Discuss the following:
South Carolina Insurance Co. issued a draft to Kelvin Owens drawn on the account of Seibels, Bruce Group at South Carolina National Bank. Owens regotiated the draft to First National Bank of Denham Springs, which paid him the entire amount and delivered it to South Carolina National Bank. The insurance company alleged fraud in Owens's claim and issued a stop-payment order. South Carolina National Bank did not honor the draft. The draft stated it was payable as follows: "Upon acceptance, pay to the order of Kelvin Ownes." South Carolina Insurance Co. was a wholly owned subsidiary of Seibels, Bruce Group. Therefore, South Carolina was both drawer and drawee. First National sued South Carolina for payment. South Carolina said the words "upon acceptance" made the draft conditional and therefore the draft was not negotiable; First National was not a holder in due course; and the defense of fraud could be raised. Was the draft conditional? [First National Bank of Denham Springs v. South Carolina Insurance Co.