Document Of Title

Question 1

Document of Title of Goods? Art. 1636

Answer 1

Includes any bill of lading, dock of warrant, quedan, or warehouse receipt or order for the delivery of goods;

Or

Any other document used in the ordinary course of business in the sale or transfer of goods, as proof of the possession or control of the goods, or authorizing or purporting to authorize the possessor of the document to transfer or receive, either by indorsement or by delivery, goods represented by such document.

Question 2

Goods? (Art. 1636)

Answer 2

Includes all chattels personal bu not things in action or money of legal tender in the Philippines. The term included growing fruits or crops.

Question 3

Order? (Art. 1636)

Answer 3

Relating to document of title means an order by indorsement on the document.

Question 4

What does a DOCUMENT OF TITLE evidence?

Answer 4

1) Transfer of title;
2) Possession of the goods;
3) Contract of the parties.

Question 5

Bill of Lading?

Answer 5

It is a contract and receipt for the transport of goods and their delivery of the person named therein to order or to bearer.

Question 6

Dock Warrant

Answer 6

Instrument given by dock owners to an importer of goods warehoused on the dock, as a recognition of the importer’s title of the said goods, upon production of a bill of lading.

Question 7

Warehouse receipt?

Answer 7

A contract or receipt for goods deposited with a warehouseman containing the latter’s undertaking to hold and deliver the goods to a specified person, to order or to bearer.

Question 8

Quedan?

Answer 8

Warehouse receipt usually for sugar received by the warehouseman.

Question 9

What are the cases when negotiable document of title can be negotiated by delivery? (Art. 1508)

Answer 9

1) Where by the terms of the document the carrier, warehouseman, or other bailee issuing the same undertakes to deliver the goods TO THE BEARER; or
2) Where by the terms of the document the carrier, warehouseman, or other bailee undertakes to deliver goods to the order of a specified person or a subsequent indorsee of the document has INDORSED IT IN BLANK OR TO BEARER.

Question 10

Cases when a negotiable document of title must be INDORSED to be negotiated? (Art. 1509)

Answer 10

When the negotiable document title specifies the person to whose order the goods are by the terms of the document deliverable.

Question 11

What are the rights of the person to whom a document of title has been NEGOTIATED? (Art. 1513)

Answer 11

1) The title to the goods as the person negotiating the document to him had or had ability to convey to a purchaser in good faith for value;
2) The title to the goods as the person to whose order the goods were to be delivered by the terms of the document had or had ability to convey to a purchaser in good faith for value;and
3) The direct obligation of the bailee to hold possession of the good for him according to the terms of the document as fully as if such bailee had contracted directly with him.

Question 12

What are the DISTINCTION of a DOCUMENT TITLE against a NEGOTIABLE INSTRUMENT

Answer 12

1) GOODS - MONEY : DELIVER - PAY;
2) In a document of title, the indorser is NOT a guarantor;
3) Unlike in NIL, a bearer document can be converted to an order document.

Question 13

Who may negotiate a negotiable document of title? (Art. 1512 & 1518)

Answer 13

1) The owner;
2) The Trustee;
3) *Thief or founder, PROVIDED, that the indorsee purchased it in good faith and for value

Good Faith = without notice of the breach of duty, or loss, theft, fraud, accident, mistake, duress or conversion.

Question 14

What are the rights of the person to whom a document of title has been TRANSFERRED? (Art. 1514)

Answer 14

1) The title to the goods as against the transferor;
2) The right to notify the bailee of the transfer thereof; and
3) The right, thereafter, to acquire the obligation of the bailee to hold the goods for him.
* Subject to the terms of any agreement with the transferor.

Question 15

What are the rights of a person to whom an order document of title has been transferred? (Art. 1515)

Answer 15

1) Rights to the good as against the transferor, provided in Art. 1514; and
2) The right to compel the transferor to indorse the indorsement (1357), UNLESS, contrary intention appears.

Question 16

What are the warranties on sale of documents of title? (Art. 1516)

Answer 16

1) That the document is GENUINE;
2) That he has the LEGAL RIGHT to negotiate or transfer;
3) That he has no knowledge of any fact which would impair the validity or worth of the document;
4) That he has the right to transfer the title to the goods and that the goods are merchantable or fit for the particular purpose for which it was intended.

Question 17

Is the indorser liable as guarantor to the indorsee? (Art. 1517)

Answer 17

The indorsement of a document of title shall not make the indorser liable for any for any failure on the part of the bailee who issued the document or previous indorsers thereof to fulfill their respective obligations.