Bill of exchange 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 bearer
Foreign bill of exchange a bill drawn
in one state or country and payable in
another state or country

Inland bill of exchange a bill drawn

and payable within the same state

Sight or Demand draft a bill of

exchange payable on demand or at sight

Time draft a bill of exchange payable

at a definite future time or some future
determinable time

Bank draft BOE drawn by a bank

against its branch or another bank

Trade acceptance draft or BOE drawn

by the seller on the purchaser of goods
and accepted by the latter by signing it
as a drawee; unlike an ordinary BOE, it
has a definite date of maturity

Letters of credit loan agreements

made by a bank (or other person) at the
request a customer that the bank (issuer)
will pay or honor drafts drawn by the
seller (creditor) on the buyer (debtor) up
to a stated amount on compliance with
the conditions specified in the credit;
neither drafts nor notes
Referee in case of need person
named by the drawer or indorser as the
one to whom the holder may resort in
case, that is, in case the bill is dishonored
by non-acceptance or non-payment
Acceptance of a bill signification by
the drawee of his assent to the order of
the drawer; the act by which the drawee

manifests his consent to comply with the

request contained in the BOE directed to
him and it contemplates an engagement
or promise to pay
General acceptance assents without
qualification to the order of the drawer;
an acceptance to pay at a particular
place, unless it expressly states that the
bill is to be paid there only and not
elsewhere

Qualified acceptance in express

terms varies the effect of the bill as
drawn; conditional, partial, local, qualified
as to time, acceptance of some one or
more of the drawees but not of all

Presentment for acceptance the

production or exhibition of a BOE to the
drawee for his acceptance or payment;
also include presentment for payment

By protest formal instrument executed

by a notary public or other competent
person certifying that the facts necessary
to the dishonor of the instrument by nonacceptance or non-payment have taken
place

Protest the formal declaration of the

fact of non-payment executed by the
proper person, usually a notary public.

Acceptance for honor is an

undertaking by a stranger to a bill after
protest for the benefit of any party liable
thereon, or for the honor of the person for
whose account the bill is drawn which
acceptance inures also to the benefit of
all parties subsequent to the person for
whose honor it is accepted, and
conditioned to pay the bill when it
becomes due if the original drawee does
not pay it.

Acceptance supra protest another

name for acceptance for honor, since
previous protest for non-acceptance or for
better security is necessary.

Payment for honor is payment made

by a person, whether a party to the bill or
not, after it has been protested for nonpayment, for the benefit of any party
liable thereon or for the benefit of the
person for whose account it was drawn.
Payment supra protest another name
for payment for honor because prior
protest for non-payment is required. It is
not applicable to promissory notes.
Bill in a set is one composed of several
parts each par being numbered and
containing a reference to the other parts,
the whole of the parts constituting but
one bill.
Certificate of deposit (CD) it is a
written acknowledgement by a bank of
the receipt of money on deposit which the
bank promises to repay to the depositor,
bearer to some other person to the order
of the depositor or to him or his order at a
later date or on demand.

Deposit slip issued by the bank when

cash or checks are deposited in a
checking account.

Savings deposit it is most commonly a

time deposit of money with a bank.

Bond It is an evidence of indebtedness

issued by a public or private corporation,
promising to pay a sum of money on a
day certain in the future.
Registered bond or one payable to the
person whose name appears on the face
of the certificate and in the books of the
company.

Coupon bond or one to which are

attached coupons which entitle the holder
to interest when due.

Bank note it is an instrument issued by

a bank for circulation as money payable
to bearer on demand.

Due bill it is a promissory note which

shows on its face an acknowledgement by
a person of his indebtedness to another.

Chattel mortgage note secured by

personal property

Real estate mortgage note secured

by real property
Title-retaining note this type is
secured by a conditional sales contract
which ordinarily provides that the title to
the goods shall remain in the payees until
the note is paid in full. It is used to secure
the purchase price of goods.

Collateral note it is used when the

maker pledges securities to the payee to
secure the payment of the amount of the
note.

Signature note a device used by

banks for short-term unsecured loans or
those made without collateral.

Judgement note this is note to which

is added the power of attorney enabling
the payee to take judgement against the
maker without formality of a trial if the
note is note paid on its due date.

Installment note it is a note payable

when specified or periodic installments at
predetermined times such as for payment
of a refrigerator over a 12 months period.

Check is a bill of exchange drawn on a

bank payable on demand.

Memorandum check it is like an

ordinary check set that the word
memorandum, mem or memo is
written upon the face of the check
signifying that the drawer engages to pay
the bona fide holder absolutely and not
upon
a
condition
to
pay
upon
presentment a maturity and if due notice
of the presentment and non-payment
should be given.

Cashiers check it is one drawn by the

cashier of a bank upon the bank itself,
payable on demand to a payee.

Bank draft check drawn by a bank

upon another bank.

Managers check it is one drawn by

the banks manager upon the bank itself.
It is similar to the cashiers check both as
to effect and use.
Travelers check it is one upon which
the holders signature must appear twice,
one to be affixed by him at the time it is
issued and the second or countersignature, to be affixed by him in the
presence of the payee before it is paid,
otherwise, it is incomplete.

Certified check It is one which bears

upon its face an agreement by the
drawee bank that the check will be paid
on presentation.
Crossed-check it is one which bears
across its face two parallel lines drawn
diagonally, usually on the upper left side.
Crossed specially the name of a
particular bank or company is written or
appears between the parallel lines in
which case the drawee bank must pay the
check only upon presentment by such
bank or company.
Crossed generally only the words
and Co. Are written between the
parallel lines or when nothing is written at
all between said lines.
Stale check it is one which has not
been presented for payment within a
reasonable time after its issue. It is
valueless and, therefore, should not be
paid. In a case, a check, payable on
demand, which was long overdue by
about 2-1/2 years was considered a stale
check. Banking practice presently regards

as stale a check outstanding for more the

six (6) months.

Certification is, in effect, an

agreement by the bank against whom a
check is drawn that the check will be paid
when presented for payment.

Deposit it is constituted from the

moment a person receives a thing
belonging to another with the obligation
of safely keeping it and returning the
same.

Bank deposit is really a loan which

creates the relationship of debtor and
creditor.

Depositary bank the first bank to

receive a check for payment.

Payor bank the bank on which a check

is drawn.

Collecting bank any bank except the

payor bank that handles a check during
some phase of the collection process.

Intermediate bank is any bank except

the payor bank and the depositary bank,
to which a check is transferred in the
course of the collection process.

Acceptance an acceptance completed

by delivery or notification

Action includes counterclaim and setoff

Bank
includes any person
or
association or persons carrying on the
business
of
banking,
whether
incorporated or not;

Bearer means the person in possession

of a bill or note which is payable to
bearer;
Bill means bill of exchange, and Note
means negotiable promissory note;

Delivery means transfer of possession,

actual or constructive, from one person to
another;

Holder means the payee or indorsee of

a bill or note, who is in possession of it, or
the bearer thereof;

Indorsement means an indorsement

completed by delivery;

Instrument
instrument

Repeals all acts and laws and parts

thereof inconsistent with the Act

Bill of lading a contract or receipt for

the transport of goods and their delivery
to the person named therein, to his order,
or to bearer; usually involves three
persons the carrier, the shipper and the
consignee

negotiable

Issue means the first delivery of the

instrument complete in form, to a person
who takes it as a holder;

Dock warrant an instrument given by

dock owners to an importer of goods
warehoused on the dock recognizing the
importers title to the said goods

Warehouse receipt a contract or

receipt for goods deposited with a
warehouseman containing the latters
undertaking to hold and deliver the said
goods to a specified person, to his order,
or to bearer

Quedan a warehouse receipt usually for

sugar received by a warehouseman

Document of title to goods includes

any bill of lading, dock warrant, quedan,
or warehouse receipt or order for the
delivery of goods, or any other document
used in the ordinary course of business in
the sale of transfer of goods, as proof of
the possession or control of the goods, or
authorizing or purporting to authorize the
possessor of the document to transfer or
receive, either by indorsement or by
delivery

Goods includes all chattels personal but

not things in action or money of legal
tender in the Philippines; term includes
growing fruits or crops

Order relating to documents of title

means an order by indorsement on the
documents

Negotiable documents of title those

by the terms of which the bailee
undertakes to deliver the goods to the

means

Person includes a body of persons,

whether incorporated or not;

Value means valuable consideration;

Written includes printed

Writing includes print

Accommodation
maker

person
primarily liable even though he adds the
word surety to his signature or the fact
that he signed for accommodations
known to the holder

Accommodation guarantor person

secondarily liable signing on the back of
the note

Reasonable time regard is to be had

to the nature of the instrument, the usage
of trade or business (if any) with respect
to such instruments, and the facts of the
particular case

Law merchant (or the custom of

merchants) from which developed the
rules of bills and notes, sales of goods,
partnerships, guaranty, insurance, and
agency, originated in the unwritten
customs of merchants in different
commercial countries

bearer and those by the terms of which

the bailee undertakes to deliver the
goods to the order of a specified person

Non-negotiable documents of title

those by the terms of which the goods
covered are deliverable to a specified
person

Warehouseman a person lawfully

engaged in the business of storing goods
for profit

Warehouse building or place where

goods are deposited and stored for profit

Warehouse receipt (a) a WRITTEN

ACKNOLEDGEMENT by a warehouseman
that he has received and holds certain
goods therein described in store for the
person to whom it is issued; a simple
WRITTEN CONTRACT between the owner
of the goods and the warehouseman to
pay the compensation for the service; (b)
a BILATERAL CONTRACT, imports that
goods
are
in
the
hands
of
a
warehouseman and is a symbolical
representation of the property itself; (c)
NOT A NEGOTIABLE INSTRUMENT

Non-negotiable receipt a receipt in

which it is stated that the goods received
will be delivered to the depositor, or to
any other specified person
Negotiable receipt a receipt in which
it is stated that the goods received will be
delivered to the bearer or to the order of
any person named in such receipt
Negotiable not used in the sense in
which it is applied to BOE or promissory
notes but only as indicating that in the
passage of warehouse receipts through
the channels of commerce, the law
regards the property which they describe
as following them and gives to their
regular transfer by indorsement the effect
of manual delivery of the things specified
in them

Action includes counter-claim, set-off,

and suits in equity as provided by law in
these islands

Delivery

voluntary
transfer
of
possession from one person to another

Fungible goods goods which any unit

is, from its nature or by mercantile
custom, treated as the equivalent of any
other unit

Goods chattels or merchandise in

storage, or which has been or is about to
be stored

Holder of a receipt a person who has

both actual possession of such receipt
and a right of property therein

Order an order by indorsement on the

receipt

Owner does not include mortgagee

Person- includes a corporation or

partnership or two or more persons
having a joint or common interest

To purchase includes to take as

mortgagee or as pledge

Purchaser - includes mortgagee and

pledgee

Receipt a warehouse receipt

Value any consideration sufficient to

support a simple contract; an antecedent
or pre-existing obligation, whether a
receipt is taken either in satisfaction
thereof or as security therefor
Warehouseman a person lawfully
engaged in the business of storing goods
for profit

Protest for better security - is one

made by the holder of a bill after it has
been accepted but before it matures

against the drawer and indorsers, where

the acceptor has been adjudged a

bankrupt or an insolvent, or has made an

assignment for the benefit of creditors.