Explanation
This is an acronym to help you remember the requirements for a Commercial Paper (i.e., the elements of a Negotiable Instrument). Each letter stands for one word, listed below.
- W = Writing
- O = On demand or at definite time
- O = Order or bearer
- P = Promise or Order to Pay
- S = Signed
- F = Fixed amount of money
- U = Unconditional
- N = No unauthorized undertakings or instructions
"SWUPFONO" is the same eight requirements (S-W-U-P-F-O-N-O), just reshuffled into a different, more pronounceable order.
Example: a personal check reading "Pay to the order of Jane Doe, exactly $500, payable on demand," dated and signed by John Smith, satisfies all eight requirements: it's a Writing (the check itself), payable On demand, to the Order of a named payee, an unconditional Promise to pay carried out by the bank, Signed by John Smith, for a Fixed amount ($500 exactly), Unconditional (no strings attached), with No extra unauthorized instructions.
Alternative mnemonics
- SWUPFONO