GSIS v.

CA Ratio P/N and mortgage deeds of subject, not negotiable instruments because they are neither payable to order or to bearer. (absence of the 4th requisite as under Sec.1 of Act no. 2031 because they are neither payable to order nor to bearer). Said note was payable to a SPECIFIED Party -provision of CC and special law on mortgages. FACTS: Sps Isabelo Racho(accommodating p) and Sps Flaviano Lagasca(accommodated) executed a D.O.Mort dated 11.13.57. in favor of GSIS to obain loan of 11.5k and 3k. TCT 38989 Lagasca ,thru assumption of mortgage, assumed obligation to obtain release of mortgage belonging to private respondent(rocha sps) Lagasca sps failed to pay and so land was extrajudicially foreclosed and sold 2 yrs later, rocha sps wanted the land back and filed for nullity of sale and recover of property plus actual and moral damages. Grounds: signed mortgage not as sureties or guarantors for the Lagasca sps but merely gave their property to co-owners who were solely benefited by the loans from GSIS. TC dismissed complaint (lack of cause of action) CA reversed.declared foreclosure of mort. Void and reconvey to rocha sps share of mortgaged property (acdg. To their share) SC reversed decision of CA. Misplaced the provision of Act.2031,an accommodation party is one who has

signed an instrument as M/D/Acceptor/indorser without receiving value therefor, but is held liable on the instrument ot a holder for value although the latter knew him to be only an accommodation party. Mclaughlin v. CA Ratio: citing New Pacific Timber & Supply CO. Inc. v. Hon. Seneris (L41764) it is the accepted practice in business to consider a cashiers or managers check as cash and that upon certification of a check, it is equivalent to its acceptance (Sec.187, NIL). The SC held further that the obj. of certifying a check to is enable the holder thereof to use it as money (PNB v. National City Bank) Clearing of a check and subsequent crediting of the amount = delivery of cash. FACTS: Luisa F. Mclaughlin and buyer respondent Ramon Flores entered into a contract of conditional sale of real property. Conditions: 140,000 to be paid thru: a) 26,550 upon exec.of deed and b) 113,450 to be paid not later than 5.31.77. Respondent failed to pay by 6.19.79 and pet. Asked for rescission. 12.27.79 new agreement reached where a)50k upon signing and 69,059.71 in 2 installments on 6.30.80 and 12.31.80. Respondent still did not pay. Petitioner filed for motion for writ of exectution and was granted on 11.14.80. Respondent filed MR and tendered pacific Banking Corp. managers check in amount of 75,059.71.

TC denied MR. CA nullified and set aside orders of lower court. SC affirmed. REPUBLIC BANK v. EBRADA

Ratio: although the defendant-appelant to whom the plaintiff back paid the check was not proven to be the author of the supposed forgery, yet as the last indorser of the check, she has warranted that she has good title to it even if in fact she did not have it because the payee of the check was already dead 11 years before the check was issued. Facts: Republic bank paid 1,246.08 to defendant Mauricia T. Ebrada after latter presented it for payment on 1.15.63. Plaintiff bank was later advised by Bureau of Treasury that the alleged indorsement on the reverse side of the aforesaid check by the payee, martin Lorenzo was a forgery since the payee was dead for the past 11 years. Plaintiff bank verbally and fomally demanded defendant Ebrada to account for the sum of P1,2456.08 but said defendant refused to do so. TC: ordered respondent to pay plaintiff said amount with interest. Question of law to SC SC: Judgement is affirmed in TOTO New Pacific Timber & Supply v. Seneris Ratio: Check deposited by petitioner in the amount of 50k is not an ordinary check but a Cashiers check of the Equitable Banking Corp., a bank of good standing and reputation. Sheriff with whome it has been deposited, it is a certified cross checked. It is a well-known practice in the business sector that a Cashiers

Check is deemed as cash. Check has been certified by the drawee bank, by certification, the funds represented by the checks are transferrd from the credit of the maker to that of the payee or holder, and for all intents and purposes, the latter becomes the despositor of the drawee bank, with rights and duties of one is such situation. FACTS: Petitioner is defendant in a complaint for collection of a sum of money filed by Ricardo A.Tong in the amount of P63,130 that the former did not comply to pay said obligation. Accordingly, a werit of execution was issued for the said amount where petitioner issued a 50k Cashiers check dated 12.3.75 of the Equitable Banking Corp. and P 13,130 in cash. Respondent, through counsel refused despite efforts of the petitioner and his counsel to settle the case before the sheriffs auction. Sheriff sold the personal properties to the highest bidder, herein respondent in the amount of P 50,000. Issue: whether or not private respondent can validly refuse acceptance of the payment of the judgement obligation made by petitioner? Held: tro made permanent. Decision of Judge dated 08.28.75 ordered null and void. Auction null and void. Great Easter Life Insurance Corp. v. HSBC and PNB Ratio: Sect. 23 of Act No. 2031 When a signature is forged or made without authority of the person whose signature it purports to be, it is wholly inoperative, and no right to retain the instrument, or to give discharge therefor, or to

enforce payment thereof against any party thereto, can be acquired through or under such signature, unless the party against whom it is sought to enforce such right is precluded from setting up the forgery or want of authority.
FACTS: Plaintiff, PNB drew a check a check for P 2000 on HSBC with whom it had account. It was payable to Lazaro Melicor but was forged by Maasim. PNB endorsed the check to HSBC and the latter sent the regular