Kentucky Revised Statutes

Ky. Rev. Stat. § 355.3-104 (2026)

Negotiable instrument

✓ current as of May 2026

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(1) Except as provided in subsections (3) and (4) of this section, "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, but the promise or order may contain:

1. An undertaking or power to give, maintain, or protect collateral to secure payment;

2. An authorization or power to the holder to confess judgment or realize on or dispose of collateral;

3. A waiver of the benefit of any law intended for the advantage or protection of an obligor;

4. A term that specifies the law that governs the promise or order; or

5. 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) of this section, except paragraph (a) of that subsection, and otherwise falls within the definition of "check" in subsection (6) of this section is a negotiable instrument and a check.

(4) 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 article.

(5) (a) An instrument is a "note" if it is a promise and is a "draft" if it is an order.

(b) If an instrument falls within the definition of both "note" and "draft," a person entitled to enforce the instrument may treat it as either.

(6) (a) "Check" means:

1. A draft, other than a documentary draft, payable on demand and drawn on a bank; or

2. A cashier's check or teller's check.

(b) 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:

(a) On another bank; or

(b) Payable at or through a bank.

(9) "Traveler's check" means an instrument that:

(a) Is payable on demand;

(b) Is drawn on or payable at or through a bank;

(d) Requires, as a condition to payment, a countersignature by a person whose specimen signature appears on the instrument.

(10) (a) "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.

(b) A certificate of deposit is a note of the bank. Effective: January 1, 2025 History: Amended 2024 Ky. Acts ch. 10, sec. 20, effective January 1, 2025. -- Repealed and reenacted 1996 Ky. Acts ch. 130, sec. 4, effective January 1, 1997. -- Created 1958 Ky. Acts ch. 77, sec. 3-104, effective July 1, 1960.

Notes of Decisions

Cited in 19 cases, 1968–2020 · leading case: Schmuckie v. Alvey, 758 S.W.2d 31 (Ky. 1988).

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Schmuckie v. Alvey, 758 S.W.2d 31 (Ky. 1988). · cites it 4× “[2] KRS 355.3-104. If the instrument is "subject to or governed by another agreement," its negotiability is destroyed, and the determination of whether an instrument is unconditional must be made from the content of the instrument itself.”

White v. Check Holders, Inc., 996 S.W.2d 496 (Ky. 1999). · cites it 2× “See KRS 355.3-104(5). Thus, in an abundance of caution, we will resort to rules of statutory construction to supplement our analysis.”

First Commonwealth Bank of Prestonsburg v. West, 55 S.W.3d 829 (Ky. Ct. App. 2000). “]” KRS 355.3-104(1). A mortgage, while it may provide security for a negotiable instrument, is not a negotiable instrument.”

Farmers Bank & Trust Co. v. Brazell, 902 S.W.2d 830 (Ky. Ct. App. 1995). · cites it 2× “KRS 355.3-104(1). Therefore, the party who possessed them could negotiate them.”

Farmers Coop. Livestock Mkt., Inc. v. Second Nat'l Bank of London, 427 S.W.2d 247 (Ky. Ct. App. 1968). “Since it was drawn on the ap-pellee bank it was a check as defined in KRS 355.3-104(2) (b), but the important thing is that it was a demand draft.”

Am. Express Travel Related Servs., Inc. v. Kentucky, 597 F. Supp. 2d 717 (E.D. Ky. 2009). “§ 355.3-104. A purchase of a traveler’s check is, in effect, a deposit with the financial institution issuing the check.”

In Re Noffsinger, 316 B.R. 283 (Bankr. W.D. Ky. 2004). “Presentment is likewise defined in KRS 355.3-501, a “demand made by or on behalf of a person entitled to enforce an instrument.”

Alliant Tax Credit Fund 31-A, Ltd. v. Nicholasville Cmty. Hous., LLC, 663 F. Supp. 2d 575 (E.D. Ky. 2009). “Additionally, KRS 355.3-104 and KRS 355.4-104 defining “negotiable instrument” have little bearing on the broader term “instrument.”

Beaumont v. Zeru, 460 S.W.3d 904 (Ky. 2015). “” KRS 355.3-104(6)(a). “[I]f a ... check is taken for an obligation, the obligation is suspended to the same extent the obligation would be discharged if an amount of money equal to the amount of the instrument were taken, .”

Brooks v. United Kentucky Bank, 659 S.W.2d 213 (Ky. Ct. App. 1983). “KRS 355.3-104(l)(b), (c), (d). The agreement signed by appellant does not specify a “sum certain,” since it provides only that the guarantor’s liability “shall not exceed” $50,000.”

Shockley v. United Parcel Serv., Inc., 664 S.W.2d 523 (Ky. Ct. App. 1983). “KRS 355.3-104 defines a check to be a negotiable instrument if it is a draft drawn on a bank and payable on demand.”

Ronny L. Stamper v. Cmty. Fin. Servs. Bank, F/D/B/A Bank of Benton (Ky. 2019). · cites it 11× “The Court of Appeals acknowledged this in its opinion but concluded that the trial court applied the incorrect law when determining the statute of limitations issue.”

Show all 19 citing cases →

— Ky. Rev. Stat. § 355.3-104(1) — 5 cases

Farmers Bank & Trust Co. v. Brazell, 902 S.W.2d 830 (Ky. Ct. App. 1995). “KRS 355.3-104(1). Therefore, the party who possessed them could negotiate them.”

Frazier v. Commonwealth, 613 S.W.2d 423 (Ky. 1981).

Ronny L. Stamper v. Cmty. Fin. Servs. Bank, F/D/B/A Bank of Benton (Ky. 2019). “The Court of Appeals acknowledged this in its opinion but concluded that the trial court applied the incorrect law when determining the statute of limitations issue.”

Cmty. Fin. Servs. Bank F/D/B/A Bank of Benton v. Ronny L. Stamper (Ky. 2019).

— Ky. Rev. Stat. § 355.3-104(2) — 1 case

— Ky. Rev. Stat. § 355.3-104(2)(c) — 1 case

Farmers Bank & Trust Co. v. Brazell, 902 S.W.2d 830 (Ky. Ct. App. 1995). “KRS 355.3-104(1). Therefore, the party who possessed them could negotiate them.”

— Ky. Rev. Stat. § 355.3-104(5) — 1 case

White v. Check Holders, Inc., 996 S.W.2d 496 (Ky. 1999). “See KRS 355.3-104(5). Thus, in an abundance of caution, we will resort to rules of statutory construction to supplement our analysis.”

— Ky. Rev. Stat. § 355.3-104(6)(a) — 2 cases

White v. Check Holders, Inc., 996 S.W.2d 496 (Ky. 1999). “See KRS 355.3-104(5). Thus, in an abundance of caution, we will resort to rules of statutory construction to supplement our analysis.”

— Ky. Rev. Stat. § 355.3-104(l)(a) — 2 cases

Fed. Land Bank of Louisville v. Hardin-Mapes Coal Corp., 817 S.W.2d 225 (Ky. 1991).

Commonwealth v. Gilbert, 768 S.W.2d 62 (Ky. Ct. App. 1989).

— Ky. Rev. Stat. § 355.3-104(l)(b) — 1 case

— Ky. Rev. Stat. § 355.3-104(l)(c) — 2 cases

Cmty. Fin. Servs. Bank F/D/B/A Bank of Benton v. Ronny L. Stamper (Ky. 2019).

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