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MEMORIZE!!! Sec. 5. Additional provisions not affecting negotiability.

- An
instrument which contains an order or promise to do any act
THE NEGOTIABLE INSTRUMENTS LAW in addition to the payment of money is not negotiable. But
I. FORM AND INTERPRETATION the negotiable character of an instrument otherwise
negotiable is not affected by a provision which:
Sec. 1. Form of negotiable instruments. - An instrument to be (a) authorizes the sale of collateral securities in case
negotiable must conform to the following requirements: the instrument be not paid at maturity; or
(a) It must be in writing and signed by the maker or (b) authorizes a confession of judgment if the
drawer; instrument be not paid at maturity; or
(b) Must contain an unconditional promise or order (c) waives the benefit of any law intended for the
to pay a sum certain in money; advantage or protection of the obligor; or
(c) Must be payable on demand, or at a fixed or (d) gives the holder an election to require something
determinable future time; to be done in lieu of payment of money.
(d) Must be payable to order or to bearer; and But nothing in this section shall validate any provision or
(e) Where the instrument is addressed to a drawee, stipulation otherwise illegal.
he must be named or otherwise indicated therein with
reasonable certainty. Sec. 6. Omissions; seal; particular money. - The validity and
negotiable character of an instrument are not affected by the
Sec. 2. What constitutes certainty as to sum. - The sum fact that:
payable is a sum certain within the meaning of this Act, (a) it is not dated; or
although it is to be paid: (b) does not specify the value given, or that any
(a) with interest; or value had been given therefor; or
(b) by stated installments; or (c) does not specify the place where it is drawn or
(c) by stated installments, with a provision that, the place where it is payable; or
upon default in payment of any installment or of interest, the (d) bears a seal; or
whole shall become due; or (e) designates a particular kind of current money in
(d) with exchange, whether at a fixed rate or at the which payment is to be made.
current rate; or But nothing in this section shall alter or repeal any statute
(e) with costs of collection or an attorney's fee, in requiring in certain cases the nature of the consideration to
case payment shall not be made at maturity. be stated in the instrument.

Sec. 3. When promise is unconditional. - An unqualified order Sec. 7. When payable on demand. - An instrument is payable
or promise to pay is unconditional within the meaning of this on
Act though coupled with: demand:
(a) An indication of a particular fund out of which (a) When it is so expressed to be payable on
reimbursement is to be made or a particular account to be demand, or at sight, or on presentation; or
debited with the amount; or (b) In which no time for payment is expressed.
(b) A statement of the transaction which gives rise to Where an instrument is issued, accepted, or indorsed when
the instrument. overdue, it is, as regards the person so issuing, accepting, or
But an order or promise to pay out of a particular fund is not indorsing it, payable on demand.
unconditional.
Sec. 8. When payable to order. - The instrument is payable to
Sec. 4. Determinable future time; what constitutes. - An order where it is drawn payable to the order of a specified
instrument is payable at a determinable future time, within person or to him or his order. It may be drawn payable to the
the meaning of this Act, which is expressed to be payable: order of:
(a) At a fixed period after date or sight; or (a) A payee who is not maker, drawer, or drawee; or
(b) On or before a fixed or determinable future time (b) The drawer or maker; or
specified therein; or (c) The drawee; or
(c) On or at a fixed period after the occurrence of a (d) Two or more payees jointly; or
specified event which is certain to happen, though the time (e) One or some of several payees; or
of happening be uncertain. (f) The holder of an office for the time being.
An instrument payable upon a contingency is not negotiable, Where the instrument is payable to order, the payee must be
and the happening of the event does not cure the defect. named or otherwise indicated therein with reasonable
certainty.
Sec. 9. When payable to bearer. - The instrument is payable
to
bearer:
(a) When it is expressed to be so payable; or
(b) When it is payable to a person named therein or
bearer; or
(c) When it is payable to the order of a fictitious or
non-existing person, and such fact was known to the person
making it so payable; or
(d) When the name of the payee does not purport to
be the name of any
person; or
(e) When the only or last indorsement is an
indorsement in blank.

Sec. 126. Bill of exchange, defined. - A bill of exchange is an


unconditional order in writing addressed by one person to
another, signed by the person giving it, requiring the person
to whom it is addressed to pay on demand or at a fixed or
determinable future time a sum certain in money to order or
to bearer.

Sec. 184. Promissory note, defined. - A negotiable promissory


note within the meaning of this Act is an unconditional
promise in writing made by one person to another, signed by
the maker, engaging to pay on demand, or at a fixed or
determinable future time, a sum certain in money to order or
to bearer. Where a note is drawn to the maker's own order, it
is not complete until indorsed by him.

Sec. 185. Check, defined. - A check is a bill of exchange drawn


on a bank payable on demand. Except as herein otherwise
provided, the provisions of this Act applicable to a bill of
exchange payable on demand apply to a check.

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