1. when it is expressed to be so payable 2. when it is payable to a person named therein or to bearer EX. I promise to pay to bearer EX. I promise to pay to X or bearer “I promise to pay to bearer X" bearer is not a word of negotiability but merely descriptive of X 3. when it is payable to the order of a fictitious or non-existing person and such fact was known to the person making the instrument EX. I promise to pay P1,000 to Superman or order knows Superman does not exist: bearer instrument does not know: non-negotiable because it cannot be issued 4. when the name does not purport to be the name of a person EX. Pay to the order of Cash “pay to cash" not negotiable as it lacks words of negotiability 5. when the last or only indorsement was in indorsement in blank in instruments payable to order where at the back, the instrument no longer contain a specific person to whom the instrument can be negotiated thus it is intended to become a bearer instrument order instrument converted into a bearer instrument 2. Section 8. Payable to order where the instrument is drawn payable to the order of a specified person or to him or his order 1. payee who is not the maker, drawer, or drawee 2. drawer or maker 3. drawee 4. two or more payees jointly required that all payees make the indorsement 5. one or more of several payees 6. holder of an office for the time being 3. Section 19. Signature by agent GR: person has to sign on the instrument to be liable on such instrument EXC: person signs an instrument but will not be held liable agent duly authorized indicate representative capacity disclose principal EX. XYZ Corp … by: JG (sgd.) minor corporation 4. Section 22. Indorsement by minor or corporation minor able to sign an instrument but it will ot hold himself liable corporation able to sign an instrument but if the corporation is not authorized to engage in such transaction then it will also not be held liable and the one who signs will be personally liable considered an ultra vires act a person dealing with a corporation is behooved to require the presentation of abroad resolution or a secretary certificate 5. Section 21. Signature by procuration signing of an agent in a agency limited in it authority agent can only bind the principal if he acts within the limit of his authority “Pre Proc” to serve as a notice to whoever is dealing with the instrument to inquire as to limit of his or her liability 6. Section 6. Omissions it is not dated law presumes it is the date of issuance does not specify the value given or that any value had been given therefor law presumes consideration was given does not specify the place where it was drawn or where it is payable law presumes it is the residence or principal place of business of the person principally liable maker; or drawee-acceptor bears a seal copied from US has no bearing of PH instruments as they need not be notarized to be negotiable designates a particular kind of current money in which payment is to be made refers to foreign instruments issued abroad which are payable in PH thus there is a need exchange the currency into PH currency as payment to payee or bearer does not mean that you need not indicate the currency as involved otherwise you will not know what to pay to the payee 7. Section 10. Terms, when sufficient sufficient for as long as the terms clearly indicate the intention to conform to the requirements EX. “Please” pay to P or order P10,000 still negotiable as long as it contains words of negotiability 8. Section 13. When date may be inserted instances 1. when the instrument is payable at a fixed period after date but is undated 2. when the instrument is payable at a fixed period after sight but the acceptance is undated purpose date is to be inserted in order to ascertain the date of maturity insertion of wrong date does not avoid the instrument in the hands of a subsequent holder in due course date so inserted is regarded as the true date 9. Section 12. Ante-dating and post-dating GR: allowed, instrument is not invalid for the sole reason that it is ante-dated or post-dated ante-dated: making it appear that the instrument was issued earlier post-dated: making it appear that the instrument was issued later EXC: illegal or fraudulent purpose invalid and illegal but does not affect negotiability negotiability is determined from the face of the instrument and Section 1 validity =/= negotiability EX. ante-dating to hasten maturity, ante-dating to gain more interest GR: date so inserted is regarded as the true date EXC: holder is not in due course then the maker or drawer can set up the defense of insertion of wrong date 10. Section 52. Holder in due course [COFI] 1. complete and regular upon its face 2. became a holder before it was overdue and without notice of previous dishonor, if such was the fact 3. took it in good faith and for value 4. at the time it was negotiated to him, he had no notice of an infirmity in the instrument or any defect in the title of the person negotiating it 11. personal defense cannot be set up against a HDC or HtHDC must by inferred by the particular provisions in NIL 12. Section 58. Shelter principle HNDC is grant all the rights of a prior holder as to any prior parties derives his title through a HDC not himself a party to the fraud or illegality 13. Section 59. Prima facie HDC every holder is deemed prima facie to be a HDC 14. Section 65. Warranties every person negotiating an instrument by delivery or by qualified indorsement warrants 1. instrument is genuine and in all respects what it purports to be 2. he has a good title to it 3. all prior parties had the capacity to contract 4. no knowledge of any fact that would impair the validity of the instrument or render it valueless when negotiation is by delivery only then the warrant extends in favor of no holder other than the immediate transferor