THE NEGOTIABLE INSTRUMENTS LAW

X. ACCEPTANCE

Sec. 133. Holder entitled to acceptance on face of bill. - The holder of a bill presenting the
same for acceptance may require that the acceptance be written on the bill, and, if such
request is refused, may treat the bill as dishonored.

Paraphrased
Section 133. When presenting a bill for acceptance, the holder may request that the acceptance be
inscribed on the bill, and if this request is denied, the bill may be treated as dishonored.

Sec. 134. Acceptance by separate instrument. - Where an acceptance is written on a paper

other than the bill itself, it does not bind the acceptor except in favor of a person to whom it is
shown and who, on the faith thereof, receives the bill for value.

Paraphrased
Section 134. When an acceptance is written on a piece of paper other than the bill itself, it binds the
acceptor only in the case of a person to whom it is shown and who accepts the bill for value on the
basis of the acceptance.

Sec. 135. Promise to accept; when equivalent to acceptance. - An unconditional promise in

writing to accept a bill before it is drawn is deemed an actual acceptance in favor of every
person who, upon the faith thereof, receives the bill for value.

Paraphrased
Section 135. An unconditional written promise to accept a bill before it is drawn is constituted a real
acceptance in favor of anybody who gets the bill for value on the basis of such commitment.

Sec. 136. Time allowed drawee to accept. - The drawee is allowed twenty-four hours after
presentment in which to decide whether or not he will accept the bill; the acceptance, if given,
dates as of the day of presentation.

Paraphrased
Section 136. The drawee has twenty-four hours after the bill is presented to determine whether or not
to accept it; the acceptance, if provided, is effective on the day of presentation.

Sec. 137. Liability of drawee returning or destroying bill. - Where a drawee to whom a bill is
delivered for acceptance destroys the same, or refuses within twenty-four hours after such
delivery or within such other period as the holder may allow, to return the bill accepted or non-
accepted to the holder, he will be deemed to have accepted the same.

Paraphrased
Section 137. When a drawee to whom a bill is handed for acceptance destroys it or refuses to return
the bill accepted or non-accepted to the holder within twenty-four hours of delivery or such other term
as the holder may allow, he is presumed to have accepted it.

Sec. 138. Acceptance of incomplete bill. - A bill may be accepted before it has been signed by
the drawer, or while otherwise incomplete, or when it is overdue, or after it has been
dishonored by a previous refusal to accept, or by non-payment. But when a bill payable after
sight is dishonored by non-acceptance and the drawee subsequently accepts it, the holder, in
the absence of any different agreement, is entitled to have the bill accepted as of the date of
the first presentment.

Paraphrased
Section 138. A bill may be accepted before the drawer has signed it, or while it is otherwise
unfinished, or when it is past due, or after it has been dishonored by a previous refusal to accept or
non-payment. When a bill due after sight is dishonored by non-acceptance and the drawee accepts it
later, the holder, unless otherwise agreed, is entitled to have the bill accepted as of the initial
presentment date.

Sec. 139. Kinds of acceptance. - An acceptance is either general or qualified. A general

acceptance assents without qualification to the order of the drawer. A qualified acceptance in
express terms varies the effect of the bill as drawn.

Paraphrased
Section 139. An acceptance might be either unconditional or conditional. A broad acceptance agrees
to the drawer's order without condition. The impact of the measure as drafted is changed by a
qualified approval in express terms.
Sec. 140. What constitutes a general acceptance. - An acceptance to pay at a particular place
is a general acceptance unless it expressly states that the bill is to be paid there only and not
elsewhere.

Paraphrased
Section 140. Unless it clearly indicates that the bill is to be paid only there and not elsewhere, an
acceptance to pay at a specific location is a general acceptance.

Sec. 141. Qualified acceptance. - An acceptance is qualified which is:

(a) Conditional; that is to say, which makes payment by the acceptor dependent on the
fulfillment of a condition therein stated;
(b) Partial; that is to say, an acceptance to pay part only of the amount for which the bill is
drawn;
(c) Local; that is to say, an acceptance to pay only at a particular place;
(d) Qualified as to time;
(e) The acceptance of some, one or more of the drawees but not of all.

Paraphrased
Section 141. Qualified acceptance: (a) Conditional; that is, the acceptor's payment is contingent on
the fulfillment of a condition indicated therein. (b) Local; that is, an acceptance to pay only at a
specific location. (c) Partial; that is, an acceptance to pay just a portion of the amount for which the bill
is drawn. (d) In terms of time, qualified. (e) Some, but not all, of the drawees have agreed to
participate.

Sec. 142. Rights of parties as to qualified acceptance. - The holder may refuse to take a
qualified acceptance and if he does not obtain an unqualified acceptance, he may treat the bill
as dishonored by non-acceptance. Where a qualified acceptance is taken, the drawer and
indorsers are discharged from liability on the bill unless they have expressly or impliedly
authorized the holder to take a qualified acceptance, or subsequently assent thereto. When the
drawer or an indorser receives notice of a qualified acceptance, he must, within a reasonable
time, express his dissent to the holder or he will be deemed to have assented thereto.

Paraphrased
Section 142. The holder has the option of refusing a qualified acceptance and, if an unqualified
acceptance is not obtained, treating the bill as dishonored by non-acceptance. The drawer and
indorsers are released from obligation on the bill unless they have directly or impliedly permitted the
holder to take a qualified acceptance or afterwards accede to it. When a drawer or indorser receives
notification of a qualified acceptance, he must express his opposition to the holder within a
reasonable time, or he will be presumed to have agreed to it.

XI. PRESENTMENT FOR ACCEPTANCE

Sec. 143. When presentment for acceptance must be made. - Presentment for acceptance
must be made:
(a) Where the bill is payable after sight, or in any other case, where presentment for
acceptance is necessary in order to fix the maturity of the instrument; or
(b) Where the bill expressly stipulates that it shall be presented for acceptance; or
(c) Where the bill is drawn payable elsewhere than at the residence or place of business of
the drawee.
In no other case is presentment for acceptance necessary in order to render any party to the
bill liable.

Paraphrased
Section 143. Presentment for acceptance is required: (a) where the bill is due after sight, or in any
other instance where it is essential to fix the maturity of the instrument; or (b) where the bill clearly
states that it must be presented for acceptance; or (c) where the bill is drawn payable somewhere
other than the drawee's dwelling or place of business. Presentment for acceptance is not required in
any other instance for any party to the bill to be held accountable.

Sec. 144. When failure to present releases drawer and indorser. - Except as herein otherwise
provided, the holder of a bill which is required by the next preceding section to be presented
for acceptance must either present it for acceptance or negotiate it within a reasonable time. If
he fails to do so, the drawer and all indorsers are discharged.

Paraphrased
Section 144. Except as otherwise stated above, the bearer of a bill that is required to be offered for
acceptance by the next previous section shall either present it for acceptance or negotiate it within a
reasonable period. If he does not, the drawer and all indorsers are released.

Sec. 145. Presentment; how made. - Presentment for acceptance must be made by or on
behalf of the holder at a reasonable hour, on a business day and before the bill is overdue, to
the drawee or some person authorized to accept or refuse acceptance on his behalf; and
(a) Where a bill is addressed to two or more drawees who are not partners, presentment
must be made to them all unless one has authority to accept or refuse acceptance for
all, in which case presentment may be made to him only;
(b) Where the drawee is dead, presentment may be made to his personal representative;
(c) Where the drawee has been adjudged a bankrupt or an insolvent or has made an
assignment for the benefit of creditors, presentment may be made to him or to his
trustee or assignee.

Paraphrased
Section 145. The holder shall provide the bill for acceptance to the drawee or someone authorized to
accept or deny acceptance on his behalf at a reasonable hour, on a business day, and before the bill
is past due; and (a) If a bill is addressed to two or more non-partner drawees, presentment must be
made to all of them unless one of them has power to accept or deny acceptance for all, in which case
presentment may be made to him alone; (b) If the drawee is deceased, the presentment may be given
to his personal representative; (c) If the drawee has been declared bankrupt or insolvent, or has made
an assignment for the benefit of creditors, the presentment may be made to him, his trustee, or
assignee.

Sec. 146. On what days presentment may be made. - A bill may be presented for acceptance
on any day on which negotiable instruments may be presented for payment under the
provisions of Sections seventy-two and eighty-five of this Act. When Saturday is not otherwise
a holiday, presentment for acceptance may be made before twelve o'clock noon on that day.

Paraphrased
Section 146. Any day on which negotiable instruments may be offered for payment under the
provisions of Sections 72 and 85 of this Act, a bill may be offered for acceptance. When Saturday is
not otherwise a holiday, a presentation for acceptance may be made before twelve o'clock noon on
that day.
Sec. 147. Presentment where time is insufficient. - Where the holder of a bill drawn payable
elsewhere than at the place of business or the residence of the drawee has no time, with the
exercise of reasonable diligence, to present the bill for acceptance before presenting it for
payment on the day that it falls due, the delay caused by presenting the bill for acceptance
before presenting it for payment is excused and does not discharge the drawers and
indorsers.

Paraphrased
Section 147. When the holder of a bill drawn payable other than at the drawee's place of business or
home has insufficient time to present the bill for acceptance before presenting it for payment on the
due date, the delay created by presenting the bill for acceptance before presenting it for payment is
forgiven, but it does not discharge the drawers and indorsers.

Sec. 148. Where presentment is excused. - Presentment for acceptance is excused and a bill
may be treated as dishonored by non-acceptance in either of the following cases:
(a) Where the drawee is dead, or has absconded, or is a fictitious person or a person not
having capacity to contract by bill.
(b) Where, after the exercise of reasonable diligence, presentment can not be made.
(c) Where, although presentment has been irregular, acceptance has been refused on some
other ground.

Paraphrased
Section 148. Presentment for acceptance is waived, and a bill may be deemed as dishonored by non-
acceptance if the drawee is deceased, has absconded, or is a fictitious person or a person without the
legal ability to contract by bill. Where, after the exercise of reasonable effort, presentation cannot be
made and acceptance has been denied on other grounds, despite the irregularity of the presentation.

Sec. 149. When dishonored by nonacceptance. - A bill is dishonored by non-acceptance:

(a) When it is duly presented for acceptance and such an acceptance as is prescribed by
this Act is refused or cannot be obtained; or
(b) When presentment for acceptance is excused and the bill is not accepted.

Paraphrased
Section 149. Non-acceptance of a bill dishonors it: (a) when it is lawfully presented for acceptance
and the acceptance required by this Act is rejected or impossible to acquire; or (b) when presentment
for acceptance is excused and the bill is not accepted.

Sec. 150. Duty of holder where bill not accepted. - Where a bill is duly presented for
acceptance and is not accepted within the prescribed time, the person presenting it must treat
the bill as dishonored by nonacceptance or he loses the right of recourse against the drawer
and indorsers.

Paraphrased
Section 150. If a bill is properly offered for acceptance but is not accepted within the specified period,
the person submitting it must regard the bill as dishonored by nonacceptance or he loses his right to
sue the drawer and indorsers.

Sec. 151. Rights of holder where bill not accepted. - When a bill is dishonored by
nonacceptance, an immediate right of recourse against the drawer and indorsers accrues to
the holder and no presentment for payment is necessary.

Paraphrased
Section 151. When a bill is dishonored by nonacceptance, the holder has an instant right of action
against the drawer and indorsers, and no payment presentation is required.

XII. PROTEST

Sec. 152. In what cases protest necessary. - Where a foreign bill appearing on its face to be
such is dishonored by nonacceptance, it must be duly protested for nonacceptance, by
nonacceptance is dishonored and where such a bill which has not previously been dishonored
by nonpayment, it must be duly protested for nonpayment. If it is not so protested, the drawer
and indorsers are discharged. Where a bill does not appear on its face to be a foreign bill,
protest thereof in case of dishonor is unnecessary.

Paraphrased
Section 152. When a foreign bill that seems to be such on its face is dishonored by nonacceptance, it
must be duly protested for nonacceptance, and when such a bill that has not previously been
dishonored by nonpayment must be duly protested for nonpayment. If no objections are raised, the
drawer and indorsers are released. Protesting a bill that does not appear to be a foreign bill on its face
is pointless in the event of dishonor.

Sec. 153. Protest; how made. - The protest must be annexed to the bill or must contain a copy
thereof, and must be under the hand and seal of the notary making it and must specify:
(a) The time and place of presentment;
(b) The fact that presentment was made and the manner thereof;
(c) The cause or reason for protesting the bill;
(d) The demand made and the answer given, if any, or the fact that the drawee or acceptor
could not be found.

Paraphrased
Section 153. The protest must be attached to the bill or contain a copy of it, be signed and sealed by
the notary, and include the following information:
(a) The time and location of presentment; (b) The fact of presentment and the method in which it was
made; (c) The cause or reason for protesting the bill; (d) The demand made and the response offered,
if any, or the fact that the drawee or acceptor could not present the bill; (d) The demand and, if
applicable, the response, or the information that the drawee or acceptor could not be located.

Sec. 154. Protest, by whom made. - Protest may be made by:

(a) A notary public; or
(b) By any respectable resident of the place where the bill is dishonored, in the presence
of two or more credible witnesses.

Paraphrased
Section 154. A notary public or any respectable inhabitant of the place where the bill is dishonored, in
the presence of two or more reliable witnesses, may make a protest.

Sec. 155. Protest; when to be made. - When a bill is protested, such protest must be made on
the day of its dishonor unless delay is excused as herein provided. When a bill has been duly
noted, the protest may be subsequently extended as of the date of the noting.
Paraphrased
Section 155. If a bill is contested, it must be protested on the day of its dishonor, unless the delay is
excused as stated below. After a bill has been officially noticed, the protest period may be extended
as of the noting date.

Sec. 156. Protest; where made. - A bill must be protested at the place where it is dishonored,
except that when a bill drawn payable at the place of business or residence of some person
other than the drawee has been dishonored by nonacceptance, it must be protested for non-
payment at the place where it is expressed to be payable, and no further presentment for
payment to, or demand on, the drawee is necessary.

Paraphrased
Section 156. A bill must be protested at the location where it is dishonored, except that if a bill drawn
payable at the place of business or home of someone other than the drawee has been dishonored by
nonacceptance, it must be protested for non-payment at the location where it is expressed to be
payable, and no further presentation for payment to, or demand on, the drawee is required.

Sec. 157. Protest both for non-acceptance and non-payment. - A bill which has been protested
for non-acceptance may be subsequently protested for non-payment.

Paraphrased
Section 157. A bill may be protested for non-payment after it has been protested for non-acceptance.

Sec. 158. Protest before maturity where acceptor insolvent. - Where the acceptor has been
adjudged a bankrupt or an insolvent or has made an assignment for the benefit of creditors
before the bill matures, the holder may cause the bill to be protested for better security against
the drawer and indorsers.

Paraphrased
Section 158. The holder may cause the bill to be protested for stronger security against the drawer
and indorsers if the acceptor has been declared bankrupt or insolvent or has made an assignment for
the benefit of creditors before the bill matures.

Sec. 159. When protest dispensed with. - Protest is dispensed with by any circumstances
which would dispense with notice of dishonor. Delay in noting or protesting is excused when
delay is caused by circumstances beyond the control of the holder and not imputable to his
default, misconduct, or negligence. When the cause of delay ceases to operate, the bill must
be noted or protested with reasonable diligence.

Paraphrased
Section 159. Any event that would dispense with notification of dishonor dispenses with protest. When
a delay in noting or protesting is caused by circumstances beyond the holder's control and not
attributable to his default, misconduct, or negligence, the holder is forgiven. When the cause of the
delay no longer exists, the bill must be recorded or disputed as soon as possible.

Sec. 160. Protest where bill is lost and so forth. - When a bill is lost or destroyed or is wrongly
detained from the person entitled to hold it, protest may be made on a copy or written
particulars thereof.

Paraphrased
Section 160. A protest may be lodged on a copy or written particulars of a bill if it is lost or destroyed,
or if it is wrongfully kept from the person authorized to have it.

XIII. ACCEPTANCE FOR HONOR

Sec. 161. When bill may be accepted for honor. - When a bill of exchange has been protested
for dishonor by non-acceptance or protested for better security and is not overdue, any
person not being a party already liable thereon may, with the consent of the holder, intervene
and accept the bill supra protest for the honor of any party liable thereon or for the honor of
the person for whose account the bill is drawn. The acceptance for honor may be for part only
of the sum for which the bill is drawn; and where there has been an acceptance for honor for
one party, there may be a further acceptance by a different person for the honor of another
party.

Paraphrased
Section 161. When a bill of exchange has been protested for dishonor by non-acceptance or for
greater security and is not late, any person who is not a party already liable on the bill may intervene
and accept the bill above protest for the honor of any party responsible on the bill or for the honor of
the person for whose account the bill is drawn, with the approval of the holder. The acceptance for
honor may be for a portion of the bill's total amount, and when one party's honor has been accepted,
another party's honor may be accepted by a different individual.

Sec. 162. Acceptance for honor; how made. - An acceptance for honor supra protest must be
in writing and indicate that it is an acceptance for honor and must be signed by the acceptor
for honor.

Paraphrased
Section 162. An acceptance for honor above protest must be written and signed by the acceptor for
honor, indicating that it is an acceptance for honor.

Sec. 163. When deemed to be an acceptance for honor of the drawer. - Where an acceptance
for honor does not expressly state for whose honor it is made, it is deemed to be an
acceptance for the honor of the drawer.

Paraphrased
Section 163. When an acceptance for honor does not indicate explicitly for whose honor it is made, it
is assumed to be for the drawer's honor.

Sec. 164. Liability of the acceptor for honor. - The acceptor for honor is liable to the holder and
to all parties to the bill subsequent to the party for whose honor he has accepted.

Paraphrased
Section 164. The honor acceptor is answerable to the holder and any future parties to the bill after the
party whose honor he has accepted.

Sec. 165. Agreement of acceptor for honor. - The acceptor for honor, by such acceptance,
engages that he will, on due presentment, pay the bill according to the terms of his
acceptance provided it shall not have been paid by the drawee and provided also that is shall
have been duly presented for payment and protested for non-payment and notice of dishonor
given to him.

Paraphrased
Section 165. By accepting the bill for honor, the acceptor commits to paying the bill according to the
conditions of his acceptance, provided that it has not been paid by the drawee and that it has been
formally presented for payment, protested for non-payment, and notice of dishonor has been given to
him.

Sec. 166. Maturity of bill payable after sight; accepted for honor. - Where a bill payable after
sight is accepted for honor, its maturity is calculated from the date of the noting for non-
acceptance and not from the date of the acceptance for honor.

Paraphrased
Section 166. When a bill payable after sight is accepted for honor, the maturity is computed from the
date of the notation for non-acceptance, not from the acceptance date.

Sec. 167. Protest of bill accepted for honor, and so forth. - Where a dishonored bill has been
accepted for honor supra protest or contains a referee in case of need, it must be protested for
non-payment before it is presented for payment to the acceptor for honor or referee in case of
need.

Paraphrased
Section 167. If a dishonored bill has been accepted for honor supra protest or contains a referee in
case of necessity, it must be protested for non-payment before being offered for payment to the honor
acceptor or referee in case of necessity.

Sec. 168. Presentment for payment to acceptor for honor, how made. - Presentment for
payment to the acceptor for honor must be made as follows:
a. If it is to be presented in the place where the protest for non-payment was made, it must
be presented not later than the day following its maturity.
b. If it is to be presented in some other place than the place where it was protested, then it
must be forwarded within the time specified in Section one hundred and four.

Paraphrased
Section 168. Payment for honor must be delivered to the acceptor in the following manner:
a. If it is to be delivered in the same location as the protest for non-payment, it must be presented no
later than the day after its maturity.
b. If it is to be presented in a location other than the one where it was protested, it must be forwarded
within the time limits set out in Section 104.

Sec. 169. When delay in making presentment is excused. - The provisions of Section eighty-
one apply where there is delay in making presentment to the acceptor for honor or referee in
case of need.

Paraphrased
Section 169. When there is a delay in making a presentation to the acceptor for honor or referee in
case of need, the rules of Section eighty-one apply.

Sec. 170. Dishonor of bill by acceptor for honor. - When the bill is dishonored by the acceptor
for honor, it must be protested for non-payment by him.

Paraphrased
Section 170. When a bill is dishonored for honor, it must be contested for non-payment by the
acceptor.

XIV. PAYMENT FOR HONOR

Sec. 171. Who may make payment for honor. - Where a bill has been protested for non-
payment, any person may intervene and pay it supra protest for the honor of any person liable
thereon or for the honor of the person for whose account it was drawn.

Paraphrased
Section 171. Any person may intervene and pay a bill that has been protested for non-payment for the
honor of any person liable thereon or for the honor of the person for whose account it was drawn.

Sec. 172. Payment for honor; how made. - The payment for honor supra protest, in order to
operate as such and not as a mere voluntary payment, must be attested by a notarial act of
honor which may be appended to the protest or form an extension to it.

Paraphrased
Section 172. The payment for honor supra protest must be proved by a notarial act of honor, which
may be affixed to the protest or form an extension of it, in order to function as such and not as a
simple voluntary payment.

Sec. 173. Declaration before payment for honor. - The notarial act of honor must be founded
on a declaration made by the payer for honor or by his agent in that behalf declaring his
intention to pay the bill for honor and for whose honor he pays.

Paraphrased
Section 173. The notarial act of honor must be based on a declaration by the honor payer or his agent
indicating his desire to pay the bill for honor and for whose honor he is paying.

Sec. 174. Preference of parties offering to pay for honor. - Where two or more persons offer to
pay a bill for the honor of different parties, the person whose payment will discharge most
parties to the bill is to be given the preference.

Paraphrased
Section 174. When two or more people volunteer to pay a debt for the honor of several parties, the
individual whose contribution will discharge the majority of the bill's parties should be given priority.

Sec. 175. Effect on subsequent parties where bill is paid for honor. - Where a bill has been paid
for honor, all parties subsequent to the party for whose honor it is paid are discharged but the
payer for honor is subrogated for, and succeeds to, both the rights and duties of the holder as
regards the party for whose honor he pays and all parties liable to the latter.

Paraphrased
Section 175. When a debt is paid for honor, all parties after the party for whose honor it is paid are
discharged, but the honor payer is subrogated for and succeeds to both the holder's rights and
responsibilities as to the party for whose honor he pays and all parties due to the latter.

Sec. 176. Where holder refuses to receive payment supra protest. - Where the holder of a bill
refuses to receive payment supra protest, he loses his right of recourse against any party who
would have been discharged by such payment.

Paraphrased
Section 176. When a bill holder refuses to accept payment over his objection, he forfeits his right to
sue any person who would have been released by such payment.

Sec. 177. Rights of payer for honor. - The payer for honor, on paying to the holder the amount
of the bill and the notarial expenses incidental to its dishonor, is entitled to receive both the
bill itself and the protest.

Paraphrased
Section 177. The payer for honor is entitled to obtain both the bill and the protest after paying the
holder the amount of the bill and the notarial charges related to its dishonor.

XV. BILLS IN SET

Sec. 178. Bills in set constitute one bill. - Where a bill is drawn in a set, each part of the set
being numbered and containing a reference to the other parts, the whole of the parts
constitutes one bill.

Paraphrased
Section 178. When a bill is drawn as part of a set, each member of the set is numbered and has a
reference to the other parts, the set as a whole is referred to as one bill.

Sec. 179. Right of holders where different parts are negotiated. - Where two or more parts of a
set are negotiated to different holders in due course, the holder whose title first accrues is, as
between such holders, the true owner of the bill. But nothing in this section affects the right
of a person who, in due course, accepts or pays the parts first presented to him.

Paraphrased
Section 179. When two or more elements of a set are negotiated to various holders throughout time,
the holder whose title initially accrues is the genuine owner of the bill as between such holders.
However, nothing in this section affects the right of a person who accepts or pays the components
initially provided to him in a timely manner.

Sec. 180. Liability of holder who indorses two or more parts of a set to different persons. -
Where the holder of a set indorses two or more parts to different persons he is liable on every
such part, and every indorser subsequent to him is liable on the part he has himself indorsed,
as if such parts were separate bills.

Paraphrased
Section 180. When the holder of a set indorses two or more pieces to different people, he is
accountable for each of them, and every successive indorser is accountable for the portion he has
indorsed, as if they were independent invoices.

Sec. 181. Acceptance of bill drawn in sets. - The acceptance may be written on any part and it
must be written on one part only. If the drawee accepts more than one part and such accepted
parts negotiated to different holders in due course, he is liable on every such part as if it were
a separate bill.

Paraphrased
Section 181. The acceptance may be written on any portion, but only one section must be written on.
If the drawee accepts more than one part, and those accepted parts are later negotiated to other
holders, he is accountable for each part as if it were a new bill.

Sec. 182. Payment by acceptor of bills drawn in sets. - When the acceptor of a bill drawn in a
set pays it without requiring the part bearing his acceptance to be delivered up to him, and the
part at maturity is outstanding in the hands of a holder in due course, he is liable to the holder
thereon.

Paraphrased
Section 182. When a bill drawn in a set is paid without the acceptor demanding the part bearing his
acceptance to be given over to him, and the part at maturity is outstanding in the hands of a holder in
due time, he is liable to the holder.

Sec. 183. Effect of discharging one of a set. - Except as herein otherwise provided, where any
one part of a bill drawn in a set is discharged by payment or otherwise, the whole bill is
discharged.

Paraphrased
Section 183. Where any portion of a bill drawn in a set is discharged by payment or otherwise, the
entire bill is dismissed, unless expressly stated above.

XVI. PROMISSORY NOTES AND CHECKS

Sec. 184. Promissory 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 fixed or determinable future time, a sum certain in
money to order or to bearer. Where a note is drawn to the maker's own order, it is not
complete until indorsed by him.

Paraphrased
Section 184. A negotiable promissory note, as defined by this Act, is an unconditional promise in
writing given by one person to another, signed by the maker, promising to pay an amount certain in
money to order or to bearer on demand, or at a definite or determinable future period. When a
message is drawn to the maker's own order, it isn't finished until he signs it.

Sec. 185. Check, defined. - A check is a bill of exchange drawn on a bank payable on demand.
Except as herein otherwise provided, the provisions of this Act applicable to a bill of exchange
payable on demand apply to a check.

Paraphrased
Section 185. A check is a bank-drawn bill of exchange that is payable on demand. The provisions of
this Act that apply to a bill of exchange payable on demand also apply to a check, unless otherwise
stated.

Sec. 186. Within 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 extent of the loss caused by the delay.

Paraphrased
Section 186. A check must be produced for payment within a reasonable period after it is issued, or
the drawer will be released from obligation for the amount of loss incurred as a result of the delay.
Sec. 187. Certification of check; effect of. - Where a check is certified by the bank on which it
is drawn, the certification is equivalent to an acceptance.

Paraphrased
Section 187. The certification of a check by the bank on which it is drawn is the same as an
acceptance.

Sec. 188. Effect where the holder of check procures it to be certified. - Where the holder of a
check procures it to be accepted or certified, the drawer and all indorsers are discharged from
liability thereon.

Paraphrased
Section 188. When a check's holder obtains its acceptance or certification, the drawer and all
indorsers are released from obligation.

Sec. 189. When 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.

Paraphrased
Section 189. A check does not constitute an assignment of any part of the money to the drawer's
account with the bank, and the bank is not accountable to the holder until and until the check is
accepted or certified.

XVII. GENERAL PROVISIONS

Sec. 190. Short title. - This Act shall be known as the Negotiable Instruments Law.

Paraphrased
Section 190. The Negotiable Instruments Law will be referred to as this Act.

Sec. 191. Definition and meaning of terms. - In this Act, unless the contract otherwise requires:
"Acceptance" means an acceptance completed by delivery or notification;
"Action" includes counterclaim and set-off;
"Bank" includes any person or association of persons carrying on the business of banking,
whether incorporated or not;
"Bearer" means the person in possession of a bill or note which is payable to bearer
"Bill" means bill of exchange, and "note" means negotiable promissory note;
"Delivery" means transfer of possession, actual or constructive, from one person to another;
"Holder" means the payee or indorsee of a bill or note who is in possession of it, or the bearer
thereof;
"Indorsement" means an indorsement completed by delivery;
"Instrument" means negotiable instrument;
"Issue" means the first delivery of the instrument, complete in form, to a person who takes it
as a holder
"Person" includes a body of persons, whether incorporated or not;
"Value" means valuable consideration;
"Written" includes printed, and "writing" includes print.

Paraphrased
Section 191. - Unless the contract specifies differently, in this Act: "Action" comprises counterclaim
and set-off, and "acceptance" denotes an acceptance finalized by delivery or notice. Any individual or
group of people engaged on the business of banking, whether incorporated or not, is referred to as a
"bank." The person in possession of a bill or note payable to bearer is referred to as the "bearer." The
terms "bill" and "note" refer to a bill of exchange and a negotiable promissory note, respectively.
"Holder" implies the payee or indorsee of a bill or note who is in possession of it, or the bearer
thereof; "Delivery" denotes the transfer of possession, actual or constructive, from one person to
another; "Issue" implies the first delivery of the instrument, complete in form, to a person who accepts
it as a holder; "Indorsement" means an indorsement completed by delivery; "Instrument" implies a
negotiable instrument; "Issue" means the first delivery of the instrument, complete in form, to a person
who accepts it as a holder. "Person" refers to a group of people, whether or not they are incorporated;
"Value" refers to a valued consideration; "Written" refers to print, and "writing" refers to print.

Sec. 192. Persons primarily liable on instrument. - The person "primarily" liable on an
instrument is the person who, by the terms of the instrument, is absolutely required to pay the
same. All other parties are "secondarily" liable.

Paraphrased
Section 192. The person who is "mainly" accountable on an instrument is the one who is obligated to
pay the instrument under its conditions. All other parties are accountable "secondarily."

Sec. 193. Reasonable time, what constitutes. - In determining what is a "reasonable

time" regard is to be had to the nature of the instrument, the usage of trade or business with
respect to such instruments, and the facts of the particular case.

Paraphrased
Section 193. The nature of the instrument, the use of trade or commerce with respect to such
instruments, and the facts of the case must all be considered when deciding what is a "reasonable
time."

Sec. 194. Time, how computed; when last day falls on holiday. - Where the day, or the last day
for doing any act herein required or permitted to be done falls on a Sunday or on a holiday, the
act may be done on the next succeeding secular or business day.

Paraphrased
Section 194. If a Sunday or a holiday falls on the day or the final day for doing any act herein needed
or authorized to be done, the act may be done on the following secular or business day.

Sec. 195. Application of Act. - The provisions of this Act do not apply to negotiable
instruments made and delivered prior to the taking effect hereof.

Paraphrased
Section 195. The provisions of this Act do not apply to negotiable instruments that were made and
delivered before the date of its enactment.

Sec. 196. Cases not provided for in Act. - Any case not provided for in this Act shall be
governed by the provisions of existing legislation or in default thereof, by the rules of the law
merchant.

Paraphrased
Section 196. Any situation not covered by this Act will be controlled by current laws or, in the absence
of it, by the norms of the law merchant.
Sec. 197. Repeals. - All acts and laws and parts thereof inconsistent with this Act are hereby
repealed.

Paraphrased
Section 197. All actions and laws, in whole or in part, that are in conflict with this Act are repealed.

Sec. 198. Time when Act takes effect. - This Act shall take effect ninety days after its
publication in the Official Gazette of the Philippine Islands shall have been completed
Enacted: February 3, 1911

Paraphrased
Section 198. This Act becomes effective ninety days after it has been published in the Philippine
Islands' Official Gazette. On the 3rd of February, 1911, legislation was enacted.