Moulic issued to Corazon two post-dated checks to Victoriano as a security for the two jewelry then the payee negotiated the check to State Investment House. However, Moulic failed to sell the jewelry so she returned them before the maturity of the checks but the checks cannot be retrieved because it is already negotiated. Consequently, before their maturity dates, MOULIC withdrew her funds from the drawee bank. Upon presentment for payment, the checks were dishonored for insufficiency of funds. On 20 December 1979, STATE allegedly notified MOULIC of the dishonor of the checks and requested that it be paid in cash instead, although MOULIC avers that no such notice was given her. Is the drawer liable even if no notice of dishonor was given to the drawer?
Yes. MOULIC, as drawer, is liable for the value of the checks she issued to the holder in due course, STATE, without prejudice to any action for recompense she may pursue against the VICTORIANOs as Third-‐Party Defendants who had already been declared as in default. (State Investment Corporation vs. CA G.R. No. 101163 January 11, 1993)