Professional Documents
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CONSIDERATIONS
zAND NEGOTIATIONS
SGD
z FAILURE OF CONSIDERATION
SGD. W
B X
EXAMPLE
SGD Y
IT IS ALSO A CONTRACT.
z
WHERE SHOULD AN INDORSEMENT BE CONTAINED
SPECIAL INDORSEMENT
it qualifies the person to whom or to
whose order the instrument is
payable, and the indorsement of
such endorsee is necessary to the
further negotiation of the instrument
(Section 34)
z KINDS OF INDORSEMENT
BLANK INDORSEMENT
I promise to pay A or order the
it specifies no endorsee, and the instrument so
amount of 10,000
endorsed is payable to bearer and may be negotiated by Sgd B
mere delivery. (Section 34)
Pay to x
The holder may convert a blank indorsement
sgd A
into a special indorsement by writing over the
signature of the endorser in blank any
contract consistent with the character of the sgd X
endorsement. Pay the order of J
sgd X
z KINDS OF INDORSEMENT
I promise to pay X or order the
ABSOLUTE INDORSEMENT
amount of 10,000
one by which the endorser binds himself to pay, upon no Sgd B
other condition than the failure of prior parties to do so and
of due notice to him of such failure. Pay to the order of J
One by which the indorser imposes a condition Pay the order of J if it rains
to his liability. tomorrow
the party required to pay the instrument may disregard the sgd X
condition and make payment to the endorsee or his
transferee whether the condition has been fulfilled or not. Pay to K
But any person to whom an instrument so endorsed is Sgd J
negotiated will hold the same, or the proceeds thereof,
subject to the rights of the person indorsing conditionally.
(Section 39)
z KINDS OF INDORSEMENT
RESTRICTIVE INDORSEMENT –
such indorsement either: it completely destroys the
negotiable character of the
Prohibits further negotiation of instrument instrument and it may no longer
be negotiated.
“Pay to X only”
the rights of X to negotiate is
Constitutes endorsee the agent of limited because the same must
endorser be within the scope of his
authority as agent.
“Pay to X as agent”
X may negotiate the instrument
Vest title in endorsee in trust for or to the only within the scope of his
use of some other person. authority as trustee.
EFFECT OF RESTRICTIVE
INDORSEMENT: It confers upon the
endorsee the right
SGD M Sgd B
Pay to X
Sgd C
Sgd A and B
Pay to X PAY TO Z
Sgd A
Sgd B or C
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Pay to superman or order 25,000.
sgd X
z
STRIKING
When it is payable to the order of a
Fictitious person or non-existing person,
A holder may at any time strike out and such fact was known to the person
making it so payable.
any indorsement which is not
necessary to his title. The Pay to Y
endorser whose indorsement is
Sgd Z
struck out, and all endorsees
subsequent to him, are thereby
relieved from liability on the
Pay to A
instrument. (Section 48)
Sgd Y
Negotiation by a prior
z
party January 1, 2021
Pay to P or order the amount of 28,000
after date.
Where an instrument is negotiated
back to a prior party, such party SGD Z
may reissue and further negotiate
the same. However, he is not Pay to A
SGD P
entitled to enforce payment thereof
against any intervening party to Pay to B
SGD A
whom he was personally liable
(NIL, Sec. 50). Pay to C
SGD B
Pay to D
Pay to E SGD C
SGD B
Pay to B
SGD D