MEMORY AID: Petitioners executed a promissory note in favour to respondent Bank in order to secure certain advances from the

Bank in connection with its exportation of logs. Petitioners defaulted in the payment of the notes. They signed the promissory notes in Blank Incomplete NI, when delivered, the person in possession of such has the prima facie authority to fill in the blanks, to complete the NI. It has also the authority to fill up for any amount, and in accordance with the authority given and within a reasonable time. TITLE: Quirino Gonzales Logging vs. CA FACTS: Spouses Quirino and Eufemia Gonzales of the Quirino Gonzales Logging Concessionaire (QGLC) executed promissory notes in favour to respondent Republic Planters Bank to secure certain advances from the Bank in connection with its exportation of logs. The notes were payable 30 days after date and provided for the solidary liability of petitioners as well as attorneys fees at ten percent of the total amount due in the event of their nonpayment at maturity. Later on, petitioner QGLC has long been defaulted in the payment of their obligations with the promissory notes they executed. The Bank then filed a complaint against the petitioner for sum of money. However, petitioners seek to evade liability under the Banks causes of action by claiming that they Gonzales signed the promissory notes in blank and that they had not received the value of said notes. ISSUE: W/N the petitioners would be held liable for the payment of the promissory notes they executed despite of the fact that they singed the notes in blank. RULING: Yes, because as Section 14 of the Negotiable Instruments Law allows the prima facie authority of the person in possession of negotiable instruments, such as the notes herein, to fill in the blanks, to complete an incomplete instrument.

Moreover, a signature on a blank paper delivered in order that it may be converted into a negotiable instrument operates as a prima facie authority to fill it up as such for any amount. Also petitioner admitted to the genuineness and due execution of the promissory notes. The promissory notes, however, appear to be negotiable as they meet the requirements of Section 1of the Negotiable Instruments Law. Such being the case, the notes are prima facie deemed to have been issued for consideration. It bears noting that no sufficient evidence was adduced by petitioners to show otherwise. In order, however, that any such instrument when completed may be enforced against a person who became a party thereto prior to its completion, it must be filled up strictly in accordance with the authority given and within a reasonable time. But if any such instrument, after completion, is negotiated to a holder in due course, it is valid and effectual for all purposes in his hands, and he may enforce it as if it had been filled up strictly in accordance with the authority given and within a reasonable time.