Sec. 52. What constitutes a holder in due course.

— A holder in
due course is a holder who has taken the instrument under the
following conditions:

(a)That it is complete and regular upon its face;

(b)That he became the holder of it before it was overdue,
and without notice that it had been previously dishonored, if
such was the fact;
(c)That he took it in good faith and for value;
(d)That at the time it was negotiated to him he had no notice
of any infirmity in the instrument or defect in the title of the
person negotiating it.

Conditions to qualify one holder in due course.

A holder in due course is a holder who took the instrument under the
conditions enumerated in Section 52.

(1) Presence of all conditions. — All the four conditions must concur in
order to qualify a person as a holder in due course. If any one of them
is absent, the holder cannot be considered a holder in due course.
Every holder is generally deemed prima facie a holder in due course.
(Sec. 59.) He who claims otherwise has the burden of proof.
(2) Status as mere assignee. — The holder of a non- negotiable
instrument cannot attain the status of a holder in due course. He is a
mere assignee. The fact that the instrument is non- negotiable is a sign
of warning to a prospective purchaser and places him on his guard
and on inquiry.
(3) Rights of holder not in due course. — A holder who is not a holder in
due course has all the rights of the latter except that the instrument is
subject to defenses as if it were non- negotiable. (see Sec. 58.)

Prepared by: Syrin M. Sunido

Explanation:

Section 52 states that in order to qualify as a holder of due course one must
satisfy the conditions stated in section 52.

There are conditions that needs to fulfill in order to call as a holder in due
course
1) Presence of conditions means all of the stated in section 52 must be
satisfied because without one of these conditions the holder may not
qualify as holder in due course.
2) Status as mere assignee means that if you’re a holder of a non
negotiable instrument you are not qualified as a holder in due course
to qualify as one you need not to be a holder of non negotiable
instruments because the status of a non negotiable instrument holder
puts him on his guard and on inquiry.
3) Rights of holder not in due course has all the rights which the holder
is enjoying except that the instrument is not subject to defenses as if it
considers as non negotiable instruments.

Prepared by: Syrin M. Sunido

 The Law on Negotiable Instruments

Republic Central Colleges

Angeles City

Written Report in Law

Submitted to:
Atty. Restitoto Mercado

Prepared by:

Pineda, Cherry Lou

Sicat, Edward King
. Sunido, Syrin M.
Timbol, Marie Joyce C.
Yutuc, Laiza
 Case Study No. 7
The Dance of the Lemons

When Romeo Mendoza joined the Swerte Corporation, he sat down

with Elsa Cruz, the senior executive to whom he reported, to learn the goals
of the organization, and to find out as specifically as possible what was
expected of him. As the discussion progressed Romeo becomes increasingly
ill at ease. Miss Cruz seemed reluctant to talk in specifics, and avoided
sharing confidential information pertinent to Romeo’s position.

As the discussion progressed and Romeo’s frustration grew, he asked

Miss Cruz about the new assignment his predecessor had been given. “Oh”
Miss Cruz said with a sly grin, “he has joined the dance of the lemons.”
“What do you asked Romeo.” “Well,” said Miss Cruz, “he was not
performing effectively, so we moved him to another assignment.” “Will he
do better there?” asked Romeo. “Who knows?” said Miss Cruz “but at least
he is out of my hair.”

“Was there any particular reason why you assigned him to another
position, rather than terminating him?” Romeo asked. “Oh we seldom
terminate senior employees, we just more than around the organization
hoping we will find a place — they will fit in.

All of us know there moves happen — we call it the “Dance of the

Lemons.” Sixty days later, after having located another position, Romeo
Mendoza resigned.

1.) Why do you think Romeo resigned?

2.) What would you have done under similar circumstances?
3.) Does this case involve managerial ethics? Why or who not?
Explanations:

1) I think Romeo resigned because of the management’s practices

especially the senior executive Miss Elsa Cruz to whom he reported.
He resigned because of what her Senior Executive had told him and
he thinks that he is not doing effectively because of his illness and
another factor why he resigned its because her boss told him that
when an employee is not doing well they are being designated to
another positions. Maybe because he resigned because he knows for
himself that he is not an asset of the company that is why he resigned.
2) Maybe I would have done the same thing that Romeo did, because if
you cannot change the environment you are in and can’t take the
situation because your organization is not doing its social
responsibility towards its employee, then resigned. It’s better to leave
than continue working with unethical people. On the other hand, the
company is still practicing a good management because instead of
terminating the employees they are designated to other positions
where they fit in. The organization believes that if an individual is not
performing effectively they will be designated and other will take
their position where in they are more effective and efficient in doing
the job.
3) Yes, it involves managerial ethics; I say so because the organization is
not practicing ethical requirements like rights view which is
protecting individual liberties and privileges which seeks to protect
individual rights of conscience, free speech, life and safety and due
process. In this case no due process is being done because the
organization is designating an employee to another position without
any valid reasons or explanations why they are being designated to
that position and its unfair on the part of the employee.

Prepared by: Syrin M. Sunido