
the agent must have been given to the banker. Otherwise
the banker is not legally bound to accept this type of
endosement.

18. Thank you