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LAW-2589 Commercial Paper
Prof. Stephen Michael McJohn,
3 credits day; 3 credits evening.
This course provides extensive coverage of post-revision Articles 3, 4, and 4A of the Uniform
Commercial Code. Coverage of related areas such as law of credit cards, electronic funds
transfers, Federal Reserve Board Regulations CC and J, and Internet payment systems is
provided through cases and problems. Electronic payment system including the UNCITRAL
draft model law on electronic funds transfers will be explored.
Faculty comments
: This course covers the law of payment systems: checks, notes, credit cards,
debit cards, wire transfers, and letters of credit. In commercial transactions, sellers want to be
paid and buyers are willing to pay – if they get what’s promised. The course addresses how
lawyers structure transactions to allocate risks between the parties. The class combines
discussion of the legal materials and problem analysis, with class slides that provide an outline of
the material, with some images related to the cases and problems. Class participation is not
graded. There is an exam, which may vary in format from year to year.
Student participation is expected and enabled by assignments each week. This course covers
electronic-based as well as paper-based payments systems. Students are also given some basic
background in UCC Article 9 in the ways it interacts with UCC Articles 3 and 4. Attention is
given to topics covered on the Massachusetts and other state bar examinations in commercial
paper.
There is a limited open book. Students may bring their UCC Codebook into the examination with
annotations. The examination is half multiple choice and half-essay modeled after the bar
examination. This course features several in class practice examinations during class. Papers are
not collected but the answers discussed in class.
Students are given a bump of a half letter grade for extraordinary participation. The areas of
particular focus are UCC Article 3 and 4 topics such as credit enhancement by guaranty,
protection for guarantors, transfer and enforcement of negotiable instruments, holders in due
course, special rules for checking losses, and very recent developments in Regulation CC and the
federalization of commercial paper law by the Federal Reserve Board. I use extensive diagrams
and study aids to help students master the subject. I also use frequent reviews to reinforce the
subject.
Elective Course
Meets Base Menu Requirement
Meets Financial Services Concentration Requirements
Recommended for the Mass Bar
Final Exam Required
<<Course Updated: March 22, 2016>>