Professional Documents
Culture Documents
-The following day, the last day of the tour, the group
arrived at the Coster Diamond House. The group had agreed
that the visit to Coster should end by 9:30 a.m. to allow
enough time to take in a guided city tour of Amsterdam.
FACTS
Continental Cement Corp obtained from Consolidated Bank
letter of credit used to purchased 500,000 liters of bunker fuel oil.
Respondent Corporation made a marginal deposit to petitioner. A
trust receipt was executed by respondent corporation, with
respondent Gregory Lim as signatory. Claiming that respondents
failed to turn over the goods or proceeds, petitioner filed a complaint
for sum of money before the RTC of Manila. In their answer,
respondents aver that the transaction was a simple loan and not a
trust receipt one, and tht the amount claimed by petitioner did not
take into account payments already made by them. The court
dismissed the complaint, CA affirmed the same.
ISSUE
Whether or not the marginal deposit should not be deducted
outright from the amount of the letter of credit.
HELD
No. petitioner argues that the marginal deposit should be
considered only after computing the principal plus accrued interest
and other charges. It could be onerous to compute interest and other
charges on the face value of the letter of credit which a bank issued,
without first crediting or setting off the marginal deposit which the
borrower paid to it-compensation is proper and should take effect by
operation of law because the requisited in Art. 1279 are present and
should extinguish both debts to the concurrent amount. Unjust
enrichment.
UCPB vs Spouses Beluso
GR No. 159912, August 17, 2007
Ponente: Chico-Nazario, J.
Facts:
rate, from February 23, 2001 until fully paid; (2) an additional
amount equivalent to 1/10 of 1% per day of the total amount, until
fully paid, as penalty; (3) an amount equivalent to 10% of the
foregoing amounts as attorneys fees; and (4) expenses of litigation
and costs of suit.
Ms. Annabelle Cokai Yu, its Senior Loans Assistant stated that as of
now the outstanding balance of petitioners was P15,190,961.48. Yu
reiterated that the interest rate changes every month based on the
prevailing market rate. she notified petitioners of the prevailing
rate by calling them monthly .It was increased unilaterally
RTC: ordered Spouses to pay bank 9M plus the interest which
amounted to 15M.CA AFFIRMED
PETITIONER: They insist that the increase in interest rates were
unilaterally imposed by the bank and thus violate the principle of
mutuality of contracts.
Issue: whether the increase in interest rates is void for violating the
mutuality of contracts
HELD:Yes
RATIO:
Article 1308. The contract must bind both contracting parties; its
validity or compliance cannot be left to the will of one of them.
Article 1956 of the Civil Code likewise ordains that "no interest shall
be due unless it has been expressly stipulated in writing."
The binding effect of any agreement between parties to a contract is
premised on xxx (2) that there must be mutuality between the
parties based on their essential equality. Any contract which
appears to be heavily weighed in favor of one of the parties so as to
lead to an unconscionable result is void. Any stipulation regarding
the validity or compliance of the contract which is left solely to the
will of one of the parties, is likewise, invalid
Escalation clauses refer to stipulations allowing an increase in the
interest rate agreed upon by the contracting parties. This Court has
long recognized that there is nothing inherently wrong with
escalation clauses
VITUG, J.:
FACTS:
This is an action against defendants shipping company,
arrastre operator and broker-forwarder for damages
sustained by a shipment while in defendants' custody, filed
by the insurer-subrogee who paid the consignee the value
of such losses/damages.
the losses/damages were sustained while in the respective
and/or successive custody and possession of defendants
carrier (Eastern), arrastre operator (Metro Port) and broker
(Allied Brokerage).
As a consequence of the losses sustained, plaintiff was
compelled to pay the consignee P19,032.95 under the
aforestated marine insurance policy, so that it became
subrogated to all the rights of action of said consignee
against defendants.
DECISION OF LOWER COURTS: * trial court: ordered
payment of damages, jointly and severally * CA: affirmed
trial court.
ISSUES AND RULING:
(a) whether or not a claim for damage sustained on a
shipment of goods can be a solidary, or joint and several,
liability of the common carrier, the arrastre operator and the
customs broker;
YES, it is solidary. Since it is the duty of the ARRASTRE to
take good care of the goods that are in its custody and to
deliver them in good condition to the consignee, such
responsibility also devolves upon the CARRIER. Both the
ARRASTRE and the CARRIER are therefore charged with the
Dario Nacar vs
Gallery Frames
a. If stipulated in writing:
3. Compounded Interest
b. If unliquidated, no interest
ANITA A.
PHILIPPINE
LEDDA,
Petitioner, v. BANK
ISLANDS,
OF
THE
Respondent.
J.:
The
interest
rate
and
penalty
charges
are
and
unconscionable.
Citing
Article1229,
in
pay
her
obligation.
REMEDIAL
LAW:
actionable
document
Civil
Code.
The
CA
rejected
Leddas
arguments.
document
ISSUES:
containing
the
Terms
and
Conditions
document?
the
HELD:
The
petition
is
partially
meritorious.
complaint.
annum.
FIRST ISSUE: The document containing the Terms and
Conditions governing the use of the BPI credit card is not
an
actionable
CIVIL
LAW:
interest;
forbearance
of
money
document.
Since there is no dispute that Ledda received, accepted and
used the BPI credit card issued to her and that she
DEL
CASTILLO,
J.:
FACTS:
loans.
credit
card
obligation.
Sum
HYDEN,
of
Money,
Injunction
and
Damages.
Respondent.
Jocelyn averred that Marilou forced, threatened and
HELD:
The
petition
is
without
merit.
ofP528,550.00
to
interest
alone
is
illegal,
CIVIL
LAW;
LOANS;
INTEREST
said loans knowing fully well that the interest rate was at 6%
said loans, she knew fully well that the same carried with it
by
the
CA.
ISSUES:
iniquitous,
unconscionable,
exorbitant,
and
absolutely
pursuant
to Article
1409
of
the
New
Civil
Code.
which
she
now
impugns.
REMEDIAL
LAW;
ESTOPPEL
DEPOSIT
as
the
principle
ofestoppel.
open the box. On the other hand, the respondent bank could not
likewise open the box without the renter's key. The Court further
assailed that the petitioner is correct in applying American
Jurisprudence. Herein, the prevailing view is that the relation
between the a bank renting out safe deposits boxes and its
customer with respect to the contents of the box is that of a bail
or/ and bailee, the bailment being for hire and mutual benefits.
That prevailing rule has been adopted in Section 72 of the General
Banking Act.
Issue:
Ruling:
The petitioner is correct in making the contention that the contract
for the rent of the deposit box is not a ordinary contract of lease as
defined in Article 1643 of the Civil Code. However, the Court do not
really subscribe to its view that the same is a contract of deposit
that is to be strictly governed by the provisions in Civil Code on
Deposit; the contract in the case at bar is a special kind of deposit.
It cannot be characterized as an ordinary contract of lease under
Article 1643 because the full and absolute possession and control of
the safety deposit box was not given to the joint renters- the
petitioner and the Pugaos. The guard key of the box remained with
the respondent bank; without this key, neither of the renters could
TRIPLE-V
FOOD
SERVICES
INC.
vs.
FILIPINO
the car was not in its parking slot and its key no longer in the
Filipino
the car was constituted when De Asis availed of its free valet
Merchants
Insurance
Company,
Inc.
Having
parking service.
LETTERS OF CREDIT
Transfield Philippines vs
Luzon Hydro Electric Corp.
GR No 146717, Nov 22, 2004
MARCH 15, 2014LEAVE A COMMENT
agreement
like
for
instance
letter
of
credit
or
repayment
of
the
credit
would
constitute
turn-key
contract
with
Luzon
Hydro
Corp.
(LHC).Under
the
contract,
Transfield
were
to
guarantee.
like
for
instance
typical
standby;
or
(b)
pending
arbitration
on
their
request
for
extension of time.
insurers
of
whomsoever.
the
goods,
or
any
other
person
transmit
to
the
beneficiary
the
relationship
will
then
prevail
the
case
correspondent
of
bank
confirming
assumes
bank,
a
the
direct
by
mandamus
before
Trust Company.
Villaluz
the
for
and
Court
Christiansen
specific
of
to
execute
performance
First
Instance
the
against
of
Rizal.
logs.
Issue: Whether or not Feati Bank is liable for
The letter of credit was mailed to the Feati Bank and
vessel
confirming bank.
but
Christiansen
refused
to
issue
the
credit.
upon
the
stage
of
the
negotiation.
If
before
but
relationship
after
will
negotiation,
then
prevail
contractual
between
the
courts below.
TRUST RECEIPTS
City
to
renovate
the
latters
Camaman-an,
Cagayan
de
Oro
convent
City.
at
Colinares
PBC
approved
the
letter
of
credit
debited P6,720
from
Petitioners
marginal
terms
of
payment
of
the
loan
be
1980,
and
thereafter P500
on
11
with
fees
by
the
separate
PBCs
legal
demand
counsel,
for
PBC
ownership
already
obligation
over
the
merchandise
was
involving
the
duty
to
deliver
it
ANTHONY NG vs PEOPLE
GUARANTY AND SURETYSHIP
EN BANC
[G.R. No. L-9306. May 25, 1956.]
SOUTHERN MOTORS, INC., Plaintiff-Appellee, vs.
ELISEO BARBOSA, Defendant-Appellant.
FACTS:
Southern Motors Inc. brought this action against Barbosa for
the foreclosure of a real estate mortgage which the latter
constituted as security for the payment of the sum of of
P2,889.53 due to said Plaintiff from one Alfredo Brillantes,
ISSUE:
Whether the mortgage in question could be foreclosed although
Plaintiff had not exhausted, and did not intend to exhaust, the
properties of his principal debtor, Alfredo Brillantes
RULING:
Defendants affirmative defense is devoid of merit for:
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effective til November 30, 1981 to assist the latter in meeting the
additional capitalization requirements of its logging operations.
To secure payment, it executed a chattel mortgage over some of its
machineries and equipments. And as an additional security, its
President and Chairman of the Board of Directors Rodolfo Cuenca,
executed an Indemnity agreement in favor of Security Bank whereby
he bound himself jointly and severally with Sta. Ines.
Specific stipulations:
The bank reserves the right to amend any of the
aforementioned terms and conditions upon written notice to
the Borrower.
As additional security for the payment of the loan, Rodolfo M.
Cuenca executed an Indemnity Agreement dated 17
December 1980 solidary binding himself:
Rodolfo M. Cuenca x x x hereby binds himself x x x jointly
and severally with the client (SIMC) in favor of the bank for
the payment, upon demand and without the benefit of
excussion of whatever amount x x x the client may be
indebted to the bank x x x by virtue of aforesaid credit
accommodation(s) including the substitutions, renewals,
extensions, increases, amendments, conversions and
revivals of the aforesaid credit accommodation(s) x x x .
FACTS:
Defendant-appellant Sta. Ines Melale (Sta. Ines/SIMC) is a
corporation engaged in logging operations. It was a holder of a
Timber License Agreement issued by the DENR
contract; (3) the old contract is extinguished; and (4) there is a valid
new contract.16
We reject these contentions. Clearly, the requisites of novation are
present in this case. The 1989 Loan Agreement extinguished the
obligation18 obtained under the 1980 credit accomodation. This is
evident from its explicit provision to "liquidate" the principal and the
interest of the earlier indebtedness, as the following shows:
"1.02. Purpose. The First Loan shall be applied to liquidate the
principal portion of the Borrowers present total outstanding
Indebtedness to the Lender (the "Indebtedness") while the Second
Loan shall be applied to liquidatethe past due interest and penalty
portion of the Indebtedness.
Since the 1989 Loan Agreement had extinguished the original
credit accommodation, the Indemnity Agreement
1) NOT mere renewal/ Extension
1989 Loan Agreement expressly stipulated that its purpose was to
"liquidate," not to renew or extend, the outstanding indebtedness.
Moreover, respondent did not sign or consent to the 1989 Loan
Agreement, which had allegedly extended the original P8 million
credit facility. Hence, his obligation as a surety should be deemed
extinguished, "[a]n extension granted to the debtor by the creditor
without the consent of the guarantor extinguishes the guaranty. x x
x."
2) Binding Nature of the Credit Approval Memorandum
Bank objects to the appellate courts reliance on that document,
contending that it was not a binding agreement because it was not
signed by the parties. It adds that it was merely for its internal use.
Indeed, it cannot take advantage of that document by agreeing to be
bound only by those portions that are favorable to it, while denying
those that are disadvantageous.
B. NO Waiver of Consent
or before the aforementioned expiry date and not exceeding the total
of P8 million.
jointly and severally liable with the principal maker of the note. The
terms of the contract are clear, explicit and unequivocal that
petitioners liability is that of a surety.
A surety is an insurer of the debt, whereas a guarantor is an insurer
of the solvency of the debtor. A suretyship is an undertaking that the
debt shall be paid; a guaranty, an undertaking that the debtor shall
pay. Stated differently, a surety promises to pay the principal's debt if
the principal will not pay, while a guarantor agrees that the creditor,
after proceeding against the principal, may proceed against the
guarantor if the principal is unable to pay. A surety binds himself to
perform if the principal does not, without regard to his ability to do so.
A guarantor, on the other hand, does not contract that the principal
will pay, but simply that he is able to do so. In other words, a surety
undertakes directly for the payment and is so responsible at once if
the principal debtor makes default, while a guarantor contracts to pay
if, by the use of due diligence, the debt cannot be made out of the
principal debtor.
The undertaking to pay upon default of the principal debtor does not
automatically remove it from the ambit of a contract of suretyship. It
has not been shown that respondent corporation agreed to proceed
against Palmares only if and when the defaulting principal has
become insolvent. There can be no doubt that the stipulation
contained in the third paragraph of the contract merely elucidated on
and made more specific the obligation of the petitioner as generally
defined in the second paragraph thereof. Also, several attendant
factors in that genre lend support to the finding that petitioner is a
surety. For one, when the petitioner was informed about the failure of
the principal debtor to pay the loan, she immediately offered to settle
the account with the respondent corporation. For another, petitioner
presented the receipts of the payments already made which were all
issued in her name and of the Azarraga spouses. This can only be
construed to mean that the payments made by the principal debtors
were considered by respondent corporation as creditable directly
upon account and inuring to the benefit of petitioner.
Petitioners contention that the complaint was prematurely filed
because the principal debtors cannot as yet be considered in default
is unmeritorious because of paragraph G of the promissory note
ISSUES:
1. Whether or not petitioners are liable to
respondent
2. Whether or not petitioners are JOINTLY
liable
HELD:
1. YES, because of the tenor of the Undertaking is
clear that the purpose of which was for
a.
b.
Agreement No. 2083-A dated March 24, 1980 was issued by the
Ministry of Agriculture and Food in favor of plaintiff Lydia Cuba only,
excluding her husband; Plaintiff Lydia Cuba failed to pay the
amortizations stipulated in the Deed of Conditional Sale; After plaintiff
Lydia Cuba failed to pay the amortization as stated in Deed of
Conditional Sale, she entered with the DBP a temporary
arrangement whereby in consideration for the deferment of the
Notarial Rescission of Deed of Conditional Sale, plaintiff Lydia Cuba
promised to make certain payments as stated in temporary
Arrangement dated February 23, 1982; Defendant DBP thereafter
sent a Notice of Rescission thru Notarial Act dated March 13, 1984,
and which was received by plaintiff Lydia Cuba; After the Notice of
Rescission, defendant DBP took possession of the Leasehold Rights
of the fishpond in question; That after defendant DBP took
possession of the Leasehold Rights over the fishpond in question,
DBP advertised in the SUNDAY PUNCH the public bidding dated
June 24, 1984, to dispose of the property; That the DBP thereafter
executed a Deed of Conditional Sale in favor of defendant Agripina
Caperal on August 6, 1984; Thereafter, defendant Caperal was
awarded Fishpond Lease Agreement No. 2083-A on December 28,
1984 by the Ministry of Agriculture and Food.
SPOUSES WILFREDO N. ONG AND EDNA SHEILA PAGUIOONG v. ROBAN LENDING CORPORATION
557 SCRA 516 (2008), SECOND DIVISION (Carpio Morales,
J.)
In a true dacion en pago, the assignment of the property
extinguishes the monetary debt.
IS
Later Spouses Ong and Roban executed several agreements an amendment to the amended Real Estate Mortgage which
consolidated their loans amounting to P5, 916,117.50; dacion in
AN ASSIGNMENT TO GUARANTEE
VIRTUALLY A MORTGAGE;
AN
OBLIGATION
RTC declared the act illegal, null and void and ordered the
petitioner to refund the amount plus interest, ordering Sabeniano,
on the other hand to pay Citibank her indebtedness. CA affirmed
the decision with modification entirely in favor of the respondent
further stating that Citibank failed to establish by competent
evidence the alleged indebtedness of plaintiff-appellant, the setoff of P1,069,847.40 in the account of Ms. Sabeniano is declared
as without legal and factual basis.
Additionally, by 25 October 1979, respondent had a total of
US$156,942.70, from which, US$149,632.99 was transferred by
Citibank-Geneva to petitioner Citibank in Manila, and was used
by the latter to off-set respondent's outstanding loans.
ISSUE: Whether petitioner may exercise its right to set-off
respondents loans with her deposits and money in CitibankGeneva
RULING: Petition is partly granted with modification.
1. Citibank is ordered to return to respondent the principal amount
of P318,897.34 and P203,150.00 plus 14.5% per annum
2. The remittance of US $149,632.99 from respondents CitibankGeneva account is declared illegal, null and void, thus Citibank is
ordered to refund said amount in Philippine currency or its
equivalent using exchange rate at the time of payment.
3. Citibank to pay respondent moral damages of P300,000,
exemplary damages for P250,000, attorneys fees of P200,000.
4. Respondent to pay petitioner the balance of her outstanding
loans of P1,069,847.40 inclusive off interest.
PARAY v. RODRIGUEZ, ET AL., G.R. No. 132287 (JANUARY 24,
2006)
FACTS:
Respondents were the owners of shares of stock in Quirino-LeonorRodriguez Realty Inc. In 1979 to 1980, respondents secured by way of
pledge of some of their shares of stock to petitioners Bonifacio and Faustina
Paray (Parays) the payment of certain loan obligations.
When the Parays attempted to foreclose the pledges on account of
respondents failure to pay their loans, respondents filed complaints with
RTC of Cebu City. The actions sought the declaration of nullity of the pledge
agreements, among others. However the RTC dismissed the complaint and
gave due course to the foreclosure and sale at public auction of the various
pledges. This decision attained finality after it was affirmed by the Court of
Appeals and the Supreme Court.
Respondents then received Notices of Sale which indicated that the
pledged shares were to be sold at public auction. However, before the
scheduled date of auction, all of respondents caused the consignation with
the RTC Clerk of Court of various amounts. It was claimed that respondents
had attempted to tender payments to the Parays, but had been rejected.
Notwithstanding the consignations, the public auction took place as
scheduled, with petitioner Vidal Espeleta successfully bidding for all of the
pledged shares. None of respondents participated or appeared at the
auction.
Respondents instead filed a complaint with the RTC seeking the
declaration of nullity of the concluded public auction.
ISSUES:
Respondents argument:
Respondents argued that their tender of payment and subsequent
consignations served to extinguish their loan obligations and discharged the
pledge contracts.
Petitioners argument:
HELD:
1. No.
No law or jurisprudence establishes or affirms such right. Indeed,
no such right exists.
The right of redemption over mortgaged real property sold
extrajudicially is established by Act No. 3135, as amended. The said law
does not extend the same benefit to personal property. In fact, there is no
law in our statute books which vests the right of redemption over personal
property. Act No. 1508, or the Chattel Mortgage Law, ostensibly could have
served as the vehicle for any legislative intent to bestow a right of
redemption over personal property, since that law governs the extrajudicial
sale of mortgaged personal property, but the statute is definitely silent on the
point.
The right of redemption as affirmed under Rule 39 of the Rules of
Court applies only to execution sales, more precisely execution sales of real
property.
It must be clarified that the subject sale of pledged shares was an
extrajudicial sale, specifically a notarial sale, as distinguished from a judicial
sale as typified by an execution sale. Under the Civil Code, the foreclosure
of a pledge occurs extrajudicially, without intervention by the courts. All the
creditor needs to do, if the credit has not been satisfied in due time, is to
proceed before a Notary Public to the sale of the thing pledged.
pledge contracts and disposed them. Said judgment did not direct the sale
by public auction of the pledged shares, but instead upheld the right of the
Parays to conduct such sale at their own volition.
2. No.
There is no doubt that if the principal obligation is satisfied, the
pledges should be terminated as well. Article 2098 of the Civil Code provides
that the right of the creditor to retain possession of the pledged item exists
only until the debt is paid. Article 2105 of the Civil Code further clarifies that
the debtor cannot ask for the return of the thing pledged against the will of
the creditor, unless and until he has paid the debt and its interest. At the
same time, the right of the pledgee to foreclose the pledge is also
established under the Civil Code. When the credit has not been satisfied in
due time, the creditor may proceed with the sale by public auction under the
procedure provided under Article 2112 of the Code.
In order that the consignation could have the effect of extinguishing
the pledge contracts, such amounts should cover not just the principal loans,
but also the monthly interests thereon.
In the case at bar, while the amounts consigned by respondents
could answer for their respective principal loan obligations, they were not
sufficient to cover the interests due on these loans, which were pegged at
the rate of 5% per month or 60% per annum.
3. No.
The pledged shares in this case are not subject to redemption.
Thus, the consigned payments should not be treated with liberality, or
somehow construed as having been made in the exercise of the right of
redemption.
4. Yes.
In this case, petitioners attempted to proceed extrajudicially with
the sale of the pledged shares by public auction. However, extrajudicial sale
was stayed with the filing of Civil Cases which sought to annul the pledge
contracts. The final and executory judgment in those cases affirmed the
5. No.
This concern is obviously rendered a non-issue by the fact that
there can be no right to redemption in the first place. Rule 39 of the Rules of
Court does provide for instances when properties foreclosed at the same
time must be sold separately, such as in the case of lot sales for real
property under Section 19. However, these instances again pertain to
execution sales and not extrajudicial sales. No provision in the Rules of
Court or in any law requires that pledged properties sold at auction be sold
separately.
On the other hand, under the Civil Code, it is the pledgee, and not
the pledgor, who is given the right to choose which of the items should be
sold if two or more things are pledged. No similar option is given to pledgors
under the Civil Code. Moreover, there is nothing in the Civil Code provisions
governing the extrajudicial sale of pledged properties that prohibits the
pledgee of several different pledge contracts from auctioning all of the
pledged properties on a single occasion, or from the buyer at the auction
sale in purchasing all the pledged properties with a single purchase price.
RULING:
Decision of the Court of Appeals is SET ASIDE and the decision of
the RTC Cebu City is REINSTATED.