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.
LEX SOCIETAS 41 The arguments set forth by the majority view find strong support in the legal
provisions. Acceptance is defined by Sec. 132 as the “signification of the drawee of his assent to the order of the drawer.” Sec. 62 should be related to this definition. “Assent to the order of the drawer” means assent to the actual not the apparent order of the drawer. In like manner, Section 139 in defining general and qualified acceptance provides: “A general acceptance assents without qualification to the order of the drawer. A qualified acceptance in express terms varies the effect of the bill as drawn.” In both these provisions, acceptance is definitely associated with the order of the drawer and not with what appears to be the drawer’s order after the alteration. The words “according to the tenor of his acceptance” should thus be construed to mean the kind of acceptance – whether qualified, or general. Furthermore, Section 124 avoids the instrument “except as against a party who has himself made, authorized or assented to the alteration and subsequent indorsers.” An acceptor has not assented to the alteration because “assent” can only mean assent with knowledge of the facts. Neither is he a subsequent indorser. The final and perhaps strongest legal argument is that Sec. 124 expressly provides that a holder in due course can recover only according to the original tenor of the instrument. There is however one important and desirable effect of the minority view cannot be ignored – denying recovery to the drawee bank would tend to give stability to checks. Furthermore, as between the holder and the drawee bank, it seems that the latter is in a better financial position to shoulder the loss, since it can and probably should insure itself against such eventualities.
F. COMPLETE AND UNDELIVERED INSTRUMENTS
Section 16, NIL. Delivery; when effectual; when presumed. - Every contract on a negotiable instrument is incomplete and revocable until delivery of the instrument for the purpose of giving effect thereto. As between immediate parties and as regards a remote party other than a holder in due course, the delivery, in order to be effectual, must be made either by or under the authority of the party making, drawing, accepting, or indorsing, as the case may be; and, in such case, the delivery may be shown to have been conditional, or for a special purpose only, and not for the purpose of transferring the property in the instrument. But where the instrument is in the hands of a holder in due course, a valid delivery thereof by all parties prior to him so as to make them liable to him is conclusively presumed. And where the instrument is no longer in the possession of a party whose signature appears thereon, a valid and intentional delivery by him is presumed until the contrary is proved.
“bad faith” means that the holder must have knowledge of facts which render it dishonest for him to take particular piece of negotiable paper.
It is sufficient that such knowledge tends to show that there was something wrong with the transaction.
5] There is presumptions under Section 118 and 139 of the NegotiableInstruments Act in favour of holder of the cheque. Until contrary is proved, presumption is in favour of holder of cheque that it was drawn for discharge of debt or liabilities. However, it is rebutable one and accused can rebut it without entering into witness box, through crossexamination of the prosecution witnesses. Complainant is not absolved from liability to show that cheque was issued for legally enforceable debt or liability. Burden on accused in such case would not be as light as it is in the cases under sec.114 of the Evidence Act. In case of “ Goa Plast Pvt. Ltd. vs. Shri Chico Ursula D' Souza 1996 (4)
2. NO, The same answer above would not apply in the event that it would be Simpo seeking to enforce the note against Corupto. The note was issued for ‘support and friendship’ – and as such, Corupto may set up as a personal defense the want or absence of consideration for the issuance of the note. ‘Friendship and support’ (in the same manner as love and affection) do not constitute ‘value’ or consideration under the ambit of the negotiableinstruments law. Absence or lack of consideration is a defense pro tanto between immediate parties, and against a holder who is not a holder in due course.
I. GENERAL CONCEPTS
NEGOTIABLE INSTRUMENT (NI)
A written contract for the payment of money which complies with the requirements of Sec. 1 of the NIL, which by its form and on its face, is intended as a substitute for money and passes from hand to hand as money, so as to give the holder in due course (HDC) the right to hold the instrument free from defenses available to prior parties. (Reviewer on Commercial Law, Professors Sundiang and Aquino)
Whether petitioner cannot be held liable on the questioned checks by virtue of the Certification executed by Ong giving her the authority to collect such checks from the GSIS?
Petitioner is liable. The NegotiableInstruments Law provides that where any person is under obligation to indorse in a representative capacity, he may indorse in such terms as to negative personal liability. An agent, when so signing, should indicate that he is merely signing in behalf of the principal and must disclose the name of his principal; otherwise he shall be held personally liable. Even assuming that Francisco was authorized by HCCC to sign Ong's name, still, Francisco did not indorse the instrument in accordance with law. Instead of signing Ong's name, Francisco should have signed her own name and expressly indicated that she was signing as an agent of HCCC. Thus, the Certification cannot be used by Francisco to validate her act of forgery.
If instruments payable to named payees or to their order have not been indorsed in blank, only such payees or their indorsees can be holders and entitled to receive payment in their own right. Negotiableinstruments are negotiated by ―transfer to one person or another in such a manner as to constitute the transferee a holder thereof. If payable to bearer it is negotiated by delivery. If payable to order it is negotiated by the indorsement completed by delivery. The present case involves checks payable to order. Not being a payee or indorsee of the checks, private respondent Salazar could not be a holder thereof. It is an exception to the general rule for a payee of an order instrument to transfer the instrument without indorsement. Precisely because the situation is abnormal, it is but fair to the maker and to prior holders to require possessors to prove without the aid of an initial presumption in their favor, that they came into possession by virtue of a legitimate transaction with the last holder.
12. A 488 mg sample of CuSO 4 .nH 2 O is heated to drive off the waters of hydration and then
reweighed to give a final mass of 319 mg. Given the sample contains 2.0 mmol of Cu, what
is the average number of water if hydration, n, is CuSO 4 .nH 2 O?
(A) 2.0 (B) 5.0 (C) 10 (D) 18
It has, likewise, been held that if no presentment is made at all, the drawer cannot be held liable irrespective of loss or injury unless presentment is otherwise excused. This is in harmony with Article 1249 of the Civil Code under which payment by way of check or other negotiable instrument is conditioned on its being cashed, except when through the fault of the creditor, the instrument is impaired. The payee of a check would be a creditor under this provision and if its non-payment is caused by his negligence, payment will be deemed effected and the obligation for which the check was given as conditional payment will be discharged. Failure of a payee to encash a check for more than ten (10) years undoubtedly resulted in the impairment of the check through his unreasonable and unexplained delay