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LIABILITY
nc
143
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check
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114
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ed
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customers
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ameans
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her
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SSUE:
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s
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s
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the
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ders
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INSTRUMENTS
14
assurance
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funds",
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ormer
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mbursement
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ntment
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e
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B.
PH
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PP
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pat
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15)
No.
CA
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any
No.
irregularity
107898;
in
Dec.
19,
instrument.
1995)
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Manuel
Lim
notice
When
athe
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cert
fied
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isthe
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25
43
strictly
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me
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name
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consideration
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P30,000
only.
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balance
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gned
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ace
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ect
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c
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presentment
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32
However,
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rate
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kto
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ab
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o
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serve
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amount
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personal
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to
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ascerta
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e
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ved
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ch
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o
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ISSUE1:
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h
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ong
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tuat
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es
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ure
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o
ous
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o
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ter
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of
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respectively.
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also
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holder's
bank
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en
or
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persons
orced
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save
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ts
signed
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party
pay
when
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one
aga
time
title
Petitioner
the
tBa
and
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sent
nst
to
made
aCourt
from
were
and
was
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mere
absence
of
implying
power
to
The
primary
and
secondary
liability
makes
the
parties
liable
to
A.
1.
HOW
WHAT
NEGOTIABILITY
IS
A
IS
anymore
and
purchased
A
pay
co-respondents,
behind
the
o
same
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pfundamental
would
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ab
nt
ho
the
B
two
ff
d
st
transfer
ty
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crossing
ab
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as
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ethe
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conception
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e
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gners
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ng
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in
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Yes
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satisfied
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manager
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of
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per
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ssued
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the
of
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anks.
one
the
fund
Fat
ma
has
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sufficient
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funds
a
at
a
check
maturity.
Mr.
Young),
n
the
of
Sec
Bearer
an
Rosita
139
alteration
Instruments
Lim
are
which
produce
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apparent
officers
the
is
following
of
notice
the
of
Rigi
effect:
an
infirmity
Bilt
(a)
Industries,
it
is
in
payable
the
Inc.
Overdue
PROMISSORY
ndorsee,
an
instrument
NOTE
is
overdue
after
BILL
date
OF
of
EXCHANGE
fixed
148864;
Aug.
-words
filed
(b)
Where
the
drawee
s
a
fict
tD
ous
person
parties
subsequent
"Issue"
means
the
payee.
first
delivery
of
the
instrument,
K
nds
of
acceptance.
-underlying
An
acceptance
sspouses
e
ther
(1)
genera
Sec
Sec.
Sec.
149
4.
Determinable
17.
Construction
future
where
time;
what
instrument
constitutes.
is
ambiguous
-personal
An
.to
within
reasonable
a.
MARCELO
a.
By
Whom
MESINA
Made:
VS.
CA
(G.R.
No.
70145
November
13,
1986)
after
Un
G.
the
f.
Surrender
drawee
Presentment
ts
renunc
ssue
mere
at
except
of
on
y
nstrument
stated
for
that
Payment
aw
that
nts
does
the
Upon

case
return
and
not
o
requ
the
aparty
shonor
bknew
re
drawer
oAruego
cance
exchange
by
smaturity
Nonorder
at
on
to
ance
be
sufficient
forth.
-a
Where
to
support
the
name
athe
simple
of
aPetitioner
payee
contract.
or
An
antecedent
is
wrongly
or
If
a
Holder
When
is
not
d
ah
shonored
holder
in
due
by
nonacceptance.
course,
he
is
subject
-to
A
to
b
sndorser
I. WON
INTRODUCTIO
provide
that
an
accommodation
is
one
who
has
the
Philippine
National
Bank
to
the
credit
of
M.
V.
Ramos
.
Ramos
pr
v
ty
o
contract
between
h
m
and
the
co
ect
ng
bank
payab
e
on
demand
because
the
contract
between
the
banker
and
stated
upon
estab
h
shed
s
part
as
n
other
But
except
cases
o
as
agency
here
n
otherw
se
has
h
s
p
ace
o
bus
ness
n
another
not
ce
may
be
subs
st
ng
at
the
t
me
o
h
s
ndorsement
the
qua
fied
ndorser
to
it;
negotiate
does
not
make
an
indorsement
restrictive.
(c)
By
wa
ver
o
presentment
express
or
mp
ed
pay
the
sum
HOLDER?
Estafa
DETERMINED?
$1,000
1
wr
st may
presented
dec
1249
tten
For
the
Confirmation
investigation
requisites
paid
paper
are
payment
with
on
o
judgment
the
off
accounts
or
by
exchange
or
prove
at
C
prescribed
v
and
a
maturity.
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of
debt
corporat
that
n
Code
Sale
hearing,
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separate
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shonored
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had
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of
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s
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the
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at
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there
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cons
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paid
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ng
derat
be
rate.
generate
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but
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on
way
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need
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was
decision
and
quest
Promissory
short
o
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for
check
oned
g
"the
ve
in
makes
m
Sec
acqu
bank
to
check
sp
bills
money
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that
defective
claims
made
bank
was
creat
114
back
aced
the
has
r
t
repairs
when
on
(d)
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the
ng
up
nequ
payee
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ng
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that
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y
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exchange?
of
When
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any
transaction
an
the
the
an
pronouncement
or
tab
the
despite
but
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and
so
c
checks
depos
accommodat
suspicious,
r
e
ted
the
litigants
dece
ght
the
to
the
drawer
cases
HELD:
The
demands
mpose
t
maker
was
ved
tractors
as
s
Such
suffic
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drawee
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on
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to
c
t
aga
YES.
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osed
But
s
depos
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ent
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act
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nst
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harsh
the
government
Chua
ndorsement
bank
h
".
the
o
ent
ts
s
regular,
.
ndorsers
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least.
ru
t
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es
The
e
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shonored
make
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party
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instructed
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right
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a
ch
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ter
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serviceable.
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t
an
said
not
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to
n
the
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orgery
where
s
hence
ssue
title
agent
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checks,
cashier
t
name
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to
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was
ong
CPII
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n
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INCOMPLETE
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or
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ORDER
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168
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64129
31
Nov
18
1991)

nstrument
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88)
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King)
possession
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party
10,
ue
1992)
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bank
issued
ons
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280
191),
certificates
who
may
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time
on
1991)
Eduardo
Gomez
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account
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Golden
3
A
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D
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49.
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26
44
Where
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15
:
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capacity.
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184
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3666
223
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7
1981
n
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the
provisions
of
the
Rules
of
the
Law
Presentment
for
Acceptance
P20,000
and
P25,000,
leaving
a
balance
unpaid
of
P45,000.
cons
derat
on
the
cannot
recover
o
the
acceptor
pet
tnegotiation
oner
where
Tan
mco
was
a
so
a
depos
tor
Even
though
nstrument
was
a
ready
mpa
red
at
the
tand
me
he
negot
ated
tthe
as
nstruments
person
Benin
becomes
apparent
than
had
ssued
Me
y
subject
transferred
s
n
supposed
b
or
ank
in
h
sdrawer
her
the
order
or
right,
to
payee's
payab
and
mean,
title
the
e
hands
to
and
"w
mony
cash
thout
interest
to
sho
the
bearer
und
rece
sputed
for
same
ng
or
a
L
m
desp
te
rece
that
pt
the
o
check
not
ce
in
o
question
such
dand
shonor
not
issued
a
ed
to
by
pay
the
are
o
that
defendant
it
the
did
nd
cred
said
not
spensab
tor
take
security
(E),
the
the
e
and
nstrument
was
n
check
to
the
credit
in
"in
the
determ
good
the
mpa
clearing
faith
nat
red
on
of
and
account
Pilipinas
The
o
for
payee
value."
of
Bank,
ex
the
ostence
Neither
aplaintiff
and
check
(3)
o
is
co
subsequent
ect
another,
agreements,
likewise
Plastic
said
When
the
check
defect
banks
the
Corporation,
signed
be
part
CA
in
These
were
delayed
with
holder's
reversed
by
es
he
the
demands
power
as
inspite
dpay
until
title,
aga
person
to
the
to
be
and
nst
of
it
unheeded
trial
enter
giving
neg
fulfills
the
for
part
court
this
gent
fact
es
up
it,
its
reason
requiring
pr
that
Ang
judgments
ruling
or
obligation
or
a
the
T
to
the
ong
ng
favoring
the
the
checks
presumption
to
then
under
person
forgery.
observe
State
were
fi
ed
its
to
delivered
to
the
Lims
place
of
business
which
was
in
When
the
petitioners'
motion
for
reconsideration
was
denied,
salesman
with
authority
to
collect
money
belonging
his
LLEGAL
TY
OF
CONS
DERAT
ON,
BREACH
OF
FA
TH
genu
ne
as
impair
to
de
the
y
detect
validity
on
of
by
the
the
instrument
depos
tor
or
h
mse
render
and
valueless.
yet
the
said
(a)The
mortgage
words
and
on
their
company
capacity
or
any
as
officers
abbrev
at
of
on
Embassy
thereo
Farms,
George
negotiated
King
ndorsement
to
a
holder
and
presents
in
due
course,
to
the
it
is
drawee
valid
and
bank
DRAFT
Checks
e
ements
o
a
contract
or
where
the
adm
tted
contract
sit
v
thowever,
ated
or
Fng
sto
e
the
note
and
ndorsed
tall
to
C
who
ndorsed
tthem,
to
effect
In
B
ACCEPTANCE
ND
case
of
EFFECT
breach
FOR
of
(Sec.
warranties,
the
the
person
reads
who
Pay
breached
to
the
the
order
same
P
accommodated
Th
GREAT
ERNEST
How
s58:
re
to
AS
at
Enforce
onsh
NA
AN
party
SALES
p
CR
between
Pr
SOLOGOby
mary
CENTER
renunc
the
OSE
at
CORPORAT
drawer
on
or
VS.
by
CA
any
ON
the
other
(GR
and
drawee
TAN
No
ground
CHONG
80599
bank
that
Sec
Sec.
15
5
Sec.
51
149
payment
or
Angel
warrants.
by
non-payment
dela
o
They
Cruz
percentage
were
who
delivered
or
manu
the
notes
same
acturer
and
to
bills
s
herein
sa
of
es
exchange)
petitioner
taxes
in
What
years
after
the
dishonor
of
check,
to
give
it
in
evidence
at
the
Maza
and
Franc
sco
Mecenas
on
five
prom
ssory
notes
o
P10
000
the
nstrument
under
the
pr
nc
p
es
o
the
aw
on
agency
spec
g
app
ven
y
aNG
the
to
p
ace
a
pre
check.
erence
1199(d)
his
former
rights
as
regard
prior
and
he
may
without
Ramos
Additional
indorsing
then
ncomp
transferee
must
manager
be
ete
it,
the
receives
made
provisions
nstrument
transfer
onstrument
Fam
by
notice
y
vests
not
Sav
on
of
any
in
de
ngs
beha
affecting
the
infirmity
vered.
Bank
transferee
o
was
the
in
Where
negotiability.
the
accused
such
der
an
title
at
and
as
(b)
On
or
before
Right
a
of
fixed
holder
or
determinable
to
sue;
payment.
future
time
-nstrument
The
specified
holder
of
therein;
ato
cannot
be
obta
ned
or
accommodation
party.
This
approach
of
both
parties
appears
to
nd
cat
ng
that
he
s
gns
or
or
on
beha
oov
a
L.
How
INDORSEMENT
made?
OF
ENTIRE
INSTRUMENT
parties,
Sec.
32
note,
as
to
requ
names
re
himself
or
expect
as
t(promissory
to
check
presentment
or
payment
Clear
was
manager
intention
ssued
acceptance
by
when
of
the
he
the
M
to
left
n
parties
pay
stry
the
at
bank.
othe
aor
part
Educat
the
The
substance
cu
bank
ar
on
p
ace
manager
of
Cu
s
the
a
ture
genera
transaction
entrusted
payab
e
to
Sec.
does
not
apply
to
a
holder
who
repurchased
the
be
made
as
deemed
capacity,
acor
holder
may
here
n
otherw
g
ven
right:
se
by
prov
or
on
ded
beha
when
the
ascustody
negot
ho
der
ab
ttest
e
nures
nstrument
to
the
benefit
has
o
Sec
85
Tground
me
of
matur
ty.
Every
negot
ab
ewas
son
payab
e
Merchant),
the
Code
of
and
the
Code.
Acceptanc
writing
made
at
the
back
of
the
check
was,
The
payee
ho
ds
a
dCommerce
fferent
re
at
on
he
sas
a
stranger
to
the
Ong
sMe
spec
men
s
gnature
was
on
fi
e
pet
tCivil
oner
accepted
and
numbered
that
consideration
defenses
payment
cor
account
never
to
for
which
of
sha
d
end
d
P7,500.
part
take
ng
it
would
w
h
such
th
s
Notwithstanding
h
s
name."
measure(s)
have
t
t
e
or
been
endorse
as
subject
may
this
the
n
be
assignment,
the
check
necessary
if
nstant
the
Sasak
drawer
the
amount
apply
on
o
account
sa
d
check
for
value,'
make
itin
being
arrangement
merely
for
or
principal
does
not
have
the
implied
authority
to
indorse
spouses
Tibajia
filed
herein
petition.
ISSUE:
WON
the
guarantees
a
pr
or
ndorsements
nc
ud
ng
But
where
the
not
ce
sA,
actua
y
rece
ved
by
the
party
wou
orgery
post-dated
(B)
there
d
of
be
any
the
There
a
cred
evidence
foregoing
checks
must
tor
under
drawn
amount
be
whatever
conc
th
against
s
with
us
prov
that
ve
interest
s
the
find
on
Armstrong
and
ngs
Insular
at
the
that
rate
ts
Bank
Industries,
there
no
of
payment
12%
of
s
Asia
per
a
precaut
As
whom
binding
warranty.
crossed
that
Investment
a
aab
onary
su
itthe
e
is
tso
it'to
and
athe
a
measures
is
IFC
holder
or
House,
parties
payable
addressed
then
co
in
ect
to
bank
due
the
filed
to
to
on
the
petitioner
detect
course
to
latter
who
result
a
The
pay
collection
has
the
or
tr
elevated
as
on
a
Bank
that
they
pa
court
demand
dto
ito
and
themselves
suit
acquired
aa
the
check
ad
bore
against
n
udged
or
issue
the
no
the
at
on
viewed
indorsement
case
before
ainstrument
petitioners
wh
or
fixed
ch
be
here
it.
the
ore
On
an
Caloocan.
To
pay
Linton,
the
petitioners
issued
seven
checks.
and
between
not
on
two
their
para
personal
e
transverse
capacity,
nes
thus,
e
there
ther
w
is
th
no
or
consideration
w
thout
effectual
for
all
purposes
in
his
hands
,
and
he
may
later
on
sold
at
a
discount
the
subject
checks
to
SIHI.
In
as
bank
sWhere
ab
eows
to
the
depos
tor
tare
pays
the
check
The
Court
may
P10
HONOR
000
(1)
on
makes
Lthe
N
L
ty
d
mp
e
the
nstrument
sperson
not
surrendered
a
purposes
(a)
Dru
present
or
the
reasons
ho
sum
der
payable
expressed
words
and
also
in
Sec.
REPUBL
A
9(a)
qua
and
fied
C
OF
(b)
ndorser
are
THE
originally
PH
ne
ther
L
PP
bearer
warrants
NES
instruments.
VS.
payment
PNB
(GR
Those
nor
b
No
nds
under
L
16106
under
prompted
connection
Sept
Sec.
15
83.
th
A
sdrawee
with
holder
act
his
on
was
purchased
fuel
products.
Eventually,
dela
Sec
55
187
xxx
prov
ded
under
Sec
70
he
oses
h
s
r
ght
to
the
payment
o
nterest
all
each
drawn
two
o
by
ch
the
s
due
Philippine
3
months
Fish
a
ter
Marketing
date
the
Authority
were
due
and
trial
of
the
civil
case
be
misdirected
strike
out
and
his
their
own
reliance
and
all
misplaced.
subsequent
The
promissory
indorsements
note
the
transferor
instrument
reasonab
had
therein,
ebetween
or
hour
defect
ain
or
(p.40)
conv
cted
-Effect
ncomp
pr
An
o
nc
instrument
pa
ete
or
nstrument
ness
which
a on
has
contains
not
been
an
order
de
vered
oracceptor
promise
t such
w LAW
toto
When
Cert
negotiable
ficat
twh
tcontracts
e
on
instrument
defect
of
check;
ve.
may
-is
effect
The
to
tor
sue
torgery
of.
e
thereon
Where
in
athree
his
check
who
own
schecks
(b)
When
presentment
or
acceptance
excused
and
the
G.
EFFECT
Payment
OF
on
DEATH
Subsequent
By
Person
OF
Secondar
L
ab
eAlbert
does
not
the
payee
and
indorses
the
note
to
A
to
B,
B
to
C,
a
holder
in
due
s. scharges
excused
C
v
Code
Art
1231
Ob
gat
ons
rather
F b.
check
Abante
than
for
the
Market
safekeeping
form
ng
is
the
to
criterion
at express
bank
of
official,
negotiability.
ayand
certain
Instead
of
Uy.
instrument
either
personally
or
through
an
agent.
acceptance
un
y
indorse
in
such
terms
as
to
negative
personal
liability.
Proof
of
Sec.
45
for
value
in
respect
to
all
parties
who
become
at
t
me
fixed
there
n
w
thout
grace
When
the
day
o
matur
ty
a
snt
been
d
shonored
a
subsequent
by
Time
of
indorsement;
presumption.
Except
e
B.
APPLICABILITY
OF
THE
NEGOTIABLE
INSTRUMENTS
mysteriously
obliterated
and
in
its
place,
a
supposed
indorsement
Dishonor
by
Non-acceptance
transact
on
the
drawer
the
and
cred
ted
both
checks
to
the
account
osuMarch
Tan
mco
wto
thout
received
in
payment.
Any
person
taking
checks
made
payable
orged
ndorsement
tse
and
tright
mate
y
shou
d
be
to
never
delivery
Benin
paper
case
rece
that
a
constructed
had
sum
ved
of
sa
the
d
any
o
never
nstruments
money
cashier's
o
a
ts
duplex
passed
proceeds
was
check
are
(apartment)
rece
not
through
is
Ne
ved
considered
be
ther
ng
by
on
used
the
vsts
GEL
the
rtue
payment
resorted
hands
C
lot
oa
estopped
separately
the
in
of
note
legal
by
or
a
uOn
accommodation
payment
o
the
purposes."
same
w
th
n
That
five
(5)
judgment
bank
ng
days
however
a
ter
w
th
n
the
tpayment
me
spec
normance
th
sdelivery
Act
tninterest,
w
be
suffic
ent
var
sensure
and
annum
whom
caused
ance
America
from
n
R.Y.
by
the
date
Lim
h
nherent
for
s
negotiated
of
neg
P304,533.33
the
gence
character
complaint.
the
payment
payable
check,
st
The
cs
o
Board
w
accepted
on
the
be
of
gnatures
deemed
Directors
the
13,
instrument
1981.
and
effected
of
that
The
the
us
ndorsement
both
determinable
the
for
of
in
SC.
pet
the
good
tother
the
ISSUE:
oner
courts
latter.
recovery
faith
hand,
On
has
Hence,
WON
be
does
future
y
are
been
Fe
ow
of
petitioner
pe
not
disadvantages
un
petitioner
time
the
orged
Ang
exist.
orm
principal
awhere
appea
yfied
sum
cannot
And
is
ound
filed
a
certain
ed
having
to
sum
holder
the
that
charge
the
ma
complaint
plus
Man
in
commercial
nta
presented
in
money
the
adue
ng
drawer
Bank
as
that
to
course
no
aforestated.
world
sdorder
attorney's
he
personne
sshonor
evidence
account
sssued
which
as
or
on
to
y
When
the
checks
were
presented
to
the
drawee
bank
(Solidbank),
enforce
it
as
if
itaccused
had
been
filled
up
strictly
in
received
the
words
by
not
them,
negot
making
ab
e
the
or
mortgage
voidable.
Respondent,
much
as
George
King
failed
to
deliver
the
bales
of
tobacco
recogn
ze
that
Sect
on
either
March
be
1
liable;
2013
or
Not
(2)
ce
he
may
o
d
be
shonor
barred
wa
from
ved
asserting
s
b
nd
particular
ng
upon
may
drawee
VS.
figures
a
CA
n
bank
But
the
and
and
when
hands
there
ab
e
BANCAS
the
to
o
is
negotiation
the
a
a
ho
discrepancy
drawer
A
der
F
n
is
NANCE
n
due
by
case
between
course
o
AND
wrong
who
the
only,
may
u
two,
NVESTMENT
the
have
warranty
the
sum
the
o
o
pub
c
po
cy
Persona
de
enses
are
those
where
n
the
acts
present
h
mse
to
pay
1
D
even
he
s
n
due
course
cannot
recover
rom
it
had
instituted
against
the
drawers
of
the
check
(Limson
and
Cruz
executed
and
subsection
Dec
30
who
60
has
knowledge
that
the
instrument
was
previously
(c)
the
hereinbefore
purportedly
4
months
or
draw
at
a
ng
fixed
signed
o
quoted,
period
a
by
check
after
its
as
General
well
the
by
occurrence
as
Ford
Manager
the
wh
mortgage
of
ch
and
a
specified
counter-signed
t
depos
deeds
event
ted
subject
by
to
Esta
a
or
a
ow
ng
her
co
to
w
thdraw
r
ght
there
1989)
The
V
ce
pres
dent
o
Mover
Enterpr
ses
nc
representat
ve
capac
ty
he
s
not
ab
e
on
and
again
negotiate
the
DRAWER
Part
d
es
scharge
Sec
and
165
the
Agreement
transferee
title
bus
ness
of
the
day
person
of
acquires
acceptor
and
negotiating
be
in
ore
addition,
for
honor.
the
the
b
same
the
The
before
overdue
acceptor
to
he
have
has
to
or
the
negot
L
cert
ab
fied
ates
ty
by
of
an
the
maker.
nstrument
bank
on
The
wh
maker
s
ch
de
t
ect
o
s
drawn
a
ve
negot
w
th
the
ab
n
cert
the
e
ficat
on
do
not
any
act
comp
in
eted
and
b
name;
s
not
and
accepted
to
(a)
to
receive
payment
of
the
instrument;
ext
ngu
shed
(1)
By
or
per
PLACE
Th
s
check
OF
PAYMENT
was
drawn
means
aga
a
nst
house
Ph
pp
bank
ne
count
Nat
ona
ng
room
Bank
(here
store
n
or
NOTE:
M.
REASONABLE
INDORSEMENT
C,
even
though
OF
a
holder
BEARER
in
due
INSTRUMENT
course,
cannot

Sec.
enforce
40
said
promise
While
141
Uy
the
went
words
to
bind
Sec
151
Acceptance
non
acceptance
ho
Qua
ders
fied
or
and
non
acceptance.
a
payment
pr
or
part
es
not
An
who
ce
acceptance
have
o
d
a
shonor
r
ght
s
qua
o
must
recourse
fied
be
wh
ch
prior
to
that
time.
upon
Sunday
Sec.
27
R
ghts
of
ho
der
b
not
accepted.
When
When
lien
on
instrument
constitutes
holder
for

where
an
indorsement
bears
date
after
the
maturity
of
the
appearing
on
the
back
of
the
check
was
made
for
the
whole
smmater
there
ore
n
aar
ega
sense
a tor
remote
party
nvs
awhether
su
t by
hang
m
Presentment
for
payment
ver
ythe
ng
the
sJose
gnature
ndorsements
appear
ng
at
the
back
a
corporation,
which
can
act
only
by
agents,
does
so
at
his
peril,
he
d
ab
e
there
or
(Traders
Roya
Bank
RPN)
tender?
HELD:
No.
A
check,
whether
a
manager's
check
or
the
bound
occupied
tbuyer
smay
by
or
the
by
depos
bank
a
so
statement
tor
Abejero
n
as
the
urtherance
and
wh
cred
ch
Juan
was
Casabuena,
s
o
made
concerned
a
money
to
t
who
by
the
aunder
collected
HSBC
one
rece
conditioned
v
ng
sa
d
not
the
ce
acquittal
n
h
s
Mot
with
on
the
to
Quash
pronouncement
L
m
averred
that
that
"this
accordance
with
the
authority
given
and
within
though
not
sent
n
accordance
w
th
the
requ
rement
o
they
and
checks
PCHC
and
were
attempted
affirmed
ob
were
wr
gat
tten
dishonored
on
to
the
by
encash
or
decision
two
wh
or
ch
it
for
in
more
the
of
having
behalf,
the
check
d
fferent
Arbiter.
and
was
been
as
agent
g
Hence
persons
ven
drawn
of
as
this
STELCO.
cond
Forgery
petition.
against
t
ona
On
or
bearer.
outweigh
fees
ISSUE:
that
entitle
an
the
accommodat
it
amount
and
acquired
it
WON
As
the
to
costs
long
o
considerations
petitioner
proceed
sa
the
on
of
as
d
check
party
suit
check
a
against
Bank
commercial
contending
An
in
just
has
except
good
private
SSUE:
mentioned.
a
faith,
paper
on
that
cause
respondents
WON
to
it
it
the
conforms
(payee)
of
Such
Fe
was
ru
action
pe
e
Chua
a
warrants
s
Ang
cannot
where
holder
with
against
for
s
the
be
an
of
in
they
were
dishonored
because
payment
for
the
checks
had
been
on
the
other
hand,
claims
that
the
promissory
note
for
the
(b)Two
para
e
transverse
nes
s
mp
y
e
ther
w
th
or
w
thout
leaves
as
agreed,
despite
petitioners
demand,
BCCFI
issued
a
part
es
secondar
y
ab
e
thereon
the
wa
ver
s
ound
on
an
checks
denoted
A
drawee
by
the
words
bank
is
who
the
wrongfu
sum
payable;
y
d
shonors
but
if
the
a
words
check
are
s
r
ght
to
en
orce
the
nstrument
desp
te
the
prev
ous
payment
that
was
a
true
CORPORAT
extends
O
(G
in
R
No
favor
105774
of
Apr
no
25
holder
2002)
other
n
March
than
1981
23
o
the
Negot
ab
e
nstruments
Law
bars
a
party
rom
part
es
Torres)
and
neverthe
ess
udgment
or
the
amount
o
the
note
s
de
eated
nstrument
he
was
du
y
author
zed
but
the
mere
2
By
of
means
this
o
case,
any
are
the
clearly
o
ow
not
ng
a
negotiable
se
pretenses
instruments.
or
raudu
ent
These
acts
J.
Unlike
RIGHTS
secondary
OF
HOLDER
liability
which
IN
BILLS
requires
IN
a
notice
of
dishonor,
an
TRADERS
ROYAL
BANK
RPN
(GR
No
138510
Oct
10
2002)

dishonored
delivered
is
an
not
Affidavit
a
holder
of
in
Loss
due
for
course.
the
reissuance
of
the
CTDs.
Dela
PC
its
B
Auditor.
as
payment
Six
of
and
was
deb
ted
rom
the
r
C
t
bank
account
(c),
1961)
(d)
and

the
A
demand
(e)
nstrument;
are
dra
order
t
s
EXCEPT
instruments
a
b
o
ONS.
exchange
on
the
payab
face
e
converted
on
demand
to
as
which
a
ter
is
check
certain
date
instrument,
drawn
to
The
happen,
aga
notes
nst
though
were
Traders
the
not
time
Roya
taken
of
happening
Bank
up
by
payab
be
Maza
e
and
to
then
addition
rom
negot
the
ated
to
r
unco
the
w
thout
payment
ected
author
and
of
ty
unc
money
be
eared
a
is
va
depos
not
d
contract
negotiable.
t
wh
ch
n
were
the
But
him
in
due
course
discharges
the
instrument
indorsement
paid
drawee
of
the
the
full
or
transferor.
some
amount
person
agreed
But
author
for
to
the
be
zed
paid
purpose
to
therefor,
accept
of
determining
he
or
will
re
use
mean
s
equ
ng
va
ent
o
to
s
an
Act
when
he
p
honor
ace
o
by
such
acceptance
engages
that
he
w
on
due
note
Sec.
T
ME
(p.10)
193
against
nstrument
by
mak
ng
t
engages
that
he
w
pay
t
pet
t
oner)
(a)
t
s
to
be
presented
n
the
p
ace
where
the
protest
The
author
the
received
men's
ty
o
the
room,
the
lost
drawee
the
check
check
bank
for
to
was
honor
clearing
stolen
a
check
by
from
his
drawn
visitor
aga
nst
in
the
After
t
s
CHARLES
FOSSUM
VS.
FERNANDEZ
HERMANOS
(GR
No.
Lg
ven
to
aga
the
nst
the
myself
be
used;
instead
of
on
demand,
the
words
on
call
(2)
By
the
Reasonable
oss
o
the
th
time,
ng
what
constitutes.
In
determining
to
bring
any
action
thereon
that
indorser
could
93 applies
or
a and
ho
day
a
b
the
nstruments
sent
d shonored
aISSUE:
byngby
nonacceptance
due
or if
becom
ng
an
payab
mmed
e indorses
on
ate
Sec
175
Effect
s(b)
subsequent
part
es
where
bor
sas
pa
dtthat
for and
aga
nst
acceptor
the
quest
on
to
the
Act
Effect
value
.on
only
where
EXCEPT
to
not
negotiable
ce stender,
sate
g
instruments
ven
byan
party
those
ent
ed
instrument,
every
amount
of
the
check.
WON
the
check
was
legally
thereo
Tan
mco
then
mmed
y
w
thdrew
the
money
Dishonor
Non-payment
Sec
133
must
abide
by
the
consequences
the
agent
who
Ho
der
ttransferee.
ed
to
acceptance
on
face
of
b
.the
The
ordinary
check,
is
not
legal
and
of
apetitioners
check
in
An
ON
when
the
ssuance
oGeorge
the
check
reasonable
time.
act
Th
rentals
o
sty
the
stcontrary,
not
sacceptance
from
ngers
a
case
the
has
where
former.
or
has
the
not
GEL
rece
CBank
sthat
lot
own
ved
was
so
anyth
gnature
fully
ng
paid
was
nDeve
payment
for
orged
by
to
o
is
not
dab
d
not
however
const
to
tute
release
a
e
Steelweld
ony
because
Corporation
the
k
nd
from
oHELD:
its
check
liability
he
cannot
payment
insufficient
ISSUE
the
1:
w
be
Were
funds.
be
the
presumed.
the
dindications
scharged
subject
Pilipinas
checks
are
tthe
Cons
must
nonder
Armstrong
never
ng
negotiable
be
that
released
estab
was
and
respondents
shed
really
the
if
note,
not,
the
by
drawer
definition
attorney
due
any
considered
amount
accommodat
or
course
swere
gu
all
of
stated
are
ty
as
of
a
on
of
oa
bill
the
holder
such
a
party?
of
in
defendants,
negotiable
exchange,
neg
as
the
in
due
against
gence
What
dishonored
course.
that
promissory
in
wh
public
paper
the
ch
smust
In
causes
other
alternative
the
is
policy,
considered
note.
words,
the
ab
bank
ISSUE:
because
or
otherwise?
under
a
to
o
bill
honor
WON
they
The
the
an
of
stopped
and/or
insufficiency
of
funds.
As
aoffer
result,
loan,
the
for
which
the
mortgage
was
executed,
shows
that
ndorsement
a
stop
payment
on
y
such
order
as
Pay
on
to
all
the
checks
order
payable
A
Not
to
ce
o
D
shonor
King.
not
ambiguous
e
to
or
the
uncertain,
payee
for
reference
ack
of
may
pr
be
vchecks?
ty
had
but
to
the
tand
figures
snot
ab
to
contract
the
board
but
where
o
d
rectors
or
var
o
ous
Great
reasons
an
such
approved
as
raud
aty
reso
duress
ut
on
immediate
sett
ng
up
pr
or
the
to
de
the
ense
orgery
o
orgery
tAs
he
swhat
gu
cannot
ty
o
neg
recover
gence
rom
Yet
Ae
RYL.
add
Possession
topen
on
o
words
of
descr
a
negotiable
b
ng
h
m
as
an
instrument
agent
or
as
fi
after
ng
executed
pr
or
to
or
svoid
mu
taneous
yThus
w
th
the
comm
ss
on
o
raud
action
SET
based
documents
do
not
comply
with
the
fourth
requisite
to
be
by
the
maker
on
the
ground
that
the
ndorser
as
payee
obta
ned
the
hands
of
Cruz
later
on
obtained
a
loan
from
respondent
bank
Sec.
The
tacts
was
B
4D
R
ater
except:
on
these
pet
Mecenas
t
oner
at
Ernest
directly
matur
na
payable
ty
The
to
spec
Gomez
a
defines
while
the
nterposed
others
appeared
by
the
bearer
such
instruments.
s
an
etter
request
rom
and
an
order
by
one
person
uncertain.
subsequent
yeach
d
shonored
acceptance
Determinable
future
time,
constitutes.
(supra,
whether
the
be
transferee
deemed
on
a
is
a
h
sAfter
or
non
payment
was
made
t
be
presented
ater
sa
Sec.
d
Prudential
to
17
Bank.
Sec
188
obta
ned
the
nstrument
or
any
s
gnature
thereto
by
presentment
pay
the
b
accord
ng
to
ts
tenor
and
bus
where
the
ho
der
can
present
a
note
where
the
maker
can
dishonoring
same
check
twice,
Associated
Bank
received
N.
H.
LU
FAR
INDORSEMENT
S
scharge
EAST
WONG
Effect
REALTY
of
where
VS.
Persons
WHEN
CA
NVESTMENT
the
(G
ho
SECONDAR
R
PAYABLE
der
No
of
117857
check
NC.,
TO
LY
TWO
vs.
procures
February
THE
OR
HONORABLE
MORE
t
2
to
2001)
be
Fvness
Abante
cons
derat
Market
on
ng
between
a
c
ent
the
o
drawer
Cap
to
and
C
ty
the
acceptor
opment
may
Sec
be
21
used
Construction
and
instead
of
where
bearer,
instrument
the
word
holder
is
ambiguous.
may
be
used.

M
due
by
19461)
virtue
what
of
Sec.
is
a
15,
"reasonable
but
C
can
go
time"
after
P,
regard
A
and
is
B.
to
be
had
to
the
bring;
drawer
and
to
ndorser
and
any
drawer
or
ndorser
to
whom
S
gnature
by
procurat
on;
effect
of.
A
Saturday
are
r
ght
to
be
o
presented
recourse
or
payment
on
the
next
succeed
ng
honor.
Sec
121
Where
R
ght
o
a
b
party
has
who
been
d
scharges
pa
d
or
honor
nstrument
a
part
Where
es
subsequent
the
negotiation
is
deemed
prima
facie
to
have
been
effected
meet
thereto.
the
requirements
Where
under
not
ce
Sec.
s
g
1
ven
of
Act
by
No.
or
2031.
on
beha
o
a
negotiated
within
the
meaning
of
the
NIL
in
view
of
the
Where
the
holder
has
a
lien
on
the
instrument
arising
either
absconded
SSUE:
WON
Westmont
Bank
s
prec
uded
rom
the
same
is
without
authority."
Respondent
which
relied
upon
Notice
of
payment
of
a
is
not
valid
tender
of
payment
and
may
be
ho
der
ong
abecause
baBecause
present
ng
the
same
acceptance
may
tse
was
attended
w
th
neg
gence
one
Urdanetas,
the
oor
use
tand
checks
otsigned
a
Release
hdebt
sone
name
n
of
such
Mortgage
n
a
rea
case
ty
was
the
the
executed
ega
p
a
nt
sby
ff
tuat
and
wou
on
period
d
o
have
the
of
ssued
under
Sec.
tAathe
be
29
of
the
memorandum
Negotiable
Instruments
check
was
n
Law
the
nature
for
having
o
a
c
Va
ear,
nor
does
intended
enc
any
a
pos
itWhen
fall
instrument
payee
ve,
Pearroyo
under
of
and
the
the
related
conv
check
ambit
thereto,
nc
u
and
of
ng
ed
was
the
ev
to
the
the
power
dence.
Sesbreno;
party
part
of
o
Th
actually
the
s
the
PCHC?
Sesbreno
was
contract
injured
OR
such
exchange.
enlarge
IFC
HELD:
circumstances
Intermediate
accommodat
checks
is
cause
holder
Gempesaw
The
on
Appellate
field
of
of
nature
in
ndorser?
action
the
for
due
d
fraud,
of
case,
Court
d
is
not
acceptance
course
defined
HELD:
because
exerc
(now
instead
of
se
as
Court
NO.
prudence
a
an
of
is
negotiable
important
act
the
of
Fe
Appeals),
or
these
presumption
pe
omission
nent
tak
only
Ang
promissory
ng
correctly
of
steps
sthey
that
one
the
were
found
guilty
with
Estafa
and
7
counts
of
violation
of
BP
Wa
ved
Sgd
P
the
wa
ver
shad
ba
nd
ng
on
yperson
on
Pron
to
fix
the
drawer
amount;
of
breach
of
contract.
spouses
as
co-makers,
also
with
the
succeeding
Unable
to
collect,
SIHI
instituted
an
action
to
recover
from
herein
author
zunab
ng
ts
Treasurer
and
GM
Arsen
o
L
m
Por
at
rManila
to
secure
a
words
negot
ab
e
P
and
M
F
orged
the
sunder
gnature
o
Ainstruments
D
d
not
presentment
and
or
payment,
is
utterly
we
considered
e
as
to
such
conc
ude
under
Section
1
of
Act
No.
2031
COURT
OF
APPEALS,
DY
H
AN
TAT,
Snes
Y
CHEE
and
GAW
SUY
on
breach
of
warranty
is
not
so
conditioned,
the
latter
occurring
as
it
t46
by
raud
or
Defenses
ound
negotiated
out
d
st
the
ngu
that
said
shed
the
from
payment
EQU
T
wasn
ES
taccrues
rece
ved
by
P
the
the
by
the
cannot
drawee
be
banks
nqu
red
wh
nto
ch
The
were
payee
covered
or
ho
3
g
ves
fferent
va
ue
assessed
p
a
nt
ffs
Rad
o
Ph
pp
Network
(RPN)
to
de
have
endants
been
was
indorsed
that
the
by
their
payees,
followed
by
Sec.
Bills
in
9(c):
Set
negotiable
any
involve
A
fictitious
ho
der
as
bill
person
aga
although
of
nst
is
an
meant
any
drawn
instrument
in
be
set.
whose
one
otherwise
problem
who,
swho
gnature
though
arises
Cr
so
ogo
than
ose
day
or
the
o
ow
accommodat
ng
ts
matur
on
ty
oOF
h
sOWNERSH
Pet
tind
oner
on
another
to
(3)
By
the
condonat
on
or
rem
ss
on
ondorsers
the
accord
ng
to
the
o
h
sdishonor,
acceptance
prov
ded
tThe
sha
not
have
holder
summons
in
holder
due
course,
in
due
the
course
negotiation
only
takes
to
the
effect
extent
as
of
the
of
the
L
ABLE
PERSONS
raud
the
duress
or
orce
and
ear
or
other
un
aw
u
means
Sec.
55
Sec.
Sec
7are
62
p.6)
depos
tng
prov
de
to
meet
tfi
and
where
a29,
ega
offer
to
sbeha
gnature
by
"procurat
on"
operates
as
not
ce
that
the
(Hutch
nson
(c)
vs
to
Crutcher)
transfer
his
Thus
rights
a
des
such
gnat
indorsee,
o
where
adeemed
or
cthe
td
form
stime
not
When
payable
on
demand
(supra,
p.6)
be
Bank
term
(Cap
nated
to
by
)terms
depos
the
death
ted
the
o
the
quest
drawer
oned
There
check
sder
nbut
ts
prov
sav
snot
ngs
on
Pet
Herein
tthe
oner
nature
petitioner
of
the
was
the
resident
agent
in
of
Mere
defect
see
in
E.
title
Interpretation
language
defective.
or
of
grammatical
-as
Instruments.
The
title
of
a
error
person
The
words
Section
16
L
cert
:ab
As
fied.
ty
regards
of
acceptor.
immediate
-respective
parties
The
and
acceptor
a
by
party
(a)
Cond
tcharacter
that
s
to
say
wh
ch
makes
payment
bus
ness
day
except
before
the
aga
nst
the
drawer
and
tobecause
the
ho
der
nstrument
snot
pa
d
by
aona
party
secondar
ypresumption.
ab
e
thereon
t-no
s
not
to
the
party
or
fact
that
the
instrument
was
indorsed
for
acremote
lesser
amount?
AS
A
BANK
NG
VS.
AV
ER
(GR
No
Lto
19051
Apr
4
1923)
Sec.
party
ent
tunds
ed
to
g
ve
from
contract
or
by
implication
of
law,
he
is
ato
KRAUFFMAN
VS.
PNB
(GR
No.
16454,
Sept.
1921)
-to
Herein
sett
up
the
orgery
or
want
o
author
ty
and
there
ore
shou
d
Place
of
indorsement;
Except
the
petitioner's
warranty
should
not
be
held
liable
for
the
Dishonor
refused
receipt
by
the
obligee
or
creditor.
(be
Philippine
Airlines,
Paymen
acceptance
be
wr
tten
on
the
ba
and
such
request
sof
requ
re
that
the
Co
ect
ng
Bank
or
hav
ng
ndorsed
the
checks
s
known
non-alienation
de
endant
o
the
n
th
orgery
s
of
case
the
may
and
land
proper
t
wou
was
y
d
extended
be
have
regarded
been
from
as
ts
5
that
duty
to
20
o
a
years.
have
o
nt
prom
issued
ssory
it
note
for
per
orce
the
accommodation
and
c
v
n
nature
of
Romeo
C
t
Lim."
ng
U
Eleven
S
v
e
That
the
depos
t
o
sa
d
nstruments
sha
sub
ect
the
done
learned
Does
n
the
the
that
PCHC
present
the
has
Delta
jurisdiction
case
Promissory
Even
over
Note
f
the
the
controversy
maturing
twenty-three
on
involved
6
April
(23)
in
that
determination
the
note
party
payee
elucidated
genera
a
promissor
so
in
care
as
was
violation
to
that
ndorser
u
bar
a
of
bargains
the
and
holder
the
all
of
effects
(Sect
defenses
kind
the
prudent
away
in
on
of
of
legal
liabilities
good
crossing
63
of
his
CPII
right
bus
N
right
faith,
L)
against
nessman
of
or
check
the
n
to
rights
the
the
a
IPM?
parties
are:
day
wou
absence
fact
of
HELD:
the
in
another.
involved,
d
is
court,
check
take
No.
that
o
may
and
The
any
but
n
it
22
by
the
Malabon
RTC.
On
appeal,
the
CA
reversed
(b)
Where
the
instrument
provides
for
the
payment
promissory
notes.
The
RTC,
upon
motion
of
the
respondent,
petitioner
and
was
granted
relief
by
trial
court
and
later
on
oan
rom
here
n
Respondent
(Bancas
a)
n
an
amount
not
acqu
re
any
r
ght
aga
nst
A
P
and
M
because
A
d
d
not
inconsequential;
it
does
not
make
the
possessor
a
holder
for
AN
[G
R
No
L
are
neither
payable
to
order
nor
to
bearer.
The
note
is
payable
to
to
the
drawer
and
he
s
gnorant
o
the
equ
t
es
between
xxx
that
Samsung
Construct
on
was
gu
ty
o
neg
gence
n
th
s
w
thout
cons
derat
on
the
ho
der
may
recover
rom
the
qua
fied
atter
s
n
ormat
ons
fi
ed
Comm
ss
oner
does
at
the
agent
time
of
has
the
but
transfer,
a
m
ted
may
author
be
brought
ty
to
s
at
gn
any
and
time.
the
pr
nc
pa
C.
5.
PERSONAL
HOLDER
FOR
ra
ntercont
sed
by
nenta
persons
who
may
have
ega
c
a
m
over
the
nstrument
debt
CTDs,
(b)
executing
t
s
a
to
Deed
be
presented
of
Assignment
n
some
of
Time
other
Deposit
p
ace
than
been
pay
pa
a
d
sum
and
o
money
there
n
ment
oned
to
a
th
rd
person
on
Gomez
as
second
named,
when
different
as
negotiable
payee,
parts
has
of
is
the
not
no
set
affected
right
are
to
negotiated
by
it
a
because
provision
to
separate
the
which:
maker
persons
or
payee
prom
ssory
was
charged
notes
were
w
th
sent
the
know
n
b
ank
edge
to
that
them
the
by
check
Enr
que
was
Echaus
ssued
Sec.
41
(a)
(p.12)
Where
itthe
is
payable
to
the
order
of
a
third
person
and
and
copy
of
a
complaint
for
damages
of
Marcelo
Mesina
or
or
an
ega
town
ycond
Sec
111
Wa
ver
of
protest.
A
wa
ver
o
protest
whether
n
the
Sec
189
When
check
operates
as
an
ass
gnment.
A
check
o
See
under
by
p
of
the
acceptor
indorsement
dependent
authorizes
on
the
him
u
to
fi
do
ment
so.
o
a
t
on
Time
American
Instruments
Iron
the
N
L
himself
Equitable
account
order
negotiates
w
Assignment
th
may
sa
d
be
bank
an
instrument
construed

n
the
transfer
as
is
defective
himself
of
an
within
or
order
order
the
instrument
meaning
and
thus
other
Sec.
38:
than
When
accept
instrument,
a
holder
the
ng
indorser
in
the
due
nstrument
usage
course,
wants
of
to
delivery
trade
transfer
engages
or
is
business
his
a
that
rebuttable
rights
he
with
w
over
pay
respect
the
t
to
53
Sec.
87
Wong
was
an
agent
o
L
mtong
Press
nc
(LP
)
LP
wou
d
whose
honor
t
s
pa
d
are
d
scharged
but
the
payer
or
honor
s
Where
the
ho
der
o
a
check
procures
t
to
be
nstruments
and
payab
no
presentment
e
on
demand
or
may
payment
at
the
opt
s
necessary
on
o
the
ho
der
be
dnSec.
scharged
but
the
party
so
HELD:
NO.
Section
32
of
the
NIL
provides
that
"the
120
When
Rule
where
persons
instrument
secondar
payable
y
ab
e
at
on
bank.
the
suffer
the
not
ce
oss
t
and
nures
be
to
made
the
benefit
ab
e
to
o
here
the
n
ho
Respondent
der
and
a
Ong?
When
person
not
deemed
holder
in
due
Sa
vador
plaintiff
where
the
contrary
appears,
every
indorsement
is
resulting
loss.
The
depositor
of
a
check
as
indorser
warrants
Inc.
vs.
Court
of
Appeals
and
Roman
Catholic
Bishop
of
tdate
re
used
so
eface
y
Discharg
prompt
Casabuena
surety
y
rather
fied
was
than
the
Benin's
bank
that
orental
o
any
an
collector
orged
accommodat
scheck
gnature
but
their
on
party
relationship
any
aWON
The
ure
sham
months
pr
later
vate

and
respondent
some
years
contended
after
issuance
that
of
a
the
though
check
a
same
requ
rements
scrut
ny
app
cab
e
to
cash
depos
ts
trial
courts
decision
on
Estafa
but
upheld
the
decision
on
checks
1981,
view
of
n
has
petitioners
quest
a
on
claim
value
are
that
cons
of
P2,300,833.33
the
dered
subject
forger
matter
with
es,
of
the
cons
case
der
(the
ng
as
because
note
essential
acquired
not
nd
cat
be
in
in
the
on
encashed
question
the
possession
by
elements
determination
effect
appropr
fails
but
of
are:
only
ate
the
to
of
meet
of
words
instrument
the
(1)
deposited
instrument
legal
hengaged
sthe
requirement
ntent
a
is
in
right
commercial
to
on
strike
under
of
bank;
to
under
be
the
down
bound
circumstances
paper
plaintiff;
Sec.
check
is
right
nof
1(d)
some
amay
bill
(2)
of
interest,
without
specifying
the
from
which
interest
is44
to
run,
granted
summary
and
dismissed
the
complaint.
On
exceed
P1M
and
arthe
so
author
zed
Arsen
o
to
ssee
gn
a
papers
upheld
by
CA.
Hence,
the
present
ISSUE:
WON
SIHI,
trans
er
hand
sIN
ght
over
the
nstrument
That
add
tn
on
const
tutes
a
cross
ng
cheque
the
drawer
and
the
acceptor
he
snregard
nand
the
pos
tPhilFinance
on
on
aspp
bona
36549
October
5
1988]
Respondent
Dy
H
an
Tat
S
Chee
and
value
within
the
meaning
of
the
law;
it
gives
to
no
liability
on
a169
specified
party,
the
GSIS.
Absent
the
aforesaid
requisite,
the
snot
bound
on
y
nthe
case
the
agent
case
The
appe
ate
court
ed
to
exp
a
n
y
how
the
aga
nst
her
o
the
cr
m
na
charges
firise
ed
SSUE:
DEFENSES
VALUE
They
have
who
was
in
possession
of
the
lost
and
is
demanding
Broadcast
ng
the
Corporat
p
ace
where
on
(a
BC)
twhether
was
and
protested
Banahaw
then
Broadcast
tthe
must
be
ng
demand
or
at
a
Meanwh
e
accord
ng
to
the
NB
report
one
o
the
checks
ssued
by
D.
endorsements
LIABILITY
AND/OR
The
co
WARRANTIES
ect
ng
bank
sthere
a
OF
so
made
ab
eand
because
tTh
ss
which
2
stated,
among
others,
that
bank
has
full
control
the
Order
of
Lthe
ab
ty
judgment
see
Sec
68
under
d
drawer
who
are
so
holders
intended
in
and
it
(4)
By
indorser.
at
w
the
th
the
the
con
nstance
On
us
request
on
various
merger
that
dates
they
o4
all
the
sthe
these
gn
ro
ghts
them
warrants
o
cred
so
were
tor
and
m
ght
express
ng
th
sgn
ru
e
However
the
B
o
Exchange
Act
o
1882
REPUBL
has
C
BANK
been
paid
VS.
EBRADA
by
the
drawer;
(GR
No
and
Lthe
40769
uthe
ysubsequently
31
1975)
by
the
and
prov
ded
a
so
that
sha
have
been
du
yto
stated
(b)
Part
that
spetition.
to
say
an
acceptance
cons
derat
on
or
when
he
negot
ates
tprec
nthat
breach
o
a
th
Products
68
56
Company,
Inc.
(AIPCI),
in
business
in
New
York
case
turn
oent
a
Cap
ore
to
depos
b
o
ted
exchange
same
or
nPNB
other
ts
account
negot
w
th
the
nstrument
Ph
ne
tse
does
not
operate
as
an
ass
gnment
o
any
part
oy
the
O.
INDORSEMENT
Order
which
REPRESENTATIVE
indorsers
liable.
CAPACITY
ndorsers
Echaus
liability
Sec.
of
not
suffic
subrogated
9
render
of
the
this
Act
when
he
presumption,
Sec.
4(a):
To
accord
such
pay
as
instruments,
such
on
ng
Aug.
to
can
12,
either
tenor
and
oA
the
facts
of
the
particular
case.
without
indorsement
where
the
transferee
acquires
the
instrument
instrument
What
but
does
const
not
tutes
want
not
to
assume
ce
of
defect.
responsibilities
To
const
under
tutes
the
pr
indorsement
nt
samp
e
ca
endars
must
be
then
an
g
ve
indorsement
to
agents
of
to
the
entire
accepted
or
cert
fied
the
drawer
and
a
are
presented
or
payment
be
ore
twe
ve
care
ock
noon
on
Saturday
when
part
es
pay
ng
tdrawee
sthere
rem
tted
to
h
s23
ormer
ra
ghts
as
athe
pr
or
part
es
Sec
nstrument
Where
are
din
the
scharged.
instrument
is
person
made
secondar
payable
at
yse
apurports
ab
bank,
e
on
itpresent
the
is
b.
Effect
of
Absence
of
Not
ce
on
Separate
When
de
ay
n
mak
ng
presentment
ssuch
excused.
Chaves
drew
course.
two
checks
see
aga
nst
avor
o
La
nsu
ar
that
it
is
genuine
and
in
all
respects
what
it
to
be.
was
entitled
to
P98,000
of
the
Philippine
Fiber
and
Produce
Consideration
is
not
presumed
when
is
transfer
without
presumed
prima
facie
to
Malolos,
Inc.
vs.
Intermediate
Appellate
Court).
The
ruling
in
may
treat
the
b
as
den
shonored
e
on
soured
de
tssecond
endant
part
resulting
wou
as
d
a
have
in
o
nt
re
aor
surety
eased
litigation
bank
may
involving
rom
upon
any
the
issue
ab
matur
on
ty
ownership,
That
ty
on
sissue
the
not
Sec
memorandum

134
in
May,
1985,
check
may
STELCO
not
d
filed
ffer
with
n
orm
the
and
appearance
Trial
Court
rom
an
of
ab
e
when
the
checks
were
depos
ted
an
violation
of
BP
22,
hence,
this
petition.
ISSUE:
WON
the
payee
and
Delta
Motors
as
maker;
and
was
stamped
nonthe
Checks)
pet
tauthorizes
was
oner
not
s
gross
negotiable.
neg
gence,
HELD:
tense
stwo
Yes.
barred
As
from
provided
sett
ng
in
of
appeal
the
Act
correlative
that
be
other
exchange
negotiated
No.
interest
should
capac
accorded
2013.
obligation
runs
ty
have
or
IFC
only
Even
not.
from
by
is
once
put
not
of
statute.
on
the
ISSUE2:
the
and
it
to
the
date
one
to
defendant;
will
assumpt
The
inquiry
who
never
of
WON
recognition
the
has
on
and
be
as
an
instrument,
Aruego
that
aRegional
(3)
to
account
holder
Ang
the
of
act
is
in
title
with
or
and
sdue
personally
omission
a
form
aby
of
course
if
bank;
mere
the
Acceptance
by
separate
nstrument.
-an
Where
an
documents
or
prom
ssory
notes
necessary
to
secure
the
oan
n
a
indorser,
a
holder
of
crossed
checks,
a
holder
in
fide
ndorsee
Hence
t
s
no
de
to
a
su
t
aga
nst
the
crossed
genera
y
n
so
s
gn
ng
acted
w
th
n
the
actua
m
ts
o
h
s
D
however
can
orce
the
nstrument
aga
nst
C
the
part
of
the
maker
drawer
and
indorsers.
It
is
clear
from
the
For
value
received,
I/We
jointly
and
severally
promise
to
pay
to
the
order
of
MERCATOR
provisions
of
Act
No.
2031
would
not
apply,
governance
shall
be
Gaw
Suy
such
payment.
acts
are
Petitioner
cons
dered
claims
esta
that
a?
a
cashier's
HELD:
Yes
check
The
cannot
cr
me
be
(d)
By
postdat
ng
a
check
or
ssu
ng
a
check
n
payment
of
an
Korean
accountant
was
d
fferent
purposes
one
s
to
c
a
m
the
nstrument
and
the
other
Corporat
on
(BBC)
o
the
r
tax
ob
gat
ons
or
the
taxab
e
years
1978
uture
t
me
spec
fied
there
n
n
act
the
term
dra
t
s
o
ten
used
pr
PARTIES
vy
to
(a)
the
sale
of
collateral
securities
in
case
the
1.
ANTEDAT
pay
(a)
part
Where
NG
on
OR
y
a
POSTo
b
the
s
amount
addressed
or
wh
to
ch
the
or
b
more
s
drawn
drawees
Ford
indicated
was
w
thdrawn
time
deposits
rom
PC
B
or
a
eged
m
stake
n
the
amount
to
due
course.
Sec.
25
indorsed
negot
ate
by
them
Gloria
w
th
Castillo
the
as
Cashier
of
Golden
Savings
and
matters
ndorsers
not,
whether
the
name
of
the
payee
used
by
him
be
that
one
debtor
Th
City,
or
s
s
(5)
the
a
while
case
By
persona
compensat
o
Fernandez
what
account
appeared
on
Hermanos
o
to
be
the
is
an
Pres
a
ndorsed
general
dent
check
who
commercial
mere
one
y
Bank
o
Value,
what
constitutes
(supra,
p.15)
(p.13)
s
deemed
to
be
a
unds
to
the
cred
t
o
the
instrument
3.
The
Moreover
FRAUD
d.
ab
Presentment
ty
the
non-negotiable.
N
o
Nat
FACTUM
the
ona
acceptor
to
nterna
the
(or
Party
Fraud
Revenue
or
honor
Pr
n
mar
execut
Code
s
y
n
a
on
ready
effect
or
d
Fraud
secondary
sa
ows
n
be
conditional
h
s
acceptance
or
for
a
special
and
purpose
adm
ts
(without
intention
of
instrument.
An
indorsement
which
purports
to
transfer
obtained
the
instrument,
or
any
signature
thereto,
by
2013;
not
oprov
anhe
nfirm
ty
n
the
nstrument
or
de
ect
ndebtor.
the
t t eAsubject
to
defenses
secondary
Sec.
Sec
to
70
189
customers
indorsers
The
agents
or
succeeds
to
both
rwas
ghts
and
es
o to
the
ho
der
as
and
he
may
str
ke
out
h
s
own
and
ah
subsequent
ndorsements
and
nstrument
Contract
equivalent
dce
scharged
to
an
order
Sec.
Sec.
71
36(a)
is
the
only
type
of
indorsement
that
bars
further
CHAN
WAN
When
Effect
VS.
TAN
check
of
KIM
want
operates
(o
G.R.
of
No.
demand
L-15380;
as
on
an
September
principal
ass
gnment.
30,
1960)
See
p
34
tcontracts,
me
or
presentment
or
Presentment
where
instrument
is
not
The
s
ons
Sect
on
epro
ghty
one
app
y
where
check
was
ndorsed
by
the
m
ted
partners
o
La
ar
and
then
Companys
EXAMPLE
M
ssued
a
note
tocases
P
or
s
order
who
ndorsed
tthe
to
A
A to
Sec.
indorsement
as
in
Sec.
49.
Striking
out
indorsement.
-PCHC,
The
holder
may
at
any
time
two
(2)
abovementioned
decided
by
the
Supreme
Court
account
other
than
that
odut
the
payees
on
the
strength
thand
of
note
s48
case
which
pay
Here
the
the
cause
the
debt
orgery
demand
was
the
the
latters
that
co
o
atera
failure
Me
cor
secur
who
pay
ty
was
and
rentals.
d
spose
payee
Upon
oy
ord
Caloocan
nary
check
City
such
a
civil
a
complaint
shad
g
against
ven
by
both
the
drawer
RYL
and
to
STEELWELD
payee
was
within
the
jurisdiction
of
the
Malabon
RTC?
HELD:
The
negotiable
on
its
face.
PhilFrance
was
later
on
placed
under
FINANCE
CORPORATION
at
its
office,
the
principal
sum
of
EIGHT
HUNDRED
FORTY-FOUR
instrument
is
undated,
from
the
issue
thereof;
That
transact
ons
nvo
v
ng
sa
d
nstruments
shou
dnsu
accord
ng
wr
tten
on
a
paper
other
than
the
bthe
tse
tthe
does
up
the
the
articles
defense
of
incorporation
forgery
under
of
Sect
its
operation
on
23
extend
of
the
liable?
obligation
of
holder
and
accommodat
the
the
the
promissory
defendant
who
act
HELD:
would
of
negotiated
crossing
bring
note
YES.
in
violation
but
the
about
Firstly,
as
the
ischeck
merely
check
he
of
a
Section
serves
said
complete
an
to
esses
legal
assignee.
it.
20
as
The
right.
a
of
reorganization
to
warning
the
burden
The
be
The
Negotiable
note
normal
he
to
was,
the
of
in
s
acceptor
oMAN
aof
dra
thands
wh
ch
has
been
d
scounted
and
upon
Feb
1982
the
board
ocheck
d
rectors
o
Great
As
an
approved
a
F.
KINDS
OF
acceptance
sparty
relevant
circumstances
that
STELCO
cannot
be
deemed
ato
holder
who
son
an
ndorser
a
ter
the
orgery
and
sact
secondar
y
countermanded
in
the
of
a
holder
in
due
course.
ISSUE:
ob
gat
on
the
offender
no
funds
nthe
bank,
or
h
s
comm
tted
by
the
accused
was
esta
a
w
th
un
abe
th
u
ness
res
st
a
cwhen
a
m
or
payment
For
examp
ebranch
the
person
rom
whom
a
An
sought
the
extens
on
o
an
accommodat
on
oan
rom
pet
oner
to
1983
To
pay
the
assessed
taxes
respondent
purchased
neg
gent
or
how
more
care
and
prudence
on
h
snetworks
part
wou
d
have
are
not
partners
presentment
must
be
them
instrument
be
not
paid
at
maturity;
DAT
NG
partnership
engaged
in
business
innot
the
Philippines.
Fossum,
the
depos
tor
who
negot
ated
the
check
bank
knows
h
m
h
sor
A
bor
Sec.
o
exchange
52
A
holder
w
th
n
in
the
due
mean
course
ng
is
o
afurther
holder
N
Lmade
does
ndorse
has
not
c.
Petitioner
then
went
to
the
Sucat
for
verification
of
PEOPLE
VS.
EGO
(supra)
Such
an
ndorser
(6)
be
Acceptor
pa
d
Th
By
s
NEGOTIABLE
it
is
only
from
the
moment
drawee
accepts
Maker
on
primary
and
unconditional
deposited
to
its
living
Sec.
178
dead,
(c)
Loca
or
one
that
who
never
to
say
existed.
an
acceptance
(Snyder
vs.
to
pay
Com.
on
Exch.
ywho
at
aNat.
Mart
preva
PNB
nw
Lorenzo
n
ed
case
upon
o
who
need
respondent
turned
that
the
out
de
voperate
endants
ce
be
pres
dead
dent
have
not
sthe
to
nce
negot
1952
ated
as
The
the
co
wa
not
y
o
a
orma
protest
but
aThe
so
ong
presentment
and
drawer
th
the
bank
and
the
bank
sto
not
ab
enecessary
to
ho
der
un
ess
because
w
thdrawa
Commun
esse
L
ab
he
swho
cat
ons
(PBCom)
wh
ch
n
turn
sent
the
check
to
26
the
indorsee
part
only
of
the
amount
payable
(as
in
Bills
in
set
constitute
one
bill.
-or
Where
a
bill
is
drawn
and
equities
2.
What
available
constitutes
or
Order
among
to
holder
Pay
parties.
Must
for
value
be
(supra,
p.15)
As
may
P.
regards
PRESUMPTION
do
so
a
by
holder
resorting
in
ON
due
TIME,
to
course,
qualified
PLACE
valid
indorsement,
delivery,
OF
INDORSEMENT
of
a
complete
by
virtue
resu
Sec.
of
45
fraud,
duress,
or
force
and
fear,
or
other
unlawful
Sec.
4(b):
To
o
the
pay
person
sixty
days
after
wou
d
get
the
purchase
orders
o
customers
and
orward
them
aga
nst
negot
ate
the
negotiation.
Those
under
(b)
and
(c)
may
still
be
negotiated,
Eleven
checks
check
to
Presentment
the
payable
o
bank
tse
for
to
does
to
payment
"cash
not
the
same
is
or
bearer"
for
as
an
the
ass
account
and
gnment
in
drawn
order
of
otshortthe
any
by
to
EXAMPLE
PBCOM
VS.
ssued
ARUEGO
a
bsdemand
oprior
(supra
exchange
p
4)
order
Sec
20
DW
prov
to
pay
des
P
that
Fa
ure
to
g
ve
not
ce
o
d
shonor
w
not
necessar
ythe
tthis
n
to
Bver
dividend
payable
for
the
year
on
1917.
George
and
where
B.
Wicks,
payable
treasurer
on
of
the
acceptance
depos
ted
by
Chaves
there
sa
de
ay
npay
C.
CONCEPT
OF
NEGOTIABLE
THOUSAND
strike
SIX
out
any
indorsement
which
is
not
necessary
to
o
orged
nstruments
(Repub
c
Bank
vs
Ebrada
BDO
o
learning
venue
the
tB(2)Where
to
check
hPromise
sDR
benefit
of
of
and
jurisdiction
the
the
but
litigation
ega
there
lies
presumpt
s
between
no
either
proo
on
in
s
whatever
that
petitioner
the
the
RTC
bank
that
Caloocan
and
wou
th
s
Benin,
d
was
not
or
more
for
the
n
the
recovery
nature
o
of
memorandum
the
value
of
the
o
steel
ndebtedness
bars
and
and
wire
shou
sold
d
to
the
wh
custody
ch
money
of
the
has
been
Securities
advance
and
by
Exchange
the
p
a
Commission.
nt
ff
that
the
As
not
b
nd
the
reported
Negot
"clearing
ab
to
the
e
checks
nstruments
Bangko
and
Sentra
other
Law.
ng
clearing
One
P
p
nas
actor
items."
wh
there
ch
s
ac
No
reasonab
tates
doubt
th
e
s
Instruments
commercial
question
parties
therefore,
holder
neverthe
that
to
ess
is
a
placed
Law
not
check
the
customs
by
provides
a
check
the
upon
are
negotiable
c
the
ear
has
and
it
that
drawer,
to
practices,
mandate
been
"Where
instrument
show
issued
the
that
the
with
o
payee
for
for
instrument
notwithstanding
sect
reference
a
lack
and
definite
on
29
of
to
contains
purpose
the
drawee
o
the
sosecond
reso
ut
on
author
z
ng
Great
As
an
to
secure
a
(c)
Where
the
instrument
is
not
dated,
it
will
be
considered
to
be
INSTRUMENTS
a
cheque
bears
across
ts
ace
an
add
t
on
o
the
WON
of
the
petitioner
check
for
can
value.
collect
It
on
does
the
not
stolen
meet
check
two
on
of
the
the
ground
essential
that
funds
depos
ted
there
n
were
not
suffic
ent
to
cover
the
ab
e
to
subsequent
part
es
due
to
the
r
warrant
es
bearer
nstrument
was
sto
en
may
c
a
m
the
nstrument
rom
a
ho
der
the
bill
or
certifies
the
check
that
the
drawee
becomes
rom
pet
oner
Traders
Roya
Bank
(TRB)
three
manager
s
checks
a
un
ess
one
has
author
ty
to
accept
or
re
use
Far
East
acting
as
agent
of
AIPCI,
procured
an
order
from
respondent
operate
(b)
taken
as
authorizes
an
the
a
confession
of
judgment
if
the
instrument
s
be
CTDs
novat
on
address
and
h
story
because
he
s
a
c
ent
Hence
t
s
n
a
better
was
rep
aced
w
th
manager
s
check
by
PC
B
wh
ch
were
Sec.
PAL
w
STOP
9(c)
thout
VS.
and
qua
CA
(d):
(GR
ficat
No.
on
They
"
49188,
nter
are
treated
a
Jan.
a
"engages
30,
as
1990)
bearer
that
CFI
instruments
on
Manila
due
ruled
in
PNB
3
VS.
QU
MPO
(GR
No
L
53194
March
14
1988)
Pr
vate
not
ce
"who
o
part
cu
ar
p
ace
and
orged
unt
Savings
s
note
gnatory
w
s
t
gnature
th
Account
the
n
accordance
bank
o
in
the
nor
the
deceased
have
Metrobank.
w
th
they
the
rece
They
ved
were
the
va
then
ue
thereo
sent
for
or

rom
contractus)
the
bank
account
o
the
deceased
un
ess
proper
taxes
are
12.
Ante-dated
and
post-dated.
The
nstrument
s
not
case)
does
not
operate
as
a
negotiation
of
the
instrument."
As
to
engagement
s
to
pay
on
y
t
sha
not
have
been
pa
d
by
the
drawee
pet
Unconditional
t
oner
or
c
ear
ng
Pet
t
oner
c
eared
the
check
as
good
instrument
which
and
he
(as
HUNDRED
60.
in
L
a
ab
TWENTY-FIVE
set,
ty
each
of
PESOS
part
maker.
of
&
the
78/100
set
The
(P
being
844,625.78),
maker
numbered
o
Philippine
a
negot
and
currency,
ab
e
x
x
The
.
How
transferee
Presentment
acquires
the
legal
title
the
transferor
had
and
means,
or
for
an
date;
Sec.
27
(a)
By
any
negot
(a)
act
The
wh
at
ex
ch
ng
stence
d
the
scharges
same
o
the
the
the
drawer
person
nstrument
the
to
genu
whom
neness
t
s
negot
o
h
ated
s
LP
A
ter
pr
nt
ng
ca
endars
LP
wou
d
sh
p
the
nstrument
When
except
lien
on
instrument
constitutes
holder
for
but
or
order
the
subsequent
P
indorsees
will
also
be
an
agent
or
trustee.
defendant
absence
o
part
charge
Tan
o
upon
the
the
unds
person
the
to
Equitable
the
primarily
cred
Banking
t
o
liable
the
on
drawer
Corporation,
the
instrument;
w
th
the
were
bank
but
all
Sec.
53ethat
Company,
requested
that
aw
telegraphic
transfer
ofo
to
. sued
ndelivered
comput
mak
ng
presentment
ng
to
the
acceptor
or
honor
or
re
eree
n
a
person
demand.
thout
(1)
Where
the
INSTRUMENTS
to honor
C
n
Chto
sdra
Dhis
current
present
ho
account
der
and
M
th
d is
shonors
the
p
the
a
ntnstrument
ffon
As
a$45,000
Bank
may
ng
When
person
not
deemed
a seen
due
course
Simple
Contract
as
used
in
Sec.
25
is
that
found
under
the
Civil
vs
EBC
Traders
Roya
Bank
vs
RPN)
title.
The
tthe
was
accepted
or
the
accommodat
oand
the
drawer
Malabon
Trial
Court.
BP
22
a
continuing
crime.
AD
person
Sesbreno
unable
to
collect
his
investment
and
interest
Urdaneta
the
check
asked
w
them
to
the
vacate
genu
ne
the
endorsement
property
Me
surrender
cor
n
and
upon
nthe
a
c
v
to
act
RYL
on
in
Consequent
the
amount
yholder
here
of
nin
P126,129.86,
Respondent
udge
plus
dRu
scount
ng
ne
w
th
Bancas
a
n
an
amount
not
ng
P2M
raud
transactions
was
de
on
ay
non-negotiable
n
the
reconc
at
checks
on
othe
bank
are
within
(PNB)
statements
the
ambit
or
term
called
bank.
suspicious
so
Negot
aPROMISSORY
obligations.
Courts
person
ab
words
he
e
must
circumstances,
nstruments
have
adds
of
inquire
negotiability.
It
long
can
to
if
recognized
his
he
readily
Law
has
signature
itoo
The
acquired
be
That
sellerbusiness
words
the
the
the
that
assignor
check
appe
indicating
judgment
check
custom
pursuant
ant
IPM
in
of
is
that
notes,
actual
aga
using
liable
he
to
n
dated
on
as
the
of
the
a
th
time
thereo
itport
was
rece
issued;
ves
the
b
or
acceptor
except
nbe
avor
areceived
to
whom
tunconditional
savor
shown
name
oby
a
banker
e
ther
w
th
or
w
thout
the
words
not
1.
NOTES
(Sec.
184,
NIL)
ownersh
An
he
is
aacceptance
holder
in
due
course?
HELD:
Petitioner
failed
to
amount
of
check
The
ure
othe
the
drawer
oexceed
the
check
requisites
prescribed
by
the
statute.
It
did
not
become
"the
holder
who
primarily
swas
not
n
due
liable.
course
(see
because
Sec.
h
sperson
equ
ty
o
p
He
may
Later
on
C
can
recover
what
he
pa
dManager
rom
the
x,
inon
installments
as
follows:
or
a
n
wh
ch
case
presentment
may
be
wh
ch
turned
over
through
A
da
Nuez
TRB
Branch
to
Rea
ty
nvestment
wh
ch
the
ormer
w
use
to
urther
the
rt
deliver
a
tail
shaft,
to
installed
on
the
ship
Romulus
.Wh
It
was
ass
gnment
instrument
of
funds
under
n
the
the
conditions:
of
drawee
who
s
not
declared
lost,
alleging
that
same
were
delivered
to
herein
a
eged
y
sto
en
and
prov
not
ded
paid
a
so
at
that
maturity;
ttstatement
sha
or
have
been
du
yNo.
presented
or
payment
nva
pos
presentment
PAYMENT
d
tSuch
or
the
to
detect
reason
**
on
y
that
tfollowing
shands
ante
dated
or
post
dated
prov
ded
(d)
Qua
fied
to
tindorsement
me
FERNANDO
a.
MAUL
That
it
N
is
complete
VS.
ANTON
and
O
regular
SERRANO
(GR
its
appeared
at
the
dorsa
on
othe
the
check
ndorsed
n
o
one
pa
dy
to
the
clearing
what
de
vered
was
by
them
really
the
written
branch
the
office
back
to
of
the
the
check
principal
which
Montinola
office
of
because
favor
it
of
Respondent
arrangement
o
the
on
w
th
ts
depos
tory
bank
eand
addition,
Made
the
and
therea
containing
ter
PBCom
a
reference
nstrument
mak
engages
that
he
w
pay
tchecks
accord
ng
to
ts
opposed
to
an
incomplete
instrument
under
Sec.
15),
by
all
parties
disclaims
his
liability
to
any
holder
or
any
subsequent
party
who
a
PROTEST
2.
DEF
Cert
N
T
s
ON
a
tto
sng
present
when
n
acheck
wr
person
ng
made
supon
nduced
by
aand
to
notary
s
gn
an
3.
As
a
consequence
o
the
above
prov
sght
on
the
drawee
scourse.
not
ab
e
illegal
consideration,
or
negotiates
itvaluable
in
breach
of
Sec.
46
4,
last
(p.13)
must
s
paragraph:
gnature
have
and
had
refers
h
sAugust
actua
capac
to
a
condition
ty
know
and
edge
author
which
o
ty
may
to
the
draw
or
may
nfirm
the
not
ty
Sec.
56
ca
endars
d
rect
yo
the
Condition
is
Resolutory
or
Suspensive
-tpresent
In
conditional
(b)
By
the
ntent
ona
cance
at
on
o
h
s
srand
gnature
by
the
ab
ty
on
the
part
the
drawer
The
oor
the
payee
to
recover
the
plaintiff
in
York
City.
Wicks
drew
and
delivered
a
and
for
if
the
payment
the
instrument
bank
by
scorporat
not
Chan
is,
ab
Wan
e
its
to
to
the
value
What
constitutes
notice
of
defect.
-used
To
constitutes
tpresented
me
case
ndorsed
tfied
to
A
A
B
B
to
C
and
Cwhen
to
D
ho
der
Later
DW
instrument
is
not
payable
on
demand,
presentment
Sec
143
170
Corporat
on
The
n
other
amount
cases
represented
the
co
ect
by
ng
both
bank
and
the
was
used
not
(who)
C
who
adds
n
turn
to
h
may
sNew
sas
gnature
not
y
B
words
A
and
nd
Phe
B
cat
may
ng
not
that
he
A
sNo
gns
Pdrawee
and
or
or
A
1.
DEFINITION:
Negotiable
Instruments
are
written
Code.
that,
aorma
negotiable
instrument
is
issued
for
ay
When
D
shonor
presentment
of
b
by
acceptor
for
acceptance
for
honor.
must
When
be
(supra)
indorser
(3
R
C
L
whose
pp
1143
1144
par
is
struck
out,
and
all
September
16,
- he
P154,267.
charged
with
a
transitory
crime
may
be
validly
tried
in
any
thereon,
he
filed
an
action
for
damages
against
Delta
Motors
and
other
to
words
him
possession
when
GEL
C
thereof
rece
ved
within
ts
banks
15
days
statement
from
notice.
t been
had
N
ta
18%
an
interest
ru
ng
that
from
B
P
20
1980
25%
of
the
total
amount
and
a
so
des
gnated
Arsen
o
as
the
author
zed
s
gnatory
to
s
gn
a
w
th
of
the
its
NAWASA
jurisdiction.
bank
accounts
The
term
The
records
as
kew
se
show
in
the
that
said
the
signs
instead
for
printed
good
that
assum
breach
purpose,
faith.
for
ng
of
checks
or
of
h
resulting
m
In
warranty
on
otherwise
to
the
where
behalf
be
to
case
and
the
an
blanks
of
he
such
accommodat
advantage
at
a
is
principal
liability
bar
not
are
a
provided
as
holder
of
as
on
the
commercial
a
general
ndorser
in
in
payee
for
a
due
representative
the
rule
may
life
acquired
date
extends
obta
in
the
of
It
n
va
ue
who
(d)
Where
there
is
a
conflict
between
the
written
and
printed
substantiate
negot
ab
e

his
that
claim
add
t
that
on
const
is
tutes
a
holder
a
cross
in
ng
due
and
course
the
and
depos
t
the
amount
necessary
to
cover
h
s
check
w
th
n
three
(3)
days
promise
of
it
before
it
was
overdue,
and
without
notice
that
it
had
a
so
res
st
the
c
a
m
o
a
ho
der
not
n
due
course
by
ra
s
ng
the
127).
He
becomes
liable
to
the
holder
by
his
unconditional
made
to
h
m
on
y
orger
F
who
becomes
pr
nc
pa
debtor
because
o
h
s
Mrs
Lourdes
C
Vera
the
financ
a
comptro
er
o
respondents
bus
ness
Respondents
prom
sed
to
pay
o
nt
y
and
severa
y
n
one
and
protested
or
non
payment
and
not
ce
o
d
shonor
g
ven
to
h
m
stipulated
that
the
tail
shaft
would
be
in
accordance
with
ab
e
on
the
nstrument
unt
he
accepts
t
(Sec
127)
n
act
th
s
s
not
done
or
an
ega
or
raudu
ent
purpose
The
person
to
petitioner
as
security
for
purchases
made
with
Caltex
by
a
synd
cate
and
depos
ted
n
the
r
own
account
The
(c)
waives
the
benefit
of
any
law
intended
for
the
Other
causes
o
ext
ngu
shment
o
ob
gat
ons
such
as
annu
ment
face;
orgery
raud
b.
or
rregu
ar
ty
n
the
ndorsement
Further
Ramon
(the
nstrument)
sha
be
accepted
or
pa
d
or
both
as
the
case
claims
to
be
a
full
indorsement
of
the
check,
the
Court
agreed
1
A
check
s
a
mere
order
on
a
bank
to
pay
money
it
was
rom
the
Metrobank,
which
forwarded
impossible
8844
(e)
Dec
to
The
indorse
acceptance
when
o
it
some,
is
payable
one
or
more
cash,
of
sundries
the
or
Franc
was
sco
the
bank
Gozon
corporat
n
payment
went
on
s
check
to
o
the
any
wh
pre
Ca
ch
oocan
ex
was
st
ng
C
debt
ssued
ty
Branch
and
to
that
pet
o
t
t
oner
PNB
was
right
Amelia
to
have
Tan
the
[under
indorsement
the
name
of
the
and
transferor,
style
of
without
Able
which
Printing
he
cred
ted
Cap
to
s
account
or
the
amount
stated
n
the
check
pub
Check
c
nstrument
at
the
to
the
to
the
other
parts,
the
whole
of
the
parts
tenor
and
adm
ts
the
prior
to
him
is
conclusively
presumed
(admission
of
evidence
to
the
H.
COLLECT
1982
ON
OF
87
He
Q.
is
CONTINUATION
only
liable
for
breach
OF
NEGOTIABLE
of
warranties
under
(a)
Where
t
s
payab
e
to
the
order
o
a
th
rd
person
and
has
been
rom
the
drawer
or
nstrument
de
ect
based
and
or
on
the
atter
s
contractua
ob
gat
on
that
obligations,
check
for
the
acquisition
the
amount
of
rights,
of
P90,355.50,
as
well
as
total
the
cost
of
said
happen.
customers
A
Therea
ter
the
agents
wou
d
come
around
to
ho
der
(c)
By
the
d
scharge
o
a
pr
or
party
bank
were
made
to
share
n
the
ab
ty
ho
der
un
ess
and
unt
t
accepts
or
cert
fies
notice
of
an
infirmity
in
instrument
or
defect
in
the
the
drawee
terms,
bank,
but
payable
they
"were
at
a
special
all
dishonored
place,
and
and
returned
he
is
able
to
him
and
Sec
NATIVIDAD
74
nstrument
GEMPESAW
must
be
exh
VS.
b
ted.
CA
(GR
The
No.
nstrument
92244;
must
Feb.
be
9,
re
used
to
(supra,
pay
and
p.15)
protest
was
du
y
made
X
made
a
payment
or
the
must
be
made
on
the
day
it
falls
due.
Where
it
is
statements
by
Chaves
a
ter
they
were
on
beha
o
a
pr
nc
pa
or
n
a
representat
ve
capac
ty
he
s
D
gave
not
ce
o
dto
shonor
to
P
Aand
Bhim,
and
Csecur
C
may
not
not
y"in
P
Agood
consideration
which
may
Sec
86
Tin
me;
the
made.
how
b
-ce
sPresentment
computed.
dmaker
shonored
for
by
When
acceptance
the
the
acceptor
nstrument
must
or
be
honor
sseparate
made:
payab
te
at
indorsers
subsequent
to
are
thereby
relieved
from
municipality
or
territory
the
offense
was
partly
Pilipinas
Bank.
Delta
Motors
contends
that
said
promissory
a
Petitioner's
r cheque
tonstrument
assume
adamant
that
Me
refusal
cor
had
to
persona
comply
yther
endorsed
with
such
the
demand
check
nstruments
sought
to
be
documents
recovered
and
as
and
checks
by
way
necessary
of
attorney's
to
secure
fees.
the
A
22
on
wh
ch
the
nrom
ormat
on
was
based
was
unconst
tut
ona
pet
Articles
tght
oner
of
a
ed
Incorporation
prov
de
of
PCHC
ate
can
only
ty
connote
measures
checks
over
in
ts
capacity,
Philippines,
to
issuance,
the
results
secur
the
check
ty
corporation
rom
therefore
the
he
might
under
the
is
name
not
be
circumstances
(IFC)
of
that
liable
the
the
to
source
to
protect
payee,
when
on
whom
the
h
the
State
instrument
abuse
mse
it
which
amount
assigned
and
aga
Investment
should
payable
nst
oppression,
ifho
its
he
the
have
was
and
danger
House
duly
and
put
for
consideration
or
value
as
shown
by
the
established
facts
rom
rece
pt
odec
not
the
bank
and
or
payee
or
der
that
sa
d
s res
crossed
spec
aappropr
ywhere
tode
that
banker
provisions
of
instrument,
the
written
provisions
prevail;
writing
mace
by
one
person
towas
another,
signed
by
Acceptance
may
be
made
on
the
nstrument
tse
or
n
a
previously
dishonored,"
and
it
did
not
take
the
check
acceptance
whom
an
so
dated
sBank
vered
acqu
res
the
tnote
tng
e
The
3
manager
wrong
sInc.
u
checks
act
o
however
org
a
were
never
vered
nor
pa
d
to
Acceptance
our
aw
requ
or
honor
that
snot
they
a
so
be
presented
ed
acceptance
supra
or
acceptance
protest
or
specifications
contained
in
aab
blueprint
given
to
Fossum
and
tr
a
court
ded
n
avor
ong
Ford
nof
th
sth
pet
tde
on
PC
B
crights
acheck
ms
that
month
Philippines,
ts
me
To
and
requested
that
the
CTDs
be
pre-terminated,
advantage
or
That
he
became
the
holder
of
itupon
with
trial
court
that
the
original
writing
of
Ramos
on
the
back
of
respondent
drawer
sdrawer
Ong
at
the
tdo.
me
the
raudu
ent
transact
took
p
ace
cannot
may
be
be
considered
accord
ng
a
to
holder
tenor
within
and
that
the
definition
tand
be
d
under
shonored
Sec.
a
fictitious
Payment
W
thout
REAL
w
th
DEFENSES
4
hdue
rwho
end
AND
PERSONAL
However
drawees
but
of
a
them
Echaus
or
the
to
the
amount
Bureau
negot
ated
nvo
of
Treasury
ved
the
note
pet
for
tcontaining
w
oner
special
the
actua
clearing.
bank
yn
and
After
had
being
no
s
4.
Recourse
of
Co
ect
ng
draw
the
co
ng
bank
may
Lorenzo
From
Ramon
Lorenzo
the
same
ndorsed
to
one
16
1914)
in
The
prom
ssory
note
reads
Press]
in
October
adrawer
16,
complaint
for
-to
damages
P154,267.
against
petitioner
ex
stence
o
payee
and
hts
sdrawn
then
capac
ty
to
ndorse
been
CHECKS
Sec.
CHARACTER
65.
pa
db
by
the
constitutes
and
one
bill
.ca
77
Sec.
nstance
179
Cross
know
o
ng
ng
by
ho
ts
der
character
dec
or
a
ar
ter
as
ng
ssue
a
that
note
the
or
achecks,
be
The
person
has
been
s(1)
gn
s fixed
separate
rom
the
negot
e
nstrument
sficat
st
bon
nd
ng
The
transfer,
including
exchange
and
cost
of
message
which
was
A
cert
fied
check
sthe
one
by
a
depos
tor
unds
to
h
s
B.
(d)
By
NEGOTIATION
payee
a
va
know
d
ust
edge
because
or
o
payment
such
the
acts
drawer
made
that
by
h
actua
s
acauses
act
pr
ycert
or
on
ssued
party
n
tak
the
ng
the
to
extinguishment
or
loss
of
those
already
negotiable
co
57
ect
instrument
the
payments
must
be
Pet
payable
tor
oner
in
however
all
events.
had
a
h
story
Right
of
holders
where
different
parts
are
The
uncond
ttender
ona
prom
se
attaches
the
moment
the
maker
title
of
the
person
unpaid
willing
to
insufficient
to
pay
it
funds
there
and/or
at
maturity,
attributable
such
ability
to
and
Sec
142
R
ghts
of
ho
der
n
due
course.
A
ho
der
due
course
exh
honor
1993)
ted
othat
A
to
-the
Natividad
person
rom
Gempesaw
whom
payment
issued
snstrument
demanded
prepared
and
by
when
her
D.
PRESUMPTION
OF
DUE
COURSE
Sec
188
The
ho
der
by
request
ng
such
on
nstead
o
payable
on
demand,
and
B
R
ghts
of
part
es
as
qua
fied
acceptance.
must
The
depos
not
ted
ab
e
n
on
the
the
p
a
nt
ff
bank
by
ng
checks
on
the
STATE
signed
NVESTMENT
by
the
maker
HOUSE
or
drawer
VS.
COURT
OF
an
unconditional
APPEALS
(217
be
to
give,
to
do
not
to
a
per
od
a
ter
date
a
ter
saddition
ght
or
a
ter
that
happen
ng
o
awho
must
be
protested
committed.
In
determining
the
proper
venue,
the
ff.
be
was
not
liability
intended
on
the
be
negotiated
or
otherwise
transferred
by
Sec.
49
dssued
scount
ng
ne
n
turn
Great
As
an
Pres
dent
Tan
Chong
Lthe
na
and
resulted
otherw
a
se
complaint
bank
wou
for
d
not
ejectment
have
pa
dect
ton
Sec
recovery
23
o
of
preliminary
attachment
was
issued
by
the
trial
court
the
basis
Transfer
without
indorsement;
effect
of.
(supra,
p.12)
own
general
records
use
in
thereby
commercial
ay
ng
and
confident
business
a
activities.
records
It
cannot
open
to
authorized;
make
interests.
drawer's
it
rediscounted
o
to
nso
the
inquiry,
vency
signature.
Even
courts
but
the
assuming
o
why
the
involuntary
check
the
mere
All
the
the
atter
holder
knowing
that
drawer
parties
cannot
the
had
of
that
has
note
words
thereto.
the
to
n
it
is
check
do
was
any
negotiable,
describing
when
If
manner
ao
the
and
crossed
he
bank
used
him
IFC
wishes
affect
check
has
which
as
it
han
to
to
the
quest
oned
Order
quash
ng
the
n
ormat
on
Hence
th
s
of
the
case.
Admittedly,
petitioner
became
the
holder
of
the
check
has
been
d
shonored
or
ack
or
nsuffic
ency
unds
sha
be
the
maker,
engaging
to
pay
on
demand,
or
at
a
fixed
(e)
Where
the
instrument
is
so
ambiguous
that
there
is
doubt
nstrument
faith
and
for
value."
Neither
is
there
any
evidence
whatever
thereto
as
of
the
date
of
de
very
(b)
Where
the
drawee
s
dead
presentment
may
be
(Westminster
Bank
vs.
Torres
&
K.
Nassor,
Inc.,
GR
No.
L-38139;
the
B
R
but
nstead
the
checks
were
presented
or
payment
by
the
shaft
s
gnature
should
be
n
shipped
the
from
New
York
in
March
or
April
or
or
payment
w
th
n
a
reasonab
e
t
me
a
ter
the
r
ssuance
or
1982
87
the
act
on
o
Ford
had
prescr
bed
because
o
ts
nab
ty
to
nsure
which
payment
was
refused
respondents
by
the
respondent
de
vered
bank
to
due
Far
to
the
East
failure
Rea
ty
of
protection
of
the
obligor;
or
3
000
Due
5
h
before
o
Sep
embe
overdue,
and
without
notice
check
was
to
the
effect
that
he
was
assigning
only
P30,000
191
and
thus
cannot
negotiate
it.
He
also
cannot
be
considered
a
was
Acceptance
a
depos
tor
o
pet
t
oner
DEFENSES
Ernesto
Santos
who
he
e
t
n
the
car
wh
e
he
transacted
bus
ness
pet
account
t
oner
recover
PNB
As
returned
such
the
s
sub
check
ect
to
to
PBCom
revocat
and
on
by
deb
the
ted
drawer
PBCom
s
and
the
necessary
ANG
Unde
TEK
Section
LIAN
VS.
191
CA
(GR
No.
the
L-2516;
Sept.
25,
Instrument
1950)
told
transact
accord
to
ng
wait
on
y
the
d
rect
several
rea
y
party
w
th
times,
n
sa
nterest
d
Gloria
and
Castillo
the
party
and
ab
Gomez
e
or
De
a
Philippine
Airlines.
On
appeal,
drawer
may
no
onger
be
secondar
y
ab
e
but
h
s
contractua
ab
ty
accepted
by
the
officer
selling
the
exchange
in
payment
of
cred
t
n
a
DEFINED
presented
(b)
Where
does
not
t
or
was
know
payment
made
that
or
or
accepted
he
or
acceptance
s
s
gn
or
ng
accommodat
but
negot
the
ab
same
on
e
nstrument
and
was
has
been
and
2.
1
Drawer
The
ho
ho
der
der

secondary
may
o
the
refuse
check
liability.
to
may
But
take
the
e
ther
a
drawer
qua
present
fied
may
acceptance
insert
t
or
in
payment
the
METROPOL
h
m
or
(BACOLOD)
FINANCING
&
INVESTMENT
makes
unrem
the
tted
co
ect
ons
wh
ch
acquired,
shall
negotiated.
depend
upon
Where
the
happening
two
or
more
of
the
parts
event
of
which
a
set
are
(e)
By
a
re
ease
o
the
pr
nc
pa
debtor
un
ess
the
ho
der
s
r
ght
drawer."
The
willingness
drawer
are
equivalent
to
a
B
HOLDING
C
and
negotiating
D
are
d
scharged
the
same,
the
person
to
whom
it
is
payment
ho
ds
the
nstrument
ree
rom
any
de
ect
o
t
t
e
o
pr
or
Sec.
7.
47.
When
Continuation
payable
on
of
demand.
negotiable
character.
An
instrument
An
is
t a.
s
pa
bookkeeper,
d
must
be
a
total
presentment
must
be
made
within
a
reasonable
time
p
a
nt
ff
Subsequent
y
these
checks
were
presented
by
the
p
a
nt
ff
promise
(a)
Where
or
order
the
bill
to
is
pay
payable
a
sum
after
certain
sight,
money,
or
in
payable
any
other
because
nstrument
the
not
ce
he
by
the
was
ho
du
der
y
author
nures
to
zed
the
but
benefit
the
o
mere
a
pr
add
or
t
on
SCRA
32
[1993])

Nora
Mou
c
ssued
checks
to
Corazon
Philfinance
as
manifested
by
the
word
"non-negotiable"
stamped
non
payment
by
h
m
spec
fied
event
the
Value
Sufficient
need
not
mean
that
the
amount
of
s
gned
2
N
L1912
possession
sthe
square
of
nnegot
po
property
nt
The
filed
money
by
was
Urdaneta
on
depos
against
tonly.
nwho
HSBC
Casabuena
andthe
t
of
the
averments
of
the
complaint
but
was
shortly
dissolved
cashier's
check
as
endorsed
by
Alexander
Lim
stole
unauthor
conceived
zed
to
persons
be
limited
to
negotiable
checks
Checks
are
agent
meritorious
issue
pay
he
ab
was
his
ty
a
or
check
to
own
as
knowingly
case,
filing
is
personal
to
appe
the
a
properly
representative
judgment
violating
ee
account,
as
fill
up
the
is
the
ultimately
the
character,
sa
the
blanks
d
avowed
remedy
duty
and
certain
without
devolved
sign
s
intention
in
a
it.
the
matter
disclosing
However,
courts.
upon
of
o
pr
ma
ac
e
ev
dence
o
dece
t
const
tut
ng
a
se
pretense
or
pet
t
on
rev
ew
or
determinable
future
time,
a
sum
in
money
to
whether
it
is
a
bill
or
note,
the
holder
may
treat
it
as
either
at
his
that
Armstrong
Industries,
to
whom
R.Y
.
Lim
negotiated
However
under
Sec
133
the
ho
der
may
requ
re
the
acceptance
on
a.
Parties
to
a
Negotiable
Promissory
Note
are
(1)
made
to
h
s
a
ter
r
November
ast
16,
at
on
(Sec
71)
P154,267.
a
ure
o
wh
ch
w
d
scharge
unknown
1920.
persons
The
manufacture
to
Secur
ty
Bank
and
Taytay
shipment
Branch
of
Respondents
the
shaft
sent
was
note
seek
ud
con
re
e
seasonab
y
cons
der
that
the
ao
eged
nvestment
petitioner
a
to
present
documents
to
prove
such
that
it
had
previously
dishonored,
if
bearer
(d)
since
gives
the
the
instrument
holder
an
is
election
payable
to
require
to
bearer.
something
to
be
value
of
the
document
and
that
he
was
instructing
the
bank
Dom
nguez
and
then
rom
Dom
nguez
here
n
account
or
the
amount
covered
by
the
check
the
reason
n
the
bank
Santos
saw
that
Gozon
e
tab
h
sto
checkbook
he
took
a
proceed
ngs
on
d
shonor
be
du
ypay
taken
he
w
pay
the
amount
bank
rPetitioner
Banks
of
are
engaged
n
a
bus
ness
Negotiable
mpressed
wmodifications
th
pub
s
c
any
tpp
me
be
ore
sn
accepted
2
Law,
PNB
VS.
issue
rom
c.
he
CA
ts
does
means
depos
(GR
not
tor
No
the
obta
who
26001
nfirst
had
an
not
Oct
delivery
unqua
gtrial
ven
29
va
fied
1968)
ue
acceptance
the
or
course
Agusto
instrument
money
Lare
he
made
should
the
payment
only
subsequent
be
o
considered
the
withdrawals
notes
as
valid
at
when
given
with
express
the
impression
legislative
corporat
SSUE
WON
pr
vate
respondent
the
CA
upheld
Ang
the
decision
of
the
CFI
with
minor
as
Sec
s
preserved
TRADERS
CORP.
62
REAL
VS.
(Producers
SAMBOK
ROYAL
Bank
BANK
MOTORS
o
the
VS.
(GR
COURT
No.
PERSONAL
nes
L-39641
vs
OF
Exce
;APPEALS
DEFENSE
Feb.
sa
ndustr
28,
1983)
(GR
es
va
uab
e
cons
derat
on
There
son
no
ob
gat
on
on
the
transfer
in
question.
As
evidence
of
this
transaction
a
Requ
instrument
or
he
s
tes
may
L
ab
ty
of
acceptor.
-Metrobank
The
acceptor
by
may
bank
wh
be
used
ch
a
proper
as
a
officer
onot
bank
cert
fies
w
be
dcan
when
(1)A
cheque
may
be
crossed
genera
ynterest
or
spec
a
y
by
the
he
du
y
acknow
edged
n
arequested
confirmat
rece
pt
he
co
srespondent
gned
w
th
b
Examp
Such
s32:
e
nd
Where
spensab
the
e
on
max
yt(Art.
mum
a
FORE
a
owed
GN
B
LL
OF
EXCHANGE
rate
sthe
24%
but
may
per
constitutes
negotiated
the
condition
to
different
1181,
NCC)
o
recourse
aga
nst
the
secondar
ypp
e
s-ng
express
y
reserved
of
82
checks
in
favor
of
several
supplies.
Most
of
the
checks
for
enters
nto
ademand
new
contract
w
th
the
bank
and
one
not
w
th
n
negotiated
have
had
actual
knowledge
of
Sec.
nstrument
drawing
30.
part
What
tender
the
wh
es
check
eDEFENSE
and
the
constitutes
of
payment
engaged
acceptor
that
upon
sSo
negotiation.
assent
"on
his
due
part.
to
the
presentment,
But
uncond
An
instrument
ona
the
as
herein
check
order
is
payable
instrument
on
negotiable
demand:
in
its
origin
continues
to
be
negotiable
Payment
across
c.
by
Ho
the
the
der
face
has
of
no
dmust
the
scharges
Note.
the
The
nstrument
court
sof
nce
and
he
spa
the
the
one
CA
case,
where
presentment
for
acceptance
is
necessary
in
after
its
issue,
except
that
in
the
case
of
bill
of
Sec.
to at
the
53
Ph
ne
on
or
a
o
words
descr
b
ng
h
m
as
an
agent
or
as
fi
ng
a
part
es
who
have
the
rto
ght
o
recourse
aga
nst
the
party
to
whom
tit
sm
V
ctor
ano
as
depos
tparty
or
When
person
not
deemed
holder
in
due
(p.16)
tin
me
oNARY
payment
sfiling
determ
ned
by
exc
ud
ng
the
day
from
wh
ch
consideration
and
the
promise
to
in
the
are
Surety
Agreements
n
avor
oto
Bancas
a
guarantee
sotone
dar
y
ORD
ACCEPTANCE
VS.
ACCEPTANCE
FOR
had
and
check.
no
Benin.
ega
He
refused
rdrawer
ght
Amid
to
the
pay
say
sprouting
tL
how
out
and
to
controversies
anyone
why
it
was
except
passed
involving
GEL
to
CG
him.
the
or
lot,
He
ts
upon
the
of
abetween
counter-bond
by
STEELWELD.
RYL
used
between
banks
and
bankers
and
their
customers,
and
his
the
it,
crossing
concern
mere
principal,
plaintiff-appellee,
fact
the
exc
does
that
us
check.
ve
he
not
y
Furthermore,
has
exempt
done
prove
these
him
his
that
accommodat
from
does
failure
it
personal
not
actually
to
give
inquire
on
liability."
rise
acquired
from
ndorser
any
An
on
cert
orar
fi
ed
by
the
cPh
tor
Genera
nexcept
beha
oto
the
Sec.
Reason:
negotiation
requires
delivery,
and
there
87
the
accepted
the
instrument
and
attempted
to
encash
in
election;
We
ocheck,
n
yto1982
and
seve
athe
y
ag
ee
o
pay
oshonored
he
on
de
oinstrument
Don
An
on
o
Se
ano
the
b
tse
otherw
se
tat
may
be
treated
as
d
shonored
Maker
and
delayed
considerably.
Meanwhile
AIPCI
had
drawn
a
time
the
drawer
rom
ab
or
to
the
extent
otook
the
oss
caused
by
the
persona
etters
to
both
TRB
Secur
ty
Bank
therea
ter
demand
ng
neg
gent
act
took
p
ace
pr
or
to
December
19
A
whose
son
gnature
was
orged
has
atherefore
rema
nthat
ng
such
was
the
fact;
That
he
it
in
Ch
allegation.
na
Bank
Check
Petitioner
drawn
then
by
filed
Dy
H
a
an
complaint
Tat
ssued
in
the
on
RTC,
September
which
was
13
deposit
to
his
credit
the
balance.
Montinola
may
not
may
treat
b
as
d
by
non
acceptance
done
in
lieu
of
payment
of
money.
-to
Sambok
Motors
Ebrada
check
there
Subsequent
rom
fi
ed
y
tit
Ebrada
up
or
P5
encashed
000
and
the
orged
same
the
sthe
n
gnature
1963
at
o
be
thereo
ng
that
there
a
mater
abank
a
terat
on
othe
the
check
The
drawer
may
countermand
payment
he
has
a
va
d
de
ense
nterest
complete
and
in
tto
its
sor
the
raty
duty
to
protect
return
the
riffirst
many
sanction.
to
the
d.
that
the
treasury
warrants
document
pa
d
was
h
made
m
out
and
delivered
to
Wicks,
which
is
referred
s
De
drawee
gnator
endants
s
es
part
o
move
the
to
honor
check
or
the
ssued
check
nc
us
under
and
on
the
o
payee
Echaus
account
has
as
no
de
o
cause
end
Mover
ng
METROPOL
Tek
Lian
ted
approached
TAN
That
BANK
at
the
Lee
VS.
time
Hua
it
CA
was
and
(supra
negotiated
asked
p
5)
him
to
him
SSUE:
he
he
could
WON
No.
93397;
Mar.
3,
1997)
Assailed
in
this
Petition
is
the
an
express
stipulation
negativing
or
limiting
is
own
liability
to
the
de
ense
even
aga
nst
a
ho
der
n
due
(g)
Where
an
instrument
containing
the
word
"I
promise
to
pay"
is
annum
a
Sec.
so
be
6
a
M
nor
ty
(ava
ab
e
y
to
Fa
ure
or
Absence
o
negotiated
h
s
w
e
accept
when
it
ng
is
transferred
the
nstrument
from
engages
one
person
that
to
he
another
w
pay
in
t
such
du
depos
y
presented
t
t
n
h
s
account
or
payment
w
th
h
t
s
s
ana
known
ogous
as
to
a
depos
cert
ficate
tary
contemp
at
on
o
the
drawer
or
a
pr
ndorser
s
nce
they
G.
the
sub
WHERE
ect
o
INDORSEMENT
a
SHOULD
BE
ESSENT
AL
amounts
Omissions;
holders
in
due
seal;
course,
particular
the
holder
money.
whose
The
title
validity
and
Period

As
opposed
to
condition,
is
when
the
event
is
certain
to
(
)
By
any
agreement
b
nd
ng
upon
the
ho
der
to
extend
the
t
me
o
dismissed
petitioners
complaint
and
appeal,
respectively,
for
the
infirmity
or
would
attaches
(a)
When
be
the
paid,
it
otherwise
is
and
so
that
expressed
provided,
if
be
to
dishonored
presentment
be
payable
.
.
for
.
he
on
payment
will
demand,
pay
is
necessary
or
amount
at
u
t
mate
opt
y
on
Sec.
89
ree
order
rom
to
fix
de
the
enses
maturity
ava
of
ab
the
e
to
instrument;
pr
or
part
or
es
among
Sec
161
When
b
may
be
accepted
for
honor.
When
a
b
o
until
it
has
been
.
Ru
e
n
case
exchange,
Party
presentment
Pr
mar
y
L
ab
e
s
ewe
ry
that
she
obta
ned
rom
the
atter
wh
ch
were
meant
to
be
Nat
representat
ona
Bank
ve
character
payment
but
the
atter
re
used
to
pay
on
the
NYCO
debts
o
To
Great
SALES
whom
As
an
notice
CORPORAT
to
Bancas
of
a
dishonor
ON
Great
VS.
As
must
an
BA
through
be
given.
F
Arsen
NANCE
o
had
therefore
notice
of
the
defect
of
his
title
over
the
check
from
2.
FUNCTIONS
OF
NEGOTIABLE
On
the
other
hand
D
not
fied
on
y
C
but
C
n
turn
not
fied
P
A
and
the
HONOR
t
me
s
to
beg
n
to
run,
and
by
nc
ud
ng
the
date
of
equal,
Sec.
59
so
long
as
it
is
not
grossly
order
the
Urdaneta
Here
GEL
spouses
C
ordered
succeeded
HSBC
to
in
pay
having
the
P2
the
000
Court
to
Me
declare
cor
could
no
longer
be
located
and
could
not
served
with
Who
is
deemed
a
holder
in
due
course
(p.16)
designed
to
facilitate
banking
operations.
It
is
of
essence
to
inspection
liability
said
holder,
and
accommodated
check
party
on
of
his
in
the
defendant
part,
good
drafts
until
party
faith.
accepted
New
and
So
The
unless
Sikatuna
that
stipulation
by
the
the
Wood
defendant
check
act
of
Industries,
that
facts
is
the
delivered
shows
contains
appe
Inc.,
that
the
ant
no
to
government
be no
partial
delivery
one
instrument.
Also,
to avoid
multiplicity
of
on o
berepresentat
oDecember
e
he agent
5 16,
h of
day
o STELCO.
Sep -embeOnP154,267.
1912
he
sum othe
h ee
housand
behalf,
and
as
of
the
contrary,
indications
(f)
a
signature
is60
so
placed
upon
instrument
that
itthe
is
draft
for
$2250,
days,
upon
Fernandez
Hermanos,
for
ve
the
amounts
covered
by
the
checks
be
re
mbursed
or
ted
to
Sec
134
b.
acceptance
sw
made
by
a
te
egram
the
acceptance
stated
(2)
Payee;
1977
1960
dismissed.
but
and
the
gned
On
re
appeal,
e
by
was
them
sought
at
CA
the
affirmed
on
back
y
n
the
o
1983
sa
decision
dthereof
check
or
seven
of
w
the
th
years
RTC.
equ
ty
o
ownersh
p
hence
h
sthe
rorce
ght
to
recover
rom
be
regarded
as
an
indorsee.
At
most
he
may
be
regarded
as
a
here
nWhere
pet
tsof
oner
Repub
cthe
Bank
sCons
ma
nurther
office
n
Esco
ta
Upon
number
PBCom
as
co
ect
ng
agent
o
Cap
to
then
Gozon
Santos
was
ater
on
apprehended
and
adm
tted
that
he
sto
e
Company
negotiated
and
indorsed
the
note
favor
of
plaintiff
aga
nst
form
to
awho
person
who
takes
it
as
holder.
The
term
holder
on
c
damages
and
depos
to
be
tors
awarded.
who
The
corresponding
writ
to
by
the
bank's
had
no
assistant
as
official
receipt.
On
give
him
had
Enterpr
party
been
wh
ses
ch
cleared.
was
nc
den
sat
Metrobank
an
ed
The
court
informed
rendered
Golden
ain
udgment
Savings
nng
avor
that
e.
there
A
holder
GS
demand
Sor
ore
check
s(2)Where
more
dra
no
tho
than
645915
sthat
very
that
B
ocashier
w
d
a
fferent
th
good
respondent
ather
rom
o
aWarrant
bank
aons
cash
am
Ph
er
y
snever
pp
ne
or
manner
1.
as
OMISSION
to
constitute
the
transferee
the
holder
.cred
If
payable
Persons
Negot
at
ng
by
De
very
the
see
es
o
a
Metropo
course
tan
the
m
nor)
derat
on
ASSOC
ATED
BANK
VS.
(GR
No
107382
107612
an
31
expect
Decision
that
the
the
check
Court
of
be
presented
or
payment
and
not
to
be
PLACED?
wa
ELEMENTS
Sec
146
moment
signed
he
accepts
the
nstrument
No
act
sinstrument,
necessary
n
check
in
bank
was
excess
or
ante
co
of
ect
dated
actual
bank
or
obligations
s
x
months
as
n
order
shown
to
in
co
their
ect
add
corresponding
ona
12%
lack
o
drawer
depos
of
cause
tbeen
o
ang
of
action.
a
cheque
IfCA
anything,
s
uncrossed
petitioner
the
ho
der
has
may
atproceeded
cause
of
Hence
pet
accord
oner
ng
ssurety
to
customers
the
tenor
were
requ
red
to
ssue
post
c
b
2
accrues
is,
as
such
holders,
the
true
sight,
or
on
negotiable
character
of
an
instrument
are
not
affected
by
the
payment
or
NTERNAT
to
postpone
ONAL
the
ho
der
TRUSTEE
s
ro
ght
L
en
M
TED
vs.
nstrument
CEC
A
happen
come.
On
1982
what
days
presentment
87
may
be
made.
Aower
b
thereof
to
the
defect,
or
knowledge
of
such
facts
that
his
restrictively
themse
indorsed
ves
or
and
discharged
may
en
orce
by
payment
payment
or
o
otherwise.
the
nstrument
Dead
the
start.
The
holder
of
a
cashier's
check
who
is
not
holder
in
so
d
to
Sec.
exchange
57
has
(1)
protested
or
d
shonor
by
non
acceptance
or
sSSUE:
gned
(b)
Deeds
Where
o(GR
Ass
the
gnment
bill
expressly
Rece
vab
stipulates
es
ass
gn
that
itof
to
ab
eents
he
were
to
seek
re
mbursement
rom
payee
ndorsee(s)
Rights
of
a
holder
in
due
course.
(supra)
ground
that
the
drawer
Chaves
had
no
unds
there
n
The
INSTRUMENTS
B
Dver
w
can
thout
d
sc
os
ng
h
sbetween
pr
nc
pa
does
not
exempt
h
m
rom
CORPORAT
Except
as
herein
No
71694
otherwise
Aug
provided,
16
1991)
when
Nyco
a
negotiable
Sa
has
and
them
the
as
money
its
true
and
was
lawful
actua
owners
y
pa
dcomme
with
to
the
Maas
deed
m
and
of
assignment
was
summons.
a.
Substitute
It
never
for
appeared.
Only
-to
although
STEELWELD
they
filed
are
not
an
inadequate.
Sec
176
Where
der
refuses
to
rece
ve
payment
supra
pesos
P3
000
o
va
ue
ece
ved
o
cits
a
ope
a
No
ce
and
Sec.
11:
He
claims
some
other
date
is
the
true
date
has
the
be
payable
on
demand,
because
the
contract
between
the
.HSBC
Ru
nowhere
the
statement
purpose
ew
payee
f4
payab
on
for
ytON
has
of
as
or
which
esuch
a
his
AT
he
A
representative.
the
good
disclosed
n
three
re
faith,
at
on
that
checks
hence,
to
Ato
the
he
negotiable
were
plaintiff
maker
was
cross
grant
payee
signing
despite
ng
has
th
as
sL
the
a
ACCEPTANCE
FOR
HONOR
ORD
ACCEPTANCE
suits
and
a
bill
or
note
WON
the
parameters
o
a
concept
o
check
under
Bes
P
22
the
price
of
the
shaft,
and
payable
Philippine
National
Bank
not
clear
in
what
capacity
the
person
making
the
same
intended
the
rstands
account
An
act
on
was
fimoney
ed
where
tNARY
was
dec
ded
that
the
Kinds
of
Negotiable
Promissory
Note
include
there
n
not
b
nd
the
acceptor
to
the
subsequent
ho
der
assurance
Thus,
the
that
present
a
ter
petition.
one
month
ISSUE:
rom
WON
September
the
CTDs
13
are
considered
1960
therea
ter
mere
assignee
the
P30,000
sold
to
him
by
Ramos,
in
which
(2)
Where
a
qua
fied
acceptance
s
taken
the
drawer
the
n
orm
check
ng
and
pet
t
encashed
oner
Repub
the
same
c
Bank
w
th
however
the
bank
that
Gozon
the
fi
payee
ed
an
sto
deb
t
the
atter
s
account
or
the
same
amount
On
the
other
to
bearer,
Metropol
it
is
negotiated
by
delivery;
if
payable
to
order,
it
is
other
hand
refers
to
the
payee
or
endorsee
of
a
bill
or
note
execution
Person
Negot
was
at
duly
ng
referred
by
mere
to
Deputy
de
very
Sheriff
under
Emilio
Sec
Z.
65
Reyes
under
for
Commerc
a
and
ndustr
a
Bank
who
n
turn
subm
tted
sa
d
same
day
the
Philippine
National
Bank
dispatched
to
its
the
ho
der
o
the
check
such
as
a
ure
to
de
ver
the
goods
that
S
manager
nce
the
s
check
S
P4,000.00.
He
said
that
he
is
supposed
to
withdraw
from
the
bank
notice
of
any
infirmity
in
the
instrument
or
32
o
PNB
of
SSUE:
the
warrants
WON
had
been
dishonored
by
the
Bureau
of
accommodat
on
party
under
N
L
and
a
debtor
o
pet
t
oner
to
the
F.
3
s
gnature
RIGHTS
OF
of
HOLDER
the
payee,
NOT
IN
n
DUE
the
case
at
bar,
was
forged
c.
Forgery
of
ndorsers
S
gnature
n
a
prom
ssory
note
Bank
can
use
orgery
o
the
warrants
as
de
ense
hence
D
Appeals
EZ
CATALAN
affirming
(G
R
the
No
nullity
159590
of
&
the
15959
transfer
October
of
Central
18
2004)
Bank
1996)
action

The
against
Prov
Philfrance,
nce
o
Tar
which,
ac
ma
however,
nta
ns
was
a
current
not
impleaded.
account
NOT
APPL
CABLE
When
the
person
had
reasonab
ean
opportun
ty
to
order
or
the
ab
ty
to
accrue
What
sshim
on
yin
necessary
ater
smorders
or
invoices.
It
was
only
after
the
of
than
2th
years
cert
yIndorsement;
ng
of
h
svbe
acceptance
and
adm
ts
January
16,
-or
P154,267.
w
thout
due
The
nd
course
depos
cat
ng
tary
cannot
tHOLDER
bank
n
enforce
contract
w
then
such
to
make
h
check
de
the
a
against
prov
usur
ous
ona
nature
cred
issuing
oby
the
h
s
a
presentation;
That
the
offender
or
postdated
or
ssued
a
check
n
payment
o
an
a.
Relationship
p
odrawee
es
enounced
with
he
Drawee
sum
he
eon
n
single
men
there
oned
is
a
sumore
no
contractual
comp
e
emust
y
relation
pa
dthe
on
dated
checks
ore
LP
wou
d
accept
the
r
purchase
owner
of
the
bill.
But
un
Forgery
Bancas
ess
made
a
15
w
th
postdated
the
checks
ssued
ega
Cons
by
derat
var
ous
on
customers
fact
may
that:
be
presented
acceptance
any
day
on
holder".
On
or
the
the
backs
u
amount
of
the
checks,
endorsements
which
apparently
Sec
protested
Sec.
118
31.
or
better
protest
need
made.
not
-lapse
The
be
indorsement
made;
when
must
be
be
shall
be
presented
for
acceptance;
or
or
the
the
ab
ty
to
such
part
es
wou
d
tson
mate
y
be
sto
other
persons
When
she
was
return
ng
the
ewe
ry
the
payee
3.
Crossed
court
sentenced
the
considered
pa
to
persona
d
Benin
to
Me
merely
ab
cor
ty
and
serving
An
he
nspect
never
as
evidence
pa
o
d
the
to
of
dra
Me
Ciriaco's
ts
cor
and
indebtedness
he
never
Restrictive
answer,
indorsement
under
date
of
as
16
used
July
in
1985.
this
provision
Judgment
pertains
was
only
rendered
to
d
scount
ng
instrument
pr
eges
has
w
th
been
BA
a
ready
ho
d
Pa
and
Bhow
ab
eDUE
because
not
ce
by
ndorser
BANK
burden
Sec.
protest.
banker
76
27
of
:Presentment
establishing
-When
If
and
negotiable
the
such
customer
where
claim.
instrument
pr
is
nc
that
pa
was
the
debtor
money
delivered
saccepted
dead.
is
by
needed
way
Where
of
representative
which
proved
warning
be
true
a
or
that
of
check
the
the
it
sake
crossing,
acquired
of
is,
o
the
is
argument
prevents
not
the
Philippine
only
check
mmater
a
from
written
Education
good
a
being
to
evidence
faith
the
considered
c
Foundation
a
and
o
of
may
the
in
a
E.
RIGHTS
OF
A
IN
COURSE

Protest
s
a
prerequ
s
te
Protest
s
not
necessary
divided
into
different
parts
divides
a
cause
of
action.
nc
ude
a
checks
spec
fica
y
memorandum
check
that
are
(PNB).
It
was
presented
to
Fernandez
Hermanos
for
to
sign,
he
is
to
be
deemed
an
indorser;
networks
shou
d
be
mbursed
or
the
amounts
o wh
the
checks
by
SSUE:
WON
certificates
Ford
sre
cause
ofFranc
deposits,
oosample
act
on
bank
has
notes,
prescr
due
bed
bills
hence
and
bonds.
cannot
sa
negotiable?
dch
check
wou
HELD:
d
be
Yes.
redeemed
A
by
text
respondents
of
the
certificates
by
pay
ng
of
cash
time
the
sa
d
ho
der
sdex
not
and
ndorsers
are
d
scharged
from
ab
ty
the
bhe
negotiated
by
the
indorsement
of
the
holder
and
(Lorenzo)
Financing
ndorsement
&
Investment
was
a
Corporation
orgery
the
with
Bureau
the
o
following
Treasury
hand
Qua
Cap
fied
to
ndorsement
cou
dythat
not
1912
n
p
13
turn
or
deb
Qua
thas
F
Abante
ndorser
Market
rom
ng
the
st
act
on
to
recover
the
amount
rom
the
Bank
ch
the
court
1983
87
check
to
PNB
through
Centra
Bank
or
cfied
ear
ng
wh
ch
the
atter
who
is
in
possession
of
it
or
the
bearer
thereof.
The
place
Freder
ck
Arthur
enforcement
with
checks
in
the
name
of
the
latter.
Four
New
agency
a
cablegram
for
$45,000.
However,
he
5
hYork
day
oinstrument
Sep
embe
h
sauthor
ns
umen
w
d
aw
nnc
eon
es
aP
but
his
bank
was
already
closed.
In
exchange,
he
gave
the
atter
s
supposed
to
de
ver
contrary
to
appe
ant
s
pretense
or
t
been
he
d
that
to
COURSE
make
t
payab
e
to
Treasury
Certificate
and
of
demanded
ISSUE:
WON
defect
the
in
non-negotiability
the
title
of
the
person
of
negotiating
a
promissory
it.
note
extent
Ramon
o
Maza
the
amount
and
sco
sa
d
Mecenas
check
are
HELD
ab
Yes
e
even
To
be
mak
ng
Go
den
did
she
discovered
the
fraudulent
manipulations
of
her
Sec.
ANG
6
TEK
LIAN
VS.
CA
(GR
No.
L-2516;
Sept.
25,
1950)
w
th
bank
the
Ph
pp
ne
Nat
ona
Bank
where
the
prov
a
unds
obta
n
know
edge
o
the
character
or
essent
a
terms
o
the
which
between
dishonors
the
same.
A
person
who
became
the
holder
of
a
wh
were
Omissions;
shonored
seal;
particular
on
matur
money.
ty
when
The
depos
validity
ted
or
account
n
the
amount
o
the
check
ob
gat
on
contracted
at
the
t
me
the
check
was
ssued
transact
cross
on

t
genera
n
or
(a)
The
stence
o
the
drawer
the
genu
neness
o
h
s
Wong
ssued
s
x
(6)
post
3
3.
When
nothing
is
in
a
promise
this
section
affects
the
right
of
a
person
who,
in
Sec.
180
wh
ch
negot
ab
e
assent
o
the
party
secondar
y
ab
e
or
un
ess
the
r
ght
o
(b)
In
which
no
time
for
payment
is
expressed.
show
they
had
been
deposited
with
the
China
Banking
secur
ty
and
s
(2)
not
overdue
(3)
any
person
not
be
ng
a
party
B.
GENERAL
(c)
STEPS
Where
N
ENFORC
bill
is
NG
drawn
SECONDARY
payable
elsewhere
Checks
Liability
of
holder
who
indorses
two
or
more
parts
Non
de
very
o
Non
de
very
o
Comp
ete
made.
written
persona
to
her
on
Where
y
in
the
endorsed
view
any
of
negot
the
the
ab
check
itself
prohibition
e
nstrument
or
or
upon
against
a
paper
has
zed
been
the
any
attached
sale
one
d
shonored
to
of
thereto.
endorse
the
land
t
on
26
June
legal
1986.
tender.
The
One
judgment
of
its
distinct
sentenced
characteristics
Steelweld
is
its
to
Un
de
ess
endant
the
amount
as
ndorser
to
pay
the
p
a
nt
ff
hence
th
s
a
ed
to
dishonored
return
the
by
checks
non-acceptance
because
she
or
non-payment,
a
ready
negot
notice
ated
of
the
a.
F
nance
DURESS
n
AND
1978
brothers
Renato
Fernandez
and
Sant
ago
Renato
de
endant
shows
Sec.
36(a),
since,
as
discussed
earlier,
(b)
and
(c)
thereof
do
not
nures
demand.
to
the
Further,
benefit
o
the
ho
participation
der
Add
t
ona
y
of
P
need
the
not
two
be
banks,
Company.
contract
not
good
appe
be
faith
ee
deemed
right
and
and
He
does
but
merely
thus
a
is
not
holder
also
he
a
is
signed
a
wh
not
species
in
t
d
due
a
m
holder
as
n
course
of
sh
property.
follows:
nor
in
due
thereof.
de
eat
course.
Just
"JOSE
the
It
as
was
r
a
Being
ghts
deed
ARUEGO
payee's
o
to
not
a
Sec.
54:
M
makes
note
for
P100,000
payable
to
the
order
of
P,
pledge,
the
person
the
pr
transferee
mar
y
ab
is
e
a
on
holder
the
nstrument
for
value
up
s
dead
to
the
and
extent
no
p
ace
of
the
o
Where
the57
ho
der
o
a bapply
re uses
to rece
vemp
payment
supra
protest
Sec.
Sec
75
Presentment
where
nstrument
payab
e
atowho
bank.
drawn
The
acceptor
aga
nst must
bank?
be
are
The
person
who
accepts
sEbrada
ato
Sec.
41:
Does
not
tomoved
instruments
payable
to
two
or
acceptance,
and
was
by
the
firm
according
its
pet
t2.
oner
bank
and
the
atter
nto
turn
must
be
re
mbursed
by
recover
anymore
rom
PC
B?
HELD:
The
statute
m
tat
ons
un
ess
they
have
express
ywas
or
ed
yun
author
zed
the
or
the
sa
dHence
check
can
be
presented
or
payment
on
or
mmed
ys
aware
thereo
completed
BILLS
by
delivery.
OF
EXCHANGE
(emphasis
(Sec.
126,
185,
NIL)
An
preced
sect
on
a
edoficat
1
pe
cen
pe
mon
h
om
he
da
ew
when
due
he
da
e
owho
February
16,
-that
P154,267.
pa
Upon
demand
oalso
GS
S
the
s
gnatures
o
ts
officers
on
requested
granted
indorsement:
the
Bank
"Pay
the
to
pet
the
taccepted
und
on
order
them
SSUE:
of
the
Metropol
WON
amount
Gozon
Bacolod
g
ven
to
Financing
e
tate
h
account
sng
nce
the
atter
had
a
ready
thdrawn
the
amount
o
Thomson
drew
5
checks
payab
e
Cata
an
n
the
tota
amount
o
where
the
bills
were
written,
signed
or
dated
does
not
months
later,
Amelia
Tan
for
the
issuance
of
an
alias
atter
sIf
a
mary
ob
gat
on
o
the
bank
wh
ch
ssues
ta
and
bank's
representative
in
New
York
replied
suggesting
the
SECURITY
BANK
respondent
Lee
Hua
ato
check
which
is
payable
to
the
order
of
prevents
its
assignment?
HELD:
No.
A
negotiable
there
was
no
va
d
reason
the
drawee
she
st
contractua
y
Indebtedness
(CBC),
with
a
face
value
of
P500,000
from
Sav
ngs
ab
e?
HELD:
No
There
no
quest
on
o
Gomez
ss
appear
that
he
had
made
an
ndorsement
n
favor
of
the
cons
c
ass
BEARER
refund
dered
fied
as
s
by
an
the
accommodat
Golden
s
gnature
Savings
oat
on
the
of
payee
the
es?
amount
HELD:
or
ho
der
it
had
Yes
swords
unnecessary
previously
The
most
bookkeeper.
It
learned
that
indorsements
of
4
Jurisprudenc
Cert
on
has
sthe
swas
m
pronounced
ar
acceptance
that
crossing
but
dinstrument
fferent
a
check
n
should
the
sense
co
ect
on
by
Bancas
a
w
th
any
opart
the
oFor
ow
ng
as
reason
or
the
Sec.
are
51
depos
ted
A
port
on
o
the
Knowing
he
had
no
funds
therefor,
petitioner
Ang
Tek
Lian
drawer
nstrument
and
the
drawee.
Thus,
akind
drawer
may
have
drawn
the
bill
cashier's
check
as
endorsed
by
the
person
who
stole
it
and
Rights
of
holder
to
sue.
(supra,
p.15)
cons
The
dered
check
made
therea
or
raudu
ter
goes
ent
purposes
through
the
and
process
may
g
ve
rwhich
c
se
ear
to
ng
dated
checks
n
tmust
athe
y
ntended
to
guarantee
the
ca
endar
orders
o
unconditional
negotiable
character
of
an
instrument
are
not
b
That
such
sand
gnature
postdat
and
ng
h
or
s
capac
ssu
ng
ty
a
and
check
author
was
ty
to
done
draw
when
the
spec
a
ypr
a
ready
L
AB
L
than
TY
at
(e)
nstruments
designates
a
particular
may
be
presented
of
current
money
for
in
payment
Sec.
17(d):
Reason
for
this
rule
is
that,
the
written
are
Corporation
and
were,
by
the
ncomp
ete
negotiability
which
allows
nstrument
it
to
go
from
hand
to
nThe
or
the
imposed
h
m
nstrument
by
has
a
eged
City
been
government.
endorsement
advanced
by
ISSUE:
was
the
drawer
a
WON
orgery
to
a
the
deed
Hence
pay
to
dishonor
Stelco
the
amount
of
P126,129.86
with
legal
rate
of
pet
t
on
of
SSUE:
a
set
to
different
persons.
Where
the
holder
of
set
(officers
NT
M
DAT
ON
may
nowhere
be
signature
protested
of
has
the
or
he
d
sc
osed
that
was
s
gn
ng
as
1.
Sec.
same
1
120(a):
to
Genera
the
Those
pet
y
t
duress
oner
prev
ous
and
y
or
d
scussed
nt
m
dat
ment
on
exerted
oned
n
aga
nst
a
petitioner
and
private
respondent,
clearing
operations
of
(Acceptor)
piece
duty
a
atter
holder
who
of
ascertain
land
in
(SGD)
a
ho
due
der
from
be
JOSE
or
delivered
the
course,
va
ARGUEGO
ue
holder
The
in
plaintiff
order
Manuel
ab
to
failure
ty
Gonzales
convey
o
is
to
the
subject
disclose
title
what
appe
to
the
ant
his
to
prevent
ASSOC
ATED
further
BANK
VS
CA
(GR
No
89802
May
7
1992)

SSUE:
not
fied
by
A
and
B
because
amount
indorsed
payment
Sec.
13:
secured.
it
s
an
spec
undated
fied
If
the
presentment
sum
note
certain
payable
state
or
to
payment
P
matures
in
the
must
on
Aug.
be
made
29,
is
P50,000
2013,
to
h
s
he
oses
h
s
r
ght
of
recourse
aga
nst
any
party
who
nstrument
s
payab
e
a
bank
presentment
or
payment
Where
the
HELD:
tenor.
YES.
Subsequently,
A
memorandum
the
shaft
check
was
s
found
n
the
not
form
to
of
be
an
in
stranger
party
Sec.
57.
Rights
of
a
holder
in
due
course.
A
holder
in
due
course
more
payees
severally,
such
as
payable
to
A
or
B,
which
may
be

the
1983
87
Secur
ty
Bank
n
the
appe
ate
court
t
was
he
d
that
Traders
Bank
ho
der
to
take
aneness
qua
fied
acceptance
or
subsequent
comp
eof
e paymen
The
make
sse
heto
eo
ag
ee
o the
pay
he
add
ona
sum
oy
beg
ns
to
run
when
the
bank
g
ves
the
depos
tor
not
ce
oHSBC
the
a
ter
month
The
oan
was
actua
ythe
extended
but
when
unconditional
. HK$3
Deemed
AND
TRUST
COMPANY
the
check
were
orged
PNB
re
cred
ted
account
oscharges
GS
S
The
&
Bank
Investment
sued
Ebrada
Corporation
upon
the
with
atter
scase
reaccount.
usa
to
Notice
return
ofthe
Demand;
money
the
check
SSUE
WON
AN
ALTERAT
ON
OF
THE
SER
AL
NUMBER
checkbook
2one
m
nto
on
hands
Cata
o
an
Santos
presented
was
ndeed
these
the
checks
prox
mate
to
cause
oconst
necessarily
tutes
ts
wr
fix
tten
or
prom
determine
pay
the
upon
place
demand
where
nNo.
they
npayment
Re
were
Bank
writ
execution
since
the
judgment
remained
unsatisfied.
advisability
of
withholding
this
money
from
Kauffman.
The
PNB
instrument,
instead
of
being
may
also
be
Philippine
Underwriters
Finance
Corporation
cash.
When
Lee
Hua
presented
the
check
for
the
dent
ob
ty
gated
or
to
ound
d
the
shonor
genu
the
check
o
on
the
h
sorced?
bas
snegotiated,
gnature
s
o
the
as
stop
checked
by
payee
that
(1)
were
Cert
forged,
ficat
on
and
at
the
the
nstance
checks
o
the
brought
ho
der
to
d
the
chief
e
have
the
dWhen
shonor
account
cnegotiable
osed
payment
stopped
account
withdrawn,
p
aus
b
e
and
to
reasonab
make
up
the
ethe
deficit
in
its
The
demand
was
the
against
forger,
the
drawee
such
because
s
the
shou
latter
dons
is
holding
be
deemed
an
amount
as
accommodat
to
pass
tCorporat
tg
e
on
to
party
the
nstrument
aapproached
person
Hence
must
(1)
be
maker
a(Philfinance)
party
may
st
to
the
be
is
Warrant
the
es
final
o
a
act
person
essential
negot
at
ng
by
its
de
consummation
very
are
spayment
m
ar
of
to
a
an
following
effects:
(a)
the
check
may
not
be
encashed
but
only
unds
o
the
prov
sorder
a
ocated
to
the
Concepc
on
customers
drew
assory
check
upon
the
FACTORS
through
the
FOR
REASONABLE
OPPORTUN
TY
(1)
age
and
sex
Where
an
instrument
is
issued,
accepted,
indorsed
when
overdue,
Sec.
58
Sec
127
offender
had
affected
no
unds
by
n
the
the
bank
or
h
srecourse.
unds
depos
ted
there
n
were
C.
2.
4
Promissory
ab
HOLDER
e
NSERT
thereon
When
Notes:
ON
IN
may
DUE
subject
OF
A
(4)
WRONG
w
to
th
original
the
consent
defense
of
the
(supra,
ho
der
p.19)
ntervene
upon
assignment
payment
the
under
can
is
sputed
the
to
transfer
be
prov
made.
acts
s
ons
ownership
tto
of
must
o
ow
the
seventy-two
that
property
HSBC
has
to
and
the
no
deemed
interest
B
from
to
hand
not
express
9
May
an
the
ass
the
1985,
commercial
true
gnment
when
intention
the
of
markets
funds
of
the
was
n
maker
hands
and
instituted
or
to
of
drawer
drawee.
take
until
fully
latter,
o
presented
to
the
drawee
on)
bank
for
collection.
Rufino
Yao
The
pres
court
dent
declined
and
non
acceptance
or
non
payment
as
the
case
may
be
but
protest
indorses
two
or
Sec
Mou
Prom
119
cabe
person
w
residence
thdrew
Notes
ves
her
or
place
unds
of
business
rom
the
of
drawee
the
bank
SSUE:
PCHC
is
a
manifestation
of
their
submission
to
its
jurisdiction.
principal,
grantee,
nature
personal
must
of
so
Aruego
the
defenses,
be
must
latter's
given
a
personally
to
title
such
to
drawer
the
liable
as
instrument
check
and
for
lack
to
the
was
each
drafts
of
be
or
indorser,
the
delivered
consideration
he
nature
accepted.
and
to
of
any
his
nstrument
Payment
by
accommodated
d
scharges
the
nstrument
negotiation.
1.
Instruments
payable
to
order:
two
steps
are
required
for
the
WON
not
S
gnature
ce
de
g
endant
ven
by
by
s
Procurat
C
nures
ab
ty
to
on
can
the
As
be
Sec
benefit
en
21
owere
supra
a
part
HELD:
es
subsequent
Sect
to
on
Sec.
Mater
118
A
terat
on
WON
Pr
vate
Respondent
Mer
e
Reyes
do
ng
bus
ness
the
and
persona
the
same
representat
was
pledged
ve
for
30
days
after
issuance,
but
Pgnature
inserted
July
15
to
hasten
maturity
When
protest
need
not
Cond
be
tor
made;
ona
de
when
very
must
ounder
be
to
A,
B
stole
the
note,
forged
signature,
B
then
indorsed
itdate,
to
C
must
be
conformity
with
the
specifications
and
was
of
use
ord
nary
P500
as
athe
o
ney
s
ees
nnce
case
oparty
a
u
e
oSect
pay
he
no
e
drawee
negotiated
assent
by
either
thereto
Aand
or
B.
In
to
make
an
indorsement
of
an
(1)
holds
Any
word
nd
cat
ng
an
shou
dSanshe
the
on
yin
Bank
ab
eor
SSUE:
WON
Traders
Bank
There
must
6778
be
Ayala
an
Ave.,
Makati
No.
90101
payment
wh
ch
swere
ord
nar
y
when
the
check
sincapable
returned
to
the
the
check
was
presented
payment
on
March
5Roya
1964
t
Accepted
order
in
writing
addressed
by
one
person
to
another,
signed
PNB
requested
re
mbursement
rom
PC
B
the
atter
re
used
o
Dishonor;
the
oss
orged
and
Protest;
thus
check
prec
and
uded
SSUE:
Presentment
rom
WON
sett
Ebrada
ng
are
up
hereby
the
sof
de
ab
waived.
ense
epayable
to
o
return
SAMBOK
orgery?
OF
A
CHECK
S
A
MATER
AL
ALTERAT
ON
UNDER
THE
NEGOT
ABLE
The
checks
d
shonored
or
hav
ng
nsuffic
ent
unds
o
the
Un
ted
States
(277
NYS
The
petitioner
filed
an
opposition
to
the
motion
for
the
dispatched
to
its
New
York
agency
another
message
to
withhold
assigned
or
transferred.
The
legal
consequences
of
negotiation
next
day,
he
discovered
that
it
has
an
insufficient
funds,
without
authorization

to
petitioner
Traders
Royal
Bank.
wh
e
there
s
no
d
scharge
n
an
ord
nary
acceptance
(2)
n
Go
den
Sav
ngs
n
act
the
treasury
warrants
were
d
shonored
under
garn
shment
and

nsuffic
ency
o
unds
SSUE:
WON
accountant
in
order
trust
for
of
the
Philippine
drawer,
Bank
or
the
of
Commerce
drawee
may
(the
have
Drawee
extended
Bank,
obligation.
qua
fied
An
rejected.
ISSUE:
stand
nstrument
or
the
s
de
gn
endants
ng
as
maker
s
that
they
drawer
are
accommodat
acceptor
or
on
ndorser
part
es
noperat
ve
and
neffectua
.
ab
e
to
a
ho
der
5
who
China
a
ed
Banking
to
ssue
Corporation
post
dated
for
checks
the
sum
However
of
P4,000,
o
ow
ng
company
to
the
PEOPLE
VS.
MAN
EGO
(G
R
No
L
30910
February
27
1987)
Emergency
deposited
in
Hosp
the
bank;
ta
The
(b)
a
the
otment
check
checks
may
be
negotiated
or
sa
d
government
only
once
it
is,
as
regards
the
person
so
issuing,
accepting,
or
indorsing
it,
o
the
ob
gor
(2)
nte
gence
educat
on
and
bus
ness
fact
DATE
COURSE
and
accept
the
b
supra
protest
or
the
honor
o
any
party
ab
e
not
suffic
ent
to
cover
the
amount
o
the
check
c
(3)Where
ear
nghous
a
cheque
s
crossed
genera
y
the
ho
der
may
part
of
money
in
commercial
transactions
free
de
assignee?
ense
to
th
HELD:
s
act
on
At
t
the
s
adm
bottom
tted
that
of
the
this
PNB
controversy
cashed
the
is
check
the
paid,
plus
another
sum
equivalent
to
25%
the
total
amount
c
genera
manager
o
Nyco
Sa
es
Corporat
on
(Nyco)
or
a
cred
s
not
e
ghty-five
of
th
s
Act
When
Saturday
s
not
otherw
se
because
they
are
placed
It
is
not
essential
that
the
word
promise
be
used.
Any
words
WON
the
A
b
o
tse
does
not
operate
as
an
ass
gnment
o
to
order
payment
for
two
principal
reasons:
(a)
plaintiff
failed
to
prove
General
ISSUE
Rule
2:
is
How
that,
does
an
additional
principle
act,
estoppel
aside
from
apply?
payment
HELD:
of
Secondly,
payee
a.
Presentment
drawee.
in
order
an
to
accommodation
evidence
for
payment
its
existence
party
must
is
be
as
one
made
a
who
binding
w
has
th
contract.
n
signed
the
because
he
more
s
parts
to
different
persons
he
is
liable
on
every
negotiation:
the
atter
athe
persona
de
ense
sinstrument
ava
abndorsement
even
there
sist
Sec.
120(b)
and
(c):
The
cance
at
on
otthe
an
obeen
a
89
oprev
the
Discharge
by
payment
ortany
otherwise
are
enumerated
under
Sec.
Indorsement
p
12me
is
the
writing
of
name
of
the
payee
onprior
the
name
and
sty
edur
P30,000,
d.
The
T
note
the
and
transferee
was
Pbefore
ace
signed
to
is
g
by
ve
athe
petitioners
holder
for
and
value
Embassy
upto
such
there
be
and
w
th
exerc
se
oon
reasonab
eFarms,
d mater
gence
made.
-(BACOLOD)
Where
negotiable
comp
ete
has
been
Pncannot
who
paid
P50,000
knowing
that
As
signature
was
forged.
InInc.
for
its
intended
purpose.
Upon
discovering
this,
Fernandez
the
ous
examp
e HELD
D
re
used
toa
accept
payment
or
the
honor
check,
w
th
the
word
"memorandum",
"memo"
or
"mem"
Metro
Manila,
Philippines
made
ng
bank
ng
hours
un
ess
the
person
to
make
instrument
payable
to
two
or
more
the
instrument
free
from
any
defect
of
title
of
shou
d
soshonoredthe
e
y
bare
oss
or
ts
neg
acceptance
gence?
HELD:
YES
a
bank
sRODOLFO
a
eged
drawer
as
a
voucher
w
th
aand
statement
oe
h
sto
account
An
express
statement
that
was
d
account
on
wh
ch
snstrument
drawn
has
ong
by
the
person
giving
it,
requiring
person
whom
it
Hence
the
act
on
SSUE:
WON
pr
or
acceptance
be
ore
Man
aenforce
une
5present
money
MOTORS
pa
d
to
CO.
h
m
by
Repub
c
By:
Bank
sub
ect
o
G.
a
NONILLO
orged
check
Asst.
and
NSTRUMENTS
LAW?
No
An
terat
s
sa
d
to
be
a
HELD:
Thomson
No
demanded
A
bank
s
bound
that
the
to
checks
know
the
be
s
made
gnatures
good
o
ts
because
customers
he
Sec
137
L
ab
ty
of
drawee
return
ng
or
destroy
ng
b
.
issuance
of
an
alias
writ
of
execution
stating
that
it
had
already
the
and
Kauffman
assignment
payment
of
the
as
suggested.
instrument
Meanwhile,
are
different.
upon
advice
A
nonof
hence,
was
dishonored
by
the
bank.
In
his
defense,
Ang
Tek
Lian
cert
ficat
on
the
bank
deb
ts
the
drawer
s
account
at
the
t
me
o
ISSUE:
WON
Central
Bank
Certificate
of
Indebtedness
(CBCI)
Pet
t
oner
s
ab
ty
rema
ns
desp
te
absence
o
not
ce
o
a
eged
y
because
o
the
orgery
o
the
s
gnatures
o
the
drawers
credit
to
the
drawer
and
agreed
to
honor
any
bill
drawn
by
the
Buendia
Branch)
who
deposited
them
in
the
accounts
of
Alfredo
undelivered
However
ndorser
except
he
bill
has
that
is
no
the
unoperative.
va
d
ormer
de
ense
s
warrant
The
the
drawer
issuance
es
extend
rema
and
on
ns
delivery
y
ab
n
avor
e
Pet
t
oner,
as
the
co
ect
ng
bank,
gross
y
erred
n
mak
ng
n
due
course
even
an
ndorsement
was
orged
a
ter
the
order
of
po
WON
(2)
But
cy
not
as
LP
treasury
accommodat
rece
re
used
ve
to
warrants
va
accept
ue
on
part
the
are
es
checks
negotiable
the
de
as
guarantees
endants
instruments?
hav
nstead
ng
s
HELD:
gned
A
cash
er
s
check
ssued
by
a
bank
however
s
not
an
ord
nary
1.
When
subject
to
original
thereon
or
or
the
honor
o
the
person
or
whose
account
the
b
s
CELY
YANG
VS.
CA
(GR
No.
138074;
Aug.
15,
2003)

Cely
Yang
hosp
ta
are
drawn
the
order
o
that:
85
exper
to
one
ence
who
(3)
has
ab
an
ty
to
Accused
upon
undisputed
a
orged
fact
sa
gnature
that
Ciriaco
p
Urdaneta
aced
the
was
money
indebted
the
to
cred
tB to
oa
c
Dece
due
tres
or
as
from
damage
and
all
for
to
personal
the
attorney's
payee
defenses
fees.
STELCO's
available
motion
against
for
e
cross
tound
spec
yto
accommodat
on
order
or
the
brothers
to
make
use
oa
ob
there
gat
on
by
shimself.
ext
ngu
Also,
shed?
because
HELD:
the
No
amount
The
acts
in
wh
words
ch
are
d
harder
scharge
to
a
ho
day
presentment
or
equivalent
Petitioner
to
aWhen
promise
is
estopped
or
assumption
from
raising
of
responsibility
the
defense
for
the
nonthe
Section
requ
instrument
16
red
of
the
as
Negotiable
maker,
drawer,
Instruments
indorser,
without
which
receiving
governs
Sec
he
was
asorged
holder
the
unds
n
the
G.
ACCOMMODATION
such
part,
and
PARTIES
every
indorser
transfer
Sec.
subsequent
to
him
is.Benin,
person
money,
is
Sec.
Sec.
Negot
52.
13.
ab
When
What
T
eis
me
constitutes
date
of
matur
may
Law
ty.
be
a
(Act
-holder
nserted.
No
Every
2031)
innegot
due
prov
Where
ab
course.
des
eto
an
nstrument
that
nstrument
-of
when
Aor
s
some
orm
o
derat
on
Me
ssa
RWT
SUCAT
has
OFFICE
an
cause
P4,000.00
o
act
on
aga
nst
pet
tng
oners
Assoc
ated
g.
NOT
the
pr
with
Person
CE
nc
not
OF
pa
the
ce
D
who
n
SHONOR
the
shou
case
d
contemp
ated
by
Sec
121(b)
2.
2
(a)
indorsement
and
(b)
delivery.
119
instrument
with
the
intent
either
to
the
title
to
same,
Demand
Hermanos
Instruments
refused
are
to
pay
those
the
which
draft,
are
and
payable
it
remained
on
demand,
for
b.
payment
because
it
is
avoided
as
to
him
who
ante-dated
for
Value
he
previously
be
given
:VS.
If
Mand
issued
aavailable
note
tochecks?
P,
then
Pthe
to
A,
Aliable
to
dishonored,
it
may
be
o
Acan
Uwr
tra
Vthe
act
o
Corporat
on
Fraud
n
nducement
this
case,
C
anstruments
across
ts
face,
s
gn
ng
that
the
maker
or
drawer
(3)
the
drawer
or
an
ndorser
rece
ves
not
ce
obut
a
case
at
any
hour
before
bank
s
c
osed
persons
effective,
all
must
indorse
to
effect
a
payment
has
no
unds
there
to
meet
tLaw,
at
any
tw
me
dur
ng
pays
atten
check
tcons
must
be
cons
dered
as
pay
out
o
unds
parties,
1912
and
free
from
defenses
to
prior
parties
enough
payment
s
requ
red
n
the
case
o
HELD:
No
n
act
on
upon
a
check
sde
ord
nar
yfy
governed
the
statutory
per
od
to
pay
on
demand,
or
at
aby
fixed
or
determinable
c
osed
The
tr
court
he
d
n
avor
o
pet
tthe
oner
but
th
sin
s(p.)
or
honor
Consent
oHe
the
ho
der
s
Consent
o
the
ho
der
sfor
not
may
and
General
tnstrument
pays
pet
Manager".
tpresentment
a
oner
orged
The
check
the
maker,
tpurpose
proceeds
must
Dr.
be
Villaruel
g
cons
ven?
dered
HELD:
defaulted
as
mak
tts
sng
cwas
the
ear
the
a
ters
the
effect
oto
the
nstrument
tmade
means
an
unauthor
zed
act
had
suffic
ent
unds
Cata
an
know
ng
that
Thomson
had
drawee
whom
aao
b
sapp
vered
or
acceptance
destroys
the
same
fully
negotiable
paid
its
obligation
instrument
to
plaintiff
may
not
through
be
the
negotiated
deputy
sheriff
Where
a
Wicks
that
the
money
has
been
placed
to
his
credit,
Kauffman
argued
that
he
did
not
indorse
the
check
to
Lee
Hua
when
the
cert
ficat
on
and
sets
as
de
unds
out
o
the
drawer
sover
contro
dn
shonor
rom
Respondent
HELD:
YES.
Great
As
an
s
our
is
aaddressed
instrument?
HELD:
No.
The
instrument
not
o
Gomez
as
payee
or
ndorser
Under
the
c
rcumstances
Romero
and
Benito
Lam.
Gempesaw
demand
upon
the
check
must
be
a
person
who
takes
it
as
a
holder.
In
o
hThe
s
payment
ssuance
o
and
he
sthe
not
re
eased
rom
the
ega
ob
gat
on
he
contracted
drawn
acceptance
or
honor
may
be
or
part
on
y
ostamped
the
sum
part
cash.
es
agreed
delivered
to
itDEPOSIT
ytthe
to
the
Lee
Hua
checks
Hong
to
in
exchange
the
payment
money
o
tgn
The
defense
No.
the
The
treasury
warrants
in
question
are
not
there
or
and
(3)
srecover
gn
or
the
o
end
ng
hoor
sname
name
or
the
account
with
a
bank;
(c)
and
the
act
of
crossing
the
"Concepc
on
Emergency
Hosp
ta
Concepc
on
Tar
ac"
or
and
uand
a
TFactum
Man
original
ego
owner.
was
nd
cted
together
w
th
R
za
no
Ubay
and
Maas
secure
read
m
and
who
which
understand
was
debt
a
the
orger
That
anguage
ceded
the
PNB
used
then
rights
endorsed
(4)
representat
the
the
check
land
ons
reconsideration
CERTIFICATE
was
OF
denied
by
the
Appellate
Tribunal's
resolution
Nyco
sto
dnegotiable
scount
ng
pr
vpayment
eges
Nyco
agreed
and
so
on
The
c
ear
nghouse
defined
as
an
assoc
at
on
o
a
s
alter
mp
e
In
contract
no
other
or
the
case
is
presentment
o
money
under
for
acceptance
Sec
119(d)
negotiability
of
the
checks
in
question.
It
its
value
checks,
per
therefor
od
provides
to
the
and
maker
in
for
part:
purpose
Every
of
contract
lending
his
on
a
negotiable
to
some
b.
Relationship
with
Collecting
Bank
their
the
privity
of
contract
is
2.
Bounc
hands
ng
Checks
the
Law
drawee
(Batas
ava
ab
Pambansa
e
or
the
payment
thereo
and
payment
of
note
(like
29.
in
due
course,
Instruments
and
(b)
payable
the
checks
bearer:
being
delivery
crossed
alone
checks
without
should
not
on
the
part
he
has
Bank
holder
expressed
PROTEST
Sec.
s
181
in
due
to
payab
be
course
payab
e
at
is
a
e
holder
at
tthe
me
athe
who
fixed
has
there
per
taken
od
n
w
the
a
ter
thout
date
grace
sbanks
under
ssued
When
negot
ab
e
nstrument
sspouses
d
shonored
or
non
acceptance
or
non
secondar
time
To
dishonored
y
const
ab
e
tute
may
in
duress
resu
PNB
Manila.
nto
there
the
d
must
Later
scharge
be
the
an
o
bank
actua
that
indorsed
person
threatened
whose
the
draft
prohibited.
This
is
based
on
fact
that
while
the
payment
ofs
c.
Payment
by
a
Th
rd
R.
NEGOTIATION
BY
PRIOR
fraudulent
Acceptance
of
bill
drawn
in
sets.
-instrument
The
due
and
payable
immediately
after
delivery.
It
isank
a
present
debt
due
to
strengthen
the
security
4.
Good
signature
of
Eduardo
Evangelista
below
it.
Sec.
17
of
the
engages
protested
to
pay
the
for
bona
non-acceptance
fide
ho
der
or
abso
non-payment,
ute
y,
w
thout
as
the
any
and
Sec
B
103
to
Sec.
83
.dra
Presentment
to
oses
h
s
r
qua
ght
o
fied
recourse
acceptance
aga
nst
he
B
and
must
C
who
w
th
wou
n
a
d
reasonab
have
been
e
t
me
on
that
Fraud
n
or
Esse
F
ng
up
b
not
w
th
n
Where
part
es
res
de
n
same
p
ace
Where
When
instrument
dishonored
by
non-payment.
Sgd
Fo
Pade
n
Mo
eno
&
Co
by
F
Mo
eno
membe
o
he
fi
m
and
cannot
charge
the
amount
so
pa
d
to
the
account
the
depos
tor
genera
"acceptance"
n
the
sense
n
wh
ch
th
s
term
the
day
n
wh
ch
Sec.
48:
An
instrument
payable
to
bearer
remains
a
bearer
future
time,
a
sum
certain
in
money
to
order
or
bearer.
app
cab
e
to
nstruments
n
wr
t
ng
Our
aws
on
the
matter
prov
de
among
themselves,
and
(2)
reversed
by
the
CA
by
ru
ng
that
the
sa
d
check
wasn
necessary
necessar
rom
payment.
the
prov
Plaintiff
s
on
o
notified
Sect
on
Sambok
as
indorsee
of
said
note
of
change
n
an
nstrument
that
purports
to
mod
y
n
any
respect
the
payment
commun
cated
out
o
w
th
ts
the
own
Bank
unds
asked
and
HSBC
cannot
Bank
ord
to
nar
c
ear
y
change
the
checks
the
or
re
uses
may
be
assigned
or
transferred,
absent
an
express
a.
Parties
to
a
of
Exchange
are
(1)
Drawer,
(2)
of
the
respondent
court,
Emilio
Reyes,
as
evidenced
by
cash
presented
himself
the
office
of
the
Philippine
National
Bank
in
latter
accepted
check
without
his
indorsement.
ISSUE:
WON
Thus
the
effect
oat
cert
ficat
on
s
the
same
as
thought
contracts
gn
ng
ts
fiBill
teen
(15)
postdated
checks
to
Bancas
at
provides
for
aSuch
promise
to
pay
the
registered
owner
Filriters.
tThat
sholder
cCh
ear
that
Go
den
Sav
ngs
acted
w
th
due
care
and
case
bank
at
to
bar,
although
the
amount
Linton
charged
a
due
collector
the
checks.
who
received
The
bank
the
wh
ch
the
b
s
drawn
and
where
there
has
been
an
acceptance
Rate
16%
by
vperson
rtue
of
sa
d
forged
sssent
gnature.
The
payee,
here
n
the
note
sClearly
nce
accord
ng
Sec
60
he
saense
to
pay
the
which
the
handed
in
the
act.
The
next
business
day,
serves
RON
CLAD
as
warning
RULE
s
a
to
cash
the
er
holder
check
that
sA,
n
the
nature
check
o
an
been
pet
tthout
oner
sass
unrem
tted
Be
ore
the
matur
o
the
checks
atter
smay
a
b
o
exchange
payab
eab
demand
tguarantee
s
an
order
upon
a
instruments.
cred
w
t17(g):
o
(a)
rece
some
itlatter
is
v1978
not
ng
other
dated;
va
person
ue
there
tto
or
sdefense.
not
and
a
va
or
d
the
de
purpose
that
f.
and
through
Other
orwarded
acredit
deed
tD
to
of
HSBC
assignment.
by
whom
An
assignment
tnstrument
was
pa
d
of
PNB
credit
had
no
is
dated
13
M
agros
"The
e
Concepc
on
Emergency
Hosp
ta
Concepc
on
Tar
ac
November
15
Sanshe
ssued
a
post
dated
(November
made
(4)Where
to
h
m
a
cheque
and
h
reason
s
crossed
to
re
genera
yZ.
on
them
yto
or
spec
or
to
a
have
ynot
the
confidence
ho
der
are
determ
Media
ned
by
of
other
exchange
ex
st
ng
eg
payment
sdelivered
they
at
ons
thus
enc
g
increase
Art
1231
oe
Prem
Chandiramani
were
to
exchange
dollar
drafts
and
checks
guarantee
on
the
back
of
checks
and
subsequently
other
instrument
person.
is
incomplete
person
is
and
liable
revocable
on
the
instrument
until
delivery
to
a
of
holder
between
other
payors
B
ang
22)
the
Sec.
58.
When
subject
to
original
-ty
In
the
hands
ofsded
any
Sec.
Joint
and
Solidary
payable,
to
be
paid,
I
agree
to
pay,
I
to
pay,
have
in
been
blank,
deposited
without
consideration,
instead
with
and
the
bank
mentioned
it
to
Fossum,
in
who
the
(a)
it
is
complete
and
regular
upon
its
Conrado
Cruz
or
the
rupon
encashment
and
to
another
person
the
undated
following
Person
or
the
conditions:
where
day
oSHONOR
matur
acceptance
ty
a
sthe
o
upon
an
nstrument
Sunday
or
payab
ahas
e
day
at
a
PARTY
s
gnature
exerc
was
str
se
cken
or
power
off
and
possessed
a
so
o
subsequent
by
the
party
part
benefited
es
as
prov
thereby
money
payment
not
be
ce
indorsed,
thereo
the
additional
act
would
have
to
be
of
the
by
assuming
a
contingent
liability
for
its
future
payment,
Faith
A
must
s
gn
the
negot
e
be
ore
he
can
C.
ASSIGNMENT
AND
NEGOTIATION
Fo
ose
at
once.
Sec.
29.
NOT
Liability
acceptance
CE
OF
of
accommodation
may
be
written
on
party.
any
part
PROTEST
An
and
accommodation
it
must
be
70.
Effect
of
want
of
demand
on
pr
pa
debtor.
purposes
(Sec.
express
12).
But
h
s
if
d
it
ssent
was
indorsed
to
the
to
ho
a
der
holder
or
in
due
he
course,
w
cond
t
on
concern
ng
ts
presentment
Such
check
an
Negotiable
case
may
be;
but
protest
is
not
required
except
in
the
Partners
C,
as
a
way
of
gift.
C
is
a
holder
for
value
as
A,
since
value
has
d.
R
ghts
of
Contractus
author
ty
used
the
n
the
person
Negot
g
v
ng
ab
and
e
nstruments
the
person
to
Law
rece
s
ve
not
requ
ce
res
red
de
or
The
instrument
is
dishonored
by
non-payment
when:
Pet
t
oner
TRB
ought
to
have
known
that
where
checks
drawn
payab
Sec
ega
87
ty

dec
ared
vo
d
or
Duress
or
nt
m
dat
on
Ru
e
where
nstrument
payab
e
at
bank.
that
the
act
on
a
wr
tten
contract
must
be
brought
instrument
and
the
holder
thereof
can
strike
out
any
special
presented
w
th
n
reasonab
e
t
me
and
a
ter
ts
ssuance
ythe
amount
L
fact
ab
that
ty
so
o
pa
acceptor
the
d
to
same
the
s
account
has
been
o
Acceptor
dishonored
depos
s
pr
tor
mar
whose
and
y
ab
demanded
name
e
was
ob
gat
on
o
a
party
or
an
unauthor
zed
add
t
on
o
words
or
and
pay
her
the
sa
d
amount
HSBC
d
d
not
heed
her
Thomson
d
ed
23
o
the
N
L
that
where
the
s
gnature
on
a
negot
ab
e
nstrument
Payee
and
vouchers
properly
signed
and
received
by
said
Emilio
Z.
Reyes.
Ang
Tek
Lians
indorsement
of
the
said
check
is
necessary
to
hold
New
York
and
demanded
the
money.
By
this
time,
however,
the
ho
express
der
may
y
a
st
ow
pu
ate
to
return
Date
of
suspens
the
Maturity
b
FEB.
accepted
ve
23,
cond
1984
t
or
FEB
on
non
22,
that
1982,
accepted
n
19
the
event
to
the
the
w
th
n
twenty
our
hours
a
ter
such
de
very
or
w
th
n
such
other
Very
clearly,
the
instrument
was
only
payable
to
Filriters.
It
checks
from
the
petitioners
place
of
business,
the
checks
were
d
gence
and
cannot
be
au
ted
or
the
w
thdrawa
s
t
a
owed
refused.
Hence,
the
present
action.
ISSUE:
Who
shall
bear
issued
for
a
definite
purpose
so
that
he
must
inquire
if
he
has
respondent,
shou
d
therefore
be
a
owed
to
recover
from
nstrument
accord
ng
to
ts
tenor
and
cons
der
ng
that
pet
check
t
oner
was
preva
presented
ed
upon
by
Lee
LP
Hua
not
Hong
to
depos
to
the
t
drawee
the
checks
bank
and
for
th
rd
party
purport
ng
to
be
drawn
upon
a
depos
t
o
unds
A
or
Cases
an
agreement
or
author
ty
by
to
pay
virtue
the
of
money
which
to
Maas
the
owner
or
anyone
of
a
stamped
November
on
1990.
their
STELCO
face
appealed.
is
the
ISSUE
word
NO.
"non-negotiable."
1
WON
the
17
Pam
accommodat
end
1978)
ntuan
ng
BP
the
rcheck
or
on
names
Ma
party
to
versat
Nyco
some
on
other
by
the
draw
amount
person
ng
checks
o
are
P60
st
000
Man
ab
Fo
ego
enot
on
ow
the
ng
J. must
SOME
or
the
NON-NEGOTIABLE
purpose
o
sett
ng
accounts
wthereto
th
each
other
on
a
y
may
tcense
was
ater
d
scovered
the
C
vISSUE:
Code
None
o
the
out
ned
there
n was
spresented
checks
for
clearing
and
it
was
on
the
basis
of
for
instrument
value,
notwithstanding
for
the
purpose
such
of
giving
holder,
effect
at
the
of
the
Thus,
taking
with
the
purchasing
difference
to
in
divided
circulation.
equally
They
as
are
their
a
safe
profit.
the
Pade
holder-depositor
by
F
Mo
eno
Ange
and
G
menez
the
collecting
bank.
There
is
no
holder
then
other
instituted
than
a
holder
this
action
in
due
against
course,
Fernandez
a
negotiable
Hermanos.
instrument
The
certa
n
crossed
drawee
checks
s
not
ssued
ab
e
n
on
her
the
b
avor?
un
ess
HELD:
and
Yes
unt
Under
he
5
NEW
PAC
Fthese
C
T
MBER
&
SUPPLY
COMPANY,
NC.
vs.
BP
Bth
g
22
was
enacted
to
prevent
the
pro
erat
on
o
worth
ess
checks
M
face;
obliges
SALAS
himself
VS.
CA
to
(supra
good
p
19)
Requ
SSUE:
due
on
WON
demand,
VMS
etc.)
raud
are
nda
the
Obligation
crossing.
Sec
143
WON
amedium
deemed
to
have
assented
(segregat
on
and
be
g
ven
to
drawer
and
each
o
the
ndorsers
and
those
When
presentment
for
acceptance
must
fixed
per
od
the
a
ter
nstruments
sLaw
ght
s
undated
a
ng
due
or
be
made
nany
Sec
DISTINGUISHED
48
or
(see
pCar
purpose
assigned.
The
following
clauses
have
been
held
to
render
nonPayment
by
th
rd
person
who
pays
or
the
benefit
or
nm
beha
o
the
ev
(d)
dence
Payable
othe
debt
aga
order
nst
or
the
drawer
and
a
though
may
be
party
Allonge
is
one
-n
is
who
an
slip
has
of
paper
signed
sometimes
the
instrument
attached
as
maker,
to
apartners.
negotiable
drawer,
Presentment
Sec.
50
or
payment
sB
not
n
order
to
charge
the
written
on
one
part
only.
If
the
Instruments
provide:
Construction
where
is
Sec
Crossed
162
Checks
Acceptance
produce
for
the
honor;
following
how
effect:
made.
An
acceptance
c.
case
of
foreign
bills
of
App
checks
y
Payer
to
and
or
the
b
spay,
same
are
payab
red
ee
n
on
ore
gn
ndeed
Sec.
119
Sec.
14:
Material
Particular
isfor,
any
particular
proper
to
be
prior
party
may
negotiate
instrument.
previously
given
by
Bthe
to
A.
(a)
It
is
duly
presented
for
payment
and
payment
is
n
the
same
p
ace
not
ce
must
be
gdemand
ven
w
th
n
the
to
the
order
Instrument;
o
one
person
how
and
discharged.
sn
presented
-the
or
A
payment
negotiable
by
another
purpose
w
n
ten
years
rom
the
tbe
me
the
rmodes
ght
o
act
on
Hence
Presentment
to
persons
ab
as
Pet
tthe
oner
nstrument
contends
sM
made
that
presentment
payab
e
at
a
bank
or
t thereto.
stime
equ
va
and
ent
not
to
an
ce
indorsements
77
by
virtue
of
Sec.
48.
Where
the
SALAS
VS.
CA
(G.R.
No.
76788
January
22,
-sinstrument
Juanita
This
isto
to
Certify
that
E
A
R
Enecessary
R
has
deposited
inpayment
this
Bank
the
sum
of
payment.
Sambok
failed
to
pay.
Trial
court
rendered
its
numbers
or
other
change
to
an
ncomp
ete
nstrument
re
at
ng
to
but
secondary
Cata
(San
was
os
not
pa
ng
d
Co
yet
vs
The
Bank
account
o
was
P
)accrues
trans
Th
spet
erred
ru
e
to
s
him
liable
for
dishonored
check?
HELD:
No.
Under
On
March
3,1978,
the
Court
of
Appeals
denied
the
issuance
of
orged
the
negot
at
on
o
the
check
s
w
thout
orce
or
effect
But
message
from
the
Philippine
National
Bank
directing
the
drawers
oan
the
checks
a
to
pay
Great
As
an
tse
w
pay
ho
der
he
b.
(3)
Drawee;
Payment
o
the
acceptor
w
Payment
by
the
acceptor
n
actually
issued
and
delivered
to
Linton
in
Navotas.
The
lacked
the
words
of
negotiability
which
should
have
as
an
Gomez
to
make
By
contrast
Metrobank
exh
b
ted
extraord
nary
received
the
check
pursuant
to
that
purpose,
otherwise,
he
is
not
the
loss
resulting
from
the
forged
indorsements?
HELD:
As
a
tenor
o
the
nstrument
s
that
he
engages
to
cash
er
sO
check
sthe
ospayab
a
very
d
fferent
character
tmaker
the
pr
mary
payment,
but
it
was
dishonored
for
insufficiency
of
funds,
the
prom
sed
to
rep
ace
them
w
th
n
30
days
However
tany
oner
e
se
credit,
upon
a
known
orge
gnature
as
the
tlike
assignor,
was
ts
ega
by
duty
acollecting
legal
to
know
cause,
that
bas
seder
Each
member
o
the
cone
ear
nghouse
orwards
a
fourth
acqu
tted
condition,
n
the
absence
i.e.
as
to
o
notice,
ev
dence
for
a
aga
holder
nst
her
in
due
but
course
ordered
is
INSTRUMENTS
scount
ng
process
agreed
upon
Nyco
thru
ts
pres
dent
Moreover,
it
indicated
that
they
are
payable
from
athat
particular
add
the
words
not
negot
e
to
nstruments
(b)
does
The
not
aw
specify
the
value
given,
or
d
ddwho
not
rece
ve
any
va
uab
e
cons
derat
on
when
he
that
these
the
endorsements
hosp
ta
d
d
by
not
the
rece
petitioner
ve
severa
that
the
otment
proceeds
checks
were
of
payee
the
instrument
of
a
negotiable
knew
him
instrument
to
be
only
acquires
an
accommodation
no
interest
party.
with
1.
rregu
Document
ar
of
Title
spayable
a
ab
person
a
certificate
not
otherw
of
stock,
se
amust
bill
party
of
LLUSOR
VS.
CA
(GR
No
139130
Nov
27
2002)

trial
court
held
that
the
consideration
for
the
draft
and
for
Chandiramani
did
not
appear
at
the
rendezvous
and
Ranigo,
accepted
bank
convenient
ng
pract
means
ce,
of
cross
ng
a
check
sserved
done
by
emphas
s
supp
ed)
HON.
nVthe
privity
of
contract
between
the
drawer
and
the
bank.
is
subject
to
sufficient
to
constitute
who
are
conduct
holder
REPUBLIC
is
not
PLANTERS
ais
holder
in
BANK
due
course
VS.
CA
may
(GR
recover
No.
93073;
on
the
Dec.
checks?
21,
(b)
any
maker
That
ho
he
becom
became
may
ng
the
nsert
holder
there
ereceiving
of
on
it
n
Saturday
before
the
it
true
was
are
overdue,
to
date
be
presented
o
and
ssue
without
or
bearer
negotiable
the
instrument:
13)
ntended
The
subsequent
o
obta
made.
to
n
ng
be
part
the
presented,
note
es
are
(or
kew
b
)
se
has
such
d
scharged
the
as
to
same
depr
s
nce
ve
effect
the
they
maker
are
as
an
"acceptance"
ab
under
the
and
same
"payment"
nstrument
are
w
For
th
examp
n
the
purv
e
a
ew
o
sa
d
Law
drawee
accepts
more
than
part
and
such
E.
3
Pr
nc
pa
Debtor
Becomes
the
Ho
der

Sec.
acceptor,
or
indorser,
person
pr
mar
y
ab
e
on
the
instrument
for
the
purpose
of
further
indorsements
when
Assignment
is
the
transfer
of
the
title
to
an
instrument,
with
ambiguous

b
s
perm
ss
ve
X.
(a)
supra
The
WHAT
protest
check
CONSTITUTES
(5)
may
must
not
be
encashed
n
VALUE
wr
t
ng

but
and
Sec.
only
nd
deposited
cate
that
in
t
the
s
an
bank;
refused
or
inserted
or
honor
in
a
negotiable
instrument
make
it
complete.
Where
an
instrument
is
negotiated
back
to
a
prior
and
purports
upon
ts
ace
to
have
been
du
y
ndorsed
by
payee
o
o
ow
ng
t
mes
instrument
is
discharged:
the
reckon
ng
t
me
or
the
prescr
pt
ve
per
od
beg
ns
when
the
PESOS:
FOUR
THOUSAND
ONLY,
SECURITY
BANK
SUCAT
OFFICE
order
to
Sec
177
R
ghts
of
payer
for
honor.
The
payer
or
honor
on
o
d
shonor
are
not
necessary
as
when
unds
are
nsuffic
ent
to
An
instrument
originally
to
order
but
converted
by
Salas
c
ous
Force
or
V
o
ence
F
ng
up
b
ank
beyond
Where
(Petitioner)
the
(1)
bought
a
motor
vehicle
from
the
Violago
1990)
abso
decision
ute
y
in
necessary
favor
of
to
Plaintiff.
the
c
rcu
Appellant
at
on
Sambok
o
dra
ts
argues
and
checks
that
by
the
ob
gat
on
o
a
party
n
other
words
a
mater
a
a
terat
on
s
one
HSBC
[Trustee]
Cata
an
then
requested
Trustee
to
pay
her
They
Section
9
of
the
Negotiable
Instruments
Law,
a
check
the
alias
writ
for
being
premature,
ordering
the
executing
Bancas
a
S
nce
the
common
cond
t
n
the
contracts
had
Kinds
of
Bills
of
Exchange
include
drafts,
trade
withholding
of
payment
had
been
received
in
New
York,
and
does
th
s
mean
collector
is
not
a
holder
or
an
agent,
he
was
just
an
a
holder
in
due
course
.
It
is
settled
that
crossing
the
checks
not
expression
d
scharge
of
the
the
b
consent
that
due
course
the
instrument
d
scharges
the
may
be
care
essness
Desp
te
ack
o
such
c
earance
t
a
owed
Go
den
rule,
a
drawee
bank
who
has
paid
a
check
on
which
per
od
any
as
the
bearer
w
be
o
deemed
the
nstrument
to
have
accepted
However
the
same
the
ho
der
s
not
a
ob
gat
on
o
the
bank
wh
ch
ssues
t
(N
ssenbaum
v
State
38
reneged
balance
on
of
the
h
s
deposit
prom
se
of
Ang
LP
depos
Tek
Lian
ted
on
the
both
checks
dates
being
w
th
P335
R
za
depos
ted
checks
drawn
on
other
members
and
rece
ves
rom
Me
transfers
cor
s
endorsement
his
credit
was
and
genu
its
accessory
ne
be
ore
cash
rights
ng
the
to
check
another,
ts
applicable
to
an
accommodation
party?
HELD:
"A
holder
in
due
Rufino
to
pay
Yao
endorsed
o
nt
y
and
the
severa
check
y
n
the
avor
amount
o
BA
o
F
nance
P57
434
Therea
50
to
ter
fund,
to
wit,
Fund
501.
credited
ndorser
lading
in
and
its
clearing
to
an
account.
The
principle
of
estoppel
In
respect
lending
value
thereto
his
had
been
name
until
given
to
its
the
therefor;
delivery
accommodated
or
to
him.
Delivery
party,
of
the
an
drawn
by
the
its
executed
now
acceptance
s
that
the
the
nstrument
accommodat
by
Fernandez
He
on
s
Hermanos
party
ab
e
to
can
a
has
ho
c
a
der
completely
m
no
or
va
benefit
ue
failed
as
as
wr
tnstream
ng
two
para
e
nes
d
agona
yterms
on
the
eft
top
port
on
nstrument
p
aced
thereon
h
s
sover
gnature
n
b
ank
be
Pet
toriginal
oner
was
awho
depos
tor
n
good
stand
ng
o(2)
respondent
doing
business
that
eliminate
the
risk
of
dealing
Yangs
representative,
lost
ALBERTO
V.
SENER
S
R
CARDO
A.
TONG
and
EX-OFF
Core
O
the
same
as
if
it
were
non-negotiable.
But
holder
ma
oP4,000
da
yty
bus
ness
and
to
avert
not
ythe
the
not
not
fied
sha
be
d
scharged
rom
ab
ty
except
where
th
sa
act
However,
6
bare
like
IOU,
Due
P1,000
or
JAI
ALAI
CORP
OF
THE
PHILS.
VS.
BPI
(GR
No.
L-29432;
HELD:
The
Negotiable
Instruments
Law
does
not
provide
1992)
-cannot
In
1979,
World
Garment
Manufacturing,
through
its
and
o
does
ts
not
bus
wacknowledgements
ness
sh
to
spec
acqu
fica
re
any
ythe
n
rways
ght
the
de
very
nstrument
aab
de
ve
so
ord
nary
check,
and
fallegedly
passed
to
the
th
rd
person,
w
be
*
notice
pay
Where
essent
that
for
it
payment
a
taxes
the
and
has
y
d
been
assessed
language
the
fferent
on
nstrument
previously
the
th
upon
ngs
of
next
dishonored,
the
sha
or
succeed
note
instrument
the
be
payab
or
ng
ormer
if
its
such
bus
mortgage
e
is
ness
saccord
was
"a
ambiguous
the
day
prom
ng
security
fact;
y
except
se
The
or
to
accepted
parts
119(e)
o
the
Presentment
qua
o
m
or
nd
acceptance
essent
a
must
mak
be
ng
oon
a
contract
s
gn
as
such
maker
be
ore
he
can
be
made
pr
mar
ylending
e
&
00
CTS
Pesos,
Philippine
Currency,
repayable
to
said
depositor
731
n
and
s
Sec.
120(c):
As
suggested
by
the
ma
or
ty
v
ew
does
not
nc
ude
without
acceptance
24
receiving
or
value
therefor,
and
for
the
purpose
of
his
Sec.
nstrument
8
assignee
but
generally
the
nstrument
taking
only
sto
by
such
ts
title
payab
or
rights
at
aa
as
spec
his
a
the
paper
is
filled
be
obtained;
or
WHEN
The
PRESENTMENT
note
was
ndorsed
on
the
back
as
the
check
tdefenses
sbank
the
pr
mary
duty
o
pet
tto
oner
to
know
that
the
check
(b)
The
check
may
be
negotiated
only
once
to
one
who
has
an
When
payable
to
order.
-s
The
instrument
is
payable
party,
such
party
may,
(a)
By
payment
in
due
course
by
or
on
behalf
of
the
May
be
verba
or
wr
tten
A
n
wr
tthe
ng
nstrument
was
ssued
and
the
correspond
ng
check
abased
check
the
drawer
srecourse"
ab
ereasonab
whether
presentment
and
virtue
of
a
blank
pay
ng
to
the
ho
der
the
(1)
amount
o
the
bb
and
the
notar
aect
e
tindorsement
me
the
to
pay
the
same
or
o
pr
nc
pa
persons
Motor
pr
mar
Sales
y
ab
e
on
the
nstrument
are
ab
e
as
partners
adding
the
words
"with
in
the
of
the
wh
ch
changes
the
tems
wh
ch
are
requ
red
to
be
stated
under
and
st
re
sYES.
used
and
upon
even
the
asked
presumed
her
neg
subm
gence
taccount
back
osuch
the
to
them
drawee
the
n
or
agwas
na
ng
drawn
payable
to
the
order
of
cash
is
a
check
payable
transp
red
an
ob
gat
on
on
the
part
o
Great
As
an
arose
rom
should
put
the
holder
on
inquiry
and
upon
him
sheriff
Emilio
Z.
Reyes
to
appear
with
his
return
and
explain
the
acceptances
payment
was
therefore
refused.
Thus
the
present
complaint
that
the
ex
stence
o
one
orged
gnature
there
ne
w
render
transferred
by
negotiation.
The
language
of
negotiability
Sav
ngs
w
thdraw
rom
the
unc
eared
treasury
warrants
The
b
indorsement
has
been
forged
cannot
charge
the
drawers
Ga
App
253
S
E
776)
and
const
tutes
ts
wr
tten
prom
se
to
Acceptance
may
be
n
Acceptance
nvo
ves
the
.meet
Future
only.
Petitioner
was
sued
for
estafa.
In
his
defense,
however,
he
Commerc
a
Bank
ng
Corporat
on
wh
ch
returned
the
c
ear
nghouse
a
checks
drawn
on
tthe
Ba
ances
are
ad
usted
remedy
known
sto
as
aga
the
nst
assignee,
Maas
m
to
who
whom
acquires
tvalue;
pa
d
the
the
money
power
The
to
Supreme
enforce
course,"
government
says
the
Man
law,
ego
"is
sought
a
holder
recons
who
derat
has
taken
on
o
the
the
instrument
udgment
BA
nance
ssued
a
check
payab
e
to
Nyco
wh
ch
endorsed
tthe
n
and
no
action
whatever
can
be
maintained
on
the
instrument
by
effectively
prevents
the
defendant
from
denying
liability
for
any
accommodation
instrument
means
party
transfer
is
of
in
possession,
effect
a
surety
actual
for
orwere
the
constructive,
latter.
He
of
the
checks.
The
cross
ng
s
spec
a
where
the
name
of
a
de
very
or
a
Sections
1
and
3
of
the
Negotiable
Instruments
Law
contract
(c)
does
was
not
not
specify
or
the
place
where
it
is
drawn
or
the
warehouse
receipt
(non-negotiable
because
is
no
in
cash.
Prov
nce
A
ter
cheque
the
checks
sfaith
crossed
were
spec
exam
a
y
ned
the
banker
tor
was
to
earned
whom
that
LORETO
DELA
VICTORIA
VS.
HON.
BURGOS
(GR
No.
111190;
TOWN
SAV
ePresentment
M
NGS
made
&
a
note
LOAN
payab
BANK
e(RCBC)
to
VS.
Pcountry
or
CA
bearer
(GR
Pa
de
No
vered
106011
the
bank
the
Man
aoin
Bank
ng
who
the
derives
two
cashiers
checks
and
the
dollar
draft
bought
by
petitioner.
SHER
FF
HAK
M
S.
ABDULWAH
[G
R
No
Lperson
41764
days.
after
date,
upon
presentation
and
surrender
of
this
certificate,
with
interest
for
prov
value
des
otherw
se
Accord
to
th
sby
ndorsers
are
not
d
scharges
the
nstrument
he
ntends
to
acqu
re
athere
rthe
ght
over
such
underm
n
ng
o
bank
ng
system
o
the
but
so
the
that
va
aF
dExamp
holder,
n
h
s
hands
ke
any
other
check.
From
the
above
Aug.
6,
(Hubard
there
vs.
are
omissions
therein,
the
following
rules
of
board
authorized
(c)
That
per
truck
he
orm
took
wou
an
it
d
act
re
"payment
good
ease
whereas
pet
tng
and
the
oner
for
atter
maker
sD
the
rom
"ISSUE:
actua
pay
ng
per
F
rst
ormance
FAct
nance
"
nsert
on
of
that
a
nstruments
wrong
date
made
d
scharge
by
Duress
re
at
ve
hence
threats
to
a
eeb
e
and
o
d
person
negotiated
to
different
holders
in
due
course,
he
is
liable
with
indorsements.
Generally,
an
allonge
may
not
be
utilized
for
4
a
An
nstrument
sall
d
scharged
when
pr
nc
pa
debtor
name
EXCUSED
o(5)Where
to
ows
some
other
person.
Such
a
person
is
liable
on
instrument
assignor
p
ace
and
has,
he
subject
sthe
ab
e
to
and
w
ng
to
pay
tthe
there
at
matur
ty
was
du
y
ndorsed
by
the
or
g
na
payee
and
where
t
pays
honor
and
must
be
s
gned
by
the
acceptor
or
honor
(
orma
Authority
Sec.
18
L
to
ab
Complete
ty
of
person
does
s
gn
not
ng
carry
n
trade
with
it
the
assumed
authority
name.
to
(b)
principal
subject
to
the
provisions
is
excused
of
and
this
the
Act,
instrument
reissue
and
is
further
account
BIBIANO
with
a
BANAS
bank;
and
VS.
CA
(GR
No.
102967;
Feb.
10,
2000)

to
order
where
it
is
drawn
payable
to
the
order
of
a
specified
returned
by
the
bank
to
ts
depos
tor
App
y
ng
the
same
ru
e
(a)
g
ven
at
the
p
ace
o
bus
ness
o
the
not
ce
be
tota
y
om
tted
or
mere
y
de
ayed
SSUE:
WON
indorsement,
the
holder
thereof
can
remove
all
subsequent
debtor
thereon
Made
by
a
ho
der
or
any
Made
a
notary
pub
c
expenses
Corporation
nc
denta
(VMS)
to
ts
as
evidenced
by
a
promissory
note.
This
and
(2)
no
p
ace
s
spec
fied
presentment
or
payment
Sec
127
to
bearer
and
the
bank
may
pay
it
to
the
person
to
note,
meet
it
ts
becomes
ob
gat
on
a
to
qualified
know
the
indorser;
s
gnature
o
that
ts
correspondent
being
a
qualified
Sect
on
1
o
Negot
ab
e
nstrument
Law
The
case
at
the
checks
or
ver
ficat
on
Cata
an
and
her
awyer
went
to
devolves
the
duty
to
ascertain
the
indorsers
title
to
the
Want
our
o
contracts
author
B
not
ty
and
an
ass
that
gnment
ob
gat
on
of
Trans
funds
s
to
er
pay
n
n
breach
hands
Bancas
o
of
a
a
drawee.
th
the
u
reason
for
his
failure
to
surrender
the
amounts
paid
to
him
by
recover
said
sum,
with
interest
and
costs.
WON
No.
vo
d
a
the
which
characterizes
a
negotiable
paper
as
a
credit
supposed
reason
or
d
shonor
to
w
trelying
the
orgery
ongu
the
pay
account
demand
for
the
amount
(Ste
nmetz
of
said
v
Schu
check.
tz
59
An
exception
D
603
241
to
the
rule
is
G.
WHEN
BILLS
TREATED
AS
B
s
avor
o
on
ythe
one
or
some
ent
re
nstrument
because
argues
that
account
as
the
check
was
cthis
osed
had
been
Desp
made
te
rece
payable
pt
o
to
the
cash
not
ce
and
on
and
sett
ed
each
day
the
Court
it
to
the
same
the
extent
ower
court
as
sorder
udgment
the
assignor
and
entered
could
another
have
n
under
the
following
conditions:
(a)
That
it
isso
complete
avor
pray
ng
Sanshe
that
she
Sanshe
be
abso
then
ved
made
rom
c
use
vIt
o
ab
and
ty
or
or
negot
at
the
ated
very
the
at
rate
of
16%
per
cent
per
annum.
AIPCI,
or
by
any
other
person
against
whom
the
defense
of
failure
bank
or
a
bus
ness
nst
tut
on
swho
wr
tten
between
the
two
damages
sustained
by
the
plaintiff
which,
upon
an
action
lends
from
one
his
name
person
to
to
enable
another.
the
Without
accommodated
the
initial
party
delivery
to
obtain
of
the
person
who
ndorses
nstrument
nS
an
unusua
sof
ar
especially
Medium
underscored
of
credit
requirement.
transactions
The
to
indication
they
allow
of
note
place
to
where
it(president)
is
payable;
or
accommodat
on
n
whatever
capac
ty
such
accommodat
on
party
Pay
tupon
no
sreversed
unconditional
crossed
e
o
he
o
may
de
promise
o
aga
Don
n
cross
Fe
or
nando
tthe
spec
Mau
to
a
ntitle
pay
y
va
to
a
ue
certain
another
ece
ved
sum
banker
Man
in
ath
une
his
title
Ranigo
through
a
holder
in
due
course,
and
who
is
not
himself
ao
30
2.
checks
were
encashed
by
one
Fausto
Pang
nan
w
the
Corporat
June
on
As
he
was
then
runn
ng
about
20
corporat
ons
and
une
17
ab
e
un
ess
they
are
not
fied
that
the
document
was
nstrument
December
he
19
may
1980]
be
cons
A
dered
comprom
aor
ho
se
der
udgment
or
ass
gnee
was
rendered
as
the
case
by
defin
to
on
t
s
c
ear
that
a
memorandum
check
wh
ch
s
thereo
n
the
words
o
the
Law
"the
acceptance
o
a
b
s
nfl
ct
on
o
damage
and
n
ury
upon
construction
shall
apply:
(g)
Where
an
instrument
containing
Shozo
Yamaguchi
and
Fermin
Canlas
(treasurer)
received
do
not
constitute
promise
to
and
are
non1975)

Petitioner
deposited
10
checks
in
its
current
(a)
Where
the
b
s
payab
e
a
ter
s
ght
or
n
any
the
amount
stated
n
(d)
does
That
not
at
avo
the
payab
time
d
the
e
it
on
was
nstrument
demand
negotiated
may
n
to
at
the
him,
the
hands
he
opt
had
on
of
o
no
a
the
notice
subsequent
ho
der
any
be
indorsement
if
m
becomes
ght
be
duress
the
to
one
wh
e
t
may
not
be
another
Robert
Wallace
ATRIUM
MANAGEMENT
CORPORATION
VS.
CA
(G.R.
No.
operat
on
o
aw
such
as
bankruptcy
nso
vency
prescr
pt
on
or
to
rece
ve
not
ce
t
must
be
g
ven
be
ore
the
c
ose
o
amount
o
the
check
to
a
th
rd
person
has
orged
the
s
gnature
o
to
a
holder
for
such
ab
ty
and
defenses
available
negotiable
against
his
assignor.
is
the
less
usual
method
debtor;
(c)
V.
person
The
PARTIES
act
s
of
ab
crossing
WHO
e
on
the
ARE
the
nstrument
check
serves
whose
as
s
warning
gnature
to
does
the
not
holder
appear
that
overdue
and
unpaid.
alter
Petitioner
(Sec.
sold
to
Ayala
Investment
Corporation
(Ayala)
a
lot
for
No
presentment
person
or
or
to
payment
and
not
ce
o
d
shonor
the
special
indorsements
as
he
can
acquire
only
by
delivery.
But
b.
n
whose
Sec
148
Where
presentment
s
excused
Presentment
or
Sec.
149
person
who
may
be
a
respectab
e
res
dent
d
shonor
note
s
was
ent
subsequently
t
ed
to
rece
ve
endorsed
both
b
to
Filinvest
tse
and
Finance
the
protest
&
Leasing
When
dishonored
by
nonacceptance.
A
bill
is
presenting
it
for
payment
without
drawers
indorser,
it
does
not
warrant
that
if
said
note
is
dishonored
by
bench
s
un
que
n
the
sense
that
what
was
a
tered
s
There
Hongkong
s
noth
on
ng
the
nequ
r
own
tab
expense
e
n
such
to
a
persona
ru
e
y
the
subm
paper
t
the
comes
checks
to
check
or
the
nature
of
his
possession.
Failing
in
this
respect,
va
ue
o
the
checks
nc
ud
ng
the
st
pu
ated
pena
ty
and
A
bpet
ofrom
tse
does
not
operate
as
an
ass
gnment
o
the
petitioner
PAL.
However,
the
order
could
not
beected
served
upon
2031
isthe
applicable
in
the
above
case?
HELD:
NO.
The
Prescr
ptnot
on
Mthe
stake
other
instrument
negot
at
is
ons
its
o
freedom
the
check
to
circulate
w
th
respect
as
adefendant
substitute
tobe
the
other
for
s
gnatures
o
the
genera
manager
and
the
aud
o
the
drawer
where
drawer
is
guilty
of
such
negligence
which
causes
NOTES
(Sgd.
Illegible)
(Sgd.
Illegible)
had
been
endorsed
by
Ang
Tek
Lian,
the
is
not
d
twh
oner
at the
ed
to
make
arrangements
or
payment
oshonor
the
part
es
enforced
tWHEN
sodeclaration
on
yunless
aon
ter
it
the
against
check
has
the
been
debtor.
c
eared
Stated
and
co
simply,
it
rom
is
the
the
Sec
135
Prom
se
to
accept;
when
equ
va
ent
to
regular
of
east
that
upon
its
is
face;
available.
ab
ty
(b)
be
That
ISSUE:
reduced
he
WON
became
The
Fossum
Court
the
is
holder
dec
a
holder
ned
of
to
in
it
Accompany
ng
exchange
o
checks
was
a
Deed
o
5
1912
Sgd
A
G
ano
para
e
nes,
ch
means
that
drawee
d
pay
on
y
or
of
the
paid
on
the
Checks.
The
credit
instrument
or
to
raise
the
money.
drawer
He
to
receives
the
payee,
no
there
of
can
consideration
no
liability
pecu
ar
an
nstrument
payab
e
to
A
but
at
men
of
undoubted
credit
(such
as
those
with
illiquid
(d)
bears
a
seal;
to
any
fraud
or
illegality
affecting
instrument,
has
all
the
s
gned
the
nstrument
whether
pr
mar
ypart
or
secondar
ya
Thus
may
be
or
co
Under
ect
on
the
CSECONDARY
v
Code
a
cred
tor
though
bound
to
the
respondent
money);
udge
aga
nst
New
Pac
fic
T
mber
For
a
ure
Assoc
d
The
shonored
ated
ow
ng
Bank
defin
Then
act
tSe
ng
ons
under
as
cadefendant,
ted
the
by
appe
genera
ant
a
pr
so
nc
confirm
ptor
enot
o
the
o
4.
reported
Provisions
the
alleged
which
loss
do
not
of
the
checks
certainty
and
the
dollar
draft
go
ng
out
oGONZALEZ
the
country
a
number
tform
mes
pet
tshonored
oner
entrusted
Aconsideration
who
ndorsed
spec
a
y
to
B
F
sto
e
the
note
and
QU
R
27,
NO
1995)
-Bmanner
Raul
LOGG
Sebreo
NG
VS.
filed
CA
a
(GR
complaint
No
126568
for
damages
Apr
20
PAPA
VS.
AU
VALENC
A
NO
105188
an
23
1993)
Spouses
H
po
to
app
ed
or
and
was
granted
oan
by
the
orm
o
an
ord
nary
check
saffect
st
drawn
on
a
bank
and
shou
d
s
gn
ficat
by
the
drawee
o
h
s
assent
to
the
order
the
trade
to
and
obtain
commerce
occas
by
nd
scr
m
nate
ssuances
word
Iinstrument
promise
to
pay
is
signed
by
two
or
more
persons,
other
case
where
presentment
or
acceptance
negotiable,
bus
ness
hours
on
the
day
o
ow
ng
account
the
note?
with
HELD:
BPI
No
The
note
was
a
negot
ab
ethe
nstrument
ho
der
n
due
presented
course;
or
but
payment
as
to
h
be
m,
ore
the
twe
date
ve
o
con,
nserted
ock
noon
sinto
on
to
infirmity
Sec
72
in
the
or
defect
in
the
title
of
the
person
Co.);
the
109491;
payee
Duress
February
the
oss
ssher
28,
a
a
rea
sBut
upon
de
ense
-oned
pet
Hi-Cement
tcourse
oner
tth
sne?
v
who
cby
Corp.
ous
cashed
or
issued
tshou
sme?
the
checks
what
check
s
in
favor
ts
aDcheck
ure
to
gwhose
ve
not
ce
o
shonor
but
on
y
those
d
scharged
H.
What
const
DEEMED
tutes
a
suffic
ent
presentment.
b
same
the
same.
shis
pract
ca
he
y
wr
is
t(GR
not
ng
entitled
the
note
to
tse
enforce
by
ho
payment
dpart
ng
the
value,
LIABLE
thereon
notwithstanding
such
holder,
at
time
of
taking
which
w
ngness
may
ho
or
are
der
may
equ
o
the
not
va
ent
involve
nstrument
to
a
an
tender
indorsement
at
or
o
a
payment
ter
matur
in
the
upon
ty
sense
date
h
sNegot
n1998)
writing
h
sab
But
the
check
holder
cannot
strike
out
the
indorsements
prior
to
the
blank
(b)
By
payment
in
due
the
party
accommodated,
A.
PRIMARY
AND
LIABLE
quest
oned
him
or
check
order.
were
Itd
made
may
be
w
drawn
nthe
reasonab
payable
e
to
tthe
the
order
HELD:
of:
No
124).
favor?
P2,308,770
to
be
compe
ed
to
pay
acceptance
Corporation
excused
(private
and
respondent)
b
may
be
which
treated
financed
as
dso
the
purchase.
by
indorsement.
Consequently,
the
of
the
check
was
attorney
dishonored
s
ees
t2001)
by
smay
to
non-acceptance:
be
noted
that
under
the
est
the
the
drawee
maker
non
the
presentment,
regu
ar
course
it
will
o
pay
bus
the
ness
amount
and
he
to
hav
the
holder.
ng
the
the
ser
asPERSON
number
of
the
check
n
an
tem
They
st
were
not
honored
ead
ng
Cata
an
to
fi
e
a
su
tof
aga
nst
EXAMPLE
the
e.
Payment
holder
A
and
is
for
partners
declared
Honor
guilty
ssued
vs.
Acceptance
of
a
note
gross
payab
negligence
for
e
at
#8
Aya
amounting
aoaw
Ave
Requ
red
to
be
made
Protest
or
not
ng
thereo
Deputy
Sheriff
Reyes
because
he
already
absconded
or
provisions
of
the
Negotiable
Instruments
Law
to
come
unds
n
the
hands
AUTHORIZED
SIGNATURES
money.
Hence,
freedom
of
negotiability
is
the
touchstone
relating
corporat
on
has
not
been
estab
shed
Th
squest
was
the
find
ng
os
part
scharge
es
nher
nso
gnature
vency
are
genu
nsert
on
No
oWON
App
wrong
y
date
the
pr
nc
p
bank
to
honor
such
checks.
Gempesaw
did
not
exercise
prudence
w
th
guilty
nsum
five
of
the
(5)
bank
offense
ng
days
charged.
so
he
ISSUE:
was
charged
w
aang
th
check
vBA
o
at
payable
on
oe
Sec.
130
When
bill
be
treated
as
promissory
note.
due
course,
such
that
an
action
can
be
maintained
on
the
process
of
transferring
the
right
of
the
assignor
to
the
w
th
before
the
ntervent
it
was
overdue,
on
of
that
and
company.
without
The
notice
cross
that
ng
it
s
had
genera
been
Ass
negate
gnment
executed
c
v
ab
by
ty
Nyco
but
(ass
d
gnor)
d
reduce
n
avor
the
o
amount
F
nance
She
drawee
bank
that
fina
cred
t
s
made
n
the
payee
depos
tor
uncond
t
ona
prom
se
n
wr
t
ng
to
accept
a
b
be
ore
t
s
drawn
s
acceptance.
An
same
principle
of
estoppel
effectively
prevents
the
defendant
on
the
instrument.
Moreover,
such
delivery
must
be
back
has
B
as
the
first
ndorser
B
s
an
rregu
ar
ndorser
accept
payment
rom
a
th
rd
person
s
not
proh
b
ted
rom
do
ng
or
the
pet
t
oner
to
comp
y
w
th
h
s
udgment
ob
gat
on
a
wr
t
o
Letter
of
Credit

a
letter
from
a
merchant
or
bank
or
co
th
s
ect
v
ew
ng
bank
t
turned
out
that
Fausto
Pang
nan
who
of
has
been
he
d
drawer
"
wh
ch
n
the
case
o
checks
s
the
payment
on
C.
REQUISITES
OF
to
h
s
secretary
to
orged
Liong.
B
Liong,
s
in
turn,
informed
Yang,
and
the
loss
was
2003)
against
n
the
Fiscal
expans
on
o
ts
ogg
ng
bus
ness
pet
t
oner
Qu
r
no
Pr
there
vate
ore
respondents
be
d
st
ngu
fi
shed
ed
n
rom
the
a
prom
RTC
ssory
a
comp
note
nt
wh
or
ch
spec
s
but
fic
a
they
are
deemed
to
be
jointly
and
severally
liable
thereon.
As
credit
the
bank
facilities
wh
ch
from
was
secured
Republic
by
Planters
a
prom
ssory
Bank
note
(RPB).
For
For
a
this,
ure
to
9
necessary
n
order
to
fix
the
matur
ty
o
the
nstrument
or
words
and
constituting
was
(b)
g
ven
a
promise
at
h
s
to
res
pay
dence
is
added,
t
must
like
be
IOU
g
ven
(or
Due)
be
ore
the
*
keep
free
from
encumbrance
property
on
which
the
value
of
ELEMENTS
PRUDENCIO
VS.
CA
(GR
No.;
July
14,
1986)

In
1955,
which
were
acquired
from
Antonio
Ramirez,
a
regular
jai-alai
on
y
remedy
s
aga
nst
the
person
to
whom
t
pa
d
the
money
INDORSER
b.
EFFECTS
OF
CROSS
NG
hands
thereof
o
against
any
intervening
party
to
whom
he
of
E.T.
Henry
and
v
rtue
o
some
act
o
the
cred
tor
indorsement
since
it
would
be
necessary
for
his
acquisition
of
title.
Examp
e
On
an
1
2013
M
ssued
a
prom
ssory
note
payab
e
to
the
Holder
GULLAS
the
VS
first
PNB
requisite
(GR
NO
is
L
that
43191
he
should
NOV
13
be
a
1935)
holder
The
as
Treasurer
defined
except
the
back
as
own
here
of
r
the
ght
n
instrument.
otherw
se
prov
ded
presentment
or
payment
sDISTINGUISHED

see
Where
the
nstrument
s
not
payab
e
on
demand
presentment
must
has
been
issued
for
a
definite
purpose
so
that
he
must
inquire
Checks
are
primarily
used
immediate
payment
H.
or
assumed
PAYEE
AS
name
HOLDER
w
be
IN
ab
DUE
e
to
the
same
extent
as
he
had
where
the
instrument
is
made
or
accepted
for
his
paid
P461,754
upon
signing
of
the
contract
and
the
balance
Sec.
121
Authority
to
put
any
amount

there
must
be
showing
of
Petitioner
defaulted
in
her
installments
allegedly
due
to
a
except
totally
as
here
unconnected
n
otherw
se
express
with
its
y
prov
dishonor.
ded
But
The
one
who
check
s
gns
was
n
Right
of
party
who
discharges
instrument.
non
acceptance
n
e
ther
o
nstruments
Law
not
ce
o
d
shonor
s
not
requ
red
the
drawer
ISSUE:
(a)
WON
When
Sambok
it
is
duly
is
presented
a
qualified
for
acceptance
indorser?
and
HELD:
wh
ch,
t
can
read
y
be
observed,
s
not
an
essent
a
opportun
HSBC
to
ty
co
ascerta
ect
her
n
ng
HK$3
ts
character
2M
SSUE
pronounces
Whether
t
to
be
not
va
Cata
d
and
an
Makat
Sec
to
163
legal
Honor
When
absence
deemed
of
to
good
be
an
faith,
acceptance
contrary
for
to
Sec.
honor
52(c)
of
the
of
usua
y
w
th
n
one
day
shou
d
be
made
on
the
day
disappeared.
ISSUE:
WON
the
payment
rendered
through
operation,
there
must
be
a
document
in
existence
of
the
o
the
drawee
ava
ab
e
or
the
payment
thereo
and
the
to
the
protection
of
holders
in
due
course,
and
the
freedom
the
ower
courts
whexistence
ch
must
be
dallowed
sturbed
As
he
d and
n
in
taking
steps
that
aorcareful
and
prudent
businessman
would
o
Beam
vs
Farre
Ante
dat
ng
or
Post
dat
ng
or
cash
needs
indorsement?
HELD:
NO.
Under
the
Negotiable
BP
22
SSUE
What
const
tutes
REASONABLE
T
ME
or
checks?
instrument?
HELD:
NO.
Fossum
is
far
from
being
abe
holder
in
due
where
the
words
wr
tten
between
the
two
para
ebounced
nes
are
assignee,
who
would
then
be
to
proceed
Mau
n
sswas
bus
ness
as
avate
broker
cons
sted
n130
ook
ng
up
previously
ed
Where
dishonored,
SSUE:
in
a135
WON
bill
ifparticular
the
such
Man
drawer
ego
was
cou
the
and
fact;
dcan
drawee
proper
(c)
are
That
y
the
he
he
same
took
d
cv
it
in
y
(ass
gnee)
w
th
the
con
orm
ty
o
Sanshe
The
check
BA
deemed
an
V
.appea
from
denying
the
ofnot
the
Checks.
The
petitioner
by
intended
to
give
effect
to
the
instrument.
The
allegations
of
execut
on
ssued
the
amount
o
P63
00
pursuant
to
banker
in
was
demand
the
ounsatisfied
a
gpromissory
ven
sum
o
money
Upon
the
other
hand
actua
(e)
designates
a
kind
of
current
money
in
NEGOTIABILITY
that
n
end
ng
h
s
name
to
the
accommodated
party
the
mere
prom
se
to
pay
pr
vate
respondent
seeks
to
equate
A
cash
er
check
s
a
check
o
the
bank
s
cash
er
on
h
s
or
another
1
H
can
co
ect
rom
M
s
nce
the
ab
ty
rema
ns
that
he
w
Kather
Gonza
such,
es
ne
Logg
the
E
Eugen
promissory
ng
o
h
s
cred
note
t
cards
itself
and
proves
h
s
checkbook
that
petitioners
w
th
b
ank
are
per
promissory
then
ormance
reported
aga
notes
to
nst
were
executed.
Each
promissory
note
was
Bienvenido
Mabanto
Jr.
of
Cebu
City.
Sebreo
won
and
he
was
The
Basic
Test
:
is
whether
the
holder
determine
by
pay
the
r
month
y
va
d
y
negot
ated
to
pr
respondent
who
s
a
ho
der
n
due
collateral
Sec
64
pledged
L
usua
ab
ty
hours
for
of
security
rregu
o
rest
ar
on
of
the
the
ndorser
instrument
day
o
ow
Where
ng
depends
a
person
(Streckhold
not
(b)
Where
the
b
express
y
st
pu
ates
that
t
sha
be
Bills
.
PERT
of
Exchange:
NEN
PH
L
PP
NE
CLEAR
N
HOUS
CORPORAT
O
A
bank
s
engaged
n
a
bus
ness
mpressed
w
th
pub
c
nterest
CHECKS
a
The
Concepcion
mak
ng
draw
and
ng
and
ssuance
o
any
check
to
app
y
or
bettor
and
a
sales
agent
of
the
Inter-Island
Gas.
All
checks
another
order
o
Co.
Inc.,
as
payee.
The
latter,
in
turn,
endorsed
the
checks
to
be
made
on
the
day
t
a
s
due
Where
t
s
payab
e
on
demand
d.
To
b.
Sec.
120(d):

n
(substitute
h
s
Tender
own
r
o
ght
Payment
has
been
means
construed
the
act
by
to
one
exc
ude
wh
ch
a
s
gned
COURSE
n
h
s
under
o
the
(a)
A
payee
NEGOTIATION
who
is
not
maker,
drawer,
or
ASSIGNMENT
drawee;
or
if
he
has
received
PRESENTMENT
the
check
FOR
pursuant
PAYMENT
to
that
purpose,
otherwise,
he
returned
because
the
drawer
had
insufficient
funds
accommodation;
covered
discrepancy
by
a
in
the
engine
note
and
to
chassis
be
paid
numbers
in
four
of
equal
the
vehicle
annual
b.
Not
ce
of
d
shonor
shou
d
be
g
ven
prom
ssory
note
s
no
r
ght
to
expect
or
requ
re
the
bank
to
honor
check
or
intention
Active
Sec.
63.
Subject
When
to
convert
in
a
person
it
negotiable
to
deemed
a
negotiable
instrument
indorser.
instrument.
is
the
A
holder
person
.
He
the
o
ow
ng
cases
pays
Appellant,
t
t
such
Where
s
not
an
by
on
the
y
instrument
indorsing
a
quest
on
is
o
the
paid
payment
note
by
a
"with
party
under
recourse''
secondarily
m
stake
liable
does
but
requ
s
te
for
negot
ab
ty
under
Sect
on
1
of
the
has
a
cause
o
act
on
HELD
Yes
A
though
Cata
an
has
no
cause
o
C
ty
NIL.
to
C
In
who
the
ndorsed
present
case,
t
to
D
BCCFIs
present
defense
ho
der
in
who
stopping
res
des
payment
n
Quezon
is
a
ter
d
shonor
o
d
shonor
drawer.
Where
an
acceptance
or honor
does
not
express
ythe
state
or
check
made
by
PAL
to
the
absconding
sheriff
inmade
his
name
operate
J. Not
KINDS
OF
character
described
in
section
1
of
the
Law;
and
no
rights
drawee
s
PAYMENT
FOR
HONOR
ACCEPTANCE
FOR
HONOR
Sectio
1,
of
Act
No.
2031,
otherwise
known
as
the
made
or
g
ven
n
the
As
a
ru
e
to
be
n
Sec
187
of
negotiability
is
the
foundation
for
the
protection,
which
Cert
ficat
on
of
check;
effect
of.
Where
a
check
s
take
in
circumstances
to
discover
discrepancies
in
her
account.
owa
670
113
N
W
590
t
can
be
sa
e
y
conc
uded
that
t
s
ega
or
raudu
ent
purpose
HELD
Instruments
Contrary
Law
to
pet
(sec.
t
oner
9
[d],
s
a
assert
check
ons
drawn
the
payable
aw
does
to
not
the
requ
order
re
course.
He
was
himself
a
party
to
the
contract
"and
Co."
or
"for
payee
s
account
on
y,"
as
n
the
case
at
bar
against
ascerta
n
the
ng
debtor.
The
assignment
involves
no
transfer
of
good
faith
and
for
value;
(d)
That
at
the
time
it
was
negotiated
to
F
nance
ab
e
not
a
ter
fied
her
Sanshe
acqu
tta
Sanshe
?
HELD
subst
Yes
tuted
Appe
the
BP
ant
s
check
content
w
th
on
a
D
SCHARGE
person
or
where
its
own
acts
and
representation
cannot
now
deny
liability
the
petitioner
in
the
original
complaint
show
that
the
two
actua
acceptance
nafter
avor
o
every
person
who
upon
the
a
th
wh
ch
the
Ex
Offic
oand
Sher
ff
ev
ed
upon
the
oh
ng
persona
date,
for
value
received,
I/we,
jointly
and
one
place,
addressed
to
another,
in
another
place
or
adm
payment
neholder
o
ve
the
officer
amount
and
o
cash
a
check
o
payee
mp
es
hosp
not
on
ythat
co
an
assent
ected
to
memorandum
which
check
payment
w
is
to
prom
be
made.
ssory
note
as
he
does
to
sk
rt
bank
tstrat
accommodat
pay
the
on
party
sand
n
effect
ade
surety
or
the
atter
The
solidarily
liable
Embassy
Farms.
Moreover,
police.
The
checks
the
dollar
draft
were
not
lost
Concess
ona
re
(QGLC)
through
ts
propr
etor
genera
manager
co
pet
oner
here
n,to
n
h
so
capac
ty
as
adm
n
strator
o
the
checks
SAMSUNG
ta
was
CONSTRUCT
aOCAMPO
so
Eugen
ON
oto
VS.
who
FAR
ver
fied
and
BANK
(GR
ed
the
No
payments
they
were
dec
ared
n
au
tAct
The
spouses
den
ed
awarded
course
and
as
payment
such
ho
of
ds
damages.
nstrument
Judge
Burgos
ordered
de
De
enses
La
calculation
or
computation
the
amount
payable
when
the
otherw
se
party
to
an
nstrument
Gthe
p
aces
thereon
EEAST
sow
N
srom
gnature
nthe
(c)
sent
by
ma
tn
must
be
depos
ted
nta
the
post
office
Section
and
ttdrawer
sor
1.
ts
Form
duty
of
protect
negotiable
ts
many
instruments.
cdue
ents
and
-an
depos
An
instrument
tors
who
presented
or
acceptance
or
Tamayo
Construction
Enterprise
had
areasonab
contract
with
the
Bureau
of
It
is
were
not
payable
necessary
to
Interto
use
the
word
order.
Any
other
words
account
or
va
Exceptions
are:
presentment
must
be
made
w
th
n
a
e
tgave
me
a
ter
ssue
Whom
Atrium
produces
and
for
valuable
consideration.
But
upon
presentment
for
STATE
NVESTMENT
HOUSE
NC.
VS.
AC
(supra
preconc
19)
until
(1)
the
LLEGAL
for
TY
money);
while
ordinary
bill
of
exchange
and
the
P
or
000
w
th
12%
w
th
6er
months
rom
date
and
case
(b)
The
where
drawer
a
or
maker;
or
1maker
Genera
yue
ega
ty
the
transact
on
that
rthe
se
to
a
Un
ted
States
ssued
a
warrant
ntANITA
the
amount
oree
$361
payab
eit
to
not
delivered
aP10
in
to
her
those
indicated
in
the
sales
invoice,
the
d
sonored
(c)
has
By
countermanded
the
intentional
payment
cancellation
n
the
nstant
thereof
case
by
apay
Sec.
and
191.
not
If
a
because
possessor
the
of
adrawers
negotiable
indorsement
instrument
was
is
not
lacking
a
holder
.the
Hence,
The
installments.
VICENTE
Ru
under
DE
Sec
On
the
146
same
swith
d
VS.
fferent
rom
Sec
85
n
(supra,
when
p.17)
Applicable
Negotiable
Instruments
Law
Civil
Code
of
the
is
placing
given
the
his
signature
right
to
demand
upon
an
the
instrument
performance
of
the
obligation
than
as
maker,
Otherwise,
it
cannot
be
not
make
itself
a
qualified
indorser
but
ais
general
indorser
C
a
ty
Negot
trade
where
own
ab
A
e
name
a
so
nstruments
res
des
Even
Law.
wou
d
be
The
more
aforement
conven
ent
oned
or
D
payment
act
because
n
neg
under
ect
Sect
o
on
duty
189
wh
ch
payee
the
commerc
may
sue
aacting
aw
drawee
p
aces
as
good
to
SIHI
as
it
is
George
King.
Because,
really,
thereon,
it
is
not
acceptance
as
isth
prescribed
by
this
refused
or
to
INDORSEMENT
satisfy
the
judgment
debt?
HELD:
Under
ordinary
whose
honor
tthe
s
properly
speaking
arise
in
respect
to
said
instrument
is
1.
Blank
and
Special
n
Negotiable
pT
ace
o
d
shonor
but
nenforced
the
p
ace
ootherwise
d
shonor
Instruments
Law,
enumerates
the
for
instrument
to
the
law
throws
around
a
holder
in
course.
This
freedom
in
There
must
be
pr
or
protest
Her
negligence
was
the
proximate
cause
of
loss,
and
under
on
yon
the
There
must
be
protest
or
cert
fied
by
the
bank
on
wh
ch
tbank
snot
drawn
the
cert
ficat
on
of
cash
is
a
check
payable
to
bearer,
and
the
bank
may
it
a
to
ma
nta
n
unds
n
hthey
srequisites
account
or
on
ythe
90
the
consideration
for
the
draft,
albeit
in
a
Th
s supplied
means
that
the
drawee
bank
shou
d
encash
the
check
but
ownership
but
merely
effects
the
transfer
rights
him,
that
severally
he
as
had
mere
no
notice
ndorser
of
she
any
may
infirmity
not
in
be
the
made
instrument
ab
eaga
on
or
Secur
ty
Bank
and
Trust
Company
check
Th
se
check
n
persons
who
had
money
to
oan
as
we
as
those
who
des
red
to
promise
the
to
drawee
pay
to
the
is
ORDER
a
fictitious
of
the
REPUBLIC
person
PLANTERS
or
a
person
BANK,
not
at
its
because
it
assumed
the
an
endorser
by
stamping
its
(2)
China
Bank
checks,
numbered
thereo
rece
ves
the
b
or
va
ue
propert
es
o
the
pet
tliabilities
oner
Pr
or
the
auct
on
sa
e
A.
sa
order
o
the
drawer
and
aof
recogn
ther
on
o
the
drawer
s
country,
requesting
addressee
to
pay
money
or
deliver
quest
oned
checks
rom
the
office
ovs.
the
Prov
nc
a
Treasurer
even
if
petitioners
signed
merely
as
officers,
it
does
because
orego
ng
notw
thstand
ng
pet
spresent
tcourse.
oner
nsd
effect
a
b
o
exchange
drawn
by
a
bank
on
tse
and
Testate
hav
ng
Estate
any
o
ava
ab
e
to
pr
or
part
es
among
themse
ves
Th
sAyala.
be
ng
so
statements
o
sa
d
check
ng
b.
2
Trave
bearer
ers
o
the
129015
Victoria,
Aug
custodian
instrument
is
due.
RULES
transact
bus
ness
w
th
t
t
s
under
the
ob
gat
on
to
treat
the
b
ank
be
ore
de
very
(c)
Where
the
b
s
drawn
payab
e
sewhere
than
n
t
me
to
reach
h
m
n
usua
course
on
the
day
o
ow
ng
Sec.
11
to
be
negotiable
must
conform
to
the
following
requirements
b
The
Public
know
edge
the
maker
drawer
or
ssuer
that
at
the
t
me
o
Island
Gas
Service,
Inc.
order.
After
the
checks
had
been
like
Let
the
bearer
or
Drawer
obliges
the
drawee
to
pay
P
or
maker
Date,
acqu
presumption
res
the
nstrument
as
to.
n
Where
a
pure
the
y
representat
instrument
ve
except
that
n
the
case
o
b
o
exchange
presentment
or
offers
to
a
person
promissory
ho
d
ng
note
a
c
a
m
are
or
demand
intended
aga
for
nst
h
the
m
the
circulation
amount
Sec.
5(a)
:
I
promise
to
pay
P
or
order
the
sum
of
P1,000
secured
by
payment,
the
drawee
bank
check
may
not
be
encashed
but
on
y
depos
ted
n
the
bank
(2)
the
checks
part
were
cu
ar
d
shonored
or
any
o
o
ow
ng
reasons
date
not
spec
fied
n
the
nstrument
A
nserted
Dec
1
2012
as
Payment
Franc
Ang
certificate
sco
Tek
must
Lian
of
be
may
registration
to
the
held
ho
der
liable
and
Payment
deed
for
estafa
of
to
chattel
because
a
payee
mortgage,
under
who
article
a
which
ready
c
holder;
due
nstrument
GATCHALIAN
(State
Investment
House
Inc.
CA;
Bataan
Cigar
and
(i.e.,
to
he
is
neither
the
note
payee
or
payment
nor
indorsee
at
A
or
s
bearer
res
dence
of
a
bearer
he
cannot
do
so
Law
(c)
The
drawee;
or
Philippines
against
the
maker,
even
by
a
holder
in
due
course
(Sec.
15).
day,
Section
petitioner
191
defines
discounted
"holder"
as
promissory
the
payee
note
or
indorsee
with
of
a
On
bill
the
or
upon
who
h
m
is
and
secondarily
the
resu
t
liable,
o
h
s
neg
because
gence
by
must
such
rest
indorsement,
upon
h
m
The
it
reflected
(a)
drawer,
Where
in
or
the
the
acceptor,
drawee
negotiable
s
dead
or
has
absconded,
or
s
a
fict
t
ous
based
by
on
non
tort
payment
under
Art
by
19
the
o
maker
the
C
v
Code
HSBC
s
not
be
ng
checks
were
issued
with
the
intention
that
George
King
would
discharged;
but
the
party
so
paying
it
is
remitted
to
or
a
By
person
way
o
not
EXCEPT
hav
ng
ON
capac
the
ty
o
ow
to
contract
ng
persons
who
d
d
not
s
gn
n
Sec
104
circumstances,
payment
by
the
judgment
debtor
to
the
sheriff
cannot
be
obtained;
or
made
delivered.
t
s
deemed
In
the
to
be
case
an
before
acceptance
us
there
or
the
was
honor
an
order
o
the
transmitted
drawer
Indorsements
Where
part
es
res
de
n
d
fferent
p
aces
Where
the
res
dence
o
the
part
and
become
negotiability
is
totally
absent
in
a
certificate
of
indebtedness
as
or
non
acceptance
or
or
Section
23
of
the
Negotiable
Instruments
Law,
is
precluded
negot
at
on
pred
cated
on
the
orged
ndorsement
that
shou
d
non
payment
s
equ
va
ent
to
an
days
to
representative
the
Under
person
Sect
capacity.
presenting
on
186
Also,
o
it
the
for
he
Negot
payment
procured
ab
e
without
the
nstruments
instrument
the
drawers
Law
to
be
"a
office
in
mere
y
accept
t
or
depos
t
n
State
nvestment
House
nc
vs
AC
which
the
assignor
has
at
the
time,
to
the
assignee.
Benin
defect
in
the
title
of
the
persons
negotiating
it."
As
regards
bounced
account
o
BA
the
F
nance
d
shonor
made
o
repeated
the
checks
demands
ndorsed
to
by
Nyco
her
and
s
having
guarantee
at
the
back
of
the
checks.
The
petitioner
having
B.
REAL
DEFENSES
pet
borrow
t
oner
money
depos
and
ted
w
act
th
ng
the
as
CF
a
n
med
h
s
ary
capac
negot
ty
as
ate
Ex
Offic
oan
o
CONCEPT
384934
and
384935,
were
not
delivered
to
the
payee,
the
ob
gat
on
to
pay
the
a
orement
oned
sum
but
a
so
a
goods
to
a
third
party
therein
named,
the
writer
of
the
letter
c
a
m
ng
to
be
ass
st
ng
or
he
p
ng
the
hosp
ta
on
the
re
ease
o
the
v.Check
Tthe
me
to
not
erase
the
fact
that
they
subsequently
Chandiramani
was
able
to
get
hold
of
said
instruments,
without
ab
ty
They
stated
that
the
rea
party
n
nterest
smaker
the
ab
ty
o
an
accommodat
on
party
acare
der
or
accepted
advance
by
the
act
o
ssuance
(10
C
Sw
409)
in
of
paychecks
of
Mabanto,
to
hold
the
checks
and
Ange
aTo
The
RTC
ru
ed
n
avor
oor
the
PR
ain
ow
ng
PR
to
account
Between
the
dates
September
5
1980
and
anuary
23
1981
nstrument
accounts
oButte
the
depos
tors
and
cany
ents
w
th
met
cu
ous
whether
Qu
no
Gonza
es
app
ed
or
cred
tvehicle
accommodat
ons
th
at
the
15
s2003)
ab
e
as
ndorser
tforgery
oner
ma
n
accordance
nta
ned
current
w
th
the
account
o
ow
ng
ru
respondent
es
ssue
he
Sec.
Works.
2
.dec
What
The
constitutes
firm
needed
certainty
fund
as
to
to
push
sum.
The
sum
with
payable
submitted
to
o
money
wh
ch
he
cons
ders
and
adm
ts
to
be
due
n
payment
capac
w
ty
be
Thus
the
ent
note
smade
not
d
w
scharged
th
n
a-through
reasonab
when
the
e
tas
me
ENR
QUE
MONT
NOLA
VS.
(supra
p
12)
debt.
Prov
nc
order
sufficient.
or
of
an
credits
acceptance
(credit
or
instruments)
indorsement
thereon
is
dated,
PRUDENC
O
VS.
CA
(supra
por
19)
The
court
finds
that
PNB
snas
"account
c
osed"
"account
under
garn
shment"
nsuffic
ency
a
ring
I are
negot
check
fact
ated
may
she
discovered
be
when
the
figured
in
an
accident.
This
dishonored
(d)
Two
the
or
checks
more
payees
for
jointly;
the
common
or
reason
"payment
Sect
Bacos
on
102
Pet
tPet
nterbank
oner
Pedro
Sett
ement
Lopez
sNew
gned
The
Bangko
as
endorsers
Sentra
ode
sha
th
transact
on
ssuffic
on
yaof
a
de
ense
For
examp
eho
ao
the
s
nce
date
there
to
co
sn
ect
a
spec
fied
p
ace
presentment
or
payment
Note
315,
paragraph
d,
subsection
2a
of
the
Revised
Penal
Code,
one
note,
agreed
(d)
that
By
if
any
Dr.
other
Villaruel
act
fails
which
to
will
pay
discharge
the
note,
plaintiffsimple
contract
appellee
pr
sued
me
on
duty
the
va
o
ue
the
o
bank
the
check
spersona
to
tse
ascerta
but
n
the
how
genu
taast
acted
neness
n
re
at
the
on
instrument),
person
she
payab
supply
e
on
BCCFI
he
a
can
Saturday
with
NEVER
the
wh
be
bales
ch
sPNB
not
of
a
tobacco
ho
day
leaf.
presentment
There
being
may
instrument,
year
VICENTE
of
that
sale,
DE
is,
petitioner
OCAMPO
obligation
reported
&
CO.
to
pay
the
VS.
a
P461,754
sum
ANITA
certain
as
GATCHALIAN
in
sales
money.
proceeds
his
former
by
Holder
is
brdeemed
the
rthe
NOT
to
be
in
indorser
due
course
unless
of
he
an
clearly
instrument
indicates
filled
by
appropriate
up
should
be
valid
payment
to
extinguish
the
judgment
There
Type
Negotiable
instruments
only
Contracts
general
by
the
defendant
bank
to
its
York
branch,
for
Sec
89
whom
not
ce
d
shonor
must
be
g
ven
Except
(b)
When
presentment
for
acceptance
is
excused
and
the
person
gthe
vand
ng
and
the
person
to
rece
ve
not
ce
res
other
p
aces
ment
oned
n
c.
L
ab
ty
of
Acceptor
for
it
merely
acknowledges
pay
a
sum
of
money
to
a
better
secur
ty
Sec.
33
negotiable.
Currency
The
CTDs
in
question
undoubtedly
meet
the
from
using
as
a
defense.
On
the
other
hand,
the
be
ared
noperat
ve
Th
sto
means
that
the
negot
at
on
ofourth
Please
credit
proceeds
of
this
Kinds
of
indorsement.
-orged
An
indorsement
may
be
either
indorsed
by
the
bank
and
delivered
to
himself
without
indorsement.
Where
check
is
made
payable
to
the
order
of
check
must
be
presented
or
payment
w
th
n
ais
reasonab
e
t The
me
having
been
deemed
subrogated
to
the
rights
and
obligations
(supra
an
untenab
p
accommodation
19)
e
the
Under
Court
the
dec
party
aw
ared
the
the
(such
effects
ho
as
der
STEELWELD),
oconsisting
or
cross
ng
ndorsee
a
check
the
of
Sanshe
but
ne
ther
o
the
two
sett
ed
the
ob
gat
on
Hence
BA
Sher
stamped
ff
o
its
Zamboanga
guarantee
C
of
ty
"all
the
prior
sum
endorsements
o
P63
130
and/or
00
Pr
lack
vate
of
capacity
to
contract,
the
holder
may
treat
the
between
the
two
Sec.
17(e)
petitioner
herein.
Without
delivery
of
said
checks
to
1.
M
NOR
TY
AND
ULTRA
V
RES
D
scharge
means
re
ease
rom
urther
ab
ty
ob
gat
on
or
rom
the
undertaking
to
provide
him
the
money
for
the
goods
or
to
Construction
where
instrument
ambiguous.
checks
To
encash
the
checks
he
the
s
gnature
o
Dr
Adena
Accept
delivering
the
exchange
consideration
of
the
PCIB
s
ster
o
the
husband
P
ar
ta
Reyes
The
spouses
not
P
A
and
B
cannot
be
ab
e
s
nce
under
Sec
40
they
w
convey
them
to
Sebre
o
instead.
De
La
Victoria
assailed
the
va
ue
a
though
such
ho
der
does
not
nc
ude
nor
app
y
to
such
accounts
cons
st
on
y
o
a
ew
hundred
or
m
ons
o
pesos
Eugen
o
was
ab
e
to
encash
and
depos
t
to
her
persona
account
redeem
the
res
sub
dence
ect
or
property
p
ace
o
and
bus
order
ness
ng
o
pet
the
t
oner
to
execute
a
d.
A
3.
ndorser
cash
er
s
check
ssued
on
request
o
a
depos
tor
s
the
Trave
subsequent
er
s
checks
from
are
nstruments
Philfinanc
purchased
to
TRB,
rom
in
banks
accor
express
with
Repub
c
(a)
It
must
be
in
writing
and
signed
by
the
maker
or
drawer;
bank
The
so
e
s
gnatory
to
pet
t
oner
s
account
was
ong
Kyu
sat
s
act
on
o
such
c
a
m
or
demand
w
thout
any
st
pu
at
on
or
contract
so
it
convinced
spouses
Eulalio
and
Elisa
Prudencio
acqu
res
t
as
agent
o
another
a
o
ter
unds"
the
or
ast
"payment
negot
stopped"
at
on
thereo
n
(Sect
first
three
on
71
nstances
Negot
ab
the
e
does
is
sum
not
certain
have
suffic
within
ent
the
meaning
unds
n
of
or
this
cred
Act,
t
w
although
th
the
drawee
it
is
to
be
An
order
is
a
command
or
imperative
direction
and,
therefore,
aand
mere
Inter-bank
clearing,
Inter-Island
Gas
discovered
that
all
the
such
date
is
Treasurer
not
a
ho
der
nbanning
due
course
because
tnstrument
has
not
acted
n
good
a
th
that
the
check
failure
nstrument
the
Thereupon
nstrument
to
pay
w
prompted
not
tmay
was
d
be
scharge
cashed
presented
private
by
the
PNB
respondent
or
Subsequent
because
to
yru
the
initiate
treasurer
he
partner
no
an
stopped"
which
prompted
petitioner
to
institute
this
action.
The
trial
estab
negot
sh
ated
ac
on
tready
es
yby
once
or
nterbank
to
one
who
csum
ear
has
ng
an
account
under
such
w
th
acourse.
bank
es
and
check
was
ssued
as
payment
or
mar
uana
the
transact
on
delivered
a
Bhis
was
to
him
aware
way
o
of
the
pledge
raudu
and
ent
which
he
othe
could
the
sell
wrong
should
date
Iscash
fail
s
gnature
can
d
go
o
the
said
drawer
appellant.
or
the
The
depos
effect
tor
of
such
the
check
indorsement
be
ng
to
Cata
(e)
an
One
safter
c
a
or
m
some
or
payment
of
several
desp
payees;
te
the
or
d
rect
ves
o
Sec.
53
for
the
payment
of
money;
be
made
who
is
be
in
ore
possession
12
00
noon
of
it,
or
on
the
that
bearer
day
th
sdo
ru
Sec.
e
52
sANY
app
defines
cab
aA.
e
rights
as
regard
all
prior
parties,
and
he
may
strike
out
his
III.
Passive
ISSUE,
and
15126
the
Subject
;Nov.
TRANSFER
balance
30,
is
1961)
the
AND
one
acceptance
against
Herein
whom
defendants
holder
issued
can
3.
LEGAL
TENDER
of
that
amount
which
the
creditor
can
be
excess
words
are
(GR
of
circumstances,
No.
When
intention
Lauthority
person
to
be
however,
given
bound
not
is
deemed
treated
in
which
some
compel
holder
as
other
athereof.
holder
capacity
a
in
different
due
of
a
materially
conclusion
a
payment
own
names
of
or
a
persons
specified
whose
sexactly
gnatures
of
money
appear
to
George
n
the
of
or
assignable
rights
note
to:
Sec.
here
120
n127
otherw
se
prov
ded
when
aoverdue,
negot
ab
erepeated
nstrument
has
bill
is
not
accepted.
Sec
103
Honor
d
fferent
p
aces
47
When
persons
secondarily
liable
on
the
check
n
quest
on
rom
Mart
n
Lorenzo
the
or
g
na
payee
to
Ramon
Continuation
negotiable
character
(supra,
p.14)
banking
rule
of
checks
for
deposit
or
requirements
of
the
law
for
negotiability.
The
accepted
rule
is
that
payment
of
value,
after
it
was
and
with
full
notice
that,
special
or
in
blank;
and
it
also
be
either
a
ter
cash,
ts
the
ssue
word
cash
the
drawer
does
not
w
purport
be
d
scharged
to
be
the
rom
name
of
ab
any
ty
Sec
The
112
b
sthe
a
overdue
The
spayment
not
yet
overdue
SEC.
&
87
A
check
o
does
not
as
ass
gnment
o
effects
there
ore
oor
cross
ng
athe
check
re
ate
to
the
mode
o
ts
the
spouses,
When
she
not
was
ce
bound
s letter
d
spensed
by
w
th.
the
same
Not
ce
conditions
o
to
condition,
i.e.,
lack
notice
of
any
infirmity
in
the
instrument
or
F
nance
a
negot
ab
Nyco
e
nstrument
who
averred
has
that
the
toperate
rece
ron
ght
ved
to
not
"enforce
ce
o
respondent
re
used
to
accept
the
check
as
we
as
the
cash
depos
t
endorsements"
(Exh.
A-2
to
F-2)
is
now
estopped
from
Accord
ng
to
the
usua
y
omay
owed
the
broker
de
vered
b
nd
ng
repay
him.
It
is
a
requesting
one
person
to
make
petitioner-payee,
ACTS
the
former
Can
as
ch
e
od
the
payee
hosp
ta
A
the
checks
bore
the
the
language
of
the
is
managers
check
and
the
Hang
Seng
Bank
dollar
draft.
Yang
decision
as
he
said
that
the
paychecks
and
the
amount
thereon
Sec
136
hav
ng
rece
ved
part
o
were
mere
guarantors
o
on
ynot
be
ab
e
to
those
who
can
trace
the
racceptor
tperson
tshonor
ebecause
to
the
TThe
me
to
accept.
The
drawee
s
Bank
The
Bank
approved
QGLC
sbe
app
cat
on
n
separate
S
nce
corporat
TRB
dsued
d
ons
wh
pay
ch
the
are
rdrawee
ght
accommodat
uTRB
ho
der
or
on
other
part
person
Th
s
ent
ty
substant
s
a
compan
ly
drawee
e
d
cond
trendered
ru
e
s
on
y
a
rtse
because
tu
sPhilippine
the
au
tinstrument
ono
the
ho
der
about
seventeen
(17)
(e)
STELCO
Identity
MARKETING
of
the
CORPORATION
VS.
CA
(GR
No.
Deed
existing
3
oes
Sa
law,
e
n
so
avor
as
to
oof
entitle
to
have
the
CBCI
registered
in
its
mortgage
their
parcel
of
land
the
National
Bank
for
drawers
had
no
rowed
ght
to
expect
or
requ
re
the
bank
to
Lee
("
ong")
nstruments
Law)
"Reasonab
ewith
toan
me"
has
been
defined
as
so
(b)
Must
contain
an
unconditional
promise
or
order
to
pay
aor
sum
request,
(a)
the
smethod
payab
e
to
the
order
o
athe
th
rd
person
he
s
Nor
sthe
tnd
d
scharged
when
maker
becomes
the
bank
paid:
or
the
payment
o
such
check
n
upon
ts
presentment
and
onger
action
ho
for
der
a
the
sum
same
of
money
sdo
true
against
when
payment
petitioner
s the
before
made
the
a
warrant
indorsements
was
shonored
made
on
by
the
the
checks
nsu
purportedly
ar
Treasurer
by
At
its
that
cashiers
tto
me
deemed
prima
facie
to
be
the
true
date
of
the
making,
when
tnstrument
wa
ved
(PT)
othe
M
sam
sts
Or
enta
Uba
Laya
ssued
check
n
quest
on
court
a
decision
regu
(3)
nsert
at
the
ons
act
on
as
o
cross
the
ng
the
check
serves
as
a
warn
the
ng
to
ho
der
is
that
the
note
was
indorsed
without
qualification.
A
who
Sec
encashed
the
164
drawer
tWhere
Thomson
sa
expected
to
to
recogn
use
reasonab
ze
the
e
check
bus
ness
the
atter
prudence
ssued
n
to
pay
nvo
ved
s
ega
2
(f)
own
The
holder
and
all
of
an
subsequent
office
for
the
indorsements
time
being.
and
against
enforce
(b)
Where
NEGOTIATION
the
a
ter
right
the
exerc
se
o
check
d
gence
presentment
compelled
L
ab
Savings
ty
of
the
Account
acceptor
for
XX
Current
honor.
Account
-es
The
No.
1372or
n
Sec
holder
85
in
due
the
course
nstrument
as
"a
sreasonab
payab
holder
ereported
on
who
demand
has
taken
Sec
the
146
makes
such
as
when
the
payment
made
by
the
petitioner
to
as
amounting
unrealized,
to
P600
and
to
consistently
one
Manuel
Gonzales,
in
who
the
represented
succeeding
transactio
altered
Kauffman.
Facts:
instrument
But
(Sec.
this
order
was
not
made
payable
"to
order
or
see
2.
Overdue,
b.
Rule
in
case
of
demand
instruments.
nstrument
tse
are
st
ab
e
An
indorser
cannot
show
by
parol
evidence
(i.e.,
outside
been
don
shonored
by
the
not
ce
must
be
g
ven
w
th
n
the
o
ow
ng
payment
with
more
than
one
indorsement
unless
cleared
by
instrument
are
discharged.
A
person
secondarily
as
between
the
original
parties,
the
consideration
had
v.
Presentment
to
o
nt
Sec.
5
the
negotiability
or
nonR
thereon
Lorenzo
to
the
2
extent
ndorser
o
shou
the
d
oss
be
dec
caused
ared
o
by
no
the
effect
de
ay
but
"
the
By
restrictive
or
qualified
or
Sec
164
L
ab
ty
of
the
acceptor
for
honor.
The
acceptor
or
Additional
provisions
not
affecting
negotiability
(p.6)
any
presentment
part
or
payment
Under
Sec
72
o
the
Negot
ab
e
which
the
latter
were
bound.
This
being
so,
she
and
the
defect
payment
in
of
title
the
of
nstrument
the
persons
for
the
negotiating
fu
amount
it,
has
thereof
no
Pr
vate
respondent
requested
the
schedu
ed
auct
on
to
proceed
d
shonor
when
the
second
check
was
d
shonored
SSUE:
WON
The
person
d
shonor
who
w
s
pay
d
spensed
may
w
th
The
when
acceptor
a
ter
must
the
exerc
be
a
se
o
claiming
that
the
checks
under
consideration
are
not
the
money
advances
to
a
third
person
on
the
credit
of
the
writer.
(It
is
in
did
not
acquire
any
right
or
interest
therein
and
cannot
therefore
stamp
o
Assoc
ated
Bank
wh
ch
reads
"A
pr
or
are
not
yet
the
property
of
Mabanto
because
they
are
not
yet
1
As
to
the
paper
tse
t
puts
an
end
to
t
as
a
contractua
effect
o
the
negot
ambiguous
ab
e
nstrument
or
there
are
Sec.
22
.
Effect
of
ndorsement
by
nfant
or
requested
FEBTC
and
Equitable
to
stop
payment
on
Reyes
As
such
they
protested
aga
nst
be
ng
dragged
nto
the
ndorsments
notw
thstand
ng
the
act
that
B
s
s
gnature
transact
ons
pet
t
oners
to
secure
certa
n
advances
rom
ent
t
ed
to
rece
ve
payment
t
has
no
r
ght
to
re
mbursement
that
he
d
a
d
owed
not
rece
ve
payment
he
accepted
the
tender
o
the
ssue
or
ndorsement
of
drawee
PR
checks
name
Penarroyo
and
cover
n
ng
the
the
ast
property
nstance
n
quest
on
the
and
drawers
to
de
ver
had
equ
va
ent
o
a
cert
fied
check
and
the
depos
t
represented
by
P10,000.00.
Prudencio,
without
consideration,
agreed
and
so
checks
drawn
aga
nst
the
account
o
the
pet
t
oner
at
the
much
t
me
as
s
necessary
under
the
c
rcumstances
or
Pro
96160;
ect
Manager
June
wh
e
the
checks
rema
ned
n
the
custody
o
or
the
ke
n
var
ous
denom
nat
ons
wh
ch
can
be
used
ke
cash
Sec
63
c
The
certain
subsequent
in
money;
d
shonor
o
the
check
by
the
drawee
bank
or
When
a
person
deemed
ndorser.
supra
p
12
Sec.
21.
Signature
by
procuration;
effect
of.
A
ab
e
to
the
payee
and
to
a
subsequent
part
es
possessor
Gu
Regional
as
has
to
whom
an
Trial
outstand
the
Court.
nstrument
ng
ba
ISSUE:
ance
was
o
WON
not
P509
ndorsed
w
private
th
PNB
respondent
and
had
ssued
is
a
ho
00257-6
der
or
of
examp
e
as
executor
or
adm
n
strator
the
supposed
payments
rom
the
Bureau
o
Pub
c
Works
contrary
WORLDWIDE
GARMENT
MFG.
supplication,
or
authority
(like
I
request
you
to
pay,
or
I
hope
you
the
comp
drawing,
a
nt
rrespect
acceptance,
ve
o
or
whether
indorsement,
or
not
as
the
the
p
case
a
nt
may
ff
s
to
were
forgeries.
The
Sec.
12
as
nstrument
PT
and
not
s
as
avo
agent
ded
o
as
PNB
to
h
when
m
he
s
gned
t
as
drawer
payab
e
accept
indorses
ng
and
without
cash
qualification
ng
a
check
engages
presented
that
on
due
to
t
presentment,
Obv
ous
ya
him
that
at
the
maturity
check

the
additional
act
is
to
be
performed
after
nonordering
but
E.T.
the
Henry
same
cannot
and
be
Co.,
ra
sed
Inc.
aga
and
nst
a
Hi-Cement
ho
der
n
due
to
pay
Monetary
Board
may
prescr
be
Prov
ded
That
the
Bangko
Sentra
cannot
be
made
negotiate
Ante-dated
the
and
instrument,
post-dated.
except:
The
instrument
is
not
presented
by
the
instrument
who
may
be
primary
or
secondarily
b
B
s
a
ho
der
n
due
course
he
can
treat
Dec
1
2012
as
the
absconding
sheriff
was
not
in
cash
or
legal
tender
but
in
checks.
himself
as
honor
s
ab
e
to
the
ho
der
and
to
a
part
es
to
the
b
"to
instrument
bearer,"
under
required
the
in
Section
1(d)
of
that
Act;
and
inasmuch
n
or
A.
ISSUANCE/DELIVERY
OF
NEGOTIABLE
nSec.
Summary
years
the
the
installment
o
ow
ng
ru
that
es
fell
shou
due.
d
be
On
o
1978,
owed
Revenue
Director
of
to
accept
as
payment.
124)
and
therefore
cannot
collect
to
parties
prior
to
completion
Sec.
57
1
One
who
s
gns
n
a
trade
or
assumed
name
(Sec
18)
non
acceptance
or
non
payment
not
ce
o
d
shonor
must
be
instrument
itself)
t
mes
completely
failed.
Under
these
circumstances,
recovery
on
some
bank
officials,
does
not
invalidate
the
instrument;
Debtors
Rights
of
a
holder
in
due
course.
See
Rights
of
a
liable
on
the
instrument
is
negot
negotiability
at
on
o
of
the
an
instrument
a
oresa
d
check
is
determined
rom
Ramon
from
the
R
writing,
Lorenzo
that
to
current
bank
ng
pract
ce,
a
check
becomes
sta
e
after
conditional.
nstruments
Law
presentment
or
payment
to
be
suffic
ent
must
be
34
honor
s
ab
e
to
the
ho
der
and
to
a
part
es
to
the
b
o
the
unds
to
cred
t
o
the
drawer
w
th
the
bank
and
the
Casabuenas
were
bound
to
respect
the
prohibition
against
application.
This
is
because
Section
29
of
the
law
above
quoted
the
pet
t
oner
cannot
produce
the
cash
n
the
course
o
the
Nyco
aga
Sa
nst
es
a
s
ab
part
e
to
es
pay
ab
BA
e
F
nance?
thereon."
HELD:
Among
Yes
The
the
re
at
"part
onsh
es
p
Special
indorsement;
indorsement
in
blank.
A
be
a
stranger
or
a
party
stranger
negotiable
instruments.
The
checks
were
accepted
forsexecuted
deposit
by
reasonab
ethat
dthe
gence
persona
y
to
the
borrower
took
note
n
h
s
own
name
and
assert
any
cause
of
action,
founded
on
said
checks
,
whether
delivered
to
him;
since
there
is
no
delivery
favor
of
a
certain
person
and
not
to
order)
endorsements
guaranteed
ASSOC
ATED
BANK
"
The
Prov
nc
a
ob
gat
on
omissions
therein,
the
following
rules
of
instruments
she
believed
to
be
lost.
Both
banks
complied
corporat
on.The
ndorsement
or
ass
gnment
o
the
nstrument
by
2
t
gat
on
The
tr
a
court
he
d
that
they
were
ab
e
as
Bank
n
connect
on
w
th
QGLC
s
exportat
on
o
ogs
a
was
orged
payment
by
a
pr
or
party
the
subsequent
party
wou
d
have
Pet
t
oner
TRB
was
rem
ss
n
ts
duty
and
ob
gat
on
and
must
peace
u
with
the
Central
Bank?
Clearly
shown
in
the
record
is
the
he
negot
mortgaged
CORP.
twenty-four
ab
e
paper
the
hours
by
land
a
a
corporat
and
ter
presentment
executed
on
w
thout
a
n
promissory
wh
cons
ch
to
derat
dec
note
de
on
for
countermanded
payment
Furthermore
the
exp
c
t
w
th
reasonab
e
prudent
and
d
gent
man
to
do
conven
ent
y
what
respondent
company
the
check
s
bank
passes
Upon
to
earn
cred
ng
t
o
that
the
checkho
Eugen
o
der
has
who
been
therea
us
ng
ter
h
s
upon
nsuffic
(c)
second
Must
ency
be
payable
on
demand,
at
a158
fixed
determinable
future
(a)
with
interest;
or
holder
17,
1992)
in
Stelco
course?
Marketing
HELD:
Corporation
YES.
The
Promissory
is
engaged
Note
in
was
certa
nday
checks
ore
he
e
tedemanded
h
sother
res
dence
or
Man
a
The
bank
on
to
the
d or
Sec
(b)
Sec.
68
the
130.
nstrument
When
bill
schecks
may
payab
be
treated
to
the
order
as
promissory
the
maker
note.
drawer
- he
ent
tsby
ed
drawers
of
the
reimbursement
from
the
signature
by
will
pay
Order
n
wh
ch
ndorsers
are
ab
e.
As
respect
one
the
note
shall
be
accepted
or
paid,
or
as
the
may
be,
pet
tto
oner
was
neg
gent
npayable
encash
ng
sa
d
forged
check
course
Where
the
instrument
is3
to
order,
the
payee
must
be
to
the
order
odue
MV
liable
(Sec.
petitioner
Atrium,
jointly
and
severally,
the
amount
corresponding
to
may
has
true
charge
been
date
adm
ssued
nbe
strat
or
ve
a
defin
and
other
te
purpose
ees
so
the
that
ma
ntenance
he
must
o
Sec.
The
5(b)
delivery
:ngs
I
promise
of
promissory
to
pay
notes
P
or
payable
order
P10,000
to
order,
and
or
ITalon
bills
hereby
of
invalid
for
the
reason
only
that
it
is
ante-dated
or
post(c)
a
though
presentment
has
been
rregu
ar
acceptance
has
instrumen
as
INSTRUMENTS
e.
it
Good
never
left
the
possession
of
the
bank,
or
its
conditions
enumerated
therein.
Since
"holder",
as
defined
S
GLER
subsequent
VS.
S
GLER
to
the
(98
Kans
por
864
[1916])
aThe
A
1
FWhere
xed
or
presentment
or
acceptance
o
day
fixed
Manila
authorized
herein
respondents
Tuazon
and
to
who
authorized
did
not
assent
the
to
the
owner
alteration.
of
the
car,
If
M
issues
Ocampo
a
note
Clinic,
and
which
authorized
will
be
Sec.
g
ven
the
draft
isthan
out
of
the
question.
He
calls
attention,
however,
Legal
Tender
Power.

All
notes
and
coins
by
neither
does
it
invalidate
the
negotiation
or
transfer
of
his
intention
to
be
bound
in
some
capacity,
as
for
example,
2
One
who
sin
gns
through
an
author
zed
representat
ve
discharged:
is,
from
Nature
Transferee
is
a
holder
who
Transferee
is
a
more
s
xpart
(6)
months,
or
180
days
Pr
Holder
made
the
ho
der
or
by
some
person
author
zed
to
rece
ve
payment
bank
not
ab
e
to
the
ho
der
ess
and
unt
tcase
accepts
or
subsequent
selling
the
the
party
within
or
the
five-year
period
imposed
by
Ade
a
da
Dom
nguez
the
ndorser
and
Ade
da
Sec
78
Presentment
to
o
debtors.
Where
there
are
severa
preserves
ab
e
thereon"
the
right
s
of
an
recourse
ndorser
of
a
"holder
of
the
for
nstrument
value"
against
e vate
the
"a
proceed
Deputy
Sher
Castro
so
doror
the
ev
ed
propert
es
tem
between
Nyco
and
BA
F
nance
sun
one
oboth
ass
gnor
ass
gnee
a.
Rule
in
case
of
installment
instruments
to
aissued
against
the
drawer
the
petitioner
special
stamping
indorsement
thereon
its
specifies
guarantee,
the
in
order
person
that
it said
can
to
tate
cannot
be
g
ven
to
or
does
not
reach
the
part
es
sought
mmed
yby
trans
erred
tnt
by
ndorsement
to
the
At
the
The
of
the
consent
checks
oproperty
to
the
Mabanto,
ho
der
the
sis
checks
The
consent
are
still
o
part
the
of
ho
the
der
public
Treasury
Warrant
-ff
it
aagent
government
warrant
for
the
Treasurer
sought
to
recover
rom
PNB
var
ous
amounts
deb
ted
with
As
to
her
the
part
request,
construction
es
to
but
the
apply:
upon
nstrument
the
representation
tAs
operates
as
of
a
re
PCIB,
ease
o
FEBTC
prom
ssory
note
n
1964
n
avor
o
the
Bank
They
were
to
execute
accommodat
on
es
to
the
prom
ssory
note
Th
srom
was
reversed
a
corporat
on
or
by
an
n
ant
Sgd.
Shozo
however
C
ndorsed
tawill
to
H
a
ho
der
n
due
course
fact
that
Philfinances
title
over
CBCI
is
defective
since
it
possess
o
the
sa
d
property
Pet
tpay
oner
appea
ed
the
a
oresa
d
P10k
in
favor
of
PNB.
Prudencio
also
PNB
issue
the
s
gnature
by
the
purchaser
tthe
has
the
character
st
cs
othereof
a
cash
er
s
the
and
contract
for
the
or
accommodat
duty
requ
res
on
shou
of
d
another
be
done
s
hav
u
tra
ng
a
v
regard
res
One
or
whether
or
not
he
w
accept
b
the
acceptance
recourse
st
pu
at
on
aga
nst
Great
an
effect
ve
y
en
arges
by
time;
cred
tauthorize
cards
pet
tis
oner
fired
a
depos
4.
tor
to
that
MATER
accountant
Kyu
Yong
Lee
A
certa
n
Roberto
Gonzaga
earn
negotiated
ng
the
by
dbearer
shonor
indorsement
o
the
in
treasury
writing
warrant
on
the
sent
instrument
not
ces
itself
by
or
I
another
you
to
ndorsers
pay)
is
not
are
sufficient.
ab
e
pr
However,
ma
ac
e
the
nender
use
the
of
order
polite
distribution
and
sale
to
the
public
of
structural
steel
bars.
On
o
unds
or
cred
tWhere
or
d
shonor
or
the
same
reason
had
not
the
drawer
drawee-banks,
s61
payab
ehe
to
he
ab
eho
to
a
part
es
subsequent
to
Where
in
ao
bill
the
drawer
and
drawee
are
the
same
person
or
where
(b)
w
by
and
thout
stated
that
carefu
if
installments;
it
be
dishonored,
y
exam
or
n
ng
he
the
s
the
gnature
amount
wh
ch
shows
to
Deed
o
Ass
gnment
Had
Deed
been
o
owed
the
oan
wou
d7
"procuration
named
operates
otherwise
as
notice
indicated
that
therein
the
agent
with
has
reasonable
but
a
limited
Ramos
who
ater
on
so
d
the
check
to
Mont
no
a
On
tr
a
recover
upon
a
or
some
o
c
ms
asserted
there
n
exchange
or
other
documents
shall
produce
the
value
of
the
checks.
CA,
such
nqu
ac
re
tmy
es
he
has
rece
ved
the
check
pursuant
to
that
purpose
representative
Fa
th
in
New
York
City,
there
was
no
delivery
in
authorize
attorney-at-law
to
appear
in
any
court
of
record
after
the
in
sec.
dated,
provided
3.
F
LL
NG
UP
BLANKS
BEYOND
Sec.
120(e):
(a)
party
When
or
whose
the
it
pr
nc
honor
is
pa
payable
he
debtor
has
accepted
to
sauthorized
re
the
eased
order
rom
of
ab
agnment
ty
third
the
GREAT
EASTERN
L
FE
NSURANCE
CO.
(GEL
C)
VS.
Sec
165
certa
52,
nAL
oseph
examine
the
books
and
records
the
familiar
rule
that
a
person
who
is
not
himself
a
holder
in
P,or
payee,
shown
to
to
insert
Sec.
2
the
15
day
fixed
a
sg
on
amercantile
Sunday
or
day
y
next
succeed
ng
Sec.
9
Agreement
of
acceptor
for
honor.
The
acceptor
or
checks.
The
only
kind
of
indorsement
which
stops
the
(a)
sent
by
ma
ts("Kyu")
must
be
depos
ted
n
the
post
office
drawer
and
to
each
ndorser
and
any
drawer
or
ndorser
to
whom
Incomplete
Liability
of
instrument
drawer.
not
The
delivered.
drawer
by
drawing
Where
an
When
the
payable
to
bearer.
The
instrument
is
59
signed
merely
as
an
agent.
of
the
fact
may
of
the
be
a
instrument
holder
in
due
itself.
Contrary
mere
to
assignee
what
respondent
and
can
(Sec
PRESENTMENT
FOR
on
respondent
h
s
beha
Who
here
the
n
depos
ho
der
ted
or
author
the
checks
zed
person
157
s
days
depends
a
ter
on
Who
deemed
holder
in
due
course.
Every
cert
fies
the
check
Neverthe
ess
even
there
s
no
ass
(a)
By
any
act
which
discharges
the
instrument;
Dom
nguez
to
the
de
endant
appe
ant
who
d
d
not
know
o
the
City
government.
The
act
of
assignment
could
not
have
accommodation
party
notwithstanding
that
"such
holder,
at
whose
by
tem
honor
to
the
has
pr
accepted
vate
respondent
as
the
h
ghest
b
dder
n
ass
person
gnor
vendor
p
ac
ng
warrants
h
s
s
gnature
both
upon
the
cred
an
nstrument
t
tse
(
ts
otherw
ex
stence
se
than
and
purchaser
of
an
persons
not
partners
pr
mar
y
ab
e
on
the
nstrument
and
no
Sima
Wei
or
against
the
Producers
Bank
or
any
of
the
other
clear
the
said
checks
with
the
respondent
bank.
By
such
to
be
funds;
and
the
checks
due
to
the
foregoing
cannot
be
the
whom,
or
to
whose
Sec
spec
113
a
request
o
the
ndorsee
and
s
mp
as
a
avor
to
h
m
not
necessary
and
the
s
a
requ
s
te
payment
of
money
such
as
that
issued
in
favor
of
a
public
De
ay
n
v
ng
not
ce;
how
excused.
De
ay
n
g
v
ng
rom
the
current
account
o
the
Prov
nce
n
turn
PNB
Yamaguchi
three
more
prom
ssory
notes
nndorse
1967
On
anuary
subsequently
lifted
the
stop
payment
order
on
FEBTC
Dollar
by
some
the
or
Court
a
oat
o
them
rom
so
urther
SSUE:
ob
WON
gat
on
Respondent
and
ab
ty
spouses
under
the
are
passes
property
there
n
notw
thstand
ng
that
rom
want
oin
acquired
instrument
from
Filriters
fictitiously.
Although
atter
may
recover
rom
A
cons
der
ng
that
he
can
trace
h
s
check
dec
srstated
o
on
the
o
the
ssuer
tr
a
tAppea
court
requ
res
to
the
Court
sbearer;
gnature
o
Appea
o
the
sthat
purchaser
ade
eg
ng
among
at
P10k
check
to
construction
firm.
In
December
1955,
the
firm
the
ghts
and
poss
b
ty
oss
any
to
the
other
party
n
the
who
147
has
taken
the
n
wh
ch
they
but
ev
dence
sAn
adm
ss
b
eRYL
to
(d)
Must
be
payable
to
order
or
to
and
ALTERAT
ON
Presentment
where
tpayable
me
s
nsuffic
ent
en
see
When
payable
to
the
Order
of
Filinvest
Finance
and
Leasing
Eugen
ma
opetitioner
to
mmed
Gu
as
ate
wh
y
ch
and
cou
nst
dpayor
tuted
not
aFACTORY,
de
cr
vered
m
na
act
to
on
h
m
aga
because
nst
her
he
or
s
A
cash
er
s
check
be
ng
mere
y
athey
bin
o
exchange
drawn
by
ain
bank
4the
presented
or
payment
FEBTC
Check
to
the
bank
The
check
different
occasions
in
September
and
October
1980,
it
sold
to
holder.
Appellant
Sambok's
intention
of
indorsing
the
note
Sec
(c)
marked
by
115
When
var
installments,
not
on
ce
from
with
need
the
a
provision
not
genu
be
ne
that,
g
ven
s
gnature
upon
to
default
ndorser.
of
pr
vate

the
who
maker
in
turn
or
demanded
from
BPI.
BPI
thus
debited
the
value
of
the
drawee
is
a
HONGKONG
&
SHANGHA
BANK
NG
CORP
(HSBC)
and
PNB
check
was
4.
FORGERY
AND
WANT
OF
authority
D.
K
NDS
to
sign,
OF
and
the
principal
is
bound
only
in
case
the
Sec.
effect
3
of
payment
only
when
have
been
cashed,
or
when
DOMAGASANG
VS.
CA
(347
SCRA
75
[2000])

Wh
e
Sec
2
o
BP
BATAAN
C
GAR
AND
C
GARETTE
NC.
VS.
CA
(supra
however,
absolved
this
is
not
&
done
ruled,
for
inter
an
illegal
alia,
or
that
fraudulent
Lourdes
purpose.
Leon
The
of
HiAUTHOR
TY
part
es
obligation
When
becomes
n
t
me
promise
to
due
go
and
by
is
ma
waive
unconditional.
the
the
day
issuing
o
ow
ng
and
the
unqualified
service
day
o
of
the
owner
as
evidence
of
defendants
good
faith
due
course
may
yet
recover
against
the
person
primarily
liable
person
and
has
been
paid
by
the
drawer;
and
191,
includes
a
payee
who
is
possession
the
word
New
Sec
88
a
so
requ
res
that
the
be
n
good
a
th
and
w
thout
of
to
which
they
assessed
him
for
deficiency
taxes,
S
g
er
ssued
a
negot
ab
e
note
to
Ode
S
g
er
Later
oseph
further
negotiation
of
an
instrument
is
a
P1,000,
bus
ness
but
day
P
inserts
P2,000,
N,
a
subsequent
holder
NOT
in
due
GSIS
VS.
CA
(GR
No.
L-40824,
Feb.
23,
1989)
Private
honor
by
such
acceptance
engages
he
w
on
I.
OTHER
3
RULES
ON
incomplete
instrument
has
not
been
delivered,
it
will
transferee
nstruct
court
on
held
stated
course
(that
on
the
the
CTDs
ace
are
o
the
check
never
to
The
the
be
depositor
s
x
a
checks
holder
which
in
n
due
is
PAYMENT
instrument
admits
the
existence
of
the
payee
and
his
payable
to
bearer:
o
date
unds
o
the
the
statement
check
Hence
n
the
sa
nstrument
d
checks
cannot
that
t
be
s
payab
cons
e
dered
at
a
19)
Bangko
Sentral
shall
be
fully
guaranteed
by
the
Other
the
than
orgery
PRESENTMENT
shou
d
be
FOR
cons
ACCEPTANCE
dered
va
the
d
ru
and
es
under
orceab
B
s
o
e
holder
is
deemed
prima
facie
to
be
a
holder
in
due
(b)
By
the
intentional
cancellation
of
his
signature
by
the
operated
to
efface
liens
or
restrictions
burdening
the
right
the
as
maker
time
of
drawer
taking
or
the
acceptor
instrument,
**
un
knew
ess
he
him
c
ear
to
be
y
nd
only
cates
an
amount
o
P50
000
00
As
a
resu
t
thereo
the
Ex
Offic
o
Sher
ff
ega
ty)
and
the
person
o
the
debtor
(h
s
so
vency)
so
proper
subject
of
garnishment.
ISSUE:
WON
De
La
Victoria
is
p
ace
deliberate
o payment
and
positive
sthe
spec
fied
attitude
presentment
of
must
petitioner
be
made
itob
to
has
them
for
respondents.
installment
InCanlas
note
the
after
original
an that
installment
complaint,
isof
overdue
petitioner
may
Bank,
be
as
order,
the
instrument
is
be
payable,
and
the
EXAMPLE
DR
ssued
aas
bpayment
oaccept
exchange
order
ng
DW
to
pay
Pthey
or
order
atter
stat
ng
to
broker
that
he
d to
dthe
not
w
sh
h sthe
s
name
to
Fermin
ho1977
der
who
re
uses
to
demanded
re
mbursement
rom
the
Assoc
ated
Bank
who
not
ce
o
d
shonor
shaving
excused
when
the
de
ay
sa
27
a
eg
ng
non
o
the
ba
ance
oa
QGLC
gat
on
Draft
No.
ab
eSgd.
on
the
prom
ssory
note
wh
ch
they
executed
avor
oa
nstrument
a
though
deed
of
assignment
Where
the
stated
instrument
the
is
so
transfer
ambiguous
was
that
for
there
value
is
ty
the
corporat
on
or
n
ant
ncur
no
ab
ty
thereon
show
that
between
or
among
themse
ves
have
tcapac
me
he
buys
tWhere
and
a
so
at
the
tmay
me
he
uses
tPNB
be
that
sn
when
he
others
that
the
sa
e
was
never
"consummated"
as
he
dbe
da E.T.
not
executed
tnot
tterat
e(e)
ahad
to
Deed
A
But
of
Assignment
in
favor
which
provides
nstant
case
the
check
na
quest
on
was
ssued
on
September
13
nstrument
w
th
know
edge
o
the
accommodat
on
nature
thereo
not
Corporation
n
Man
a
n
and
v
ew
it
o
th
is
s
an
the
indorsement
bank
app
ed
of
the
outstand
entire
ng
on
tse
(e)
Where
the
instrument
is
addressed
to
a
drawee,
he
must
esta
a
thru
a
s
ficat
on
Pr
vate
respondent
a
so
odged
A
mater
(GR
No
a
T
18657
a
me
s
on
Aug
s
23
on
y
part
rea
defense
because
the
PHILIPPINE
EDUCATION
CO.
VS.
SORIANO
(GR
No.
L-22405,
payab
e
to
cash
and
drawn
respondent.
The
act
of
the
p
a
nt
ff
n
eav
ng
h
s
checkbook
Construction,
Inc.
quantities
drawer
payment
of
any
installment
or
of
interest,
the
whole
shall
become
fictitious
person
or
a
person
not
capacity
to
contract,
the
d
shonor
s
requ
red
to
be
g
ven
to
an
ndorser
n
e
ther
o
the
checks
AUTHOR
d
against
shonor
TY
petitioner's
or
there
current
be
no
ma
account
at
and
conven
forwarded
ent
to
hour
CHECK
Not
ce
o
through
the
fault
of
the
creditor
they
have
been
impaired.
In
The
depos
t
reserves
ma
nta
ned
by
the
banks
n
the
Bangko
3.
Conditional
person
B
g
22
does
not
state
that
the
not
ce
o
d
shonor
n
wr
t
ng
severe
intention
y
mut
to
ated
purchase
and
beneath
the
said
Laya
car.
s
s
Without
gnature
knowledge
appears
the
of
words
this
secondar
where
y
it
ab
appears
e
oses
that
the
r
such
r
ght
holder
o
recourse
derives
aga
his
nst
title
through
ormer
Cement
was
not
authorized
to
issue
the
subject
checks
in
favor
of
processes
p
18)
and
confess
a
judgment
Central
(b)
it
was
made
or
accepted
for
accommodation
not
ce
that
order
or
promise
to
pay
is
unconditional
within
the
3
payab
e
on
demand

at
the
opt
on
o
the
ho
der
be
ore
12
00
a
holder
F
ng
up
in
n
the
excess
first
o
clause
the
author
of
ty
sec.
g
ven
52
as
and
prov
in
ded
the
n
Sec
second
14
s
restrictive
indorsement
which
prohibits
the
further
arguing
that
since
the
note
evidencing
the
installment
emp
oyed
RC
W
son
to
purchase
the
note
rom
Ode
at
the
owest
course
cannot
enforce
it
against
M.
But
if
N
was
a
holder
in
due
case
at
bar
been
crossed
and
ssued
"
or
payee
s
account
INDORSEMENT
Exchange
are
s
m
ar
to
Prom
ssory
Notes
as
regards
Presentment
respondents,
Mr.
Mrs.
Isabelo
R.
Racho,
together
with
the
:
Angel
dela
Cruz),
documents
provide
course
that
the
amounts
bank
s
equ
due
va
ent
presentment
to
an
order
to
the
bank
to
pay
the
same
or
the
sta
e
On
(a)
y
When
the
presumpt
it
is
expressed
on
o
to
know
be
so
edge
payable;
o
nsuffic
or
ency
o
unds
not,
ifor
completed
and
ncapac
tated
who
sde
gnense
through
the
red
ega
barr
ng
any
cinstallment.
a(c)
onot
Be
ng
the
ast
ndorser
however
then
capacity
to
Government
of
the
Republic
of
the
Philippines
and
correct?
4
HELD:
Yes.
Under
Section
16
of
the
Negotiable
n re
presentment
the
ho
der
exh
b
ts
the
the
course;
but
when
is
holder;
By
the
discharge
of
anote,
prior
party;
accommodation
party."
ISSUE
NO.2:
WON
STELCO
ever
dec
ared
aon
defic
ency
o
P13
00
Pet
t ooner
fi nstrument
an
extoparte
st
by
pu
ated
appropr
ate
nm
words
the
horgery
case
s
at
on
bar
to
be
Consequent
bound
nyypart
some
there
other
be
The
transferee-holder
Transferee
cannot
a
indorsement
P10
000
Rights
plaintiff,
holder
sued
in
due
respondent
course
as
to
the
balance
if
he
has
no
notice
appear
the
books
oit
the
borrow
ng
company
as
a
ender
o
the
first
The
holder
may
assume
that
the
regular
payment
oses
has
spersons
rby
ght
o130
used
to
pay
nterpos
ng
orgery
SSUE
WON
caused
by
and
non
payment
opayment
the
prom
ssory
notes
desp
te
repeated
demands
4771.
Yang
lodged
Complaint
for
injunction
and
damages
agreed
otherw
se
o
nt
payees
or
the
pet
tas
oner?
HELD
Yes
end
ng
h
son
name
to
the
The
received,
note
became
there
was
and
really
no
payment
no
consideration
was
made.
involved.
RPB
eventually
What
nstrument
may
be
dntent
scharged
as
where
o
the
obta
ns
the
check
doubt
rom
whether
the
bank
it
is
and
a
bill
a
or
so
at
the
the
tholder
me
he
may
de
treat
vers
encash
the
check
(instrument
n
the
amount
o
P40
000
00)
gthe
ven
by
that
B
whose
s due
from
was
orged
Bureau
may
of
ra
se
Public
the
de
Works
ense
oin
a.
M
nor
to
the
de
ense
oa
nor
ty
sho
rea
and
may
be
en
orced
1960
but
was
presented
to
the
drawee
bank
on
y
on
March
instrument.
Under
the
circumstances,
there
appears
to
be
no
ba
ances
o
Gu
current
account
w
th
the
PNB
or
the
on
ast
day
the
next
ma
therea
ter
1922)
n
May
1920
pet
oner
GEL
drew
ts
check
or
P2
000
on
ho
der
n
due
named
or
otherwise
indicated
therein
with
reasonable
certainty.
comp
and
anst
accepted
or
esta
nthereof,
a
advance
thru
by
the
act
o
ssuance
sshall
not
aga
Samsung
Construct
on
sand
current
account
was
amount
holder
Art.
June
may
348,
Code
of
Commerce.
The
conveyer
answer
oSec.
ow
ng
PBCOM
of
steel
VS.
of
JOSE
various
ARUEGO
sizes
(GR
rolls
L-25836-37,
of
G.I.
wire.
Jan.
These
31,
bars
1981)
and
BANCO
RN
DE
ORO
VS.
VS.
GEORGE
EQU
TABLE
SELLNER
BANK
(GR
NG
No
CORPORAT
16477
ON
22
due;
or
(c)
meantime,
he
gns
the
or
the
action
accommodat
derived
from
on
onecessary
the
the
payee
original
he
obligation
sn
ab
e
to
shall
a
latter
the
checks
Indorsement
Sentra
transaction,
n
accordance
w
received
th
the
prov
sNo.
ons
Gonzales
o
Sect
the
on
94
subject
o
th
check
snhas
Act
holder
in
due
course.
There
is
not
an
line
of
proof
tending
to
show
Forgery
o
sand
gnatures
and
the
p
ac
ng
o
a
s
gnature
nthe
beha
os1.
ers
Check
and
Managers
Under
th
sany
paragraph
n
order
to
der
the
secondary
ab
ty
on
ynt
asWhen
persona
de
ense
See
p
8
or
d
scuss
on
on
Sec
14
and
Procuration
is
the
act
by
which
athe
principal
gives
power
another
to
Agent
taken
n
con
whom
unct
on
an
so
dated
isbe
delivered
acquires
against
me
in
of
the
holder
thereupon
waive
all
in
any
Henry,
Bank
Inc.
ISSUE:
noon
on
a
or
and
D
shonor
meaning
of
this
Act
13
Assoc
The
negotiation
negot
ab
ty
osale
the
check
pursuant
sNOT
not
to
Section
by
tto
be
ng
36
crossed
of
the
When
date
may
be
inserted.
-a
Where
an
subsection
may
be
on
yPayment
"Cash
Th
sCLARK
cou
dpayment
on
y
sgnature
gn
ytm
that
the
had
ntended
the
payee
so
tbars
tfavor
e
splaintiff
de
ect
ve
Accord
ng
yaffected
a
ho
der
who
has
been
nature
of
the
was
account
o
the
pr
nc
pa
debtor
thereo
However
the
order
must
course,
he
can
enforce
poss
deposited
b
e
pr
pay
shall
the
When
be
b
repayable
accord
ng
to
to
the
depositor.
terms
And
ondorses
hwho,
sto
acceptance
according
Instruments
Law,
every
contract
on
a
negotiable
instrument
Ebrada
warrants
she
has
good
tdrawers
tthe
e
to
check
sub
ect
osame
th
5
was
ost
(b)
but
When
such
itthat
is
know
payable
edge
to
a
cou
person
dC
st
named
proven
therein
by
or
d
bearer;
rect
or
or
Lagasca
spouses,
executed
atitle
indorse;
and
engages
that,
on
due
presentment,
the
ENRIQUE
guard
negotiated
ans
MONTINOLA
Forgers
without
o
sVS.
authority,
gnatures
PNB
(Sec
(GR
be
a
No.
23)
valid
L-2861
contract
;re
Feb.
in
26,
maker
or
shall
be
legal
tender
in
S.
STRIKING
(d)
By
OUT
aacquire
valid
OF
tender
or
payment
made
by
prior
party;
became
capac
ty
ce
a
holder
Such
in
an
due
ndorser
course
of
"who
Check
765380,
aNov
w
bearer
thout
mot
on
shown
ssuance
that
o
the
cert
ficate
of
o
any
sat
sho
person
act
on
oerrors
who
udgment
any
breach
may
o
the
above
warrant
more
rights
es
the
ass
gnor
vendor
shou
d
be
acquire
more
rights
of
such
indorsee
is
the
further
Sima
Wei
on
the
promissory
note,
and
the
alternative
money
that
he
des
red
that
the
broker
take
the
note
hto
acquire
course
P
ndorsed
tor
to
A
A
to
Bthe
B
to
C
C
to
D
present
der
DW
used
recourse
aga
nst
any
party
who
e.
Presentment
sand
NECESSARY
or
ated
Bank
(co
ect
ng
bank)
may
nterpose
the
rea
nt
ndorsees
who
ndorse
are
deemed
to
ndorse
c
rcumstances
beyond
the
contro
o
the
ho
der
against
Equitable,
Chandiramani,
and
David
(payee
of
the
the
Bank
fi
ed
a
comp
a
nt
or
sum
o
money
aga
nst
pet
t
oners
accommodated
party
the
accommodat
on
party
s
n
effect
as
happened
was
Philfinance
merely
borrowed
CBCI
from
sued
B.
respondents
HOW
NSTRUMENT
Va
enc
a
and
S
Pearroyo
n
payment
o
the
uo
consideration
aga
nst
a
of
work
done
(by
the
firm)
so
far
shall
be
paid
H.
BILLS
AND
NOTES
(b)
g
ven
otherw
se
than
through
the
post
office
then
payment
question
o
that
the
Filinvest
check
is
a
On
holder
the
in
return
due
course,
o
Gu
having
as
not
taken
ce
the
o
course
can
en
orce
t
accord
ng
to
ts
or
g
na
tenor
o
P999
HSBC
the
legality
of
the
credit
and
for
the
capacity
inexchange
which
he
atreat
sub
s ficat
ect
on
to
o
countermand
commerc
a
by
the
documents
payee
aon
ter
aga
ndorsement
nst
Eugen
o
and
on
has
E.
d.
CHECKS
Forgery
AND
of
B
D
LLS
raw
OF
e
rs
EXCHANGE
S
gnature

barr
ng
gross
SEC.
136
vs.
SEC.
137:
The
b
s
at
a
t
mes
property
o
the
be
Herein
wire
30,
1971)
held
were
plaintiff
in
delivered
Enrique
abeyance.
instituted
Montinola
at
different
Since
against
sought
a
places
an
negotiable
action
to
purchase
at
the
against
instrument
indication
from
defendant
the
is
of
Manila
only
RYL
for
a
(d)
(supra
with
1921)
exchange,
p
3)
Here
A
n
whether
commerc
de
endant
at
a
a
fixed
bank
together
rate
cannot
or
w
at
th
escape
the
two
current
other
the
rate;
ab
persons
or
ty
for
the
payment
of
the
hospitalization
of
his
wife.
On
the
failure
that
the
bank
itself
was
ever
a
holder
in
due
course.
It
was
sha
containing
serve
ustrat
the
as
instrument
on
bas
the
s
forged
at
the
his
c
indorsements
ear
option
ng
o
either
checks
which
as
and
a
petitioner
bill
the
of
sett
ement
refused
cases
Ph
Nat
ona
Bank
HELD:
The
nsert
o
the
words
"Agent
Ph
another
Check
such
proceedings
and
waive
all
right
of
appeal

confession
of
there
must
be
express
reservat
on
o
the
r
ght
o
recourse
ndorser
of
Bearer
nstrument

Sec
40
65
Sec.
however
(a)
104
It
must
w
a
th
note
Sec
be
in
s
3
d
writing
o
shonored
the
aw
and
on
a
signed
mere
March
ora
by
1
not
the
ce
maker
or
demand
or
to
act
in
his
place
as
he
could
himself.
It
is
otherwise
understood
as
WON
petitioner
Atrium
is
a
holder
in
due
course?
HELD:
To
though
coupled
or
Sec.
depos
39.
t
Conditional
on
y
by
the
indorsement.
person
nd
cated
Where
to
w
t
an
Me
indorsement
ssa
s
RTW
is
There
Negotiable
Instruments
Law.
In
light
of
any
case
not
instrument
(1)
expressed
to
be
payable
at
a
fixed
whether
genera
y
or
spec
a
y
t
may
ega
y
be
negot
ated
Act
b
depr
is
ved
incomplete
o
and
revocable
until
delivery
of
instrument
act
Ode
to
on
earned
the
The
prov
document
pet
that
ded
t
W
oner
t
son
is
drawee
was
the
rea
depositor?
o
y
the
the
check
agent
It
can
is
o
the
oseph
recover
bearer.
he
sued
rom
The
the
discounted
the
same
year
it
was
issued,
the
sale
should
be
c
rcumstant
a
ev
dence
As
ound
by
the
tr
a
court
pr
vate
deed
of
mortgage
in
favor
of
petitioner
GSIS.
Subsequently,
instrument
b.
When
against
T
me
M
upto
s
the
stated
amount
of
P2,000
since
it
is
instrument
EULALIO
PRUDENCIO
VS.
CA
(supra,
p.
19)

Petitioners
(c)
When
it
is
payable
to
order
of
a
fictitious
or
hands
of
any
holder,
as
against
any
person
whose
the
Philippines
for
all
debts,
both
public
and
Persons
whose
s
gnatures
were
orged
but
who
are
prec
uded
INDORSEMENT
1951)
In
instrument
than
within
the
transferor
the
contemplation
if
he
of
the
Negotiable
the
Th
acceptor
s
mot
on
to
was
demand
den
ed
payment
by
the
respondent
o
the
amount
udge
reflected
Pet
t
oner
n
now
the
he
qua
d
answerab
ficat
on
"
e
nter
there
a
or
a
"engages
There
s
that
no
on
quest
due
on
presentment
then
that
the
**
negotiated
the
instrument
was
defective,
the
burden
is
(e)
By
a
release
of
the
principal
than
debtor
unless
the
the
transferor
holder's
negotiation
ofby
the
instrument.
An
indorsement
in
blank
defendants,
own
name
mmed
ate
y
trans
erred
to
h
m
t
t
e
thereto
by
of
business
has
been
followed
and
that
each
installment
may
be
d
scharged
such
d:
EXCUSED
accept
the
nstrument
and
protest
was
du
y
made
X
accepted
the
de
ense
o
orgery
aga
nst
PNB
(drawee
bank)
as
to
bar
subject
checks).
The
Court
rendered
judgment
in
favor
of
c.
P
ace
of
o
and
nt
y
not
and
severa
y
The
comp
a
sted
ten
causes
o
act
on
the
s
xth
to
n
nth
o
wh
ch
Filriters,
a
sister
corporation.
Thus,
for
lack
of
any
surety
or
the
atter
He
ends
h
s
name
to
enab
e
the
Yamaguchi
and
Canlas.
Canlas,
in
his
defense,
averred
that
he
D
SCHARGED
w
th
n
the
t
me
that
not
ce
wou
d
have
been
rece
ved
n
purchase
pr
ce
o
the
sub
ect
ot
He
ma
nta
ned
that
what
directly
to
PNB

this
will
also
ensure
that
the
loan
gets
to
be
ho
ders
but
s
on
y
ava
ab
e
to
the
m
nor
h
mse
DISTINGUISHED
instrument
under
the
following
conditions:
[a]
it
is
complete
and
d
shonor
rece
ved
and
the
unpa
daga
ba
ance
o
the
US
Treasury
made
the
transfer;
but
he
shall
not
answer
for
the
solvency
of
the
D
ST
NGU
neg
gence
SHED
on
the
500
00
A
ter
the
bank
te
er
that
there
were
enough
bas
snstrument
of
o
Gonzales
pet
tank
oner
to
sappear
statement
the
day
that
following,
h
sand
sned
gnatures
to
bring
n
the
the
checks
car
and
were
its
ho
whom
der
incumbent
and
ttvendor
had
on
an
Fossum
account
show
payab
that
e
the
to
the
was
order
a
holder
oCruz
Lazaro
in
due
the
same
ega
effects
substitute
money
and
not
money,
the
delivery
of
such
an
to
accept.
part
the
drawer
where
hsuch
sby
swh
gnature
sdid.
orged
he
sa
judgment
nterbank
the
Construction,
S
gned
recovery
is
ba
bwas
a
ances
written
of
pholder
ece
sub
acknowledgment
othe
ect
paper
to
ascerta
such
(1)
there
ru
by
es
must
and
the
de
regu
defendant
very
o
ons
the
as
of
his
Sec
he
an
s
124
endorser
gned
ent
aorequired
ed
note
odo
to
n
a
have
avor
tto
he
wants
tbank
the
ho
der
shou
d
Nat
Post
ona
Bank"
wh
ch
converts
the
bank
rom
aarmy
mere
drawee
w
thout
author
ty
are
rea
de
enses
(e)
with
costs
of
collection
or
an
attorney's
fee,
in,On
payment
shall
aga
nst
part
es
secondar
ynstrument;
ab
e
ch
produces
the
mp
ed
and
67
2013
pay
drawer;
wou
d
A
terat
on
of
effect
of.
Where
a
D.
OMISSIONS
AND
PROVISIONS
THAT
DO
NOT
be
ng
no
ev
dence
that
the
crossed
checks
were
yprov
rece
ved
by
with:
BSP
C
rcu
ar
No
291
ndeed
Ser
es
opa
provided
for
in
Act
that
is
to
be
governed
by
the
agency
or
proxy.
period
after
date
is
issued
undated
or
(2)
where
the
the
may
en
orce
payment
nst
adue
payor
who
HAD
emphasize,
the
checks
were
crossed
checks
and
specifically
the
party
to
pay
the
may
disregard
the
ho
der
[Ebrada]
the
money
pa
d It
to
the
on
a
orged
rom
one
person
to
conditional,
atter
documents
sha
not
not
have
say
been
that
the
d
depositor
the
is
Angel
and
dela
ded
and
so
another
deed
nsuffic
ent
treated
a
cash
transaction
and
not
installment
and
accordingly
will
be
accepted
or
paid,
or
both,
according
to
its
tenor,
private:
Provided,
however
,case
unless
parcel
of
land,
co-owned
by
mortgagor
spouses,
was
given
2.
ADDITIONAL
NOT
AFFECTING
is
a
holder
in
due
course
contend
that
the
payee
PNB
is
an
immediate
party
and,
therefore,
non-existing
person,
and
fact
was
known
to
signature
was
placed
thereon
before
delivery.
Instruments
Law?
HELD:
NO.
never
There
no
Sec.
quest
6
16
ons
rom
sa
sett
d
order
ng
up
as
the
de
ense
was
o
ready
orgery
a
(Sec
u
sat
23)
sat
act
on
o
the
ass
gnor
sout
ab
e
or
nva
dactua
ty
oThat,
whatever
he
1942,
Mariano
Ramos,
as
disbursing
officer
of
an
division
ofs
because
he
merely
steps
negot
ab
e
specifies
nstrument
or
no
whatever
indorsee,
ba
ance
that
an
spresumed.
instrument
so
2.
B
s
of
on
the
to
prove
Delivery;
when
effectual;
when
-gence
Every
Sec.
48
right
of
recourse
against
the
party
secondarily
liable
is
was
paid
when
due.
Ainstrument
transferee
has
no
reason
to
including
Sima
Wei,
on
the
two
checks.
appeal
from
the
ndorsement
The
tr
a
court
he
d
that
tred
was
mmater
a
whether
Striking
indorsement.
-the
The
holder
may
at
any
time
payment
recovery
by
the
atter?
HELD
NO
Where
the
nstrument
nstrument
nas
avor
defendant
Fernando
David
against
the
plaintiff
Cely
Yang
and
Presentment
Sec
Sec.
79
35
mputab
est
to
hthere
s
de
au
ta
m
sconduct
or
neg
were
anchored
on
the
prom
ssory
notes
ssued
by
pet
t77
consideration,
the
assignment
is
aatter
complete
nullity.
When
presentment
indorsement;
not
how
requ
changed
to
to
special
charge
the
accommodated
party
to
obta
n
cred
tdrawee
or
to
ra
se
money
He
should
not
be
held
personally
liable
for
authorized
due
course
oPROVISIONS
ma
tRIZAL
had
been
depos
ted
n
the
post
sa
d
respondent
had
actua
y
pa
dmade
was
on
y
the
amount
o
paid
off
before
Notwithstanding
the
provision
in
the
Sec
119
was
regular
pa
dBoard
by
upon
h
m
As
its
a
resu
face;
twho
o
[b]
th
sthe
it
the
became
checks
the
ssued
holder
by
h
m
thereof
be
ore
b.
U
tra
V
res
Acts
must
are
acts
done
beyond
the
power
PROMISSORY
nstrument;
NOTES
how
d
scharged.
BILLS
A
OF
negot
EXCHANGE
ab
eThe
debtor,
unless
there
is
an
express
agreement
requiring
him
to
do
indebtedness
and
liability
to
the
certificate
of
registration
and
return
the
check
on
the
course,
and
can
have
no
assistance
from
the
presumption
as
instrument
a
cert
ficate
does
depos
not,
tit
or
by
a
cert
itself,
fied
operate
check
(Wa
as
ker
payment.
v
Se
ers
A
check,
So
orged
unds
Pet
to
cover
tBlank
oner
the
then
check
requested
and
compared
the
respondent
the
s
gnature
bank
to
as
cred
conta
t oners
back
ned
Me
cor
not
E
ab
M
e
Maas
m
raudu
ent
y
obta
ned
possess
on
o
the
Monetary
ISSUE:
WON
may
BPI
had
ssue
the
w
th
right
respect
to
debit
to
such
from
operat
petitioner's
ons
Prov
current
ded
demand
return
the
DEVELOPMENT
total
sum
of
money
BANK
plus
OF
interests
VS.
and
SIMA
attorneys
WEI
fees.
(GR
The
No.
Qua
fied
reservat
B
on
LLS
oa
OF
the
EXCHANGE
rmaturity.
(part
es
secondar
y
ab
CHECK
e)
rsuch
ght
o
recourse
Inc.
nstrument
The
aggregate
to
another
price
person
for
(2)
the
purchases
paper
that
was
P126,859.61.
was
check
o
the
and
p
wh
nt
ff
ch
wh
may
ch
st
turn
pu
ates
out
that
to
sof
be
x
months
a
orged
aa
ter
endorsement
date
o
Office
10
money
orders
(P200
each),
offering
to
pay
for
contract
(a)
When
the
drawee
ndorser
s
was
a
fict
aware
t
ous
o
person
that
act
or
at
person
the
t
me
not
he
hav
ng
the
pr
vate
respondent
she
wou
d
have
a
r
ght
o
act
on
aga
nst
AFFECT
negot
ab
e
nstrument
s
mater
a
y
a
tered
w
thout
the
2001
by
ma
the
not
ce
must
be
depos
ted
w
th
the
appropr
ate
acceptance
of
an
instrument
payable
at
fixed
period
b.
provisions
of
existing
legislation,
pursuant
to
Section
196
of
the
D
3.
SHONO
Check
Sec.
condition
nstrument
2(b)
:
STATED
and
t
s
not
instalments
supposed
must
to
be
clearly
ts
duty
indicate
to
ascerta
the
amount
n
whether
due
Sec
40
Sec.
32
A
terat
on
that
tota
y
prevents
recovery

n
the
case
o
indorsed
for
deposit
to
payee's
(E.T.
Henry)
account
only.
Atrium
otherwise
fixed
by
the
Monetary
Board,
coins
shall
Genera
Section
but
that
oseph
191.
the
c
Definition
a
amounts
med
that
deposited
and
the
nstrument
meaning
are
was
repayable
terms
d
scharged
.
specifically
HELD:
The
to
that
s
sha
have
been
du
presented
or
payment
Sec
23
Forged
and
ndorsement
that
s
gnature;
if
of
be
effect
nstrument
dishonored
of.
When
payab
and
a
s
gnature
e
the
to
bearer.
necessary
s
orged

Indorsement
be
of
entire
instrument.
another
as
ong
as
the
one
encashes
the
check
w
th
the
B.
said
as
NEGOTIABILITY
the
whole
amount
of
evidence
whatever
that
STELCO's
possession
of
Check
765380
udgment
be
ore
the
auct
on
sa
e
was
conducted
SSUE
WON
Sec
ass
189
gned
to
the
ass
gnee
vendee
Cons
der
ng
now
the
acts
o
the
is
not
a
holder
in
due
n
case
o
construct
ve
acceptance
person
making
it
so
United
into
the
shoes
of
the
Exchange
147
Presentment
where
t
me
s
nsuffic
ent.
Where
the
When
check
operates
as
an
ass
gnment.
A
check
o
a.
Requ
s
tes
for
orders
conclude
of
dismissal
from
the
of
the
mere
Regional
fact
that
Trial
a
Court,
note
circulates
petitioner
Bank
after
that
he
or
some
person
under
whom
he
claims
acquired
Sec
105
contract
on
a
negotiable
instrument
is
incomplete
and
expressly
reserved;
there
was
a
cons
derat
on
or
the
trans
er
or
not
as
the
ndorser
When
sender
deemed
to
have
g
ven
due
not
ce.
strike
out
any
indorsement
which
is
not
necessary
to
payab
to
order
at
the
tadvances
me
odobtain
orgery
such
as
the
checks
declaring
former
entitled
to
the
proceeds
of
the
two
(2)
o
B f.
Xe stye
ab
e
as
acceptor
or
honor
to
B
and
the
part
es
subsequent
When
the
cause
oto
de
ay
ceases
to
operate
not
Furthermore,
the
transfer
wasn't
in
with
a he
eged
to
secure
certa
n
rom
the
Bank
n
connect
on
wceth
corporate
acts
that
he
performed
inasmuch
as
heasked
signed
the
rece
ves
no
part
o59
the
cons
derat
on
orconformity
the
nstrument
but
Sec
73
drawer.
indorsement.
-not
P
ace
of
presentment.
-money
Presentment
or
payment
sTh
000
00
(any
nthe
cash)
as
earnest
The
Court
oao
Appea
Deed
of
Assignment,
the
Bureau
ofgo
Public
Works
PNB
ifs
Payment
for
Honor
vs.
by
Person
Pr
y
before
it
was
overdue,
and
without
notice
that
it
had
previously
or
Man
a
were
not
pa
because
o
ack
o
unds
stand
ng
to
con
erred
upon
a
so
plaintiff.
It
enables
the
holder
a
judgment
without
the
delay
streats
d
scharged
following
day
as
previously
agreed
upon,
defendant
expressed
in
of
NIL,
to
the
effect
that
every
holder
is
2tP5
parties
dated
Maker
and
Payee
3
parties
of
Drawer,
Payee
whether
aunder
managers
check
or
ordinary
check,
is
not
legal
tender,
account
the
of
the
checks
with
the
forged
indorsements?
That
any
bank
ch
ncurs
on
overdraw
ng
n
ts
depos
tleave
account
and
restore
to
ts
account
check
ndorser
orged
Me
cor
ssuch
n
complaint
the
spec
men
whether
not
the
nstrument
swere
e
to
bearer
S
or
order
be
ore
the
24
hours
prov
by
Sec
136
the
drawee
wou
dsuch
be
A
demand
dra
tvalue
sdence
there
ore
oPayment
same
category
as
a
cash
er
sn
drawer
ndorsed
compan
the
es
wh
ch
n
cou
dpayab
aga
nst
the
rinstrument's
respect
ve
Although
85419;
June
the
corresponding
invoices
issued
STELCO
stipulated
Whenever
same
the
ormer
bank
sha
pay
swas
atter
gnature
the
sum
at
the
o
P12
back
000
o
w
th
de
vered
was
a
b
ank
paper
be
legal
tender
in
amounts
not
NEGOTIABILITY
them
with
private
check.
Montinola
was
able
to
the
s120(f):
gnatures
assent
after
sight
o
osec
the
athe
is
part
payee
undated
es
or
,binding
ndorsers
any
holder
are
may
genu
insert
ne
or
therein
not
the
sthe
s
Negotiable
Instruments
Law,
the
bank
may
be
held
liable
for
R
K
Not
ng
necessar
yto
drawn
on
aturn
tthat
swhom
necessary
that
check
(a)
An
indication
of
athe
particular
out
of
address
du
ynstrument
stamped
n
a
way
ttransferee
wou
d
be
part
the
ndorser
Mont
a
vs
PNB
above
even
tts
was
negot
ated
to
amar
ho
der
on
was
Court
each
aware
susta
of
the
ned
fact
oseph
that
the
exp
checks
athe
nthe
ng
that
there
sbecause
no
pr
nc
p
ema
o
proceedings
on
dishonor
be
duly
taken,
he
will
been
fulfilled
payment
or
But
indorsee
any
person
or
to
his
an
instrument
whether
so
the
or
Renunc
made
thout
supra
on
the
under
author
How
Negot
ty
o
at
on
person
Takes
Pnotes
whose
ace
p
s
10
gnature
tthe
indorsement
must
be
an
indorsement
the
entire
drawee
bank
swh
another
bank
or
tdeeds
sEast
spec
a
yby
crossed
by
the
Sec.
Extens
on
o
Term
the
assurance
o
the
drawer
gain
on
disposition
should
have
been
reported
in
1976,
the
year
at
Sec.
5
(a
supra,
p.6)
and
they
also
executed
ever
back
to
any
time
before
the
pr
course
vate
respondent
and
stands
can
va
no
d
better
y
re
use
footing
acceptance
a
mere
o
the
assignee.
payment
o
In
case
at
bar
tor
snot.
beyond
dded
spute
that
Nyco
executed
a
deed
security
the
aforesaid
payable;
or
transferor
States
Armed
Forces
in
the
Far
(USAFFE)
and
based
in
the
due
of
one
or
more
installments
that
alleged
that
its
cause
of
action
not
based
on
collecting
the
Suffic
ency
ho
der
o
ano
b
drawn
payab
e
eshonor
sewhere
than
at
the
pfund
ace
o
bus
tse
does
not
operate
as
an
ass
gnment
o
any
part
owants
the
(f)
By
any
agreement
upon
the
holder
to
extend
the
under
ev
offered
was
an
accommodat
on
ndorser
the
title
as
holder
in
due
course.
But
the
lastPRESENTMENT
FOR
Sec
137
revocable
.not
L
ab
ty
until
of
drawee
ng
or
destroy
ng
b
.ness
cashiers
checks.
ISSUE:
WON
Fernando
David
is
a
holder
in
due
n
th
sw
case
the
son
gnature
oreturn
rThe
ght
u
ho
der
(here
the
Where
not
ce
o
d
du
ythan
addressed
and
his
title.
The
B.make
EFFECT
OF
Availabilit
Transferee-holder
may
be
Transferee
is
always
the
exportat
on
o
ogs
as
reflected
above
were
payab
epay
30
d.
Matur
ty
Date
S
ght
promissory
notes
in
his
capacity
as
officer
of
the
defunct
assumes
ab
ty
to
the
other
part
es
thereto
he
Presentment
-the
The
holder
or
may
payment
convert
ss
a
not
blank
requ
indorsement
red
n
order
into
to
a
rendered
made
aendorsements
dec
at
the
sodate
on
proper
affirm
p
ace
ng
w
th
mod
ficat
on
the
tr
a
court
s
it
can
make
the
payments
instead
to
the
firm
because
the
firm
EXAMPLE
ce
was
not
g
ven
due
to
ca
am
ty
ke
flood
and
L
ab
e
h
s
been
cred
dishonored;
t
n
the
bank
[c]
it
SSUE:
took
the
WON
same
PNB
in
has
good
the
faith
r
ght
and
to
for
app
value;
y
usually
incident
to
a
lawsuit.
While
not
authorized
in
this
corporat
on
by
aw
and
such
want
o
author
ty
may
be
Gatchalian
issued
"Stop
Payment
Order"
on
the
check,
with
the
deemed
prima
facie
to
be
and
a
holder
in
due
course.
This
and
an
offer
of
a
check
in
payment
of
a
debt
is
not
a
w
th
HELD:
the
Bangko
Yes.
BPI
acted
Sentra
within
sha
legal
u
bounds
y
cover
when
sa
it
d
debited
overdra
t
s
gnature
the
bank
te
er
orwarded
the
check
w
th
two
other
bank
drawee
banks
wh
ch
n
turn
cou
d
sue
the
here
n
pet
t
oner
as
exceeding
Fifty
pesos
(P50.00)
for
denominations
of
the
check
va
ue
o
the
checks
wh
ch
were
wrong
u
y
encashed
but
s
gnature
true
as
date
an
endorser
of
issue
or
and
acceptance,
then
persona
and
y
the
endorsed
instrument
and
filed
by
the
Philippine
Bank
of
Commerce
contains
twenty-two
because
the
drawer
was
never
a
party
to
the
nstrument

he
conta
n
ng
the
s
gnature
o
the
person
who
w
de
ver
and
(3)
E.
requ
HOW
red
to
NEGOTIATION
comp
y
on
pa
TAKES
n
o
be
ng
he
d
as
an
acceptor
but
that
RYL
would
pay
capac
because
checks
nterest
ty
to
as
the
at
nstrument
rate
ndorser
10%
s
and
supposed
to
warrant
to
the
drawee
9,
1983)
In
consideration
for
a
loan
extended
by
depos
t
s
drawn
on
a
depos
t
building
which
with
reimbursement
his
check
and
is
to
be
made
or
a
particular
The
Sec.
Monetary
65.
Warranty
Board
where
n
ts
Reso
negot
ut
on
at
No
on
by
707
de
dated
very
10
and
May
so
2001
ab
e
thereon
t
s
avo
ded
except
as
aga
nst
a
party
that
aw
wou
that
d
depart
wou
on
d
prevent
an
nd
v
dua
rom
go
ng
nto
the
D.
HOW
ARE
NEGOTIABLE
INSTRUMENTS
AND
NOND for
SHONORED
is
BY
NONdue
course
such
instalment
Art
findorsed
Written
315
1
indorser
and
includes
W
th
the
un
printed,
a
interest,
th
uindorsement
ness
and
ifFnthe
or
any.
writing
abuse
Anegotiable
bill
o
is
includes
confidence
or
note
print.
indicating
PNB
VS.
the
MANILA
amount
thereof
OIL
REFINING
to
the
(GR
holder
No.
L-18103;
or
to
June
any
8,
all
deposit
only
to
payee's
account.
Clearly,
then,
Atrium
purports
5.
Absolute
to
be
tted
s
and
the
instrument.
An
Sec
65
GEMPESAW
VS.
CA
(supra
p
14)
The
ssu
ng
a
crossed
check
of
sale.
presentment
and
dishonor.
There
is
no
evidence
the
those
udgment
ob
gat
on
n
Cash
er
s
check
wh
ch
t
depos
ted
w
th
ass
gnment
n
avor
o
BA
nance
w
th
Sanshe
Corporat
on
as
Sec.
66
L
Sec.
ab
ty
65.
of
Warranty
genera
where
ndorser.
a
spouses
negot
Every
executed
at
on
ndorser
by
an
de
very
who
denominated
Misamis
Oriental,
"Assumption
procured
of
cash
Mortgage"
advances
under
in
the
which
amount
they
of
sum
installments
of
money
evidenced
were
not
by
paid
the
(Bliss
vs.
instruments
California
stated
Co-op
two
a.
Confession
of
Judgment

see
p.6
Sec
122
Renunc
at
on
by
ho
der.
ho
der
may
express
y
(d)
When
the
name
of
payee
does
not
purport
to
be
the
time
SSUE
WON
Serrano
was
an
accommodat
on
ndorser?
HELD:
ACCEPTANCE
Sec.
60
or
the
res
dence
o
unds
to
the
delivery
of
the
instrument
for
the
purpose
of
giving
effect
course?
HELD:
Yes.
Petitioner
fails
to
point
any
circumstance
mentioned
rule
does
not
apply
in
favor
of
a
party
who
Where
a
drawee
to
whom
a
b
s
de
vered
or
acceptance
Legal
Character.

Checks
representing
demand
payee
hosp
ta
)
s
essent
a
to
trans
er
t
t
e
to
the
same
whose
indorsement
struck
out,
and
all
ESTOPPEL
depos
n
the
post
Sec
72
What
const
tutes
suffic
ent
presentment.
y
of
free
from
personal
defenses
subject
to
personal
Worldwide
Garment
Manufacturing.
ISSUE:
WON
Canlas
should
days
a
ter
date
and
prov
ded
or
the
so
dary
ab
ty
o
pet
t
oners
as
B
s
to
accommodate
another
the
case
at
bar
t
s
nd
sputab
e
that
b.
charge
special
the
indorsement
drawer
where
by
writing
he
has
over
no
the
rthe
ght
signature
to
expect
of
the
or
dec
sdng
on
WON
a
eged
sa
eand
othe
the
sub
ect
property
needs
the
money
to
buy
construction
materials
to
complete
typhoon
the
and
[d]
when
it
was
negotiated
to
Filinvest,
the
latter
had
no
depos
tIndorsement
to
the
debt
o
the
depos
tor
to
the
bank?
HELD:
No
The
N
L
PAYMENT
FOR
HONOR
drawee
bank.
The
CFI
of
Manila
then
ordered
defendants
to
pay
jurisdiction,
because
it
deprives
the
maker
or
drawer
ano
day
in
court,
PAYMENT
BY
ra
sed
as
a
rea
de
ense
but
the
negot
at
on
oproceeds
the
presumption
arises
in
favor
a
person
who
is
holder
in
Drawee
(a)
By
payment
n
due
course
by
or
on
beha
o
valid
tender
of
payment
may
be
refused
receipt
by
petitioner's
account.
When
the
petitioner
deposited
the
shall
be
payable
accordingly.
The
insertion
of
a
nc
ud
ng
nterest
thereon
at
aand
rate
equ
va
ent
to
one
tenth
o
one
branch
co
ect
bank
n
a
saccord
ar
sat
tuat
on
tdamages
was
dscourse.
that
to
s
mp
y
Maker
that
cannot
the
be
gnatures
the
payee
oto
the
Drawer
and
prev
payee
ous
may
ndorsers
be
the
are
respondent
bank
re
used
Hence
pet
tmay
oner
fi
ed
the
nstant
presented
PLACE
ts
to
PNB
where
the
amount
o
the
check
was
p
aced
to
(22)
causes
of
action
referring
to
twenty-two
(22)
transactions
dProducers)
not
se
to
pay
return
w
th
nSSUE:
24
hours
wh
the
"COD"
shou
10
(cash
come
on
w
th
delivery),
nrthe
without
the
purv
the
the
ew
knowledge
o
latter
the
aw
made
of
the
teller.
payments
Upon
thus
per
og
annum
ca
ypayment
guarantees
rom
unt
same
pa
dof
as
payab
such
there
ehe
quarter
can
be
ya
The
no
doubt
note
account
to
be
debited
with
the
amount;
or
(b)
dec
Where
ded
to
the
author
ndorser
ze
the
sm
the
person
ssuance
to
whom
o
cash
er
nstrument
manager
sYes.
sdeed
or
petitioner
Bank
to
respondent
Sima
Wei,
latter
executed
who
has
h
mse
made
author
zed
or
assented
to
the
subsequent
indorser
who
be
compelled
to
March
market
and
2
purchas
ng
apayee
d
scount
or
otherw
se
secur
tThe
es
NEGOTIABLE
ACCEPTANCE
condition
forth.

has
negotiated
will
hold
the
same,
the
name
y143
payable
in
two
1922)
ho
der
-thout
cannot
The
manager
en
orce
the
and
nstrument
treasurer
aga
nst
of
respondent
bank
as
could
Death
not
be
aprom
considered
oonly
athe
a
BOE
holder
Death
in
o
due
the
drawer
The
o
a
SC,
ndorsers
so
payment
ng
to
the
tenor
o
the
nstruments
an
of
the
person
indorsing
who
mposes
ych
noperat
no
ob
ve
gat
and
on
no
on
ght
to
drawee
reta
n
not
the
honor
nstrument
such
a
or
check
to
g
ve
tthe
aa
s
whatsoever
which
that
purports
the
check
transfer
was
ever
to
given
the
indorsee
to
it,
or
indorsed
a
part
only
to
it
the
cases
Ex
Offic
where
o
Sher
athe
payee
ff
be
ore
either
the
acquired
date
o
the
the
note
schedu
from
ed
another
auct
on
the
debtor
ob
gor
BA
Fto
nance
sfor
actua
yholder's
en
orc
ng
sa
d
Absent
no
(3)
above
nstrument
cannot
be
en
orced
aga
nst
obligated
6.
ISSUE:
WON
the
proceeds
of
the
note
should
Php800,000
the
Provincial
Treasurer
(PT)
of
Lanao
for
the
use
ndorses
w
and
so
qua
forth.
ficat
on
see
warrants
under
Qua
to
a
fied
subsequent
ndorser
rom
ho
ders
n
but
on
quasi-delict

a
claim
on
the
ground
of
a.1
Warrant
of
attorney
discounted
to
confess
judgment,
renounce
h
smoney
rd
ghts
aga
nst
any
party
nstrument
be
ore
at
or
name
of
any
person;
or
No
There
was
never
a
that
was
the
rea
which
should
have
put
David
on
inquiry
as
to
the
and
the
drawee
thereto.
has
no
torders
me
w
th
the
exerc
se
o
reasonab
ethe
d
gence
to
cred
tdrawer
o
the
drawer
w
th
the
bank
and
the
bank
swhy
not
of
or
postpone
the
right
to
nstrument
When
the
ho
der
s
ndorsement
saccepted
forged,
destroys
the
same
or
indorsers
deposits
do
not
have
legal
tender
power
and
their
be
held
liable
for
the
promissory
notes?
HELD:
1.
Instrument
Complete
and
personal
if
he
is
adate
holder
in
due
defenses
we
Presentment
as
office
or
swith
payment
ees
at
sender
ten
to
be
percent
suffic
smoment
deemed
ent
o
the
must
tota
to
be
have
amount
made
g
ven
(HRPT)
due
n title
the
Sec
When
presentment
for
acceptance
must
be
BANCO
DE
ORO
SAVINGS
VS.
EQUITABLE
BANKING
CORP.
the
spouses
s
gned
the
prom
ssory
note
to
enab
e
Reyes
to
had
been
consummated?
HELD:
The
Court
finds
no
mer
te
n
80
project.
Notwithstanding
the
of
the
Deed
of
When
Matur
ty
of
b
payab
not
eto
requ
after
red
snety
ght;
to
charge
the
for
Sec
166
de
ay
sattorney
excused
However
the
ho
der
must
gSerrano
ve
not
ce
once
(a)
Where
andorsers
p
ace
o
payment
sprovision
spec
fied
n
the
nstrument
conta
notice
ns
of
prov
any
spresentment
infirmity
ons
estab
in
the
sh
instrument
ng
the
or
ab
defect
ty
oand
in
adue
the
genera
the
plaintiff
the
sum
of
P600
with
legal
interest
until
paid.
In
this
it
nevertheless
does
not
affect
negotiability.
A
confession
of
judgment
the
sense
defined
in
sec
191
of
NIL,
that
is,
a
payee
or
indorsee
wrong
date
does
not
avoid
the
instrument
in
the
PERSON
corporat
on
may
pass
t
t
e
to
the
obligee
or
creditor.
Mere
delivery
of
checks
does
not
percent
checks
(1
10
o
with
1%)
per
the
day
or
respondent,
preva
ng
the
n
nature
one
day
of
treasury
the
the
pr
nc
pa
debtor
officers
who
counterchecked
the
s
gnature
One
o
the
bank
officers
same
person
case
Pet
t
oner
contends
that
h
s
cred
t
A
ter
hav
ng
pa
d
check
and
on
the
next
day
PNB
discovery,
unaccepted
wou
d
not
be
a
d
shonor
the
drawee
can
st
accept
by
cert
fied
checks
or
other
s
m
ar
nstruments
n
b
ank
or
payab
to
C.
entered
RELAT
pay
ONSH
into
by
it.
P
the
BETWEEN
But
said
the
DRAWER,
drawer
DRAWEE
may
insert
AND
in
the
e.
Persons
Forgery
prec
of
uded
from
sett
S
ng
gnature
up
n
a
b
of
exchange
for
the
construction
materials
thus
ordered
delivered
sa
matured
d
bank
has
but
cons
ts
amount
dered
was
the
checks
not
pa
d
as
Counse
negot
ab
or
e
the
Apropos
de
endant
the
Sec.
30
and
delivered
to
the
former
a
2013
presented
or
payment
(b)
A
statement
of
the
transaction
which
gives
rise
What
a
terat
constitutes
on
and
negotiation.
(supra,
p.
9)
w
th
the
know
edge
o
the
check
w
th
the
know
edge
o
Sec.
extens
Every
2(c):
on
person
o
Stated
t
me
negot
instalments
agreed
at
ng
by
an
with
the
nstrument
acceleration
ho
der
and
by
clause:
the
de
pr
very
nc
pa
or
debtor
by
a
company
INSTRUMENTS
drawer
The
executed
drawee
TRANSFERRED?
and
cannot
be
compe
ed
to
pay
un
ess
he
however,
conditionally
held
that
it
does
not
Sec
149
holder
or
has
not
directly
dealt
with
the
maker
thereof.
As
in
any
manner
or
form
in
payment
of
an
obligation
or
as
sa
e?
HELD
No
va
d
reason
or
the
pr
vate
respondent
to
have
and
the
check
covered
thereby
s
mere
y
an
nc
denta
or
the
one
however,
are
not
authorized
nor
contemplated
by
our
disadvantage
When
of
d
Atrium
shonored
in
not
by
being
nonacceptance.
a
holder
in
due
A
b
course
s
is
d
scharge
more
o
Joint
there
a
warn
Indorsement
or
ng
or
to
to
en
orce
payment
thereo
aga
nst
any
of
the
amount
payable,
or
which
purports
to
transfer
themselves
of
in
to
assume
de
Misamis.
the
PT-Lanao
GSIS.
did
This
not
undertaking
that
fraudulent
acts
and
bad
faith
the
alternative
have
been
reported
as
taxable
income
during
1976
and
F.
a.
Payment
APPL
CABLE
for
due
Sec
course
67
prev
sect
on
Signature
of
the
maker
or
drawer
is
usually
written,
preferably
with
wherefore
of
the
possession
of
the
checks
by
Chandiramani.
L
ab
ty
of
ndorser
where
paper
negot
ab
ehave
by
owner
o
the
note
tobligation
was
a
ways
the
othe
the
ndorsee
(e)
the
only
or
last
indorsement
is
an
indorsement
in
present
a
ter
ts
matur
ty
ab
e
to
As
between
immediate
parties
and
as
regards
adefense
Sec.
part
65
es
pr
or
to
the
may
ra
se
the
rea
enforce
the
instrument
unless
made
with
the
assent
of
solidary
liability
of
private
respondent
Fermin
Canlas
isthereof.
made
Warranty
where
negotiation
by
delivery
and
acceptance
inevident
the
re
Regular
uses
w
th
nous
twenty
our
hours
ato
ter
such
de
very
or
w
th
navo
defenses
course
Sec.
184
event
oaUSAFFE
the
rtyphoon
non
payment
at
matur
ty
Pet
tnote
oners
seek
to
d
subsequent
to
him,
are
relieved
from
liability
not
ce
notw
thstand
ng
any
m
scarr
age
none
ma
sremote
Sec
106
made
Sec.
secure
50
Presentment
Promissory
a
oan
rom
or
the
acceptance
note,
bank
defined.
She
must
was
be
made
the
-of
actua
A15)
benefic
negotiable
ary
(GR
No.
When
prior
party
may
negotiate
instrument.
Depos
tCagayan
nceases
post
office;
what
const
tutes.
Not
ce
sso
pet
tpayab
oner
sWhen
arguments
tdeemed
sthereby
an
und
sputed
act
that
Where
b
payab
e
a
ter
sforgery
ght
saccountant
accepted
or
honor
ts
matur
ty
snot
Assignment,
PNB
agreed.
And
so
the
loan
matured
without
Sec.
53.
When
person
holder
in
due
course.
2.
Qualified
ndorser.
and
tor
spossession
there
presented
the
action,
of
flood
or
defendants
seek
Accordingly,
to
recover
respondent
the
value
of
corporation
the
check,
honor.
ndorser
and
gAn
v
ng
the
procedure
or
a
not
ce
obanks
d
shonor
The
hands
of
a
subsequent
holder
in
due
course;
but
as
to
who
is
in
of
the
or
the
PR
MAR
L
ABLE
discharge
the
obligation
under
aostage
judgment.
The
obligation
is
relationship
created
at
that
was
of
agency,
b
rate
pVMS
us
three
percentage
po
nts
wh
chever
sLY
h
gher
not
ater
not
ced
Semp
o
the
ass
stant
otwo
Construct
on
There
must
be
protest
or
There
no
need
to
protest
ATR
UM
(b)
MANAGEMENT
By
payment
nmade
due
VS.
course
CA
(supra
by
the
py
party
(supra,
SSUE:
not
ficat
on
message
was
sent
to
all
postmasters
and
involving
endorsed
the
check
HSBC
wh
ch
Man
PAYEE
a
Bank
sCorporation.
ab
e-COURT
or
damages
or
ts
neg
gence
n
a
ng
to
cash
forgery
bearer
eclause
to
numbered
account
as
an
except
on
rom
the
Bank
and
Aruego
on
different
dates.
The
sum
sought
to
be
promissory
despite
insistent
note,
engaging
to
pay
the
petitioner
Bank
or
order
the
(b)
(c)
matter
Where
persona
a
ege
o
the
that
orgery
serv
nstrument
the
ce
atter
nBARTOLOME
w
th
was
nnot
the
same
or
tdraft,
accepted
me
that
the
or
hma
sbearer
w
norma
thereof,
subject
to
the
rights
subsequent
to
the
instrument.
law
because
under
these
instruments,
the
promisor
There
bank
is
does
unconditional
not
revoke
the
xxx
There
the
is
bank
unconditional
revokes
ORDER
the
by
Sec.
there
40
ore
re
eases
those
part
es
rom
secondary
ab
ty
wh
ch
was
held
in
Bank
of
Commerce
and
Savings
vs.
Randell:
We
SESBRENO
VS.
OF
APPEALS
qua
fied
ndorsement
warrants
accepts
and
the
drawer
security
for
an
obligation,
or
for
any
other
purpose
before
it
was
re
delivered
used
acceptance
to
the
Philippine
o
the
payment
Bank
the
(PNB),
ob
gat
a
on
promissory
n
h
swas
avor
note
that
Acceleration
co
the
atera
Indorsement
matter
Th
to
requires
s
of
part
instrument
cu
the
ar
debtor
check
payable
to
pay
mere
off
to
the
ev
bearer.
balance
denced
-and
the
not
fulfilled.
Upon
failure
of
the
mortgagors
with
respondents.
This
was
clearly
an
attempt
by
the
petitioner
Bank
amount
who
de
vered
in
cash
so
nstrument
he
gave
Ramos
Examp
eP300,000
P
a
o
in
Vcomply
emergency
ma
Aunor
negotiable
non
instrument
is
subject
to
defenses
as
if
it
were
nonparty
thereto
can
be
the
instrument
to
Sec.
the
5(c):
ho
der
Notice
that
of
the
dishonor
check
waived
cannot
on
be
even
presented
waiver
of
to
protest,
the
drawee
Honor
LAW
d
shonored
by
David
was
privy
to
the
transaction
between
petitioner
Sec.
41.
Indorsement
where
payable
to
or
more
persons.
deferred
on
installments?
Mau
n
he
hav
urn
shed
the
wh
ch
the
If
payment
full
name
is
or
made
at
prior
the
to
the
surname.
fulfilment
However,
of
the
initials
condition,
or
any
the
mark
holder
the
abso
b
ute
or
and
party
acceptance
uncond
other
tng
than
ona
be
ore
aho
renunc
holder
present
at
in
ng
due
o
tsmoney
course,
or
hSamsung
sdpayment
ran
ghts
the
aga
delivery,
on
the
nst
day
the
int
de
very.

of
forgery
aga
nst
a
part
es
subsequent
thereto.
An
clearer
and
certain,
without
reason
for
ambiguity,
by
payment
of
debts,
both
public
and
private,
is
at
the
ab
such
ty
by
other
c
a
per
m
od
ng
as
that
the
Qu
rNational
der
no
and
may
Eu
a
ow
em
to
athe
Gonza
return
es
the
spayment
b
gned
Payable
to
Order
:least
when
it
is
payable
to
the
(1)
order
of
a
specified
(a)
By
the
ho
forth
der
or
by
some
person
author
zed
to
rece
ve
PNB
vs.
P
CORNELL
(GR
No
Ly
o
the
oan
and
the
spouses
accommodated
her
by
s
gn
ng
Complete
it
is
complete
when
it
is
not
wanting
of
any
material
promissory
note
within
the
meaning
of
this
Act
is
an
deemed
to
have
been
depos
ted
n
the
post
office
when
74917,
p.14)
Jan.
20,
1988)
Manager's
checks
(Checks)
having
respondents
Va
enc
a
and
Pearroyo
had
g
ven
pet
t
oner
P5
ca
cu
ated
PNB
actually
receiving
any
payment
from
the
Bureau
of
Public
CASABUENA
VS.
COURT
OF
APPEALS
(GR
No.
115410;
Feb.
Indorsements
Where
an
instrument
payable
on
demand
is
negotiated
on
an
him,
the
date
so
inserted
is
to
contending
that
plaintiff
is
not
a
holder
in
due
course.
ISSUE:
genera
holds
the
ndorser
instrument
engages
free
that
from
he
any
be
defect
shonored
of
title
and
of
prior
the
(b)
Where
no
p
ace
o
payment
s
spec
fied
but
the
address
Presentment
s
not
requ
red
n
order
to
charge
an
ndorser
Under
this
definition,
in
order
to
be
a
holder,
one
must
be
in
Sec
114.
When
not
ce
need
not
be
g
ven
to
drawer.
Not
ce
o
not
extinguished
and
remains
suspended
until
the
payment
than
that
the
is,
next
the
c
ear
bank
ng
was
day
to
Prov
collect
ded
from
urther
That
drawees
sett
ement
of
the
o
was
a
so
n
the
bank
and
when
asked
Semp
o
vouched
or
the
non
payment
or
non
payment
or
non
WON
the
accommodated
ssuance
o
the
where
checks
the
were
nstrument
u
tra
v
res?
HELD:
s
made
No
amount
of
P1,820,000.00
on
or
before
June
24,
1983
with
w
th
n
24
hours
the
drawee
a
ter
return
ng
the
b
st
re
used
to
the
unpaid
money
orders.
One
of
the
money
orders
was
prov
s
ons
o
C
rcu
ar
no
259
sub
ect
to
the
o
ow
ng
cond
t
ons
recovered
detect
the
d
screpant
checks
He
adds
that
as
a
genera
ru
e
a
bank
pa
d
ORDER
t
and
charged

subsequent
the
amount
ho
o
ders
the
check
cannot
to
the
en
orce
account
payment
o
the
bargains
away
his
right
to
a
day
in
court.
(PNB
vs.
demands
for
payment
by
the
former.
On
April
4,
1981,
RYL
1.
Ord
nar
y
checks
are
drawn
on
bank
accounts
that
are
endorsements
d
d
not
rece
ve
th
s
n
Court
that
has
transact
succ
on
nct
e
y
ther
emphas
the
zed
who
e
that
or
any
the
ndorsers
MWSS
author
VS.
ty
o
CA
the
(GR
banker
No
L
to
62943
pay
author
u
y
14
ty
1986)
o
23
the
checks
banker
were
to
conclude,
therefore,
that
a
payee
who
receives
a
negotiable
var
es
rom
the
or
g
na
undertak
ng
o
the
secondary
part
es
asked
or
her
autograph
and
ater
on
fi
ed
up
the
paper
to
be
PROMISE
by
the
maker
drawer
to
the
drawee
conditions
of
the
mortgage,
particularly
the
payment
presented
for
payment.
On
the
contrary,
STELCO
never
s
to
be
emphas
zed
n
th
s
connect
on
that
the
check
depos
ted
by
cred
t
wh
ch
was
actua
y
ass
gned
to
BA
F
nance
Thus
e.
to
115
change
When
(c)
S
Not
nce
not
the
ce
only
Not
ndorser
the
Requ
theory
s
red,
the
of
pr
Excused
its
nc
case
pa
he
or
but
cannot
the
basis
rea
y
of
his
which
notes
cannot
(supra,
provides
and
p.3)
be
made
a
check
a
promise
ab
for
e
unt
P500,000.
to
the
pay
nstrument
petitioner
Thereafter,
bank
s
Ramos
d
shonored
the
amount
presented
As
of
sooner
negotiable.
than
Where
acceptance
One
the
due
an
instrument,
date
if
some
payable
specified
to
event
bearer,
occurs,
is
indorsed
such
Chandiramani.
Instead,
Chandiramani
and
David
had
a
separate
such
defense
is
absence
or
failure
of
(a)
acqu
bank
The
red
matters
or
through
payment
and
or
under
th
n
ngs
cash
such
ment
nstead
s
gnature
oned
the
n
subd
check
un
ess
v
can
s
the
ons
on
party
(a)
y
be
(b)
aga
depos
and
nst
ted
(c)
two
or
more
indorsees
severally,
does
not
operate
as
a
presentment
HELD:
Yes.
for
payment,
As
a
general
or
demand,
rule,
the
would
whole
not
profit
destroy
accruing
negotiability.
from
a
cons
derat
on
or
the
note
d
rect
y
to
the
maker
and
be
ng
the
on
y
There
s
no
prov
s
on
n
the
N
L
that
governs
crossed
check
that
pr
nc
pa
t
a
s
due
the
de
ay
caused
by
present
ng
the
b
or
be
sufficient,
see
p.
order
to
be
effectual,
must
be
made
either
by
or
under
the
will
Sec
Sec.
hold
171
14
the
payment
subject
to
the
rights
of
the
conditional
indorser.
presence
of
the
phrase
joint
and
several
as
describing
the
ndorser
of
an
order
nstrument
warrants
"that
the
when
may
be
filled.
-the
Where
the
Who
option
may
make
the
payment
for
Provided,
honor.
Where
however,
bmember
That
has
at
Where
aaccepted
person
pwas
aces
hdu
s or
ndorsement
on
an
prom
ssory
notes
n
b
ank
that
they
had
not
rece
ved
the
va
ue
o
on
haccepted
sthe
or
non
Sec.
66
(a)
note
Where
Un
the
ke
bnthe
the
sof
Mau
payab
ncreditor:
case
e
after
there
sg
was
ght
no
or
agreement
nthe
any
other
here
person;
18751
or
LBlanks;
18915
September
26
1922)
Barto
ome
P person
corne
beha
Liability
of
general
indorser.
accepted
see
d.
Indorsers,
particular
or
particular
proper
to
be
inserted
in
a
negotiable
unconditional
promise
in
writing
made
by
depos
ted
nPhilippine
any
000
aggregate
00
nnst
cash
amount
P40
of
000
P45,982.23
00
nh
and
n
payment
to
certain
ondorser
purchase
Works.
Prudencio,
upon
learning
that
no
payment
was
made
on
T.
EFFECT
OF
TRANSFER
WITHOUT
INDORSEMENT
one
Sec.
49
WON
plaintiff
is
a
holder
in
due
course?
HELD:
Under
the
acceptance
rom
date
or
o
the
not
ng
or
non
and
not
rom
the
date
unreasonable
length
of
time
27,
1998)
parties,
and
free
from
defenses
available
to
prior
necessary
proceed
ngs
o
d
shonor
be
y
taken
he
w
pay
the
of
note
or
bearer
thereof.
(Night
&
Day
Bank
Sec.
38
o
the
person
to
make
payment
spayable
ven
n
nstrument
where
nstrument
made
for
scheck
Qualified
indorsement.
-ng
A
qualified
d
shonor
sba
not
requ
red
to
be
g
ven
to
the
drawer
n
e
ther
onary
the
checks
the
corresponding
proceeds.
Itpartial
is
true
that
c
ear
ng
ances
sha
not
be
effected
or
account
wh
ch
genu
neness
onote,
ong
sssect
sor
gnature
The
ofor
day
Kyu
exam
ned
acceptance
act
o
ssu
or
ng
accepted
the
or
scheck
Anstrument
notar
interest
a
act
at
32%
sat
necessary
per
annum
.the
Sima
A
notar
Wei
made
aow
sany
not
necessary
payments
on
act
a
ter
aga
the
exp
the
rat
on
drawee
o
the
drawer
tthe
me
a
owed
payee
the
or
ho
the
der
then
wou
whose
d
be
received
by
the
Education
Co.
as
part
its
sales
represents
the
cost
of
the
printing
of
"World
Current
Events,"
a
MANILA
OIL
REFINING,
supra,
p.6
)act
wh
ch
has
obta
ned
p
apossession
nt
ff
nsappropr
the
ord
nary
course
oas
bus
ness
HSBC
rendered
ayr
opened
by
gave
prom
to
note
payab
e
to
h
ssacceptance
order
P
then
endorsed
th
to
Aand
n
promissory
in
good
faith,
for
value,
before
maturity,
But
an
order
promise
to
pay
out
of
aof
particular
co
part
ect
o
ng
the
amount
or
ast
oa
the
endorser
debt
pay
that
genera
the
y
nstrument
suffers
the
oss
not
D.
CHARACTERISTICS
OF
NEGOTIABLE
sPresentment
suggested
by
Aqu
no
that
ssubstitute
ru
e
app
es
to
an
the
amortizations
due,
GSIS
extra-judicially
foreclosed
the
(b)
depos
By
ted
m
by
the
at
payees
ng
or
D
convert
zon
Sth
son
ng
and
to
the
Mendoza
pre
ud
n
ce
the
o
cause
of
action.
It
is
well-settled
that
a
party
cannot
change
his
(a)
became
That
the
abank
holder
for
sot
genu
value
ne
and
and
that
n
a
"(n)owhere
respects
what
in
the
twas
the
pet
tssory
oner
n
the
amount
o
P50
000
00
ssee
not
an
ord
expect
des
D
spensed
gnat
the
on
W
snstrument
th
mmater
as
tor
cou
Some
d
be
any
Bills
other
check
need
scheck
prior
on
check
to
their
PT
in
their
province
encashment.
PT-Misamis
dealing
in
which
was
precisely
Chandiramanis
duty
to
deliver
CONSOLIDATED
PLYWOOD
INDUSTRIES,
INC.
VS.
IFC
P61,000
drawee
he
and
cannot
that
in
be
case
made
payment
to
pay
was
because
not
made
there
at
was
time
no
of
as
failure
specially,
to
pay
for
an
payment
it
may
consideration.
o
the
next
preced
ng
on
(sec
65

warrant
es
o
a
person
sale
of
whom
w
th
person
the
t
s
sought
payee
who
had
s
to
en
the
orce
ghtest
such
r
nterest
ght
s
prec
there
uded
n
Serrano
rom
sett
the
ng
broker
up
negotiation
of
the
instrument.
But
where
the
instrument
Sec.
39
However
Sec.
May
40
a
be
check
presented
which
has
been
Must
cleared
be
and
presented
credited
to
or
the
debtor
made
authority
of
or
the
a
ter
party
making,
matur
ty
drawing,
o
the
accepting,
nstrument
or
unconditional
promise
to
pay
to
the
order
of
Republic
Planters
Conditional
indorsement.
,
Part
III,
Indorsement
of
instrument
payable
to
bearer.
(supra,
provided
that
such
signature
be
used
a
and
the
maker
or
s
genu
ne
and
n
a
respects
what
t
purports
to
Such
that,
when
been
protested
or
non
payment
any
person
may
instrument
is
sa
d
notes
and
that
the
cred
t
ne
thereon
was
unnecessary
n
v
ew
case
wr
where
tten
or
presentment
verba
that
or
acceptance
n
s
gn
ng
the
s
prom
necessary
ssory
n
note
order
the
to
EXAMPLE
When
the
nstrument
payab
e
n
Pasay
C
ty
two
executed
a
b
o
exchange
(2)
to
him
or
his
order.
Consequently,
an
instrument
payable
to
7
ndorsers
who
s
gn
on
a
separate
p
ece
o
paper
known
as
instrument
without
which
the
to
another,
signed
by
the
maker,
General
pr
ce
o
the
sub
ect
Pet
t
oner
s
assert
on
that
he
never
the
loan,
petitioned
to
have
the
mortgage
cancelled
(to
save
branch
post
office
or
n
any
etter
box
under
the
contro
o
establishments
(p.12)
of
Negotiable
Instruments
Law,
Section
52
(c)course
provides
that
a
honor
o
the
after
its
issue,
the
holder
is
not
deemed
aabeen
holder
in
due
course.
amount
toany
the
ho
der
The
not
ce
othe
d
shonor
sng
n
order
to
-presented
vs.
Ciriaco
Rosenbaum)
Urdaneta
Iforged
was
this
aB
action
grantee
had
parcel
instituted
of
land
purchased
by
the
bank
by
and
twhen
s to
there
accommodat
on
indorsement
constitutes
indorser
a
mere
cont
respondent
nues
to
be
had
overdrawn
already
or
collected
five
(5)
consecut
the
proceeds
ve
bank
of
days
checks
unt
oscharges
ow
ng
cases
the
ba
ance
o
the
bank
account
and
scovered
that
check
s the
gnature
was
or
those
es
pr
or
to
the
orged
the
note,
leaving
a
balance
of
P1,032,450.02.
On
November
18,
checks
was
we
w
th
n
the
tof
opart
va
d
corporate
act
or
accommodat
on
receipt.
periodical
It
published
was
deposited
by
the
by
defendant.
the
company
To
facilitate
with
the
payment
Bank
of
th
examp
e
even
A
a
ho
der
nd
due
he
a
That
amount
each
check
sha
not
exceed
person
who
w
pay
sa
a
possess
without
on
o
notice
a
check
of
any
infirmity,
an
unauthor
a
zed
not
or
the
maker,
orged
a.2
Cognovit
Actionem
efrom
he
has
confessed
the
bank
statement
too
The
person
who
w
pay
may
mortgage
INSTRUMENTS
and
caused
the
mortgaged
property
to
be
sold
at
another
money
goods
or
any
other
persona
property
rece
ved
by
Armstrong
drawers
on
drawee
Industries
banks

described
drawer
o
the
STELCO
check
s
as
athe
depos
its
"sister
tor
accommodated
But
party
an
who
nstrument
s
the
has
pr
nc
been
pa
mater
debtor
a
but
y
a
not
to
and
an
because
theory
on
t10)
has
appeal,
to
the
the
as
in
effect
the
other
party
v.
purports
Ru
itself
eon
When
does
to
be
ncomp
the
name
ete
of
Stelco
s
Marketing
appear
as
payee,
but
a
Cash
er
s
Check
oand
the
Equ
tab
Bank
ng
Corporat
on
a
what
s
represented
by
the
sa
d
checks
that
Nyco
by
sor
the
be
ng
asked
drawee
to
accommodat
respect
the
checks
ve
current
on
maker
accounts
David
to
pay
as
The
evidence
shows
that
did
not
have
enough
cash
to
cover
check
so
he
gave
LEASING
125
account
of
the
creditor
shall
d
the
nstrument
But
a
renunc
at
on
does
affect
the
instalment.
negot
maturity,
acceptance
at
ng
by
any
de
the
very
lawyer
Bank
or
by
in
cannot
qua
the
fied
a
so
ndorsement)
be
made
to
pay
as
a
without
prior
acceptance
property
is
taxable
as
income
in
the
year
sale
is
made.
But,
if
nevertheless
be
further
negotiated
by
delivery;
but
the
Sec
109
What
const
tutes
aamb
mater
a
adeprive
terat
on.
-tered
Any
act
ng
so
edue
y
as
an
agent
a
veh
cor
by
wh
ch
the
naked
tcannot
tsince
e
to
payment
Bank.
Where
w
th
n
a
an
reasonab
instrument
epayee.
payment
containing
w
th
nacceptance
a
the
reasonab
words
e
It
(a)
When
tng
sthis
du
y
presented
or
and
B.
acceptance
OF
as
scheck
prescr
bed
by
th
Act
smay
re
used
or
bank
wh
indorsing,
ch
n
turn
as
must
the
present
may
tThe
be;
payment
and,
aga
in
such
nst
the
case,
drawee
Sec.
5(d):
or
an
airconditioner
at
the
option
of
the
holder
drawer
be;
that
he
has
a
good
tcase
tsThe
e
to
t;
that
aholder,
pr
or
part
es
had
A
orged
stonge
gnature
whether
tunrem
be
that
oeby
the
drawer
maker
the
condition
Wa
did
ver
not
of
happen,
not
ce
he
is
obliged
to
the
amount
he
drawer
prov
sCLASSES
intends
concern
to
be
ng
bound
such
by
type
it.
o
Not
check
ce
oa
can
dreturn
shonor
be
ound
be
n
the
Conditional
Sec.
41
p.
7.
Irregular
o
the
rster
money
depos
ts
tted
proceeds
on
og
exports
ntervene
and
pay
twould
Indorsement
where
payable
to
two
more
wanting
in
any
material
particular,
the
(b)
At
Cond
a
reasonab
ons
precedent
e
hour
to
aupon
bus
make
ness
unqua
day
fied
ndorser
fix
the
spouses
matur
were
ty
o
act
the
nstrument
as
agents
or
or
the
money
ender
the
days
order
ng
Hyndman
Tavera
&
Ventura
(HTV)
to
pay
PNB
or
a
(c)
proper
p
ace
as
here
n
a
specified
person
(Pay
to
P),
is
not
aacceptance
negotiable
order
instrument.
same
will
not
be
complete.
Examples
of
particulars
are
name
encashed
engaging
the
a
oresa
to
pay
d
on
demand,
smust
not
substant
or
at
asthe
fixed
ated
or
and
determinable
swith
at
odds
Sec.
192
his
property
from
foreclosure).
The
trial
court
ruled
against
holder
in
course
is
one
who
takes
the
instrument
"in
good
Persons
primarily
liable
on
instrument.
-holder
The
Visa
Card.
Subsequently,
the
Checks
were
deposited
the
post
office
department
Sec
107
STATE
INVESTMENT
HOUSE
VS.
CA
(GR
No.
;and
July
13,
1989)

U.
DIFFERENT
COMBINATIONS
OF
charge
a
Not
ndorser
ce
to
and
subsequent
that
the
rng
ght
party;
omaterial
act
on
tthe
me
aga
of.
nst
h
Where
m
does
anot
itself,
the
presumption
that
the
bank
was
aabove,
holder
in
due
course
the
City
of
Manila
and
conveyed
to
its
less
privileged
inhabitants,
EXAMPLE
agood
b
sstand
payab
eon
10
days
a
ter
sencashed
ght
and
was
d
shonored
Unreasonable
presented
is
relative
and
be
determined
in
relation
to
81
1983,
Sima
Wei
issued
two
crossed
checks
payable
to
ndorsement
ndorsers
AFTER
the
orgery
are
st
secondar
y
when
it
debited
the
petitioner's
account,
so
that
following
such
taa
me
When
as
the
overdraw
de
ay
n
ng
mak
shad
u
y
covered
presentment
or
otherw
s
se
excused.
converted
assignor
of
the
title
to
the
amount
ng
to
P999
500
00
been
Aware
that
he
was
or
secur
ng
a
oan
to
finance
act
v
ton
es
ong
the
en
orce
t
aga
nst
V
ma
Aunor
as
the
act
o
P
convert
ng
of
the
printing
the
defendant
obtained
a
credit
accommodation
America,
which
cleared
it
with
Bureau
of
Post.
The
P10
000
to
whom
it
was
negotiated
as
a
party
completed
instrument,
is
a
(c)
By
the
ntent
ona
cance
at
on
thereo
by
the
ho
der
o
the
public
auction.
Private
respondents
filed
a
complaint
against
the
the
offender
n
trust
or
on
comm
ss
on
or
or
adm
n
strat
or
under
action
of
his
day
in
court.
Notwithstanding
the
it
does
not
accommodat
GEL
C
show
on
ng
ndorser
that
the
who
amount
must
o
a
the
so
be
check
d
scharged
was
charged
by
the
to
be
stranger
or
may
be
a
o
the
drawee
bank
Accepted
corporation"
and
"manufacturing
arm"

a
check
drawn
Chandiramani
indorsee
or
be
depositor
performed
equivalent
thereof."
said
to
What
a
task
delivery
record
the
to
shows
letter.
the
creditor
is
Petitioner
that:
(1)
of
bank
o
ng
and
reputat
on
As
test
fied
to
by
the
Ex
w
duty
pay
th
de
Nyco
endant
the
to
PC
s
pretens
B
ascerta
or
and
payment
on
PBC
n
that
Thru
the
t
and
had
the
genu
before
that
not
Centra
been
neness
the
de
not
Bank
presentment
endant
fied
of
C
ear
o
a
the
ng
be
act
pr
these
for
an
or
o
rendorsement
ghts
1.
o
NEGOTIABILITY
a
ho
der
n
due

course
is
that
w
quality
thout
not
or
ce
attribute
A
renunc
of
a
at
bill
on
Ramos
P400,000
in
emergency
notes
and
a
check
for
P100,000
(b)
That
he
has
a
good
t
t
e
to
t
(b)
That
(GR
the
No.
nstrument
72593;
April
s
at
30,
the
1987)
t
me
o
h
s
Consolidated
ndorsement
va
Plywood
d
and
not
all
of
the
sale
price
is
received
during
such
year,
and
a
promise
to
pay
is
signed
by
two
or
more
persons,
they
the
cons
note
der
ng
passed
that
the
rom
change
the
o
borrower
to
the
ender
The
on
y
f.
Not
ce
when
prev
ous
y
d
shonored
by
nonPhilippines
is
authorize
to
represent
the
company
and
confess
Insecurity
t
e
a
ter
person
clause
ts
indorsing
ast

allows
negot
specially
at
the
on
creditor
is
t
me
liable
a
to
ter
as
demand
indorser
ts
ssue
to
immediate
only
such
HOLDER
cannot
be
delivery
may
be
shown
to
have
been
conditional,
or
for
a
terat
on
wh
ch
changes
be
ore
the
me
ovalid
g
vhonor
ng
not
ce
has
arr
ved
or
a
ter
the
bank
the
course
osred
norma
ng
transact
between
payee
capac
orn(see
ty
any
to
contract;
and
that
the
nstrument
sons
at
the
trfrom
me
recovered
the
holder
has
the
choice,
instrument
is every
still
negotiable
because
Code
ohab
Indorser
Signature
is
presumed
,yto
the
person
denying
and
to
rom
the
Bank
SSUE
WON
pet
ton
oners
may
nterpose
the
wa
ved
ther
ab
e
persons.
supra
protest
-tn
Where
or
the
an
instrument
oof
any
isSee
person
payable
ab
to
e
the
order
or
of
person
in
possession
thereof
has
a
prima
facie
acceptance
and
s"primarily"
requ
to
be
accepted
nor
Davao
Csis
ty
the
(b)
amount
Where
the
beCourt
st
pu
ates
that
t thereon
sha
be
defined
pplaintiff.
12)
person
liable
an
instrument
is
Sec.
w th
8(b):
s (c)
statement
An
instrument
hace
payable
sthe
answer
that
the
maker
"he
can
is
not
no
complete
onger
reca
until
the
faith
and
for
value;"
Section
59,
"that
holder
deemed
8
Prudencio;
the
of
Appeals
affirmed
the
trial
court.
ISSUE:
of
payee,
amount,
signature
of
maker
or
drawer,
rates
of
interest,
if
future
time,
aexpress
sum
certain
in
money
to
order
or
to
bearer.
defendant
INDORSEMENT
New
Sikatuna
Wood
Industries,
Inc.
requested
for
a
loan
accrue
unt
the
not
ce
gthe
ven
As
a
genera
ru
epraying
athe
bank
has
aof
ght
would
have
arisen
from
the
tenor
the
draft
and
the
fact
that
party
rece
ves
not
ce
o
dbank
shonor
he
has
aprov
ter
the
by
non
petitioner
Bank
drawn
against
China
Banking
Corporation,
Sec.
193
through
its
land
e
because
o
r
warrant
es
BDO
vs
Equ
tab
e
Where
no
p
o
payment
s
spec
fied
and
no
address
nto
the
an
emergency
rule
in
Gullas
oan
vs.
or
Philippine
advance
pursuant
National
Bank
to
2
it
might
s
ons
be
o
instrument.
It
may
be
made
by
adding
to
the
(a)
had
Where
b
ank
not
the
p
prepared
ece
drawer
o
and
paper
such
drawee
nto
a
check
are
a
negot
same
or
ab
e
ong
person
nstrument
s
s
gnature
w
thout
Kyu
corporat
on
hence
not
an
u
tra
v
res
act
An
u
tra
v
res
act
s
one
De
ay
n
mak
ng
presentment
or
payment
excused
from
the
Thus,
for
every
printing
of
the
"World
Current
Postmaster,
through
the
Chief
of
the
Money
Order
Division
in
due
course
within
the
purview
of
Negotiable
Instruments
Law,
(d)
By
any
other
act
wh
ch
w
d
scharge
a
s
mp
e
a.3
Relicta
Verificationem

his
pleading
being
petitioner
and
the
Lagasca
spouses
that
the
any
other
ob
gat
on
nvo
v
ng
the
duty
to
make
de
very
o
or
to
necessarily
follow
that
the
drawer
Sima
Wei
is
freed
from
payee
s
s
gnature
and
wh
ch
co
ects

maker
the
amount
or
drawee
o
the
acceptor
check
rom
admits
that
David
took
step
of
asking
the
manager
of
ts
account
and
no
ob
ect
on
was
then
made
to
the
statement
party
the
STEELWELD
company
check
in
question
was
given
by
its
Offic
t
cannot
o
Sher
ff
be
w
th
payment
whom
t
has
n
been
depos
ted
t
s
a
cert
fied
checks
d
shonor
were
s
be
ed
not
on
y
by
the
payment
orma
demand
etter
ssued
by
or
note
(c)used
That
a
pr
or
part
es
had
capac
ty
to
contract
drawn
against
on
the
PNB
in
as
the
he
had
previously
deposited
P500,000
endorsements
accommodat
on
cons
party
der
spay
ng
not
that
ab
e
the
un
ess
act
ofexcused
note
present
sPNB?
ng
ated
the
2.
The
drawer
checks
n
payment
o
an
ob
gat
on
to
a
payee
L
ab
ty
of
Agent
or
Payment
n
due
course
are
deemed
to
be
jointly
and
severally
liable
thereon.
subs
st
ng
statute
provides
that
income
shall
be
taxable
in
the
year
in
acceptance
payment
the
broker
rece
was
or
h
sng
serv
ces
ne
negot
ng
payab
e
on
demand
Industries,
ab
was
Inc.
due
(CPII)
to
the
needed
aby
terat
on
two
Same
tractors
ru
e
its
es
logging
138.
such
Acceptance
an
obta
of
ned
ncomp
or
ete
b
Athe
b
may
be
accepted
judgment
special
for
purpose
the
said
only,
sum
with
and
interest,
not
for
cost
the
of
purpose
suit
and
of
Liability
of
holders
the
maker
as
make
is
Liability
of
the
drawer
is
and
full
payment
om
ss
on
of
the
loan
balance
the
creditor
has
reason
of
h
s
ndorsement
va
d
and
subs
"384934,
He
cannot
nterpose
(b)
When
presentment
or
acceptance
snote
and
the
banks
The
crossed
he
can
still
demand
payment
of
money.
If
the
option
is
on
the
Sec.
51
other
party
sMetrobank
who
y
noperat
ve
and
no
one
can
ga
n
tfor
tapp
to
the
ense
o
ack
ossues
cons
derat
on
that
the
Prom
ssory
Notes
were
X.
4.
Restrictive
whom
Sec
541
the
The
signature
maker
operates
or
any
ega
must
ho
provide
der
oifhave
a
evidence
check
sha
of
be
invalidity.
ent
tHELD:
ed
to
Rights
of
holder
to
sue.
(supra)
person
who,
by
the
terms
of
the
instrument,
is
absolutely
two
the
or
more
honor
payees
oprimary
the
person
or
whose
account
t-negot
was
Sec.
(d)
To
3the
(a):
person
does
pr
not
mar
render
y
ab
the
e
on
instrument
the
nstrument
non-negotiable
or
he
sat
172
C.
Accommodat
ntent
ona
on
Party
at
on
ved
Sec
to
Sec.
29
p
Payment
authority
to
for
complete
honor;
how
it
by
made.
The
payment
or
honor
Liability
of
irregular
indorser
.was
-maker
Where
a
person,
not
otherwise
a
presented
or
acceptance
or
de
ay
prima
or
the
facie
presentment
to
be
a
holder
or
payment
due
course;"
sst
excused
and
Section
and
does
52
not
(d),
that
to
purchase
ba
es
o
tobacco
and
P
corne
comm
ss
on
transact
on
wh
ch
sthe
supposed
to
happened
10
years
WON
Prudencio
should
the
promissory
tosits
indorsed
by
him.
(Sec.
184)
Persons
who
negot
ate
mere
de
very
They
are
ab
eto
or
naccess
bty
e
to
any
person
ound
at
the
p
ace
where
the
presentment
Where
a
note
Regular
It
is
regular
upon
its
face
when
it
does
not
contain
any
TIBAJIA
VS.
CA
(GR
No.
100290,
June
1993)
A
writ
of
it
was
in
the
bank's
possession;
but
when
the
instrument
to
set
off
the
depos
ts
ts
hands
or
the
payment
o
any
bearing
Chua.
The
respectively
latter
agreed
the
serial
grant
numbers
the
same
subject
for
the
the
(respondent
Equitable)
to
the
of
its
depositor
(Aida
V.
RIGHT
OF
PRIOR
PARTY
TO
NEGOTIATE
4,
Sec.
50
rece
pt
o
such
(p.15)
comm
tted
outs
de
the
ob
ect
or
reform
Subsequently,
he
assigned
his
rights
and
acceptance
on
March
1
2013
but
accepted
or
honor
on
March
5
argued
that
the
relationship
between
the
parties
had
become
Sect
on
ntent
84
on
indorser's
o
th
rom
sCance
Act
the
nd
Prov
cated
ded
fina
y
wou
That
dthe
const
the
tute
appropr
raud
ate
n
swas
gprogram.
ven
and
nstrument
scredit
presented
at
the
usua
p
ace
perused
the
checkbook
and
ound
that
the
ast
b
ank
check
was
(b)
When
Events,"
when
the
the
drawee
the
printer
de
say
collected
fict
sn
tin
ous
the
person
cost
or
of
printing
a
person
by
not
drawing
hav
ng
a
Manila
Post
Office
informed
the
bank
of
the
irregular
extrajudicial
abandoned;
foreclosure
a
confession
be
declared
of
judgment
null
and
accompanied
void.
In
their
by
return
the
same
even
though
such
ob
gat
on
be
tota
y
or
part
a
y
b
That
liability
the
buyer
to
petitioner
o
the
check
Bank
s
proper
under
y
dent
the
fied
loan
as
requ
evidenced
red
under
by
contract
or
the
payment
o
money
his
bank
to
verify
from
FEBTC
and
Equitable
as
to
the
the
due
drawee
course
s
ab
and
e
or
the
payment
proceeds
thereo
to
payee
Pet
t
oner
president
to
R.Y
.
Lim;
(2)
it
was
given
only
by
way
of
crossed
check
t
s
a
we
known
and
accepted
pract
ce
n
the
presented
About
BA
F
nance
our
(4)
or
but
payment
months
a
so
by
by
PBC
the
and
act
PC
that
B
to
the
Nyco
de
and
endant
Sanshe
PNB
and
had
emergency
amount
But
a
of
P126,129.86,
notes
in
the
numbered
PNB
branch
765380
in
Cebu
and
dated
and
thus
4
April
he
Broker
whereby
it
may
pass
from
one
person
to
another
similar
to
check
Canlas
wh
ch
for
is
payment
solidarily
not
done
to
liable
as
the
on
each
of
the
promissory
notes
bearing
f.
(d)
That
Forgery
he
has
of
no
ndorsers
know
edge
S
o
gnature
any
act
n
wh
a
ch
b
wou
of
exchange
d
mpa
r
the
d
scharges
the
nstrument
which
it
is
received,
the
profit
from
an
installment
sale
is
to
the
oan
He
was
pa
d
abso
ute
y
noth
ng
or
becom
ng
transferring
the
property
in
the
instrument.
But
where
and
absolute
(a)
The
date
secondary
and
conditional
business.
Atlantic
Gulf
&
Pacific
be
ore
t
has
been
s
gned
by
the
drawer
or
wh
e
otherw
se
attorney's
fees
of
ten%
for
5.
the
EXT
de
NCT
ense
VE
that
s
gnatures
pr
to
h
m
are
orged
A
co
ect
b
s
not
to
believe
that
the
required
to
pay
the
same.
All
other
parties
are
Sec
116
Not
ce
of
non-payment
where
acceptance
refused.
check
cannot
be
presented
or
payment
but
t
can
on
y
be
promisor,
it
would
be
difficult
to
CHECKS
Indorsement
110
s
gned
n
b
ank
aga
nst
the
bank?
HELD
NO
The
genu
neness
and
An
nd
cate
instrument
there
n
that
payable
t
be
pa
to
d
to
bearer
a
certa
is
n
banker
not
converted
or
nst
tut
into
on
wh
an
ch
nstrument
through
such
orged
s
gnature
aga
nst
part
es
pr
or
to
the
Whom
affected
by
wa
ver
Where
the
wa
ver
s
Sec.
The
26
may
or
may
not
The
drawee
s-accepted.
aWhere
ways
a aw
bank
I.
absent
SHELTER
oralterations
because
119(c)
20
the
reimbursement
is
aholder
subsequent
act
to
the
payment,
or
filling
indorsees
up
who
are
blanks
not
must
indorse
unless
What
constitutes
holder
for
value.
has
in
order
that
one
may
be
aa
in
due
course
it
isamount
necessary
to
an
instrument,
places
thereon
his
signature
in
blank
ago
" drawee
A
ter
more
than
ten
(10)
years
rom
the
payment
n
(c)
Where
the
supra
b
saccepted
drawn
payab
e
sewhere
than
atthe
the
res
dence
d
scharge
the
drawers
and
No.
PNB
is
not
athe
holder
inpartners,
due
course.
Prudencio
is
an
HTV
ater
on
the
be
and
re
accepted
tvalue
a
ter
sparty
made
breach
oty
warranty
a
though
they
d
d
not
s
gn
(Sec
65)
Sec.
8(c):
Being
payable
to
the
drawee,
he
may
pay
himself
at
passed
out
of
the
possession
of
the
bank
and
into
is
drawn
to
the
maker's
own
order,
itby
is
not
complete
Sec.
attachment
151
was
issued
by
the
trial
court
in
connection
material
amount
of
P550,000.00
or the
if
there
are,
and
they
384935,
are
not
apparent
for
the
or
visible
on
of
condition
that
the
former
should
Trencios
(p.14)
Rights
of
holder
where
bill
not
- to
not
ce
the
same
tdebtor
me
or
g
v11
ng
not
ce
to
antecedent
wh
ch
acontacts
corporat
on
sby
created
as
defined
o
ts
c
ear
that
actum
ng
office
of
wh
creditor
ch
sha
as
and
be
scussed
offic
ear
y
not
as
er
fied
tosbank
arecourse"
preclude
opresentment
rea
banks
de
ense
w
the
th
respondent
wh
overdrawn
ch
may
interests
1/2
of
the
lot
to
Arsenia
Benin
covering
full
payment
2013
the
matur
signature
date
sha
words
be
March
"without
2013
not
March
or
any
15
2013
words
m
ss
ng
He
reported
the
matter
to
ong
who
then
proceeded
to
the
c.
Overdue
interest
payments
all
the
mere
fact
that
draft
against
plaintiff,
said
draft
being
sent
later
to
o
bus
ness
or
caused
by
cd
rcumstances
beyond
the
contro
of
the
capac
ty
to
contract
issuance
of
the
money
order.
The
the
account
aforesaid
complaint,
they
alleged
that
they
signed
guaranteed
by
ato
bond
or
deny
ng
hav
ng
rece
ved
such
money
the
promissory
note
agreed
to
by
her.
Her
allegation
that
a
withdrawal
the
plea.
C
rcu
ar
genuineness
of
the
checks
and
only
accepted
the
same
after
When
the
pr
nc
pa
becomes
the
ho
othe
were
accommodation,
pa
d(e)
At
the
to
me
be
o
"used
the
ror
as
presentat
collateral
on
to
for
PNB
another
these
bus
descharges
ness
sector
on
y
that
the
aof
part
Cash
es
er
sdeemed
Check
sdebited
deemed
as
cash
requent
be
ore
dur
ng
a
ter
the
shonor
More
a
ter
the
check
was
charged
to
the
account
oor
the
pothers.
a
nt
ff
urther
expected
1981.
contends
That
to
that
have
the
check
issued
by
him
in
Cebu
drawee
payab
sin
e
an
assert
on
that
the
party
mak
ng
the
money,
so
as
to
give
the
holder
in
due
course
right
his
signature
for
following
reasons:
The
promissory
notes
apportioned
between
or
among
the
years
in
which
the
shown
by
the
ev
dence
SSUE
WON
de
endant
sder
ab
va
d
ty
o
the
nstrument
or
render
tand
va
ue
ess
And
respons
payee
n
add
does
tb
on
e
not
as
he
have
engages
ndorser
that
to
on
re
at
due
paper
onsh
p
nor
w
th
d
d
the
drawee
tthe
sha
ndorsee
be
Sec
69
accepted
the
instrument
is
in
the
hands
of
acashed
holder
due
"secondarily"
liable.
Company
its
sister
company
Industrial
Products
bank
PRESCR
where
PT
aathrough
ON
check
scontractua
depos
ted
and
wh
ch
ndorses
the
check
L
ab
ty
of
an
agent
broker.
Where
a
broker
debtor
ncomp
is
ete
about
or
when
to
default,
tthere
stan
as
when
the
debtor
suddenly
loses
ae
collection,
release
of
all
errors
waiver
of
all
rights
to
he
do
(b)
The
wr
sum
tFossum,
ng
payab
across
e
the
e
ther
ace
or
the
pr
nc
name
pa
o
sa
d
banker
or
due
4.
execut
MEMORANDUM
on
o
the
notes
AND
had
TRAVELLERS
been
adm
tted
by
pet
tin
oners
due
not
ce
o
d
shonor
by
non
acceptance
has
been
g
ven
compel
him
to
make
payment
in
instrument
Sec
Where
150
payable
to
order
by
being
indorsed
specially.
be
a
bank
a.
Forgery
When
nstrument
of
cons
S
gnature
dered
and
the
maker
s the
not
ab
e
A.
(b)
CHECKS
Must
the
contain
nstrument
tse
unconditional
trestrictive.
s debtor
bcheck
nd
ng
promise
upon
a
part
or
order
es
but
to
RULE
Sec.
36
embod
ed
n
that
"at
the
time
the
instrument
was
negotiated
to
him
"he
had
therein.
Duty
When
of
ho
der
where
b
not
accepted.
-and
An
indorsement
-dnterest
which
still
makes
itan
the
one
indorsing
has
authority
to
indorse
for
the
Where
asis
b
Sec.
42
at
any
time
been
given
for
the
instrument,
the
holder
party
by
cash
and
n
part
by
the
presumpt
on
that
Ru
The
n
Case
accommodat
of
Un
ntent
on
party
ona
ends
h
sto
name
to
the
accommodated
accommodation
Effect
of
party
instrument
for
he
signed
drawn
the
or
promissory
indorsed
note
to
as
ast
before
delivery,
he
is
or
psha
ace
o
bus
ness
o
the
drawee
possession
protest
of
n
order
to
no
operate
presumption
as
such
arises
as
not
to
as
the
atwo
mere
character
ACCEPTANC
requested
extens
on
P500,000.00.
The
said
checks
were
allegedly
issued
in
full
maturity
from
the
funds
of
the
drawer.
account).
Following
normal
procedures,
and
after
stamping
at
V
.ances
DEFENSE
collection
organ
zat
on
of
a
and
sum
of
ore
beyond
the
power
con
erred
upon
tthe
by
the
face
of
the
b.
Date
of
When
aindorsement
bill
is
dishonored
by
nonacceptance,
an
wait
until
December
1980
when
he
would
have
the
money.
In
W.
CONSIDERATION
FOR
ISSUANCE
AND
SUBSEQUENT
ho
part
der
es
and
that
the
not
ho
mputab
der
has
e
a
ter
h
the
s
de
d
shonor
au
t
m
sconduct
or
Sec
108
from
using
the
petitioner's
funds
to
make
payments
ba
Banks
w
th
ex
st
ng
overdra
ts
w
th
Bangko
Sentra
as
o
of
similar
import.
Such
an
indorsement
does
not
interests
on
a
bank
ong
Where
earned
not
o
ce
the
must
encashment
be
sent.
o
Where
the
check
a
party
and
has
rea
zed
of
his
indebtedness
in
the
defendant
for
acceptance.
As
an
added
security
for
res
dence
o
the
person
to
make
payment
e.
Protest
Sec.
of
65
the
company.
The
company
moved
for
reconsideration.
(c)
When
drawer
s
the
person
to
whom
the
nstrument
s
mortgage
contracts
not
as
sureties
or
guarantors
for
the
Warranty
where
negotiation
by
delivery
and
so
forth.
she
has
paid
the
balance
of
her
loan
with
the
checks
being
assured
that
there
was
nothing
wrong
with
said
checks.
At
b.
Waiver
of
Obligor

Sec.
109.
Waiver
of
notice
.
checks
bear
the
standard
ndorsement
wh
ch
reads
a
pr
or
No
259
the
dated
nstrument
29
September
at
or
a
ter
matur
ty
n
h
s
own
r
ght
a
ter
the
party
n
whose
presentment
obligation;"
(3)
has
in
done
breach
ts
of
the
duty
agreement,
to
ascerta
however,
n
the
R.Y
.
Moreover,
s
nce
the
sa
d
check
had
been
cert
fied
by
mportant
y
as
ong
as
the
cred
t
rema
ns
outstand
ng
Nyco
under
against
check
Sect
was
on
said
a
23
deposit.
company
o
the
Ramos
check
Negot
was
of
ab
another
e
unable
nstruments
corporation,
to
encash
Law
said
Steelweld
a
check
orged
deve
oped
that
BEARER

same
ru
e
w
th
bearer
prom
ssory
note
installments
are
paid
and
received.
However,
the
proceeds
from
ose
to
pay
collect
or
orego
on
the
anyth
ng
or
a
ter
h
s
pos
t
on
thereby
He
s
accepted
or
pa
d
or
both
as
the
case
may
be
accord
ng
to
ts
g
are
ven
negotiable
the
de
enses
instruments
ra
sed
and
by
h
m?
must
HELD
be
The
governed
ab
ty
by
o
the
ntent
ona
raud
(equ
ty
pr
nc
p
e)
WON
Samsung
course,
a
valid
delivery
thereof
by
all
parties
prior
to
SPOUSES
MORAN
AND
L
BRADA
MORAN
VS.
CA
(GR
No
Marketing
(IPM)
upon
presentment
w
th
the
drawee
bank
s
such
an
ndorser
So
significant
overdue
nst
tut
on
or
or
a
on
other
ter
y
the
t
agent
has
words
been
negot
and
d
ates
shonored
company
an
nstrument
by
a
prev
w
thout
ous
re
usa
to
inquisition
and
appeal,
and
to
the
benefit
of
all
laws
exempting
(c)
The
t
me
or
p
ace
o
CHECK
The
prescr
pt
ve
per
od
or
the
fi
ng
o
a
c
a
m
based
no
not
ce
o
a
they
hav
ng
a
ed
to
deny
the
same
under
oath
The
r
c
a
m
that
they
(c)
Payable
on
demand
or
at
a
fixed
or
determinable
Makers
d
shonored
to
a
However,
DEF
pay
NED
a
the
where
sum
person
t
s
who
no
notice
of
any
.
.
.
defect
in
title
of
the
person
negotiating
I.
NEGOTIABLE
INSTRUMENTS
WITH
OTHER
4.
ABSENCE
subsequent
OR
FA
part
LURE
es
whether
OF
the
nstrument
s
an
order
or
a
K
T
NG
presented
s
the
wrong
or
u
acceptance
pract
ce
o
and
tak
ng
s
not
advantage
accepted
o
w
the
th
n
float
the
person
as
cashier.
Where
an
instrument
is
drawn
or
which
the
check
had
been
encashed
As
a
ready
stated
he
even
absolute.
Cance
party
at
Same
to
on
is
true
if
there
is
indication
of
a
particular
fund
to
be
Presentment
or
acceptance
Presentment
or
acceptance
s
maker
restrictive
but
he
did
not
receive
value
or
consideration
therefor.
is
deemed
athe
liable
as
indorser,
in
accordance
with
the
following
rules:
in
which
du
ythe
bank
held
the
paper.
The
relation
to
the
E
Sec.
settlement
58.
When
subject
of
to
drawer's
original
defense.
account
-printer,
evidenced
In
the
hands
by
of
any
the
However
the
bP500.
was
not
pa
d8(e),
upon
matur
ty
HTV
argu
ng
that
aw"
The
vo
term
untary
"u
payment
tra
vA
res"
must
srecourse
"d
st
be
ngu
attested
shed
rom
by
aan
notar
ega
a
act
act
S
Sec.
back
8(d):
of
Pay
the
to
Checks
A
and
B;
for
usual
Sec.
endorsements
Pay
tobank's
Aany
or
(All
B.
prior
and/or
lack
instrument.
Presentment
neg
gence
When
the
cause
o
de
ay
ceases
to
operate
money
filed
by
Eden
Tan
against
Tibajia
spouses.
The
fund
immediate
right
of
view
of
this
agreement,
private
respondent
Chua
issued
three
TRANSFER
Primary
and
Secondary
Liability,
in
the
authorized
effect
vadded
ty
o
by
th
the
sthe
Act
latter.
sha
It
is
our
th
nand
view
such
nonetheless
per
od
as
may
that
no
be
payment
of
the
amounts
advanced
to
the
plaintiff
note
was
overdue
does
not,
in
the
absence
of
an
acceleration
amount
of
deed
of
sale
with
mortgage
was
requ
red
an
address
to
h
s
sw
gnature
not
ce
o
d
shonor
(d)
n
any
other
case
presented
to
the
person
to
make
Lagasca
spouses
but
they
merely
gave
their
common
property
to
ISSUE:
WON
postal
money
orders
are
negotiable
payable
to
petitioner
Bank
has
no
merit
for,
as
We
have
earlier
presented
or
payment
that
time,
David
was
not
aware
of
"stop
payment"

ndorsement
and
or
ack
o
endorsement
guaranteed
Notice
of
dishonor
may
be
waived
either
before
the
time
of
Lim
indorsed
the
check
to
Armstrong
in
payment
of
an
the
avor
drawee
payment
bank,
or
honor
by
s
the
cert
ficat
on,
the
funds
2000
and
Corporation
of
the
Philippines,
signed
by
its
President,
Peter
for
he
was
captured
by
the
Japanese
later
made
a
prisoner
of
check
s
A.
Payment
n
Due
Lazaro
Me
cor
to
whom
the
check
was
made
payab
e
had
never
the
disposition
or
discounting
of
receivable,
though
not
tenor
a
so
and
not
that
an
accommodat
t
be
d
shonored
on
party
and
the
under
necessary
Sec
proceed
29
The
ngs
SSUE:
Construct
on
accept
or
by
non
payment
But
when
a
b
payab
e
a
ter
s
ght
s
negot
instrument
him
ab
e
so
nstruments
as
to
sum
make
payable
s
ten
them
years
for
liable
himself
rom
to
the
free
him
t
me
from
is
the
conclusively
any
cause
defect
o
de
endant
as
one
o
Negotiable
Instruments
Law.
Under
the
Negotiable
lnstruments
was
offered
prec
uded
to
sell
rom
two
sett
used"
ng
up
tractors.
the
de
IPM
ense
inspected
o
orgery
the
under
job
Sect
site
and
on
g.
But
when
S
tuat
the
on
negot
w
th
at
a
on
COLLECT
s
by
de
NG
very
BANK
on
y
the
warranty
even
the
ndorsement
on
the
check
depos
ted
by
the
bank
s
c
ent
105836
March
7
1994)

The
re
at
onsh
p
between
the
bank
WESTMONT
BANK
VS.
EUGENE
ONG
(GR
No
132250
an
30
s
gned
the
notes
n
b
ank
does
not
thus
e
Pet
t
oners
adm
ss
on
ndorsement
he
ncurs
a
property,
real
or
personal,
payment
(d)
The
number
or
the
re
at
ons
o
the
part
es
future
time
Acceleration
at
the
option
of
the
HOLDER
will
render
the
subsequent
dty
shonor
by
non
payment
sowh
not
necessary
ess
n
the
a.
Memorandum
COMPARE
indorsed
has
been
to
a
person
as
"cashier
PAPERS
or
other
fiscal
officer
CONS
bearer
DERAT
ON
the
tsnstrument
me
prescr
bed
indorsed
specially
is
liable
only
to
those
who
can
trace
their
it;"
and
lastly
Section
59,
that
every
holder
is
deemed
prima
wr
tten
above
the
svo
gnature
ndorser
tun
bto
nds
h
m
Who
certain
either:
shou
in
d
money;
g
ve
Sec
83
wa
ved
the
And
presentat
aon
on
o
on
ora
a
ev
blank
paper
Grant
delivered
ng
that
pet
by
th
the
oner
He
instrument
necessary
expected
or
the
became
certa
firm
nof
(accommodated
types
past
not
history
necessary
party)
when
to
it
delivered
the
loan
Sec
the
185
Check,
ormer
holder
for
ssignature
mere
value
y
in
A
respect
check
dab
e
to
sdence
aholders
all
ban
ch
parties
oaffect
may
exchange
who
be
become
en
drawn
orced
such
on
a
by
debited,
like
Pay
P
or
order
the
sum
of
P10,000
and
charge
itA
to
my
promissory
note.
These
two
d
shonored
checks
by
non-payment.
delivered
to
n c.
no
other
case
sdefined.
presentment
or
acceptance
necessary
n
order
to
enab
eWhen
the
atter
to
obta
n
cred
tcourse,
orw
ra
se
money
He
rece
ves
qua
presentment
must
be
made
th
reasonab
eproof.
dthe
gence
173
holder
other
than
anstrument
holder
in
due
aswere
negotiable
instrument
of
endorsement
guaranteed),
Equitable
sent
the
checks
for
Sec.
191
Sec.
8(f):
Pay
to
the
order
the
Commissioner
of
Internal
Revenue.
Sec
123
Cance
at
on;
un
ntent
ona
;to
burden
of
Dec
arat
on
before
payment
for
honor.
-pay
The
notar
A.
A
Holder
REAL
132
Acceptance;
AND
upon
PERSONAL
receiving
how
an
DEFENSE
made,
instrument
by
and
which
so
forth
is
incomplete
The
or
Definition
and
meaning
of
terms.
-not
In
this
Act,
was
then
on
deposit
with
the
cashier
of
the
Regional
Trial
general:
(3)
"crossed
checks"
against
the
drawer
and
indorsers
accrues
the
bank
creditor-debtor
also
required
re
at
defendant
onsh
p
was
Aruego
created
to
execute
between
a
trust
the
receipt
part
es
in
clause
failure
to
pay
interest,
an
indorsee
with
Instrument
Primary
Secondary
Sec.
24
executed,
with
Presentment
where
nstrument
not
payab
e
on
Presumption
of
consideration.
-Co
Every
negotiable
71
must
be
sent
to
the
said
co-owners
who
were
solely
benefited
by
loans
explained,
these
checks
were
never
delivered
to
petitioner
Bank.
instruments?
HELD:
No.
Philippine
statutes
are
payment
wherever
he
can
be
ound
or
presented
at
sathe
Sec
70
order.
Under
these
circumstances,
David
thus
had
no
82
(d)
Sec
167
Protest
the
drawer
of
b
has
no
accepted
rprior
ght
to
for
expect
honor,
or
requ
and
re
so
that
forth.
the
Effect
of
want
of
demand
on
pr
nc
pa
debtor.
Subsequent
nvest
gat
on
however
conducted
by
the
NB
showed
When
presentment
for
payment
spostal
excused.

Every
person
negotiating
an
instrument
by
delivery
made
Rafael
Limson,
and
its
Vice-President,
Artemio
Torres.
The
obligation;
(4)
Armstrong
deposited
the
check
to
its
account,
represented
by
the
check
are
transferred
from
the
giving
notice
has
war.
After
his
release,
sometime
in
1945,
Ramos
allegedly
noperat
ve
and
that
Man
athat
Bank
no
author
to
pay
the
orged
d
shonored
by
non
acceptance
and
the
drawee
y
act
on
accrued
(Pay
vs
Vda
De
Pa
anca)
W
th
respect
to
accommodat
on
to
wh
ch
re
erence
sby
made
n
Sec
29
sfrom
not
on
shonor
be
du
y
taken
w
pay
the
amount
thereo
to
the
rece
ved
twas
and
that
h
s
gnature
as
an
endorser
orged
Law,
persons
who
write
their
names
on
the
face
of
promissory
23
assured
o
that
the
tractors
were
fit
for
job
and
gave
a
inlevy
the
title
of
any
of
the
parties
or
defenses
available
to
sndWhere
orged
the
co
ect
ng
bank
shad
bound
h
sty
warrant
es
as
an
the
1.
sis
gners
Payee
oto
the
can
note
cs
a
s
m
not
aga
dependent
on
ect
whether
ng
Bank
he
has
way
extends
n
avor
o
no
ho
der
other
the
mmed
ate
avor
o
a
spec
fied
person
Payment
sthe
not
n
avor
o
and
the
depos
tor
s
2002)
toinstrument
und
that
Respondent
Eugene
Ong
nta
ned
The
payment
of
a
made
bank
to
or
a
person
corporation,
other
than
it
is
deemed
the
banker
prima
or
nst
tut
to
the
neness
and
due
execut
on
o
prom
ssory
notes
the
ab
tsputed
es
prescr
bed
by
Sect
on
S
xty
five
o
th
sfacie
Act
(e)
The
med
um
or
currency
n
wh
ch
payment
swas
to
be
from
or
sale.
Indeed,
Manila
Oil
has
failed
to
pay
on
demand.
Check
accepted
meant
me
instrument
nonnegotiable.
person
making
the
signature
in
order
that
the
paper
title
to
the
by
adepos
series
of
unbroken
indorsements
from
Time
must
be
certain
so
that
the
holder
will
know
when
he
may
not
ce
facie
nstrument
to
a
holder
However
in
due
ndorsers
course.
In
a
the
ter
case
at
orgery
bar
the
are
rule
st
that
that
e
between
the
tit
o
the
check
n
one
bank
and
ts
had
(Negotiability
document
never
encashed
to
vs.
Fossum;
Assignability)
and
check
was
h
sthan
incumbent
a
ure
to
upon
so
or
him
more
to
show
than
oCourse
bapses
seven
exchange
non-acceptance
or
he
oses
the
rdo
ght
of
recourse
this
obligation
prior
was
shifted
to
the
Bureau
of
Public
Works
by
STATE
the
NVESTMENT
petitioner-payee
HOUSE
or
VS.
to
CA
(supra
any
of
p
19)
its
Be
authorized
ng
not
a
Money
the
medium
of
exchange
authorized
or
adopted
by
aor
render
any
party
the
b
ab
e
Y.
By
payab
wa
ver
e
on
tby
the
me
demand
person
the
person
Except
renounces
present
as
here
the
ng
n
benefit
otherw
tnst
must
o
se
treat
the
prov
act
the
ded
or
bsubsequent
matter
the
as
n
hon
sa
account,
EFFECT
because
OF
VALUE
PREVIOUSLY
GIVEN
the
Sec.
26
-unless
The
nstrument
she
d
shonored
by
non
payment
when
Sec.
o
52
ba
es
oconstitutes
tobacco
e
short
o
what
was
expected
SSUE:
bank
no
part
obe
the
cons
derat
on
or
the
nstrument
but
assumes
clearing
through
the
Philippine
Clearing
House
Corporation
(a)
Ifgenu
the
instrument
is
payable
to
the
order
of
a
third
person,
he
is
What
a
holder
in
due
course.
ma
see
C.
is
subject
the
D
ST
NGU
SHED
cance
at
on
made
un
ntent
ona
y
or
under
a
m
stake
or
w
thout
the
act
o
honor
must
be
ounded
on
a
dec
arat
on
made
by
b
s
the
s
gn
ficat
on
by
the
drawee
o
h
s
assent
to
the
order
o
the
Court
of
Pasig.
The
Tibajia
spouses
thereafter
delivered
to
the
irregular
the
contract
otherwise
requires:
acceptance
favor
of
o
said
a
bank
wherein
said
defendant
undertook
to
hold
payable
to
New
Sikatuna
Wood
Industries,
Inc.
all
postdated
S
nce
the
ndorsements
were
orger
es
they
are
noperat
ve
holder
and
no
presentment
for
payment
is
necessary
notice
of
dishonor
or
put
him
on
inquiry.
where
payab
e
on
demand.
Where
the
nstrument
s
not
the
GSIS.
Trial
court
dismissed
the
case.
CA
reversed
decision
Urdaneta
undertaking
to
pay
the
City
the
amount
figured
for
a
And
deemed
granting,
prima
without
facie
admitting,
to
have
that
been
there
issued
was
delivery
for
a
to
Promissory
address
Note
but
Maker
he
has
not
g
ven
such
General
address
Indorsers
then
the
instrument
is
patterned
from
those
of
United
States,
and
the
weight
of
demand
and
obligation
to
ascertain
from
Chandiramani
what
the
nature
of
that
Rau
D
zon
Arturo
S
son
and
Anton
o
Mendoza
were
a
drawee
or
acceptor
w
honor
the
nstrument
Where
a
d
shonored
b
has
been
accepted
or
honor
supra
protest
Presentment
or
payment
s
not
necessary
n
order
to
check
was
issued
by
Limson
at
the
behest
of
his
friend,
Presentment
or
payment
s
excused
c
That
a
reg
ster
o
g
t
checks
ssued
sha
be
ma
nta
ned
w
th
the
after
indorsing
it;
(5)
the
check
was
dishonored.
The
record
does
cred
CHECKS
t
of
or
the
by
the
act
a
maker
qualified
on
o
the
to
indorsement
depos
that
tor
of
aga
warrants:
the
nst
payee
h
s
drawee
or
ho
bank
der,
accepts
t
the
ho
der
n
the
absence
checks
SSUE
WON
pet
t
oner
may
put
up
the
de
ense
o
indorsed
the
check
to
herein
plaintiff-appellant.
According
to
CR
SOLOGOOSE
VS.
CA
(supra
p
24)
The
ab
ty
one
to
the
person
who
takes
the
note
payee
whose
s
gnature
s
orged
may
d
rect
y
proceed
be
payable
to
the
bank
or
corporation
of
Sec
by
88
Maas
What
m
const
who
tutes
payment
n
due
course.
Payment
s
90-day
warranty
for
machine
performance
and
availability
of
and
the
them
aw
among
requ
res
that
spec
fic
part
es
has
not
rece
ved
any
part
o
the
amount
o
the
debt
The
trans
eree
that
o
a
debtor
and
cred
tor
By
v
rtue
o
the
contract
o
depos
t
sha
not
exempt
the
person
on
whom
t
s
drawn
the
the
Negot
ab
e
nstruments
Law?
HELD:
No
On
the
prem
se
notw
GEMPESAW
thstand
ng
VS.
they
CA
(supra
ra
se
p
want
14)
o
Under
cons
derat
Sec.
23
on
of
thereo
the
The
a
current
un
account
ess
he
made
may
be
converted
into
a
negotiable
instrument
operates
This
prompted
the
bank
to
file
a
case
in
court,
wherein
an
Sec.
2(d):
refers
to
instruments
payable
in
foreign
currency.
that
the
bank
had
in
fact
acquired
the
instrument
for
value
and
enforce
PEOPLE
representatives.
the
VS.
instrument,
N
TAFAN
For
and
(GR
reasons
the
No
person
75954
not
liable
shown,
Oct

22
maker,
these
1992)
drawee,
checks
Accused
or
came
Instruments
ten
(10)
aga
years
originally
nst
undoubted
payable
y
resu
to
ted
order
n
:
the
Sec.
40
mpa
does
rment
not
o
secondar
y
ab
e
to
the
ho
der
by
v
rtue
o
the
r
warranty
co
ect
of
on
the
at
another
Deed
of
Assignment).
As
a
general
rule,
an
athe
of
the
instrument
is(G
prima
facie
aof
holder
in
EXAMPLE
DR
ssued
aCA
b
othe
exchange
aga
nst
DW
drawee
payab
e
prov
avor
SESBRENO
WON
s8,
ons
HTV
oHOLDER
thforty
sBank,
VS.
ab
(GR
e
No.
on
89252,
nstrument
May
24,
-demand
Petitioner
der
ng
that
Z.
ho
der
n
due
course
p
ased
nt
ff
ect
to
persona
de
enses
domestic
Sec
90
or
foreign
government
part
of
its
currency.
In
a literal
here
instrument
is
payable
absolutely,
the
debit
the
account
(a)
Prohibits
the
further
negotiation
of
the
instrument;
or
ANG
T
ONG
vs.
LORENZO
T sthe
NG
R
No
La
26767
February
22
(p.15)
(a)
tce
splaintiff
du
yapparent
presented
or
payment
and
payment
sdue
(PCHC).
Accordingly,
BDO
paid
the
Checks;
its
clearing
account
By
whom
g
ven.
The
not
ce
may
be
g1993)
ven
by
or
on
beha
ab
ty
to
the
other
same
defenses
as
ifand
it
were
non-negotiable.
But
holder
who
liable
to
the
payee
and
to
all
subsequent
parties.
A
ways
payab
eb
on
IN
DUE
COURSE,
p.
drawer
May
be
payab
est
on
demand
oras
in
trust
for
the
periodicals
and
to
sell
the
same
with
Sec.
last
paragraph:
If
there
istthe
no
payee,
there
iscons
nobody
who
author
ty
o
the
ho
der
the
payer
or
Rea
Defenses
may
be
ra
aga
nst
aPostal
ho
ders
even
aga
nst
aasked
Deputy
Sheriff
the
total
money
December
the
payment
made
by
drawee
banks
there
ore
s
(containing
visible
must
be
put
on
inquiry
stating
that
the
respondents
are
that
only
of
an
petitioner
the
delivery
of
checks
in
payment
of
an
payab
epossessor
on
authority
in
said
isalterations)
that
money
orders
are
not
period
the
latters
of
title
to
years
checks
in
was,
480
ifmatur
any,
equal
or
the
nature
installments.
of
his
not
must
be
sent
as
oVergara
ows
valuable
fict
3.
tng
ous
Notice
persons
of
Infirmity
NWSA
addressed
or
a
etter
to
PNB
request
ng
the
Bill
commences
of
Exchange
to
run
Acceptor
rom
the
tsub
me
he
sthat
Drawer
g
ven
and
(e)
Where
the
drawer
has
countermanded
payment
Y.
Lim,
President
of
RYL.
Romeo
Lim
had
or
conta
ns
a
re
eree
charge
the
person
pr
mar
y
oSec
ow
m
n
mum
n
ormat
on
o
any
not
d
fferent
show
any
agreement
intervention
sauthority
ent
or
ed
participation
to
have
the
by
STELCO
accepted
in
as
any
o
orgery
and
aga
for
nst
a
Man
ntents
acountry
bank?
and
HELD
purposes,
NO
True
the
tnegot
sroused
amaker
ru
atter
ein
that
becomes
when
a
Montinolas
version
of
circumstances
the
present
o
an
aga
accommodat
nst
the
on
co
party
ect
ng
to
bank
a
ho
der
(Westmont
or
va
ue
Bank
a
though
vs
Eugene
such
presented
which
and
he
depos
is
such
ted
officer,
ton
to
hindorsee
and
sone
pr
may
vate
account
negotiated
n
PNB
by
parts.
Romeo
that
sCPII
the
officers
payee
or
Wee
and
but
one
purchased
to
the
the
or
tractors
ndorser
due
course
when
trea
s
at
or
after
the
ty
o
the
payment
there
s
a
statement
ondorsee
the
themselves.
made
n
as
a
prima
facie
to
fill
it
up
as
such
for
any
between
payment
de
endant
was
not
s
correct
yby
and
yde
made
express
y
o
the
o
nt
and
severa
prom
ssory
notes,
however,
appear
to
be
ab
e
as
they
that
ong
s
w
th
pet
tterm
oner
ormer
y
the
Assoc
ated
Bank
ng
Corporat
on
but
Negot
ab
e
d
oses
the
name
o
h
scollect
pr
nc
pa
and
the
act
he
say
(Rights
)sc
Or
wh
ch
adds
a
p
ace
o
payment
where
no
pthat
ace
o
19
attorney
associated
Exchange
is
the
under
such
conditions
as
would
constitute
itbe
ato
holder
in
due
into
the
of
respondent
Lee
Kian
Huat,
who
the
check
through
h
shonor
unreasonab
e
unexp
a
ned
de
course
does
not
apply
because
there
was
a
defect
the
title
of
b
The
accommodation
depos
S
gnature
tary
bank
party
w
agent;
is
liable
author
on
the
the
checks
ty;
instrument
how
even
shown.
to
tamount
has
aA
holder
not
acceptor
due
he
may
to
P
or
the
ba
es
o
tobacco
vered
were
owhose
poor
qua
ty?
HELD:
The
Yes
K
T
L
awhen
kused
a
Mar
ano
Lthe
m
here
n
Pr
vate
Respondent
was
apply
to
instruments
originally
payable
to
order
which
was
indorsed
b.
Forgery
of
ndorse
rs
S
gnature
n
a
prom
ssory
note
such
as
ack
o
sense,
Sesbreno
the
d
(b)
shonored
made
Constitutes
means
amade
the
money
the
drawer
indorsee
market
and
the
placement
ndorsers
agent
of
in
the
the
indorser;
or
of
Sec
151
wh
ch
n
the
case
o
Sec
109
s
the
benefit
odefendant's
not
ce
Act
app
was
cab
debited
e
to
a
for
b
the
o
value
exchange
of
the
payab
Checks
e
on
and
demand
app
y
clearing
a
Sec.
3,
last
paragraph:
The
instrument
is
deemed
non-negotiable
R
(c)
ghts
Vests
of
the
ho
der
title
where
in
the
b
not
in
accepted.
trust
for
-to
or
When
to
derives
part
his
es
re
thereto
or
He
cannot
sto
ab
be
e
to
obta
atothe
ho
ned
der
or
or
va
ue
as
the
contract
HOLDER
1968)
FOR
VALUE
Sec.
27
(p.15)
o
the
ho
der
or
by
or
beha
o
any
party
the
If
the
instrument
is
payable
order
of
the
maker
or
drawer,
Sec.
57
the
promise
to
turn
over
to
the
plaintiff
the
proceeds
of
the
of
holder
in
due
course.
and
see
Rights
of
s(b)
noperat
ve
but
where
an
nstrument
or
any
gnature
thereon
honor
or
by
h
sto
agent
n
that
beha
dec
ar
ng
h
s
ho
der
nm
"Delivery"
means
transfer
of
possession,
actual
or
at
aDate
fixed
or
determ
nab
e
could
give
the
order
or
authority
to
or
otherwise
indorse
and,
The
acceptance
noperat
ve
must
and
be
re
at
(1)
onsh
n
wr
p
ng
a
and
cred
(2)
tor
s
gned
and
debtor
by
the
was
not
judgment
in
the
form
of
Cashier's
Check
worth
P262,750.00.
why
accommodation
22,
it
is
such.
1980.
Ifpossession
he
Subsequently,
fails
party.
do
ISSUE:
so,
he
New
WON
takes
Sikatuna
the
instrument
NIL
is
entered
applicable
subject
into
to
to
the
an
obligation
does
not
constitute
payment
unless
they
are
possession.
Thus,
we
cannot
hold
him
guilty
of
gross
neglect
negotiable
instruments
inasmuch
as
establishment
of
a
postal
consideration;
and
every
person
signature
appears
not
ce
o
mmed
Another
ate
restorat
deed
on
of
ts
Account
No
6
o
the
tota
sum
o
Defect
Indorsers
Limson
for
financial
assistance,
and
the
latter
had
agreed
to
give
s
gnature
s
orged
or
made
w
thout
the
author
ty
o
the
person
manner
or
form
whatsoever
in
these
transactions,
or
any
the
depos
tor
of
the
drawee
bank,
w
th
r
ghts
and
dut
es
of
(a)
That
the
instrument
is
genuine
and
in
all
respects
controversy,
Ramos,
who
then
was
no
longer
connected
with
the
1
ssued
Ong)
amount.
ho
der
does
not
W
thprov
th
sthe
on
installment
and
paid
the
down
payment.
The
deed
of
either
the
indorsement
of
the
bank
or
corporation
or
the
to
the
person
or
whose
meet
the
requ
rements
of
Sect
on
1
of
the
Negot
ab
e
2.
ACCUMULATION
OF
SECONDARY
CONTRACTS

as
debtors
on
the
note
and
as
such
he
s
gnature
was
ndeed
orged
FEBTC
s
ab
e
or
the
oss
s
nce
t
them
the
banker
agrees
to
pay
checks
drawn
by
the
depos
tor
The
s
ons
o
subd
v
s
on
(c)
o
th
s
sect
on
do
not
app
y
to
a
now
known
as
Westmont
Bank
Somet
me
n
May
1976
he
so
d
course.
Moreover,
Fossum
personally
made
the
contract
payment
s
spec
fied
or
any
other
change
or
add
t
on
nstruments
with
them
Law,
entered
a
forged
his
appearance
s
gnature
s
for
who
the
y
defendant.
noperat
ve,
To
the
holder
(Manuel
Gonzales),
because
the
instrument
is
not
The
quest
on
o
whether
or
not
the
tobacco
was
worth
for
value/in
due
course,
notwithstanding
such
holder
at
the
charge
yet
been
for
expense
of
providing
funds
at
the
place
where
the
order
P
ndorsed
the
same
to
A
then
A
to
B
When
B
be
required
to
pay,
or
the
secondary
parties

drawer,
payab
e
to
charged
be
ore
in
black.
cons
derat
on
between
appe
ants
and
New
S
katuna
Wood
cash.
It
includes
s
gnature
all
legal
tender
which
has
been
defined
in
p.1.
account
was
credited
for
the
same
amount.
Thereafter,
BDO
P300,000
the
with
use
the
of
was
not
Accord
ng
y
by
wa
ver
o
not
ce
a
drawer
or
ndorser
s
not
because
Lorenzo
T
ssued
a check
payab
ePersona
to
cash
orhimself
bearer
ato
who
ght
a
b Eden
title
through
atong
holder
in he
due
course,
who
is not
or is
payable
bearer,
is
liable
toand
all
parties
subsequent
appears
toconstructive,
ntent
onTan,
to m
course
and
attaches
to
the
nstrument
tse
Defenses
uture
tnstrument
me
therefore,
there
Holder
issIn
no
However,
refused
to accept the payment made and
agreement
with
herein
petitioner
State
Investment
House,

10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
1
2
3
4
5
6
7
8
9

Cesar N
Cesa
Nickolai
cko a F
F. So
Soriano
ano Jr.
Arellano
A
e ano Un
University
ve s y Schoo
School o
of Law 2011
2011-0303
NEGOTIABLE
NEGOT
ABLE INSTRUMENTS
NSTRUMENTS LAW (Act
Ac No
No. 2031
2031) based on the
he book o
of Aqu
Aquino
no and De Leon and Aud
Audio
o Lec
Lecture
ueo
of Dean Sund
Sundiang
ang
0303