BUSLAW3 – Lesson 2 PRESUMPTION AS TO DATE

OMISSION OR INSTANCES NOT AFFECTING NEGOTIABILITY OF 1. The instrument contain the date of issue
INSTRUMENT - It is prima facie the true date of the making or drawing of
the instrument
a. Not dated 2. In an accepted bill of exchange, the acceptance is dated
b. Does not specify the value given or that any value has been - It is prima facie the date of acceptance
given therefore 3. An instrument is indorsed, and the indorsement is dated
c. Does not specify the place where it is drawn or the place where - It is prima facie date of indorsement
it is payable
d. Bears a seal ANTE-DATED AND POST-DATED
e. Designates a particular kind of current money in which
payment is to be made Ante-dated – contains a date earlier than the true of its issuance.

WHEN INSTRUMENT IS PAYABLE ON DEMAND Example:

a. When it is so expressed to be payable on demand, or at sight, Instrument issued on June 17 but dated June 10
or on presentation
Post-dated – contains a date later than the true date of its issuance.
b. In which no time for payment is expressed
c. When an instrument is issued when overdue
Example:
WHEN INSTRUMENT IS PAYABLE TO ORDER
Instrument issued on June 15 but dated June 30
It may be drawn payable to the order of:
WHEN DATE MAY BE INSERTED
a. A payee who is not maker, drawer, or drawee
1. Where an instrument is payable at a fixed period after date but
b. The drawer or maker
it is issued undated
c. The drawee
2. Where the instrument is payable at a fixed period after sight
d. Two or more payees jointly
but the acceptance is undated.
e. One or some of several payees
f. The holder of an office for the time being EFFECT OF INSERTION OF WRONG DATE

1. “I promise to pay to the order of P P10,000, signed M.” 1. As to holder with knowledge
2. “To Dw The instrument will be void as to him but not to a subsequent
Pay to the order of B P10,000, signed D” holder in due course who may enforce the same
3. “I promise to pay to the order of myself P10,000, signed M” notwithstanding the improper date.
4. “To Dw 2. As to subsequent holder in due course
Pay to the order of myself P10,000, signed D” It constitute a material alteration but in the hands of a holder in
5. “To Dw due course, the date inserted even if wrong is to be regarded as
Pay to the order of yourself P10,000, signed D” the true date.
6. “Pay to the order of B and C P10,000”
7. “Pay to the order of B, C, or D P10,000” RULES WHEN BLANKS MAYBE FILLED
8. “Pay to the order of B, C, and D or any of them P10,000” 1. Prima facie evidence to fill out blanks
“Pay to the order of B, C, and D or any two of them P10,000” 2. Prima facie authority to fill out the instrument for any amount
9. “Pay to the order of the Commissioner of Internal Revenue 3. It must be filled out strictly in accordance with the authority
P10,000” given and within a reasonable time
4. If negotiated after completion to a holder in due course, it is
WHEN INSTRUMENT IS PAYABLE TO BEARER valid and enforceable as if it has been strictly filled out in
accordance with the authority given and within reasonable
a. When it is expressed to be so payable
time.
b. When it is payable to a person named therein or bearer
c. When it is payable to the order of a fictitious or non-existing RULES WHEN INSTRUMENT IS INCOMPLETE BUT DELIVERED
person, and such fact was known to the person making it so
payable 1. Where the holder is a holder in due course, he can enforce the
d. When the name of the payee doesn’t purport to be the name instrument as completed against parties prior or subsequent to
of any person the completion.
e. When the only or last indorsement is on indorsement in blank.
2. Where the holder is not a holder in due course, he can enforce
the instrument as completed as against the parties subsequent
to the completion but not against those prior thereto.

INCOMPLETE AND UNDELIVERED INSTRUMENT

Rules

1. The instrument is not valid in the hands of any holder, as

against any person whose signature was placed thereon before
delivery.
2. The instrument can be enforced against a party who signs the
instrument after completion and delivery.