This is the nature or the essence of accommodation.

DATE, VALUE, PLACE, SEAL, MONEY CURRENCY Accommodation Party (1991) (BANK)
is ABSENT
On June 1, 1990, A obtained a loan of P100th from B, payable not
later than 20Dec1990. B required A to issue him a check for that
amount to be dated 20Dec1990. Since he does not have any
SUGGESTED ANSWER:
checking account, A, with the knowledge of B, requested his
The fact that the instrument is undated and does not friend, C, President of Saad Banking Corp (Saad) to accommodate
mention the place of payment does not militate againsthim. C agreed, he signed a check for the aforesaid amount dated
its being negotiable. The date and place of payment are20Dec 1990, drawn against Saads account with the ABC
not material particulars required to make an instrument Commercial Banking Co. The By-laws of Saad requires that checks
negotiable.
issued by it must be signed by the President and the Treasurer or
the Vice-President. Since the Treasurer was absent, C requested
The fact that no mention is made of any consideration is the Vice-President to co-sign the check, which the latter reluctantly
not material. Consideration is presumed.
did. The check was delivered to B. The check was dishonored upon
(tan-awa page 48 sa ako book jums please sec.6)
presentment on due date for insufficiency of funds.
a. Is
Saad
liable
on
the
check
as
an
accommodation party?
b. If it is not, who then, under the above facts,
is/are the accommodation party?

Place of Payment (2000)

PN is the holder of a negotiable promissory note within theSUGGESTED ANSWER:

meaning of the Negotiable Instruments Law (Act 2031). The note
a. Saad is not liable on the check as an accommodation
was originally issued by RP to XL as payee. XL indorsed the note to
party. The act of the corporation in accommodating a
PN for goods bought by XL. The note mentions the place of
friend of the President, is ultra vires (Crisologo-Jose v CA
payment on the specified maturity date as the office of the
GR 80599, 15Sep1989). While it may be legally possible
corporate secretary of PX Bank during banking hours. ON maturity
for the corporation, whose business is to provide financial
date, RP was at the aforesaid office ready to pay the note but PN
accommodations in the ordinary course of business, such
did not show up. What PN later did was to sue XL for the face
as one given by a financing company to be an
value of the note, plus interest and costs. Will the suit prosper?
accommodation party, this situation, however, is not the
Explain. (5%)
case in the bar problem.
SUGGESTED ANSWER:
b. Considering that both the President and Vice-President
Yes. The suit will prosper as far as the face value of the note is
were signatories to the accommodation, they themselves
concerned, but not with respect to the interest due subsequent to
can be subject to the liabilities of accommodation parties
the maturity of the note and the costs of collection. RP was ready
to the instrument in their personal capacity.
and willing to pay the note at the specified place of payment on
the specified maturity date, but PN did not show up. PN lost his Parties; Accommodation Party (1998)
right to recover the interest due subsequent to the maturity of the
note and the costs of
Pedro nagbuhat ug note as accomodation party para kang X. Gi
hatag ni X kang Y. Maka kuha ba si Y kang Pedro? Kung bayaran ni
Accommodation Party (1990)
pedro ang note, ma singil ba niya si X?
To accommodate Carmen, maker of a promissory note, Jorge
signed as indorser thereon, and the instrument was negotiated to
Raffy, a holder for value. At the time Raffy took the instrument, heSUGGESTED ANSWER:
a. Yes. Y can recover from Pedro. Pedro is an
knew Jorge to be an accommodation party only. When the
accommodation party. Absence of consideration is in the
promissory note was not paid, and Raffy discovered that Carmen
nature of an accommodation. Defense of absence of
had no funds, he sued Jorge.
consideration
cannot
be
validly
interposed
by
Jorge pleads in defense the fact that he had endorsed the
accommodation party against a holder in due course.
instrument without receiving value therefor, and the further fact
that Raffy knew that at the time he took the instrument Jorge had
b. If Pedro pays the said P20,000 to Y, Pedro can recover the
not received any value or consideration of any kind for his
amount from X. X is the accommodated party or the party
indorsement. Is Jorge liable? Discuss.
ultimately liable for the instrument. Pedro is only an
accommodation party. Otherwise, it would be unjust
SUGGESTED ANSWER:
enrichment on the part of X if he is not to pay
Yes. Jorge is liable. Sec 29 of the NIL provides that an
accommodation party is liable on the instrument to a holder for collection.
value, notwithstanding the holder at the time of taking said
instrument knew him to be only an accommodation party.