Case No.

6
Ang Tek Lian vs. CA
L-2516; September, 1950

Topic: PAYABLE TO BEARER

FACTS: In 1946, Ang Tek Lian approached Lee Hua and asked him if he could give him
P4,000.00. He said that he meant to withdraw from the bank but the banks already closed. In
exchange, he gave Lee Hua a check which is payable to the order of cash. The next day, Lee
Hua presented the check for payment but it was dishonored due to insufficiency of funds. Lee
Hua eventually sued Ang Tek Lian. In his defense, Ang Tek Lian argued that he did not indorse
the check to Lee Hua and that when the latter accepted the check without Ang tek Lians
indorsement, he had done so fully aware of the risk he was running thereby.

ISSUE: Whether or not the check issued by Ang Tek Lian that is payable to the order to cash
and not have been indorsed by Ang Tek Lian, making him not guilty for the crime of estafa.

HELD: No.Under Sec. 9 of NIL a check drawn payable to the order of cash is a check payable
to bearer and the bank may pay it to the person presenting it for payment without the drawers
indorsement. However, if the bank is not sure of the bearers identity or financial solvency, it
has the right to demand identification or assurance against possible complication, such as
forgery of drawers signature, loss of the check by the rightful owner, raising of the amount
payable, etc. But where the bank is satisfied of the identity or economic standing of the bearer
who tenders the check for collection, it will pay the instrument without further question; and it
would incur no liability to the drawer in thus acting.