Yang vs CA

G.R. No. 138074

FACTS: Yang and Chandiramani entered into an agreement

whereby the latter was to give Yang a manager’s check in the amount
of 4.2 million and a 200k dollar draft payable to PCIB in exchange of
2 manager’s check payable to Fernando David each in the amount of
2.087 million and a 200k dollar draft to be issued by Hang Seng
Bank.
At the time of exchange, it was alleged that Yang’s check was
lost. However, it transpired that it was not lost for Chandiramani was
able to get hold of the said instruments without delivering the
exchange consideration to Yang. He then later delivered the 2
manager’s check to David and David gave Chandiramani 360k US
dollar in exchange. Hence, a complaint from Yang arise.

ISSUE: WON David is a holder in due course.

HELD/RULING: The CA affirmed. Every Holder of a negotiable

instrument is deemed prima facie a holder in due course. In the
present case, it is not disputed that David was the payee of the
checks in question. The weight of authority sustains the view that a
payee may be a holder in due course. Hence, the presumption that
he is a prima facie holder in due course applies in his favor. In
alleging otherwise, the petitioner has the burden of proving the
contrary.