111 Quirino Gonzales Logging Concessionaire vs.

CA, GR 126568, Apr 30, 2003

FACTS: Spouses Quirino and Eufemia Gonzales of the Quirino Gonzales Logging Concessionaire (QGLC) executed
promissory notes in favour to respondent Republic Planters Bank to secure certain advances from the Bank in connection
with its exportation of logs. The notes were payable 30 days after date and provided for the solidary liability of petitioners
as well as attorney’s fees at ten percent of the total amount due in the event of their non-payment at maturity.
Later on, petitioner QGLC has long been defaulted in the payment of their obligations with the promissory notes they
executed. The Bank then filed a complaint against the petitioner for “sum of money.”
However, petitioners seek to evade liability under the Bank’s causes of action by claiming that they Gonzales signed the
promissory notes in blank and that they had not received the value of said notes.

ISSUE: W/N the petitioners would be held liable for the payment of the promissory notes they executed despite of the
fact that they singed the notes in blank.

RULING: Yes, because as Section 14 of the Negotiable Instruments Law allows the prima facie authority of the
person in possession of negotiable instruments, such as the notes herein, to fill in the blanks, to complete an
incomplete instrument.

Moreover, a signature on a blank paper delivered in order that it may be converted into a negotiable instrument operates as
a prima facie authority to fill it up as such for any amount.

Also petitioner admitted to the genuineness and due execution of the promissory notes. The promissory notes, however,
appear to be negotiable as they meet the requirements of Section 1of the Negotiable Instruments Law. Such being the
case, the notes are prima facie deemed to have been issued for consideration. It bears noting that no sufficient
evidence was adduced by petitioners to show otherwise.

In order, however, that any such instrument when completed may be enforced against a person who became a party
thereto prior to its completion, it must be filled up strictly in accordance with the authority given and within a
reasonable time. But if any such instrument, after completion, is negotiated to a holder in due course, it is valid and
effectual for all purposes in his hands, and he may enforce it as if it had been filled up strictly in accordance with the
authority given and within a reasonable time.

Alan A Gultia