Nego finals DOCX

Title	Nego finals
Author	Melanie Mejia
Pages	58
File Size	183.2 KB
File Type	DOCX
Total Downloads	14
Total Views	58

Summary

GENERAL CONCEPTS a. An indication of a particular fund out of which reimbursement is to be made, or a NEGOTIABLE INSTRUMENTS – A written contract for the particular account to be debited with the payment of money which complies with the requirements of Sec 1 amount of the Negotiable Instruments Law ...

Description

GENERAL CONCEPTS NEGOTIABLE INSTRUMENTS – A written contract for the payment of money which complies with the requirements of Sec 1 of the Negotiable Instruments Law (NIL), which by its form and on its face, is intended to hand as money, so as to give the holder in due course (HDC) the right to hold the instrument free from personal defenses and available to prior parties (Jose R. Sundiang and Timoteo B. Aquino, Reviewer on Commercial Law, 2006 ed.). REQUISITES (Sec 1 NIL) 1. Must be in WRITING and signed by the maker or drawer – Signature is binding however written or printed as long as it is intended to be the signature of the signer or made with his authority o Assumed or Trade name – NO person is liable on the NI whose signature does not appear thereon unless otherwise provided. But one who signs in a trade or assumed name will be liable to the same extent as if he signed his own name (Sec 18 NIL) o Signature by agent – The signature of any party ma be made by a duly authorized agent. No particular form is necessary o If the signature placed on the NI is not clear so what capacity the person intended to sign, he is deemed as an indorser (Sec 17.f NIL) 2. Must contain an UNCONDITIONAL promise or order to pay a sum certain in money – There must be an express promise or order to pay a sum certain in money o "Promise" need not be used; an equivalent expression is sufficient o Order is a command or imperative direction. A mere request or authority to pay is not equivalent to an order. o There must be a clear demand upon the drawee to pay WHEN UNCONDITIONAL (Sec 3 NIL) There is an unqualifed or unconditional order or promise to pay if there is: a. An indication of a particular fund out of which reimbursement is to be made, or a particular account to be debited with the amount NOTE: An order or promise to pay out of a particular fund is not unconditional o The promise or order to pay to be unconditional must be unqualifed, absolute and obligatory; nor merely aspirational o TEST: Does the instrument carry the general credit of the drawer or the maker or only the credit of a particular fund? FUND FOR REIMBURSEMENT PARTICULAR FUND FOR PAYMENT Acts involved Drawee pays the payee from his own funds, afterwards the drawee pays himself from the particular fund indicated There is only one act: the drawee pays directly from the particular fund indicated. Payment is subject to the condition that the fund is sufficient Nature of fund indicated Particular fund indicated is NOT the direct source of payment but only the source of reimbursement Particular fund indicated is the direct source of payment Effect Unconditional Conditional Example Pay to the order of X P1,000 and reimburse yourself from the rentals of my house I promise to pay X or order the sum of P1,000 out of my salary in XYZ corp NOTE: Bills and checks by itself do not operate as an assignment of any part of the funds to the credit of the drawer with the bank, and the bank is not liable to the holder unless and until it accepts or certifes the check (Sec 127 and 189 NIL) Page " 1...