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NEGOTIABLE INSTRUMENTS NOTES

BASED ON AGBAYANIS BOOK AND ATTY. MERCADOS LECTURES


Page 96 of 190


BY: MA. ANGELA LEONOR C. AGUINALDO
ATENEO LAW 2D BATCH 2010
to pay it there at maturity, such ability and willingness are
equivalent to a tender of payment upon his part. But except as
herein otherwise provided, presentment for payment is necessary
in order to charge the drawer and indorsers.

MEANING OF PRESENTMENT FOR PAYMENT
Production of a bill of exchange to the drawee for his acceptance, or to
the drawee or acceptor for payment or the production of the
promissory note to the person liable for payment of the same
1. Personal demand for payment at the proper place
2. With the bill or note in readiness to exhibit it as required and
to receive payment and surrender it if the debtor is willing to
pay

PRESENTMENT FOR PAYMENT NOT NECESSARY TO CHARGE PERSONS
PRIMARILY LIABLE
It cannot be validly claimed that it is presentment of the bill which is
the operative act that makes the acceptor liable under his acceptance

PAYABLE AT A SPECIAL PLACE
If the bill is payable at the PNB, is it necessary to make presentment
for payment to X in order to charge him? No, the rule is the same.
The only effect is that if, X is able and willing to pay the bill at the PNB
at maturity, it is equivalent to a tender of payment on the part of
drawee X.

PRESENTMENT NECESSARY TO CHARGE PERSONS SECONDARILY LIABLE

NECESSARY STEPS TO CHARGE PERSONS SECONDARILY LIABLE IN BILLS
OF EXCHANGE
1. In the three steps required by law, presentment for acceptance to
the drawee or negotiation within reasonable time after acquisition
unless excused
2. If the bill is dishonored by non-acceptance, notice of dishonor by
non-acceptance must be given to persons secondarily liable
unless excused and in case of foreign bills, protest for dishonor
by non-acceptance must be made unless excused
3. But if the bill is accepted, or if the bill isnt required to be
presented for acceptance, it must be presented for payment to
the persons primarily liable unless excused
4. If the bill is dishonored by non-payment, notice of dishonor by
non-payment must be also be given to person secondarily liable
unless excused, and in case of foreign bills, protest for dishonor
by non-pay7ment must be made unless excused

NECESSARY STEPS TO CHARGE PERSONS SECONDARILY LIABLE
Presentment for payment must be made within the period required to
the person primarily liable unless excused
If the note is dishonored by non-payment, notice of dishonor by non-
payment must be given to the person secondarily liable unless excused

CASE DIGESTS: SECTION 70

131 CLARK V. SELLNER
42 SCRA 384

FACTS:
Sellner with two other persons, signed a promissory note solidarily binding
themselves to pay to the order of R.N Clark. The note matured but the
amount wasn't paid. The defendant alleges that he didn't receive any
amount of the debt; that the instrument wasn't presented to him for
payment and being an accommodation party, he is not liable unless the
note is negotiated, which wasn't done.

HELD:
On the first issue, the liability of Sellner as one of the signers of the note,
is not dependent on whether he has or has not, received any part of the
debt. The defendant is really and expressly one of the joint and several
debtors of the note and as such he is liable under the provisions of Section
60 of the NIL.

As to the presentment for payment, such action is not necessary in order
to charge the person primarily liable, as is the defendant Sellner.

As to whether or not Sellner is an accommodation party, it should be taken
into account that by putting his signature to the note, he lent his name, not
to the creditor, but to those who signed with him placing him in the same
position and with the same liability as the said signers. It should be noted
that the phrasewithout receiving value therefore as used in section 29
means without receiving value by virtue of the instrument and not, as it
apparently is supposed to mean, without receiving payment for lending his
name. It is immaterial as far as the creditor is concerned, whether one of
the signers has or has not received anything in payment for the use of his
name. In this case, the legal situation of Sellner is that of a joint surety
who upon the maturity of the note, pay the debt, demand the collateral
security and dispose of it to his benefit. As to the plaintiff, he is a holder
for value.