The holder in due course
“Niloko ako ng pinagbigyan ko ng tseke. Kailangan ko pa rin bang magbayad sa iba?”
Negotiability exists so that strangers can trust paper. The price of that trust is that a holder in due course takes the instrument free of most of the quarrels between the people before him — but not all of them.
Study material, not legal advice. Written and checked by the PhilippineLaws team to the best of our knowledge; not reviewed by a lawyer. Check every provision and case against its full text before you rely on it or cite it.
Read the strip. The last panel does not answer — you do, before the rule shows up.
A car lot. Carlo writes a post-dated check for ₱300,000 to Benjie for a used pickup. Benjie grins and pockets it.
BENJIE“Walang problema ang makina, sir. Promise.”
Carlo is the drawer; Benjie is the payee. The deal is the consideration.
A week later. The pickup is on a tow truck, hood open, smoke rising.
CARLO“Sira pala! Niloko ako. Ipa-stop payment ko ang tseke.”
Fraud in the inducement — a defense Carlo has against Benjie.
Meanwhile, at an appliance store, Benjie indorses the check to Liza, who gives him a refrigerator and cash in exchange, knowing nothing of the pickup.
LIZA“Maayos ang tseke, hindi pa due. Sige, tanggapin ko.”
Taken complete and regular, before maturity, for value, without notice.
Liza holding the dishonored check, looking at the reader.
CAPTIONNiloko si Carlo ni Benjie. Pero si Liza ang may hawak. Kanino ang talo?
Vote before the rule.