Negotiables Instrument Law

Question 1

Requisites in order for an instrument to be negotiable

Answer 1

Section 1. Form of negotiable instruments. - An instrument to be negotiable must conform to the following requirements:

(a) It must be in writing [and] signed by the maker [or] drawer;

(b) Must contain an unconditional promise [or] order to pay a sum certain in money;

(c) Must be payable on demand, [or] at a fixed or determinable future time;

(d) Must be payable to order [or] to bearer; [and]

(e) Where the instrument is addressed to a drawee, he must be named or otherwise indicated therein with reasonable certainty.

Question 2

what constitutes Holder in Due Course?

Answer 2

Sec. 52. What constitutes a holder in due course. - A holder in due course is a holder who has taken the instrument under the following conditions:

(a) That it is complete and regular upon its face;

(b) That he became the holder of it before it was overdue, and without notice that it has been previously dishonored, if such was the fact;

(c) That he took it in good faith and for value;

(d) That at the time it was negotiated to him, he had no notice of any infirmity in the instrument or defect in the title of the person negotiating it.

Question 3

3 requisites for a PAYMENT to be considered IN DUE COURSE

Answer 3

sec 88

payment is made in due course when;

1. payment is made AT [or] AFTER maturity of the payment
2. to the HOLDER thereof in GOOD FAITH pand[
3. W/O notice that his title is DEFECTIVE

Question 4

what constitutes material alteration

Answer 4

Sec. 125. What constitutes a material alteration. - Any alteration which changes:

(a) The date;

(b) The sum payable, either for principal or interest;

(c) The time or place of payment

(d) The number or the relations of the parties;

(e) The medium or currency in which payment is to be made;

(f) Or which adds a place of payment where no place of payment is specified, or any other change or addition which alters the effect of the instrument in any respect, is a material alteration.

Question 5

Requisites for ACCEPTANCE for HONOR

Answer 5

1. it must be a person who is [not yet liable on] the instrument
2. the instrument must not be overdue
3. HOLDER of the instrument must consent
4. BEFORE AoH, there must be a protest by non-acceptance

Question 6

what is a crossed check & its effects

Answer 6

A cross check is one with two parallel lines drawn DIAGONALLY across its face or across a corner thereof.

The effects of a crossing a check
1. only desposited in the account of the payee
2. indorsed oNLY ONCE in favor of a person who has an account with the bank
3. issued for a SPECIFIC PURPOSE [and] the person who takes it NOT IN ACCORDANCE with said purpose does not become a HIDC [and] is NOT entitled to payment thereundeer

Question 7

give at least 5 prohibited acts under the IRR of the philippine competition act

Answer 7

1. prohibition to impose price fixing or predatory fixing
2. bid rigging
   - (acted w/ other bidders to manipulate outcome of a bid)
3. limiting production to the prejudice of consumers
4. tying bundling offers of products with no connection at all
   - mang tomas with a book free
5. imposing unfair selling or purchase price onto the competitors, supliers, and consumers
6. Monopsony (unfairly low price for agri products)

Question 8

FORMAL REQUISITES OF ACCEPTANCE

Answer 8

1. must be in writing
2. signed by the drawee
3. must consist of an express promise to pay in money
4. acceptance must be delivered to the holder