REAL AND PERSONAL DEFENSES

Real Defense Personal Defense

Vicious Force or Violence Duress or Intimidation

Illegality – if declared void for any purpose Illegal Consideration

Insolvency

Marriage (Wife)

Public Enemies

SEC. 55
When title defective. – The title of a person who negotiates an instrument is defective within the meaning of this
Act when he obtained the instrument, or any signature thereto, by fraud, duress, or force and fear, or other
unlawful means, or for an illegal consideration, or when he negotiates it in breach of faith, or under such
circumstances as amount to a fraud.

DURESS AND INTIMIDATION

Duress Intimidation

- External - Internal

- Prevents the expression of the will substituting it - Influences the operation of the will - inhibiting it in
with a material act dictated by another such a way that the expression thereof is apparently
that of a person who has freely given his consent
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Personal Defense

General Rule: vicious force, duress or intimidation against a person gives the latter a personal defense.

- Defendant did not act as a reasonable man would in resisting the coercion exercised upon will- will not
prevent him from setting up the defense of duress.

Real Defense

- Duress or intimidation is considered as real defense if it amounts to forgery

- The person who exerted the same is practically writing the note itself by holding the hands of another.

ILLEGALITY / ILLEGAL CONSIDERATION

Consideration promised in a particular transaction that violates the:
• Law
• Morality
• Public Policy
• Public Interest.

Generally, illegality of the transaction that gave rise to a particular transaction is only a personal defense.

Exception: when the law which declares that the transaction illegal likewise declares that the Negotiable
Instrument or document issues in connection thereto is void against any party.

Section 55 – makes not only “illegal consideration” but also any other unlawful means of obtaining the instrument
– a defect of title which is not available to against a holder in due course under Section 57.

- Personal defense under Section 55 of the Negotiable Instruments Law

- Under Article 1409 of the Civil Code, a contract with an illegal cause is void which is tantamount to a real
defense.

- Although the contract lacks the essential elements of lawful cause or consideration, the law treats the
defect as personal defense only.

Illustrative Case:

In contract law, an illegal consideration is consideration promised in a contract that violates the law, morality,
public policy, or the public interest.

For example, in a contract where a hit man promises to kill someone for another party in exchange for money, the
promise of murder is an illegal consideration.

Report by: Maricel R. Lacanilao

Student ID: 2016-0429
Negotiable Instruments
Atty. L. Bundac