OCTOBER 16, 2018
If he failed to do that, then he could
GR: Acceptance must be made in writing.
EXC: Constructive Acceptance (Sec. 137)
PRESENTMENT FOR PAYMENT
There’s no limitation as to the type of
instrument to be presented for payment. The
law deems it that all instruments have to be
presented for payment in order to charge
persons secondarily liable, BUT not to charge
persons primarily liable. As opposed to
presentment for acceptance where it only
applies in a BOE.
‘No demand, no delay’
The liability of a person primarily liable is always
there the moment the instrument is issued (PN)
or accepted (BOE). But then again, the
instrument has a maturity date. As provided in
Sec. 70, NIL, presentment for payment is not
necessary in order to charge the person
primarily liable on the instrument. But it does
not necessarily follow that he will be considered
in default. A person primarily liable cannot be
considered in default if there is no presentment
for payment because take note, to whom will he
make payment if there’s no person who will
present the instrument for payment? As a rule in
ObliCon – no demand, no delay. This is also
applicable in NIL. Hence, the party primarily
liable can only be considered in default if there
is presentment for payment and there is no
payment made. It is important to know then
when will the person primarily liable be
considered in default to determine when will the
interests and other costs start to accrue. There
is an emphasis made in Sec. 70 that if the
instrument is supposed to be payable at a
special place, then the holder has to go to that
specified place and then present the instrument
for payment. The ability and willingness to pay
there by the person primarily liable is a tender of
payment on his part, regardless of whether
there has been presentment for payment or not.
There is a presumption set forth by law that if
only the holder went there, then he would have
been paid.
not demand interest from the time that the
instrument has matured up to the time that he
presented it for payment. IOW, this provision
makes it clear that the interest and other costs
would not accrue from the time of maturity up
to the time the holder makes the actual
presentment for payment because the person
primarily liable is not considered in default.
Time of Maturity (Secs. 85 and 86)
To A:
Pay to the order of B P1M.
(Signed C)
Additional facts:
 A already accepted the instrument.
 drawer: C; drawee-acceptor: A; payee: B
 A is a call center that operates on a 24/7 basis
When can you present this instrument for
payment?
Since this is a BOE payable on demand,
presentment must be made within a reasonable
time after the last negotiation thereof. (Sec. 71,
NIL)
Under Sec. 72 (b), NIL, presentment for
payment, to be sufficient, must be made at a
reasonable hour on a business day.
On a business day
First, we have to settle what is considered a
business day. Sec. 85, NIL provides that when
the day of maturity falls upon Sunday, or a
holiday, the instrument is payable on the next
succeeding business day. Hence, it is settled that
Sunday is not considered a business day for
purposes of the law, regardless of whether the
establishment operates on a 24/7 basis or not,
since the law did not make any distinction as
regards to what is considered ‘on a business
day’. Furthermore, the same provision provides
that instruments falling due or becoming
payable on Saturday are to be presented for
payment on the next succeeding business day
(TN: This is different from the rule in Question raised by Alianza to be clarified next
presentment for acceptance because in the meeting: Buuuut di diay different ang rules sa
latter case, there is no option available on the PA and PP? See table below.
part of the holder. It has to be presented for
acceptance before 12nn that day if such is not a Presentment Presentment for
holiday), EXCEPT instruments payable on for Acceptance Payment
demand which may, at the option of the holder, (Sec. 145) (Sec. 72)
be presented for payment before 12nn on By  Holder, or  Holder, or
Saturday when that entire day is not a holiday. whom  on behalf of  by some person
Therefore, the law seems to be restrictive that if the holder authorized to
the maturity date falls on a Sunday or a holiday, Authority may receive
you have to present it on the next business day. not be payment on his
If it is a Saturday, then the option is available – established behalf
(1) you can present it up to 12 noon or (2) To  drawee or  person
present it on the next business day. The reason whom  some person primarily liable
for the rule is that the instrument being payable authorized to on the
on demand, the presumption is that the party accept or instrument, or
primarily liable has the money ready at any time refuse  if he is absent
for payment. acceptance or inaccessible,
on his behalf to any person
At a reasonable hour found at the
There is no problem as to ascertaining what is place where
considered as reasonable hour. In the previous the
case, the whole 24 hours could be considered as presentment is
reasonable hour in those types of made
establishments. But on matters of days, you’ll Authority may
have to comply with what is provided under the not be
law. OW, it would be considered irregular and established
will be deemed improper presentment for When at a reasonable at a reasonable
payment. hour, on a hour on a
business day business day
How presentment for payment made (Sec. 72) and before the
We have to make a distinction between the one bill is overdue
presenting for payment and the one accepting Where no requirement at a proper place
the presentment. If it’s just the one presenting
for payment, the authority of the person Proper Place (Sec. 73)
representing such holder, is not required to be (a) Where a place of payment is specified in the
in proper form. It could be in any form as long as instrument and it is there presented;
you are just presenting it for payment. Here, it is (b) Where no place of payment is specified but
for the benefit of the holder. But if it’s on the the address of the person to make payment
part of the person accepting the presentment, it is given in the instrument and it is there
will have to be a person duly authorized because presented;
in this case, it creates liability. (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 not be paid, then you can present it at any
place of business or residence. time before the bank closes.

TN:
o The order of enumeration or priority must be
followed. OW, presentment is improperly
done.
o If no definite address is given and only the
name of town or city is stated, then
subsection (b) or (c) applies.

Exhibition of instrument (Sec. 74)

It is the act of showing the bill to the drawee and
requesting its acceptance or payment. It is a
personal or face to face demand at the proper
place, exhibiting the instrument to the maker or
acceptor from whom payment is demanded.
Hence, an instrument can neither be presented
via telephone call nor video conference.

Reason: The instrument not only has to be

physically exhibited, but it also has to be
delivered to the person paying the instrument. It
is for the protection of the person primarily
liable in order that the instrument cannot be
used again. It becomes proof that indeed,
payment has been made.

Presentment where instrument payable at

bank (Sec. 75)
 GR: Where the person to make payment has
sufficient funds in the bank, presentment for
payment must be made during the usual
banking hours (usually 9:00 am – 4:00 pm).
Presentment made outside banking hours
operates to discharge the persons
secondarily liable.
 EXC: If the person has no funds in the bank,
presentment at any hour before the bank is
closed on that day is sufficient.
 Reason: Even if presentment was made
during banking hours, the instrument could
not have been paid just the same.
 Just because the usual banking hours is from
9-4, it does not mean that the bank closes at
4 pm. They also work for 8 hours a day or
even more. So, when there is reasonable
knowledge to believe that the instrument will