Sec. 29. Liability of accommodation party.

- An accommodation party is one who has signed the

instrument as maker, drawer, acceptor, or indorser, without receiving value therefor, and for the
purpose of lending his name to some other person. Such a person is liable on the instrument to a
holder for value, notwithstanding such holder, at the time of taking the instrument, knew him to
be only an accommodation party.
Sec. !. Liability of maker. - "he maker of a negotiable instrument, by making it, engages that he
will pay it according to its tenor, and admits the e#istence of the payee and his then capacity to
indorse.

Sec. $. Liability of drawer. - "he drawer by drawing the instrument admits the e#istence of the
payee and his then capacity to indorse% and engages that, on due presentment, the instrument will
be accepted or paid, or both, according to its tenor, and that if it be dishonored and the necessary
proceedings on dishonor be duly taken, he will pay the amount thereof to the holder or to any
subse&uent indorser who may be compelled to pay it. 'ut the drawer may insert in the instrument
an e#press stipulation negativing or limiting his own liability to the holder.

Sec. 2. Liability of acceptor. - "he acceptor, by accepting the instrument, engages that he will
pay it according to the tenor of his acceptance and admits(
)a* "he e#istence of the drawer, the genuineness of his signature, and his capacity and authority
to draw the instrument% and
)b* "he e#istence of the payee and his then capacity to indorse. Sec. +. ,hen a person deemed
indorser. - A person placing his signature upon an instrument otherwise than as maker, drawer, or
acceptor, is deemed to be indorser unless he clearly indicates by appropriate words his intention
to be bound in some other capacity.

Sec. -. Liability of irregular indorser. - ,here a person, not otherwise a party to an instrument,
places thereon his signature in blank before delivery, he is liable as indorser, in accordance with
the following rules(
)a* .f the instrument is payable to the order of a third person, he is liable to the payee and to all
subse&uent parties.
)b* .f the instrument is payable to the order of the maker or drawer, or is payable to bearer, he is
liable to all parties subse&uent to the maker or drawer.
)c* .f he signs for the accommodation of the payee, he is liable to all parties subse&uent to the
payee.
Sec. /. ,arranty where negotiation by delivery and so forth. 0 1very person negotiating an
instrument by delivery or by a &ualified indorsement warrants(
)a* "hat the instrument is genuine and in all respects what it purports to be%
)b* "hat he has a good title to it%
)c* "hat all prior parties had capacity to contract%
)d* "hat he has no knowledge of any fact which would impair the validity of the instrument or
render it valueless.
'ut when the negotiation is by delivery only, the warranty e#tends in favor of no holder other
than the immediate transferee. "he provisions of subdivision )c* of this section do not apply to a
person negotiating public or corporation securities other than bills and notes.

Sec. . Liability of general indorser. - 1very indorser who indorses without &ualification,
warrants to all subse&uent holders in due course(
)a* "he matters and things mentioned in subdivisions )a*, )b*, and )c* of the ne#t preceding
section% and
)b* "hat the instrument is, at the time of his indorsement, valid and subsisting% And, in addition,
he engages that, on due presentment, it shall be
accepted or paid, or both, as the case may be, according to its tenor, and that if it be dishonored
and the necessary proceedings on dishonor be duly taken, he will pay the amount thereof to the
holder, or to any subse&uent indorser who may be compelled to pay it.

Sec. 2. Liability of indorser where paper negotiable by delivery. 0 ,here a person places his
indorsement on an instrument negotiable by delivery, he incurs all the liability of an indorser.
Sec. $2. 'ill of e#change, defined. - A bill of e#change is an unconditional order in writing
addressed by one person to another, signed by the person giving it, re&uiring the person to whom
it is addressed to pay on demand or at a fi#ed or determinable future time a sum certain in money
to order or to bearer.

Sec. $22. 'ill not an assignment of funds in hands of drawee. - A bill of itself does not operate as
an assignment of the funds in the hands of the drawee available for the payment thereof, and the
drawee is not liable on the bill unless and until he accepts the same.

Sec. $23. 'ill addressed to more than one drawee. - A bill may be addressed to two or more
drawees 4ointly, whether they are partners or not% but not to two or more drawees in the
alternative or in succession.

Sec. $29. .nland and foreign bills of e#change. - An inland bill of e#change is a bill which is, or
on its face purports to be, both drawn and payable within the 5hilippines. Any other bill is a
foreign bill. 6nless the contrary appears on the face of the bill, the holder may treat it as an
inland bill.

Sec. $+!. ,hen bill may be treated as promissory note. - ,here in a bill the drawer and drawee
are the same person or where the drawee is a fictitious person or a person not having capacity to
contract, the holder may treat the instrument at his option either as a bill of e#change or as a
promissory note.

Sec. $+$. 7eferee in case of need. - "he drawer of a bill and any indorser may insert thereon the
name of a person to whom the holder may resort in case of need% that is to say, in case the bill is
dishonored by non-acceptance or non-payment. Such person is called a referee in case of need. .t
is in the option of the holder to resort to the referee in case of need or not as he may see fit.
Sec. $3-. 5romissory note, defined. - A negotiable promissory note within the meaning of this
Act is an unconditional promise in writing made by one person to another, signed by the maker,
engaging to pay on demand, or at a fi#ed or determinable future time, a sum certain in money to
order or to bearer. ,here a note is drawn to the maker8s own order, it is not complete until
indorsed by him.

Sec. $3/. 9heck, defined. - A check is a bill of e#change drawn on a bank payable on demand.
1#cept as herein otherwise provided, the provisions of this Act applicable to a bill of e#change
payable on demand apply to a check.

Sec. $3. ,ithin what time a check must be presented. - A check must be presented for payment
within a reasonable time after its issue or the drawer will be discharged from liability thereon to
the e#tent of the loss caused by the delay.

Sec. $32. 9ertification of check% effect of. - ,here a check is certified by the bank on which it is
drawn, the certification is e&uivalent to an acceptance.

Sec. $33. 1ffect where the holder of check procures it to be certified. - ,here the holder of a
check procures it to be accepted or certified, the drawer and all indorsers are discharged from
liability thereon.

Sec. $39. ,hen check operates as an assignment. - A check of itself does not operate as an
assignment of any part of the funds to the credit of the drawer with the bank, and the bank is not
liable to the holder unless and until it accepts or certifies the check.