40Transfer of cheque by negotiation

40 Transfer of cheque by negotiation

(1) The transfer of a cheque by negotiation is the transfer of the cheque from the holder to another person in such manner as to constitute the other person the holder. (2) A cheque payable to order is transferred by negotiation if: (a) it is indorsed by the holder; and (b) the cheque is delivered so as to complete the contract arising out of the indorsement. (3) A cheque payable to bearer is transferred by negotiation if it is delivered by the holder to another person (whether or not the cheque is indorsed by the holder).