Negotiable Instruments Law
Atty. Ronic Treptor
Form of Negotiable Instruments –
Omissions Not Affecting
Negotiability, Seal, Particular Money
Module 2.5
Omissions Not Affecting Negotiability
• What are the omissions in the negotiable instrument that will not
affect its negotiability?
• Sec. 6. Omissions; seal; particular money. - The validity and negotiable
character of an instrument are not affected by the fact that:
• (a) it is not dated; or
• (b) does not specify the value given, or that any value had been given therefor; or
• (c) does not specify the place where it is drawn or the place where it is payable; or
• (d) bears a seal; or
• (e) designates a particular kind of current money in which payment is to be made.
• But nothing in this section shall alter or repeal any statute requiring in certain
cases the nature of the consideration to be stated in the instrument.
Date
• What is the effect on the negotiability of the instrument if it is not
dated?
• The omission of the date will not affect the negotiability of the instrument.
• What are the relevant dates in an instrument?
• Date of issue
• Date of payment
• Date of acceptance
Date
• What happens if there is no date of payment?
• The instrument is payable on demand. (Sec. 7, NIL)
• What happens if there is no date of issue?
• Where an instrument is expressed to be payable at a fixed period after date is
issued undated, any holder may insert therein the true date of issue, and the
instrument shall be payable accordingly. (Sec. 13, NIL)
• Note that if the instrument is not dated, it will be considered dated as of the
time it was issued (This is why even if the date is omitted, it will not affect the
negotiability of the instrument). In this case the holder may insert
(indicate/write) the date of issue.
Date
• No date of issue; payable at a fixed period after date:
P15,000
I promise to pay to the order of Pedro Dela Cruz the
sum of P15,000, 20 days after date.
(Sgd) Dina Leligo
• In this case, there is no date of issue. The 20 days after date cannot be
counted, however, it will not affect the negotiability of the instrument
because the holder may insert therein the true date of issue.
Date
• What happens if the holder inserts a wrong date of issue?
• The insertion of a wrong date does not avoid the instrument in the hands of a
subsequent holder in due course; but as to him, the date so inserted is to be
regarded as the true date. (Sec. 13, NIL)
Date
• What happens if the acceptance of the instrument is not dated?
• Where the acceptance of an instrument payable at a fixed period after sight is
undated, any holder may insert therein the true date of acceptance, and the
instrument shall be payable accordingly.
• The insertion of a wrong date does not avoid the instrument in the hands of a
subsequent holder in due course; but as to him, the date so inserted is to be
regarded as the true date.
Date
• Can the maker or drawer ante-date or post-date the instrument?
• Yes. The instrument is not invalid for the reason only that it is ante-dated or
post-dated, provided this is not done for an illegal or fraudulent purpose. The
person to whom an instrument so dated is delivered acquires the title thereto
as of the date of delivery.
• Example of an illegal or fraudulent purpose:
• Ante-dating or post-dating to increase or decrease interest accrued on the note or bill.
Consideration
• What is the effect on the negotiability of the instrument if the
consideration is not indicated in the instrument?
• It will not affect the negotiability of the instrument.
• Why?
• Every negotiable instrument is deemed prima facie to have been issued for a
valuable consideration; and every person whose signature appears thereon to
have become a party thereto for value. (Sec. 24, NIL)
• That is why even if the consideration is not indicated in the instrument, it will
not affect the negotiability of the instrument because it is already presumed.
Place
• What are the places relevant to a negotiable instrument?
• Place of issue
• Place of payment
• What is the effect on the negotiability of the instrument if such
instrument did not indicate a place of issue or place of payment?
• The omission has no effect on the negotiability of the instrument.
• The place of issue of the instrument is not relevant to its negotiability.
Omission of the place of issue is not material to the instrument.
Place
• Where should the instrument be paid if there is no indication of place
of payment?
• Presentment for payment is made at the proper place:
• (a) Where a place of payment is specified in the instrument and it is there presented;
• (b) Where no place of payment is specified but the address of the person to make
payment is given in the instrument and it is there presented;
• (c) Where no place of payment is specified and no address is given and the instrument is
presented at the usual place of business or residence of the person to make payment;
• (d) In any other case if presented to the person to make payment wherever he can be
found, or if presented at his last known place of business or residence. (Sec. 73, NIL)
Seal
• What is the effect on the negotiability of the instrument if the
instrument contains a seal?
• The validity and negotiability of the instrument are not affected by the fact
that it bears a seal.
• Seals are mere ornamentations of the instrument usually used for
advertisement.
Particular Money
• What is the effect on the negotiability of the instrument if there is a
designation of denomination in the instrument?
• It will not affect the negotiability of the instrument.
Particular Money
• Designates a particular kind of current money in which payment is to be made:
P15,000 September 15, 2021
I promise to pay to the order of Pedro Dela Cruz the
sum of P15,000. I will make payment in the form of 150
pieces of 100-peso bills.
(Sgd) Dina Leligo
