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MEANING OF NOTICE
By notice of dishonor is meant bringing either verbally or by writing, to the
knowledge of the drawer or indorser of an instrument, the fact that a specified
negotiable instrument, upon proper proceedings taken, has not been accepted or
hasnt been paid, and that the party notified is expected to paid it
(2) Non-payment (both bill and note) to indorsers Note: Notice must be given to
persons secondarily liable. Otherwise, such parties are discharged. Notice may be
given to the party himself or to his agent.
When given Notice may be given as soon as the instrument is dishonoured.
When not necessary to give to drawer Notice of dishonor is not required to
be given to the drawer in any of the following cases: (1) Drawer and drawee
are the same; (2) Drawee is a fictitious person or not having the capacity to
contract; (3) Drawer is the person to whom the instrument is presented for
payment; (4) The drawer has no right to expect or require that the drawee or
acceptor swill honor the instrument; (5) Where the drawer has countermanded
payment (Sec. 114)
When not necessary to give to Indorser Notice of dishonor is not required
to be given to an indorser in the following cases: (1) Drawee is a fictitious
person or does not have the capacity to contract, and indorser was aware of that
fact at the time he indorsed the instrument; (2) Indorser is the person to whom the
instrument is presented for payment; (3) Instrument was made or accepted for his
accommodation. (Sec. 115)
Who will benefit If given by or on behalf of the holder (Sec. 92): (1) All subsequent
holders (2) All prior parties (as to holder) who have a right of recourse against the
party to whom it is given.
If given by the indorser (Sec. 93): (1) Holder (2) All parties subsequent to the party
to whom notice is given.
PARTIES WHO MAY GIVE NOTICE OF DISHONOR
The notice may be given by or on behalf of the holder, or by or on behalf of any
party to the instrument who might be compelled to pay it to the holder, and who,
upon taking it up, would have a right to reimbursement from the party to whom the
notice is given.
Who should give (Sec. 90): (1) Holder (2) Agent or representative of holder. (3)
Any party who may be compelled to pay like indorsers. (4) Agent of any party who
may be compelled.
EFFECT OF NOTICE
Notice of dishonor is required to charge parties secondarily liable. Upon valid notice
of dishonor, immediate right of recourse against the indorser arises. It is as if the
indorser becomes primarily liable in the sense that the holder need not claim
payment from the person primarily liable.
FORM OF NOTICE (Sec. 96) The notice may be: (1) In writing; or (2) Merely oral
The notice may be given in any terms which: (1) Sufficiently identify the instrument;
and (2) Indicate that it has been dishonored by non-acceptance or non-payment It
may in all cases be given by delivering it personally or through the mails
Insurance definition
A contract of insurance is an agreement whereby one undertakes for a
consideration to indemnify another against loss, damage or liability arising from an
unknown or contingent event (Sec. 2, par.1) DEFINITION - (1) A contract of
indemnity (2) Wherein one undertakes for a consideration (3) To indemnify another
against loss, damage, or liability (4) Arising from an unknown or contingent event.
Insurable interest - DEFINITION
An insurable interest is that interest which the law requires the owner of an
insurance policy to have in the person or thing insured, the absence of which
renders the contract void. In general, an insurable interest is that interest which a
person is deemed to have in the subject matter insured, where he has a relation or
connection with or concern in it, such that the person will derive pecuniary benefit
or advantage from the preservation of the subject matter insured and will suffer
pecuniary loss or damage from its destruction, termination, or injury by the
happening of the event insured against. The existence of an insurable interest gives
a person the legal right to insure the subject matter of the policy of insurance. An
insurable interest is one of the most basic and essential requirements in an
insurance contract. As such, it may not be waived by stipulation. The insurable
interest need not always be pecuniary in nature.
Insurable Interest
SECTION 11. Every person has an insurable interest in the life and health.
(a) Of himself;
(b) Of any person on whom he depends wholly or in part for education or support;
(c) Of any person under a legal obligation to him for the payment of money, or
respecting property or services, of which death or illness might delay or prevent the
performance; and
(d) Of any person upon whose life any estate or interest vested in him depends.
SECTION 12. Every interest in property, whether real or personal, or any relation
thereto, or liability in respect thereof, of such a nature that a contemplated peril
might directly damnify the insured, is an insurable interest.
SECTION 13. An insurable interest in property may consist in:
(a) An existing interest;
(b) An inchoate interest founded on an existing interest; or
(c) An expectancy, coupled with an existing interest in that out of which the
expectancy arises.
SECTION 14. A carrier or depository of any kind has an insurable interest in a thing
held by him as such, to the extent of his liability but not to exceed the value thereof.
SECTION 15. A mere contingent or expectant interest in anything, not founded on
an actual right to the thing, nor upon any valid contract for it, is not insurable.
SECTION 16. The measure of an insurable interest in property is the extent to
which the insured might be damnified by loss or injury thereof.
SECTION 17. The sole object of insurance is the indemnity of the insured, and if he
has no insurable interest the contract is void.
SECTION 18. An interest insured must exist when the insurance takes effect, and
when the loss occurs, but need not exist in the meantime.
SECTION 19. Except in the cases specified in the next four sections, and in the
cases of life, accident, and health insurance, a change of interest in any part of a
thing insured unaccompanied by a corresponding change of interest in the
insurance, suspends the insurance to an equivalent extent, until the interest in the
thing and the interest in the insurance are vested in the same person. robles virtual
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2) Carrying passengers safely as far as human care and foresight can provide, using
the utmost diligence of very cautious persons, with a due regard for all the
circumstances (Art 1755)
(3) Does not require common carriers to exercise all the care, skill, and diligence of
which the human mind can conceive. Nor such as will free the transportation of
passengers from all possible perils. Note: A common carrier is not an insurer of the
safety of the passengers and is not absolutely and at all events to carry them safely
and without injury REASONS Nature of business of common carriers and the
exigencies of public policy
Diligence vs Extra diligence
Extraordinary diligence - As applied to the preservation of property, the term
"extraordinary diligence" means that extreme care and caution which very prudent
and thoughtful persons use in securing and preserving their own
property. Extraordinary diligence means that it is more than the diligence of the
good father of a family in the transport or custody of goods. It is taking good care or
custody of the goods beyond those of others.
Ordinary diligence or common diligence is the diligence that a person of
average prudence would exercise in handling his/her own property like that at issue.
As applied to the preservation of property, the term "ordinary diligence" means that
care which every prudent man takes of his own property of a similar nature.
Stoppage in transitu
Right of the unpaid seller to stop the delivery (and regain possession) of goods in
transit to the buyer who has been declared bankrupt or insolvent. If this right is not
exercised in time, the goods on delivery become part of the estate of the buyer and
may
be
sold
to pay off
the secured
creditors.
AMLA
Anti-Money Laundering Act (R.A. No. 9160, as amended by
R.A. No. 9194)
DEFINITION
Money laundering is a crime whereby the proceeds of an unlawful activity are
transacted, thereby making them appear to have originated from legitimate
sources. (Sec. 4, RA 9160)
POLICY OF THE LAW
It is the policy of the State to protect and preserve the integrity and confidentiality
of bank accounts and to ensure that the Philippines shall not be used as a money
laundering site for the proceeds of any unlawful activity. Consistent with its foreign
policy, the State shall extend cooperation in transnational investigations and
prosecutions of persons involved in money laundering activities whenever
committed. (Sec. 2, RA 9160)
COVERED INSTITUTIONS
(1) banks, non-banks, quasi-banks, trust entities, and all other institutions and their
subsidiaries and affiliates supervised or regulated by the Bangko Sentral ng Pilipinas
(BSP);
(2) Insurance companies and all other institutions supervised or regulated by the
Insurance Commission; and
(3) (i) securities dealers, brokers, salesmen, investment houses and other similar
entities managing securities or rendering services as investment agent, advisor, or
consultant,
(ii) mutual funds, close and investment companies, common trust funds, pre-need
companies and other similar entities,
(iii) foreign exchange corporations, money changers, money payment, remittance,
and transfer companies and other similar entities, and
(iv) other entities administering or otherwise dealing in currency, commodities or
financial derivatives based thereon, valuable objects, cash substitutes and other
similar monetary instruments or property supervised or regulated by Securities and
Exchange Commission. (Sec. 3[a], RA 9160)
OBLIGATIONS OF COVERED INSTITUTIONS
CUSTOMER IDENTIFICATION
Covered institutions shall establish and record the true identity of its clients based
on official documents. They shall maintain a system of verifying the true identity of
their clients and, in case of corporate clients, require a system of verifying their
legal existence and organizational structure, as well as the authority and
identification of all persons purporting to act on their behalf.
The provisions of existing laws to the contrary notwithstanding, anonymous
accounts, accounts under fictitious names, and all other similar accounts shall be
absolutely prohibited. Peso and foreign currency nonchecking numbered accounts
shall be allowed. The BSP may conduct annual testing solely limited to the
determination of the existence and true identity of the owners of such accounts.
RECORD KEEPING All records of all transactions of covered institutions shall
bemaintained and safely stored for five (5) years from the dates of transactions.
With respect to closed accounts, the records on customer identification, account
files and businesscorrespondence, shall be preserved and safely stored for at least
five (5) years from the dates when they were closed.
REPORTING OF COVERED AND SUSPICIOUS TRANSACTIONS
Covered institutions shall report to the AMLC all covered transactions and suspicious
transactions within five (5) working days from occurrence thereof, unless the
Supervising Authority prescribes a longer period notexceeding ten (10) working
days.
Should a transaction be determined to be both a covered transaction and a
suspicious transaction, the covered institution shall be required to report the same
as a suspicious transaction.
When reporting covered or suspicious transactions to the AMLC, covered institutions
and their officers and employees [,representatives, agents, advisors, consultants or
associates] shall not be deemed to have violated Republic Act No. 1405, as
amended, Republic Act No. 6426, as amended, Republic Act No. 8791 and other
similar laws, but are prohibited from communicating, directly or indirectly, in any
manner or by any means, to any person, the fact that a covered or suspicious
transaction report was made, the contents thereof, or any other information in
relation thereto. In case of violation thereof, the concerned officer and employee [,
representative, agent, advisor, consultant or associate] of the covered institution
shall be criminally liable. However, no administrative, criminal or civil proceedings,
shall lie against any person for having made a covered or suspicious transaction
report in the regular performance of his duties in good faith, whether or not such
reporting results in any criminal prosecution under this Act or any other law.
When reporting covered or suspicious transactions to the AMLC, covered institutions
and their officers and employees [,representatives, agents, advisors, consultants or
associates] are prohibited from communicating directly or indirectly, in any manner
or by any means, to any person or entity, the media, the fact that a covered or
suspicious transaction report was made, the contents thereof, or any other
information in relation thereto. Neither may such reporting be published or aired in
any manner or form by the mass media, electronic mail, or other similar devices. In
case of violation thereof, the concerned officer and employee [, representative,
agent, advisor, consultant or associate] of the covered institution and media shall
be held criminally liable.(Sec. 9, RA 9160)
COVERED TRANSACTIONS
'Covered transaction' is a transaction in cash or other equivalent monetary
instrument involving a total amount in excess of Five hundred thousand pesos
(P500,000.00) within one (1) banking day. (Sec. 3[b], RA 9160)
SUSPICIOUS TRANSACTIONS
'Suspicious transaction' are transactions with covered institutions, regardless of
the amounts involved, where any of the following circumstances exist:
(1) there is no underlying legal or trade obligation, purpose or economic
justification;
(2) the client is not properly identified;
(3) the amount involved is not commensurate with the business or financial
capacity of the client;
(4) taking into account all known circumstances, it may be perceived that the
clients transaction is structured in order to avoid being the subject of reporting
requirements under the Act;
(5) any circumstance relating to the transaction which is observed to deviate from
the profile of the client and/or the clients past transactions with the covered
institution; (6) the transaction is in any way related to an unlawful activity or
offense under this Act that is about to be, is being or has been committed; or
(7) any transaction that is similar or analogous to any of the foregoing. (Sec. 3[b-1],
RA 9160 as amended)
WHEN IS MONEY LAUNDERING COMMITTED
Money laundering is a crime whereby the proceeds of an unlawful activity are
transacted, thereby making them appear to have originated from legitimate
sources. It is committed by the following:
(1) Any person knowing that any monetary instrument or property represents,
involves, or relates to the proceeds of any unlawful activity, transacts or attempts to
transact said monetary instrument or property.
(2) Any person knowing that any monetary instrument or property involves the
proceeds of any unlawful activity, performs or fails to perform any act as a result of
which he facilitates the offense of money laundering referred to in paragraph (a)
above.
(3) Any person knowing that any monetary instrument or property is required under
this Act to be disclosed and filed with the Anti-Money Laundering Council (AMLC),
fails to do so. (Sec. 4, RA 9160)
UNLAWFUL ACTIVITIES OR PREDICATE CRIMES
Unlawful activity' refers to any act or omission or series or combination thereof
involving or having direct relation to the following:
(1) Kidnapping for ransom under Article 267 of Act No. 3815, otherwise known as
the Revised Penal Code, as amended;
(2) Sections 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, and 16 of Republic Act No. 9165,
otherwise known as the Comprehensive Dangerous Drugs Act of 2002;
(3) Section 3 paragraphs B, C, E, G, H and I of Republic Act No. 3019, as amended;
otherwise known as the AntiGraft and Corrupt Practices Act;
(4) Plunder under Republic Act No. 7080, as amended;
(5) Robbery and extortion under Articles 294, 295, 296, 299, 300, 301 and 302 of
the Revised Penal Code, as amended;
(6) Jueteng and Masiao punished as illegal gambling under Presidential Decree No.
1602;
(7) Piracy on the high seas under the Revised Penal Code, as amended and
Presidential Decree No. 532;
(8) Qualified theft under Article 310 of the Revised Penal Code, as amended;
(9) Swindling under Article 315 of the Revised Penal Code, as amended;
(10) Smuggling under Republic Act Nos. 455 and 1937;
(11) Violations under Republic Act No. 8792, otherwise known as the Electronic
Commerce Act of 2000;
(12) Hijacking and other violations under Republic Act No. 6235; destructive arson
and murder, as defined under the Revised Penal Code, as amended, including those
perpetrated by terrorists against non-combatant persons and similar targets;
(13) Fraudulent practices and other violations under Republic Act No. 8799,
otherwise known as the Securities Regulation Code of 2000;
(14) Felonies or offenses of a similar nature that is punishable under the penal laws
of other countries. (Sec. 3[i], RA 9160) n 3(i) hereof;