PRESENTMENT FOR PAYMENT Definition: The presentation of an instrument to the person primarily person primarily liable liable for the purpose of demanding payment Necessity of presentment for payment (Sec. 70) a. Against party primarily liable (i.e. maker or acceptor) !resentment for payment is not necessary in order to charge the person primarily liable on the instrument (e"en if it is re#uired according to the terms of the instrument) $f the instrument is% by its terms% payable at a special place% and he is able and &illing pay it there at maturity% such ability and willingness are willingness are e#ui"alent to a tender of payment upon his part. Thus% if the instrument is not paid and is o"erdue% he cannot be considered in delay (he still is not relie"ed from his liability of paying the amount due) b. Against party secondarily liable (i.e. dra&er and indorsers) 'eneral rule: !resentment for payment is necessary in order to charge the dra&er and indorsers. Thus% if the instrument is not presented to the person primarily liable% dra&ers and indorsers are discharged from their liability ceptions (dra&er and indorsers are liable e"en &ithout presentment for payment): *. +hen presentment not re#uired As to dra&er a. +here the dra&er has no right to epect or re#uire that the dra&ee or acceptor &ill (Sec. 7,) pay the instrument (e.g.% dra&er has no funds &ith dra&ee% dra&er has &ithdra&n funds from the dra&ee bank lea"ing nothing &ith &hich to pay the bill% etc.) b. +here the dra&er and the dra &ee are the same person (in effect% the dra&er is considered a maker% and thus% presentment is not necessary) As to indorser indorser +here the instrument &as made or accepted (not (not indorsed) for the his accommodation (Sec. -0) and he has no reason to epect that the instrument &ill be paid if presented Note: $f Note: $f presentment is not re#uired to charge the dra&er% the indorsers &ill only be liable if presentment for payment is made to them (indorsers). . +hen presentment dispensed &ith (Sec. -) a. +here after the eercise of reasonable diligence (acti"e searching)% presentment cannot be made b. +here the dra&ee is a fictitious person c. +here there is &ai"er of presentment (by the dra&er or indorser)% epress or implied /. +hen a bill is dishonored by nonacceptance% presentment for payment is not necessary (Sec. **) Requisites of sufficient presentment for payment (Sec. 7) 1y &hom The holder% or by some person authori2ed to recei"e payment on his behalf (authority need not be presented in &riting) To &hom 'eneral rule: To the person primarily liable on the instrument% or if he is absent or inaccessible% to presented any person found at the place &here the presentment is made Specific rules on presentment for payment ( Note: applicable Note: applicable only if no place of payment is specified3 if there is% presentment should be made at such place): a. +here principal debtor is dead 4 5ust be made to his personal representati"e% if such there be% and if &ith the eercise of reasonable diligence% he can be found (Sec. 76) b. +here principal debtors are liable as partners 4 5ust be made to an y one of them% e"en though there has been a dissolution of the firm (Sec. 77) c. +here principal debtors are oint debtors 4 5ust be made to them all (Sec. 7-) +here At the proper place% place% successi"e successi"e and in order (Sec. 7/): presented a. !lace for payment is specified 4 in the place specified b. !lace for payment not specified% but address of the person to make payment is gi"en 4 in the address gi"en c. !lace for payment not specified% address not gi"en 4 at the usual place of business or residence of the person to make payment d. Any other case 4 &here"er the person to make payment can be found% or at his last kno&n place of residence +hen 'eneral rule: !resentment for payment is made on the date fied &ithout grace presented ception: Delay (not the act of presentment itself) is ecused &hen the delay is caused by circumstances beyond the control of the holder and not imputable to his default% misconduct or negligence. +hen the cause of the delay ceases to operate% presentment must be made &ith reasonable diligence (Sec. -*) *. Time of presentment 4 At a reasonable hour on a business day. Note: +here Note: +here instrument is payable at a bank% presentment for payment must be made (Sec. 7): a. During banking hours if person to make payment payment has sufficient sufficient funds in the bank b. At any time during the day% before the bank is closed if person to male payment has no or insufficient funds in the bank . Date of presentment (Sec. 7* 8 Sec. -) a. $nstrument payable on demand 4 +ithin a reasonable time after its issuance (in case of promissory notes) or after its last negotiation (in case of bills of echange) Note: $f Note: $f the date of maturity falls on Sunday or a holiday% presentment must be made on the net succeeding business day. $f the date of maturity falls on Saturday and such is not a holiday% the holder% at his option% may present the instrument (a) before * noon on Saturday or (b) the net succeeding business day. b. $nstrument payable at a fied or determinable future time 4 9n the date it falls due. Time of payment is determined by ecluding the day from &hich the time is to run% and by including the date of payment (Sec. -6) Note: $f Note: $f the date of maturity falls on a Saturday% Saturday% Sunday or a holiday% presentment must be made on the net succeeding business day
o& presented
5ust be exhibited to the person from &hom payment is demanded% and &hen it is paid% the instrument must be deli"ered up to the party paying it (Sec. 7;)
NOTICE OF DISHONOR Definition: 1ringing% either "erbally or by &riting% to the kno&ledge of the dra&er or indorser of an instrument% the fact that a specified negotiable instrument% has not been paid or accepted% and that the party notified is epected to pay it !en instrument "is!onore" *. Dishonor by nonpayment (Sec. -/) a. $nstrument is duly presented for payment% and payment is refused or cannot be obtained b. !resentment for payment is ecused% and the instrument is o"erdue and unpaid . Dishonor by nonacceptance (Sec. *;,) a. $nstrument is duly presented for acceptance% and acceptance is refused or cannot be obtained b. !resentment for acceptance is ecused% and the bill is not accepted Ri#!t of !o$"er %!en instrument is "is!onore" (Sec. -; 8 Sec. **) 9nly after gi"ing of due notice of dishonor% an immediate right of recourse to all parties secondarily liable (dra&er and indorsers) accrues to the holder Necessity of notice of "is!onor a. Against party primarily liable +95 '$?= (Sec. ,0) 1y holder 1y another on behalf of holder
=otice gi"en inures to the benefit of (Sec. ,): a. All holders subse#uent to the holder &ho has gi"en notice b. All prior parties &ho ha"e a right of recourse against the party to &hom it is gi"en (i.e. parties prior to holder but subse#uent to party &ho has been gi"en notice) 1y any party entitled thereto@ =otice gi"en inures to the benefit of (Sec. ,/): 1y another on behalf of party entitled a. The holder b. All parties subse#uent to the party to &hom notice is gi"en Note: The party entitled thereto is the party to the instrument% &ho might be compelled to pay it to the holder% and &ho% upon taking it up &ould ha"e a right to reimbursement from the party to &hom notice is gi"en. $n other &ords% if a holder gi"es notice to one party% the said party can gi"e notice to other parties prior to him. !ersons benefited from the notice gi"en can hold other parties liable e"en if they themsel"es did not gi"e notice of dishonor to such parties. =otice of dishonor may be gi"en by an agent either in his o &n name or in the name of any party entitled to gi"e notice% &hether that party be his principal or not (Sec. ,*). Agent need not be authori2ed by to give notice. +here the instrument has been dishonored in the hands of an agent% he may either (Sec. ,;): a. gi"e notice to the parties liable thereon% &ithin the time fied in this Act
b. gi"e notice to his principal% &ithin the same time as if he &ere the holder% and the principal upon receipt of such notice has himself the same time for gi"ing notice as if the agent had been an independent holder
T9 +95 '$?= 'eneral rule: =otice must be gi"en to the dra&er and to each indorser (Sec. -,). =otice may be gi"en either to the party himself or to his agent in that behalf (Sec. ,7). $n this case% an agent must be authori2ed to receive notice of dishonor (in contrast to Sec. ,*% that an agent need not be authori2ed to give notice of dishonor). Specific rules: +here party is dead and his death is kno&n a. To the personal representati"e% if there be one% and if &ith to the party gi"ing notice (Sec. ,-) reasonable diligence% he can be found b. To the last residence or last place of business of the deceased +here parties are partners (Sec. ,,) To any one partner% e"en though there has been a dissolution +here parties are oint parties To each of them% unless one of them has authority to recei"e such (Sec. *00) notice for others (Note: oint parties here do not refer to oint payees or oint indorsees) +here party has been adudged a bankrupt a. To the part himself or an insol"ent% or &here party has made an b. To his trustee or assignee assignment for benefit of creditors (Sec. *0*) + '$?= (Sec. *0-) +here a party has added an address to his signature% notice of dishonor must be sent to the address. 1ut if he has not gi"en such address% then the notice must be sent as follo&s: a. ither to the postoffice nearest to his place or residence% or to the postoffice &here he is accustomed to recei"e his letters b. $f he li"es in one place and has his place of business in another% notice may be sent to either place c. $f he is soourning in another place% notice may be sent to the place &here he is so soourning 1ut &here the notice is actually recei"ed by the party &ithin the time specified in this Act% it &ill be sufficient though not sent in accordance &ith the re#uirements of this section. += '$?= 'eneral rule: =otice may be gi"en as soon as the instrument is dishonored ception: Delay in gi"ing notice is ecused &hen the delay is caused by circumstances beyond the control of the holder and not imputable to his default% misconduct or negligence (Sec. **/) Specific rules: +her e parties reside in same place (Sec. *0/) +here parties reside in different places (Sec. *0;) a. $f notice is to be gi"en at the place of business of the a. $f sent by mail% it must be deposited in the post office person to recei"e notice% it must be gi"en before the in time to go by mail the day follo&ing the day of close of business hours on the day following (i.e. the dishonor% or if there be no mail at a con"enient hour on day follo&ing the day of dishonor) that day% by the net mail thereafter b. $f gi"en at his residence% it must be gi"en before the b. $f gi"en other&ise than thru the postoffice% then usual hours of rest on the day following &ithin the time that notice &ould ha"e been recei"ed in c. $f sent by mail% it must be deposited in post office in due course of mail% if it has been deposited in the post time to reach him in usual course on the day following office &ithin the time specified in the last subdi"ision Notes: +hen a party recei"es notice of dishonor% he has% after the receipt of such notice% the same time for gi"ing notice to antecedent parties that the holder has after the dishonor (Sec. *07) 9+ '$?= Borm of notice: The notice may be (a) in &riting or (b) merely oral% and may be gi"en in any terms &hich sufficiently identify the instrument% and indicate that it has been dishonored by nonacceptance or nonpayment (Sec. ,6). Note: A &ritten notice need not be signed and an insufficient &ritten notice may be supplemented and "alidated by "erbal communication. A misdescription of the instrument does not "itiate the notice unless the party to &hom notice is gi"en is in fact misled thereby (Sec. ,). o&e"er% a mere statement that the instrument is due and payable is insufficient notice. =otice of dishonor% in all cases% may be gi"en by: a. deli"ering it personally b. through the mails +hen notice of dishonor is duly addressed and deposited in the postoffice% the sender is deemed to ha"e gi"en due notice% not&ithstanding any miscarriage in the mails (Sec. *0) =otice is deemed to ha"e been deposited in the postoffice &hen deposited in any branch postoffice or in any letter bo under the control of the postoffice department (Sec. *06)
DISCHAR&E OF NE&OTIA'(E INSTR)MENT Definition: The release of all parties% &hether primary or secondary% from the obligations arising under the instrument rendering it &ithout force and effect% and conse#uently% no longer negotiable Ho% instrument is "isc!ar#e" (Sec. **,) *. !ayment in due course 4 by or on behalf of the principal debtor% or by the party accommodated% &here the instrument is made or accepted for accommodation e#uisites (Sec. --): a. 5ust be made at or after maturity of the instrument b. 5ust be made to the holder thereof (not necessarily a holder in due course) c. 5ust be made by person to make payment% in good faith and &ithout notice that the holderCs title is defecti"e . $ntentional cancellation thereof by the holder ancellation of an instrument is not limited to the &riting of the &ord EcancelledF or EpaidF or the dra&ing of crisscross lines across the instrument. $t includes tearing% erasure% obliteration% burning and mutilation. To effect a discharge of the instrument% it must be (a) intentionally done and (b) done by the holder thereof. A cancellation made unintentionally or under a mistake or &ithout the authority of the holder% is inoperati"e3 but &here an instrument or any signature thereon appears to ha"e been cancelled% the burden of proof lies on the party &ho alleges that the cancellation &as made unintentionally% or under a mistake% or &ithout authority (Sec.*/) /. 1y any other act &hich &ill discharge a simple contract for the payment of money 4 payment or performance% loss of the thing due% condonation% confusion% compensation% no"ation% etc. (Art. */*) ;. +hen the principal debtor becomes the holder of the instrument at or after maturity in his o&n right (not in a representati"e capacity) Ho% secon"ary parties are "isc!ar#e" (Sec. *0) *. 1y any act &hich discharges the instrument . 1y the intentional cancellation of his signature by the holder /. 1y the discharge of a prior party (thru the act of the holder% not by operation of la&) ;. 1y a "alid tender of payment made by a prior party . 1y a release of the principal debtor% unless the holderCs right of recourse against the party secondarily liable is expressly reser"ed 6. 1y any agreement (by the holder and the principal debtor) binding upon the holder to etend the time of payment% or to postpone the holderCs right to enforce the instrument% unless (a) made &ith the assent of the party secondarily liable% or (b) the right of recourse against such party is epressly reser"ed Effect of payment of instrument *. !aid by party primarily liable 4 instrument is discharged% so are the secondary parties . !aid by party secondarily liable (Sec. **) a. $nstrument is not discharged b. !arty so paying it is remitted to his former rights as regards all prior parties c. e may strike out his o&n and all subse#uent indorsements% and again negotiate the instrument% except : +here instrument is payable to order of a third person and has been paid by dra&er +here instrument &as made or accepted for accommodation and has been paid by accommodated party Renunciation of !o$"er (Sec. *) $n fa"or of &hom +hen made $n fa"or of secondary party 1efore% at% or after maturity
ffect Such secondary party and the parties subse#uent to him are discharged $n fa"or of principal debtor At or after maturity $nstrument is discharged% pro"ided renunciation is made absolutely and unconditionally Note: enunciation must be in &riting% unless the instrument is deli"ered up to the person primarily liable thereon. Burther% a renunciation does not affect the rights of a holder in due course without notice. Materia$ a$teration Definition (Sec. *): $t is any alteration &hich changes the: a. Date b. Sum payable% either for principal or interest c. Time or place of payment d. =umber or the relation of the parties e. 5edium or currency in &hich payment is to be made f. Alteration &hich adds a place of payment &here no place of pa yment is specified g. Any other change or addition &hich alters the effect of the instrument in any respect ffect of material alteration (Sec. *;) +here a negotiable instrument is materially altered &ithout the assent of all parties liable thereon% it is a"oided ecept as against a party &ho has himself made% authori2ed% or assented to the alteration% and subse#uent indorsers. 1ut &hen an instrument has been materially altered and is in the hands of a holder in due course% not a party to the alteration% he may enforce payment thereof according to its original tenor. ights of holder *. older not in due course
an enforce instrument against (a) party &ho has himself made% authori2ed or assented to the alteration and (b) subse#uent indorsers according to the altered tenor . older in due course an enforce instrument according to the altered tenor against guilty parties and parties subse#uent to the alteration. o&e"er% as against parties prior to the alteration% he can enforce instrument according to its original tenor ACCEPTANCE Definition: $t is the signification by the dra&ee of his assent to the order of the dra&er. $t must not epress that the dra&ee &ill perform his promise by any other means than the payment of money (Sec. */). $n other &ords% tenor of acceptance must be in the form of money. o& made 'eneral rule: 5ust be in &riting and signed by the dra&ee (Sec. */) ception: +here there is constructi"e% not implied% acceptance (Sec. */7) a. +here the dra&ee to &hom a bill is deli"ered for acceptance destroys the bill (must be &illful% not accidental) b. +here the dra&ee refuses to return the bill accepted or nonaccepted to the holder% &ithin ; hours after such deli"ery or &ithin such other period as the holder may allo& (if there is bad faith% retention of bill may be deemed e#ui"alent to refusal% and thus a constructi"e acceptance) +here made a. 9n the bill itself b. 9n a paper other than the bill itself +here an acceptance is &ritten on paper other than the bill itself% it does not bind the acceptor ecept in fa"or of a person to &hom it is sho&n and &ho on the faith thereof% recei"es the bill for "alue (Sec. */;). $n addition% the holder of a bill presenting the same for acceptance may re#uire that the acceptance be &ritten on the bill% and if such re#uest is refused% may treat the bill as dishonored (Sec. *//) 'eneral rule: The paper% other than the bill% containing the acceptance must be shown (not merely notified) to the person to &hom the instrument is negotiated. This is an acceptance of an eisting bill. ception: An unconditional promise in &riting to accept a bill before it is dra&n is deemed an actual acceptance in fa"or of e"ery person &ho% upon the faith thereof% recei"es the bill for "alue (Sec. */). $n this case% acceptance is in a separate paper% but it need not be sho&n to person to &hom the instrument is negotiated to bind the acceptor. This is an acceptance of a future or a noneisting bill. +hen made (Sec. */-) a. 1efore the bill has been signed by the dra&er or &hile other&ise incomplete b. After it is o"erdue c. After it has been dishonored by nonpayment d. After it has been dishonored b y a pre"ious refusal to accept $n this case% &hen a bill payable after sight is dishonored by nonacceptance% and the dra&ee subse#uently accepts it% the holder% in the absence of an y agreement% is entitled to ha"e the bill accepted as of the date of first presentment. Note: The dra&ee is allo&ed ; hours after presentment in &hich to decide &hether or not he &ill accept the bill% but the acceptance% if gi"en% dates as of the day of presentation (Sec. */6). + here a bill is duly presented for acceptance and is not accepted &ithin the prescribed time% the person presenting it must treat the bill as dishonored by non acceptance or he loses the right of recourse against the dra&er and indorsers. (Sec. *0) *in"s of acceptance (Sec. */,) *. 'eneral acceptance 4 Assents &ithout #ualification to the order of the dra &er. Acceptance &hich is consistent &ith the tenor of the instrument . Gualified acceptance (Sec. *;*) a. onditional 4 !ayment by acceptor is dependent on the fulfilment of a condition therein stated b. !artial 4 Acceptance to pay part only of the amount for &hich the bill is dra&n c. Hocal 4 Acceptance to pay only at a particular place. o&e"er% an acceptance to pay at a particular place is a general acceptance unless it epressly states that the bill is to be paid there only and not else&here (Sec. *;0) d. Gualified as to time e. Acceptance of some% one or more of the dra&ees% but not of all ights of parties as to #ualified acceptance (Sec. *;) The holder may refuse to take a #ualified acceptance and if he does not obtain an un#ualified acceptance% he may treat the bill as dishonored by nonacceptance +here a #ualified acceptance is taken% the dra&er and indorsers are discharged from liability on the bill% unless (a) they ha"e epressly or impliedly authori2ed the holder to take a #ualified acceptance or (b) subse#uently assented thereto +hen the dra&er or an indorser recei"es notice of a #ualified acceptance% he must% &ithin a reasonable time% epress his dissent to the holder% or he &ill be deemed to ha"e assented thereto PRESENTMENT FOR ACCEPTANCE Definition: The production or ehibition of a bill of echange to the dra&ee for his acceptance or payment !ere presentment for acceptance necessary (Sec. *;/) !resentment for acceptance must be made in order to render any party to the bill liable:
a. +here the bill is payable after sight% or in any other case% &here presentment for acceptance is necessary in order to fi the maturity of the instrument b. +here the bill epressly stipulates that it shall be presented for acceptance c. +here the bill is dra&n payable else&here at the residence or place of business of the dra&ee Note: The holder of a bill% &hich is re#uired to be presented for acceptance% must either (a) present it for acceptance or (b) negotiate it &ithin a reasonable time. $f he fails to do so% the dra&er and all indorsers are discharged (Sec. *;;). !ere presentment for acceptance e+cuse" (Sec. *;-) !resentment for acceptance is ecused and a bill may be treated as dishonored by nonacceptance: a. +here the dra&ee is dead has absconded is a fictitious person is a person not ha"ing capacity to contract by bill b. +here% after the eercise of reasonable diligence% presentment cannot be made c. +here% although presentment has been irregular% acceptance has been refused on some other ground o& made (Sec. *;) !resentment for acceptance must be made: a. 1> +95: 1y or on behalf of the holder b. +=: At a reasonable hour on a business day before the bill is overdue A bill may be presented for acceptance any day on &hich negotiable instruments may be presented for payment (Sec. *;6). Same rules apply% ecept for date falling on a Saturday &hich is not a holiday. $n such a date% presentment for acceptance may be made before * noon on that day% regardless if the bill is payable on demand or at a fied or determinable future time. Delay in making presentment for payment is ecused &hen such delay is caused by presenting the bill f or acceptance% &ith the eercise of reasonable diligence% at a place other than the place &here the bill is dra&n payable. This delay does not discharge the dra &ers and indorsers (Sec. *;7) c. T9 +95: 'enerally to the dra&ee or: To all dra&ees% &here a bill is addressed to t&o or more dra &ees &ho are not partners To one dra&ee% &here a bill is addressed to t&o or more dra&ees &ho are not partners% but such dra&ee has authority to accept or refuse acceptance To personal representati"e% &here the dra&ee is dead To the dra&ee or his trustee or assignee% &here the dra&ee has been adudged a bankrupt or an insol"ent PROTEST Definition: The formal instrument eecuted by a notary public or other competent person certifying that the facts necessary to the dishonor of the instrument by nonacceptance or nonpayment ha"e taken place Necessity of protest +here any negotiable instrument has been dishonored% it may be protested for nonacceptance or non payment% as the case may be3 but protest is not re#uired% ecept in the case of foreign bills (Sec. **-) +here a foreign bill appearing on its face is dishonored by nonacceptance% it must be duly protested for non acceptance% and &here such a bill% &hich has not been pre"iously dishonored b y nonacceptance is dishonored by nonpayment% it must be duly protested for nonpayment. $f it is not so protested% the dra&er and indorsers are discharged (Sec. *) A bill protested for nonacceptance may be subse#uently protested for nonpayment (Sec. *7) +here a bill does not appear on its face to be a foreign bill% protest thereof in case of dishonor is unnecessary !rotest is dispensed &ith b y any circumstances &hich &ould dispense &ith notice of dishonor (Sec. *,) o& made (Sec. */) a. 5ust be anneed to the bill or must contain a copy thereof b. 5ust be under the hand and seal of the notary making it c. 5ust specify: The time and place of presentment The fact that presentment &as made and the manner thereof The cause or reason for protesting the bill The demand made and the ans&er gi"e% if any% or the fact that the dra&ee or acceptor could not be found Note: +hen a bill is lost or destroyed or is &rongly detained from the person entitled to hold it% protest may be made on a copy or &ritten particulars thereof (Sec. *60) 1y &hom made (Sec. *;) ither (a) by a notary public or (b) by any respectable resident of the place &here the bill is dishonored% in the presence of t&o or more credible &itnesses +hen made (Sec. *) 'eneral rule: +hen a bill is protested% such protest must be made on the day of its dishonor ceptions: a. +hen delay is ecused% i.e. delay is caused by circumstances beyond the control of the holder and not imputable to his default% misconduct or negligence (Sec. *,) b. +hen a bill has been duly noted% the protest may be subse#uently etended as of the date of the noting +here made (Sec. *6) 'eneral rule: A bill must be protested at the place &here it is dishonored
ception: +hen a bill% dra&n payable at the place of business or residence of some person other than the dra&ee% has been dishonored by non acceptance% it must be protested for nonpayment at the place &here it is epressed to be payable% and no further presentment to% or demand on% the dra&ee is necessary !rotest for better security (Sec. *-) +here the acceptor has been adudged a bankrupt or an insol"ent 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 dra &ers and indorsers ACCEPTANCE AND PAYMENT FOR HONOR Acceptance for honor As to its 1ill has been protested for dishonor by non nature (Sec. acceptance or protested for better security 1ill is not o"erdue at the time of acceptance *6* 8 *7*) for honor Any person not being a party already liable (i.e. stranger) may inter"ene and accept the bill supra protest Done for the honor of any party liable thereon or for the honor of the person for &hose account the bill is dra&n onsent of the holder is re#uired
o& made
An acceptance for honor must (Sec. *6): a. be in &riting b. indicate that it is an acceptance for honor c. be signed by the acceptor for honor Note: +here an acceptance for honor does not epressly state for &hose honor it is made% it is deemed to be an acceptor for the honor of the dra&er (Sec. *6/)
=umber of parties
ffects
The acceptance for honor may be for part only of the sum for &hich the bill is dra&3 and &here there has been an acceptance for honor for one party% there may be a further acceptance by a different person for honor of another party (Sec. *6*) *. The acceptor for honor is liable to the holder and to all parties subse#uent to the party for &hose honor he has accepted (Sec. *6;) . The acceptor for honor% by such acceptance% engages that he &ill% on due presentment% pay the bill according to the terms of his acceptance% pro"ided: a. Dra&ee has not yet paid the bill b. 1ill has been duly presented for payment and protested for nonpayment c. =otice of dishonor is gi"en to him (Sec. *6)
!ayment for honor 1ill has been protested for nonpayment 1ill is o"erdue at the time of payment for honor Any person% &hether a party to the bill or not% may inter"ene and pay the bill supra protest Done for the honor of any party liable thereon or for the honor of the person for &hose account the bill is dra&n onsent of the holder is not re#uired. older cannot refuse payment. +here the holder of a bill refuses to recei"e payment supra protest% he loses his right of recourse against an y party &ho &ould ha"e been discharged by such payment (Sec. *76) The payment for honor supra protest% in order to operate as such% and not as a mere "oluntary payment: a. 5ust be attested by attested by a notarial act of honor &hich may be appended to the protest or form an etension to it (Sec. *7) b. Such notarial act of honor must be founded on a declaration made by the payer for honor% or by his agent% declaring his intention to pay the bill for honor and for &hose honor he pays (Sec. *7/) Note: $f abo"e formalities are not follo&ed% the payment &ill operate as a mere "oluntary payment% and the payer ac#uires no right to full reimbursement. +here t&o or more persons offer to pay a bill for the honor of different parties% the person &hose payment &ill discharge most parties to the bill is to be gi"en the preference (Sec. *7;)
*. All parties subse#uent to the party for &hose honor it is paid are discharged . !ayer for honor is subrogated for% and succeeds to% both the rights and duties of the holder% as regards the party for &hose honor he pays and all parties liable to the latter (Sec. *7) /. The payer for honor% on pa ying the holder% the amount of the bill and the notarial epenses incidental to its dishonor% is entitled to recei"e both the bill itself and the protest (Sec. *77)
5iscellaneous pro"isions in acceptance for honor *. +here 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 (Sec. *66) . +here a dishonored bill has been accepted for honor supra protest or contains a referee in case of need% it must be protested for nonpayment before it is presented for payment to the acceptor for honor or the referee in case of need (Sec. *67) /. !resentment for payment to the acceptance for honor must be made as follo&s (Sec. *6-): a. $f it is to be presented in the place &here the protest for nonpayment &as made% it must be presented not later than the day follo&ing its maturity b. $f it is to be presented in some other place than the place &here it &as protested% then it must be for&arded &ithin the time specified in Sec. *0;.
;. The pro"isions of Sec. -* apply &here there is delay in making presentment to the acceptor for honor or referee in case of need (Sec. *6,) . +hen the bill is dishonored by the acceptor for honor% it must be protested for nonpayment by him (Sec. *70)
