CLARK V. SELINER- Liability Of An Accommodation Party
42 PHIL 384
Sellner with two other persons, signed a promissory note solidarily binding themselves to pay to the order of R.N Clark. The note matured but the amount wasn't paid. The defendant alleges that he didn't receive any amount of the debt; that the instrument wasn't presented to him for
payment and being an accommodation party, he is not liable unless the note is negotiated, which wasn't done.
On the first issue, the liability of Sellner as one of the signers of the note, is not dependent on whether he has or has not, received any part of the debt. The defendant is really and expressly one of the joint and several debtors of the note and as such he is liable under the provisions of Section 60 of the Negotiable Instruments Law.
As to the presentment for payment, such action is not necessary in order to charge the person primarily liable, as is the defendant Sellner.
As to whether or not Sellner is an accommodation party, it should be taken into account that by putting his signature to the note, he lent his name, not to the creditor, but to those who signed with him placing him in the same position and with the same liability as the said signers. It should be noted that the phrase”without receiving value therefore” as used in section 29 means “without receiving value by virtue of the instrument” and not, as it apparently is supposed to mean, “without receiving payment for lending his name.” It is immaterial as far as the creditor is concerned, whether one of the signers has or has not received anything in payment for the use of his name. In this case, the legal situation of Sellner is that of a joint surety who upon the maturity of the note, pay the debt, demand the collateral
security and dispose of it to his benefit. As to the plaintiff, he is a holder for value.