Professional Documents
Culture Documents
As explained by
Chico-Nazario, J. Villanueva, the presented promissory note was in her
handwriting because Sigaan told her to copy it and she did
Facts: because she feared the threats of Sigaan to block her deals
Alicia Villanueva filed a complaint against Sebastian Sigaan with the Phil Navy. (this was not rebutted by Sigaan so the SC
bec she wants a return of her money (the excess interest she believed this explanation)
paid). Events according to her: o Clearly, there was NO CONSENT to the payment
o Sigaan, the comptroller of the Phillipine Navy, of interest, she was coerced.
offered to loan money to her. She accepted
because she needed capital for her office supply RE: Exceptions
business venture. She currently supplies office Sigaan’s claim that Villanueva admitting to the interest should
mat’l and equipment to the Phil Navy. be an exception, SC says: In the BP22 case, Villanueva did
o She agrees to the loan of P540k. Loan was not in not declare to have made an express stipulation in writing as
writing and there was no stipulation as to payment to the interest. There instances in which interest may be
of interest. imposed in the absence of stipulation, verbal or written, are:
o She issues a check worth P500; as partial payment. 1. NCC 2209: If obligation consists in payment of sum
2 months later, she issues another check worth of money, no stipulation on interest, and debtor
P200k. incurs delay = legal interest 12% per annum
o Sigaan (who now received P700k from Villanueva) 2. NCC 2212: interest due shall earn legal interest
said the excess money Villanueva paid would be from the time it is judicially demanded
applied as interest. But Sigaan still kept pestering Under those 2 instances, interest MAY be imposed only as
her for additional interest and threatened to block PENALTY or damages for breach of CONTRACTUAL
her transactions with the Phil Navy if she won’t obligations and NOT for compensation for the use or
comply. Fearing this, she paid additional amounts forbearance of money.
totalling to P1.2m. She asked for a receipt but was o MEANING: those 2 are only applicable to
told that there was no need bec they had mutual COMPENSATORY interests and not to monetary
trust and confidence. interest.
o She then consulted a lawyer who told her that o This case involves a claim for monetary interest.
Sigaan could not validly collect interest because Compensatory is not chargeable because it was not
there was no agreement of interest. She demands proven that Villanueva defaulted in paying the loan.
from Sigaan the return of the P660k.
According to Sigaan, however: RE: Solutio indebiti (NCC 2154: 1. if something is received where there
o He did not offer to loan but was instead is no right to demand it and 2. it was delivered through mistake, the
propositioned by Villanueva and insists that there obligation to return it arises)
was no overpayment, as that there was a Principle: no one shall enrich himself unjustly at expense of
promissory note by Villanueva admitting to having another
borrowed P1.24m.
o As payment, Villanueva issued 6 postdated checks. RE: Interest payment
Only 1 was honoured. He filed criminal cases Eastern Shipping v. CA:
against Villanueva (BP 22). In this BP 22 case, o when an obligation NOT constituting a loan or
Sigaan claims that Villanueva, in her testimony, forbearance of money is breached, interest on
admitted to having agreed to a 7% interest. This amount of damages may be imposed at the rate of
should be an exception (to the rule that interests 6% per annum.
should be in writing) because it would be unfair o When judgment awarding a sum of money
since Villanueva already admits to the interest. becomes final and executory, legal interest
o Also Villanueva was already estopped from (whether loan/forbearance or money or not) shall
complaining because she was given several times be 12% per annum from finality
to settle her obligation but failed. o The INTERIM period is deemed a forbearance of
RTC says: there was overpayment. Villanueva’s obligation credit
only amounted to P540k because there was no interest Sigaan’s obligation arises from a quasi-contract of solutio
agreement. CA affirmed. indebitu and NOT from a loan or forbearance of money. So:
o 6% per annum should be imposed on the amount
Issue: Was there overpayment? What about interest? to be refunded (as well as to the damages and atty
fees) from time of extra judicial demand (March
Held: [Yes. Sigaan should return the excess amounts.] [No interest to 3, 1998) up to finality.
be paid by Villanueva. However, Sigaan should pay interest on the o Amount shall become 12% per annum from
amounts he should refund Villanueva.] finality of decision up to its satisfaction
Ratio:
SC defines interest: monetary and compensatory:
o Monetary interest: Interest is a COMPENSATION
fixed by the PARTIES for the use or forbearance of
money.
o Compensatory: Interest imposed by LAW or by
COURTS as PENALTY or INDEMNITY.
The right to interest arises only:
1. By a contract; or
2. By virtue of damages for delay or failure to pay the
principal loan
ISSUE:
GR 96405
The facts show that the parties agreed to the payment of
a specific sum of money of P40,000.00 per month for six
months, not to a 4% rate of interest payable within a 6- Summary: A co-maker to a loan is facing collection
month period. demands from a creditor bank. One of his co-defendant
is outside the Philippine jurisdiction while the creditor
chose to dismiss their claim against the other.
No issue on the excessiveness of the stipulated amount
of P40,000.00 per month was ever put in issue by the
petitioners; they only assailed the application of a 4% Rule of Law: In solidary obligations, any one, some or all
interest rate, since it was not agreed upon. of the debtors may be proceeded against for the entire
obligation. The choice is left to the solidary creditor to
determine against whom he will enforce collection.
It is a familiar doctrine in obligations and contracts that
the parties are bound by the stipulations, clauses, terms
and conditions they have agreed to, which is the law Facts: Baldomero Inciong, Jr. (D) cosigned a P50,000-
between them, the only limitation being that these promissory note with Rene Naybe and Gregorio
stipulations, clauses, terms and conditions are not Pantanosas holding themselves jointly and severally
contrary to law, morals, public order or public policy. The liable to creditor Philippine Bank of Communications
payment of the specific sum of money of P40,000.00 per (P)—PBCOM, Cagayan de Oro City branch.
month was voluntarily agreed upon by the petitioners
A solidary or joint and several obligation is one in which
each debtor is liable for the entire obligation, and each
The due date expired without the promissors paying
creditor is entitled to demand the whole obligation.
their obligation. Consequently, creditor PBCOM (P)
demanded payment from the obligors who did not —Tolention, Civil Code of the Philippines, Vol. IV, 1991,
respond. So, creditor PBCOM (P) filed for collection of p. 217.
the sum of P50,000.00 against the three obligors.
Issues: Can the creditor file a claim for the entire Section 4, Chapter 3, Title I, Book IV of the Civil Code
obligation against a co-maker to a loan? states the law on joint and several obligations.
Ruling:
fail to pay within ten days from date of receipt. This was
Held: alleged by the latter to be an act of waiving Premiere
HELD:
PREMIERE DEVELOPMENT BANK VS CENTRAL SURETY &
(1) No. Relevant to the case is the statutory provision on
INSURANCE COMPANY, INC.
application of payments, particularly Article 1252 of the
579 SCRA 359
Civil Code. “He who has various debts of the same kind
FACTS: Respondent Central Surety & Insurance Company in favor of one and the same creditor, may declare at the
(Central Surety) acquired an industrial loan worth
time of making the payment, to which of them the same
sixmillion pesos from petitioner Premiere Development
must be applied. xxx” The debtor’s right to apply
Bank, evidenced by Promissory Note. Should Central
payment
Suretyfail to pay, it would be liable to Premiere Bank for:
(1) unpaid interest up to maturity date; (2) unpaid is only directory, and not mandatory, as manifested by
penalties upto maturity date; and (3) unpaid balance of the use of the word “may”. Such right may be waived or
the principal. To Secure Payment for the loan Central
even granted to the creditor if both parties agree on such
Surety executed aDeed of Assignment with Pledge in
circumstance.
favor of Premier Bank its proprietary share in Wack Wack
and golf and countryClub. In the instant case, it was stipulated in the contract that
the right to apply payments would be enjoyed by
Central Surety had another commercial loan with
Premiere Bank worth 40,898,000.00 pesos, again by
the Premiere Bank. It cannot be understood that such served as security for the standing obligation, also for
granted right was waived by Premiere Bank. As all debts future advancements. Such security worth
15,000,000.00
were already due, the subsequent demand made by
Premiere Bank cannot be equated with a waiver of the pesos was clearly worth more than the industrial loan
right worth 6,000,000.00 pesos, which was understood to
secure
to demand payment of all the matured obligations of
Central Surety to Premiere Bank. The Court also the ballooning debt of the Central Surety. As all
recognized demandable obligations are yet to be fulfilled, the
release of the
the standard practice in commercial transactions to send
demand letters before default may set in. The demand Wack Wack membership as security cannot yet to be
done as prayed for by Central Surety. Wherefore, the
cannot be considered a waiver for a waiver must be
instant
positively demonstrated, and voluntary, made
knowingly, petition is partially granted. The decision of the Court of
Appeals is set aside and the decision of the Regional Trial
intelligently and with sufficient awareness of relevant
circumstances and likely consequences. Also any Court of Makati is reinstated with modification.
inference
parties falls on the dragnet clause, which is one So, the plaintiffs filed a complaint for the collection of the
“specifically phrased to subsume all debts of past and full amount of the loan, plus interests and other charges.
future Servando contended that he did not obtain any loan from
the respondents, he was not benefited from its proceed
origins.” The security clause in the instant case is that of and he signed the promissory note as a witness. With the
a continuing pledge, wherein the Wack Wack various appeals and motion for reconsideration with the
Membership RTC and CA, it was decided that the parties should be
liable for the loans. Servando opposed that he and the
respondents had agreed to fix the entire obligation at substitution is unequivocally declared, or the old and the
P775,000.00. According to Servando, their new obligations are incompatible on
agreement, which was allegedly embodied in a receipt every point. A compromise of a final judgment operates
dated February 5, 1992, whereby he made as a novation of the judgment obligation
an initial payment of P400,000.00 and promised to pay upon compliance with either of these two conditions.
the balance of P375,000.00 on February
On the receipt of February 5, 1992 did not create a new
29, 1992, superseded the July 23, 1986 promissory note. obligation incompatible with the
But the RTC ruled over Servando’s
old one under the promissory note that was issued. It
opposition and moved to the execution of the judgment was only a payment of the obligation of
for it is final and executory. Then,
Servando and did not establish a new obligation. The
Servando’s heirs, on account of his intervening death, Court ruled that the payment of the
appealed that there was novation is the
obligation does not novate the instrument that only
judgment that transpired upon the decision of the court expressly recognize the old obligation, or
on December 9, 1991 and February 5,
changes only the terms of the payment, or adds other
1992. obligation that is not incompatible with the
ISSUE: Whether or not there is novation between the old ones, or the new contract merely supplements the
judgments rendered by the courts? old one. The new contract that is a mere
of the parties to make a new contract; (c) an Thus, the court affirms the decision of the CA
extinguishment of the old contract; and (d) a valid promulgated on March 19, 2003
> In October 1987, an agent of Lifeman, Rodolfo Lalog, > Virginia went to Manila to claim the benefits under the
visited Perez in Quezon and convinced him to apply for insurance policies of the deceased. She was paid
additional insurance coverage of P50,000.00, to avail of P40,000.00 under the first insurance policy for
the ongoing promotional discount of P400.00 if the P20,000.00 (double indemnity in case of accident) but
premium were paid annually. the insurance company refused to pay the claim under
the additional policy coverage of P50,000.00, the
proceeds of which amount to P150,000.00 in view of a
> Primitivo B. Perez accomplished an application form triple indemnity rider on the insurance policy.
for the additional insurance coverage. Virginia A. Perez,
his wife, paid P2,075.00 to Lalog. The receipt issued by
Lalog indicated the amount received was a "deposit." > In its letter of January 29, 1988 to Virginia A. Perez, the
insurance company maintained that the insurance for
P50,000.00 had not been perfected at the time of the
> Unfortunately, Lalog lost the application form death of Primitivo Perez. Consequently, the insurance
accomplished by Perez and so on October 28, 1987, he company refunded the amount of P2,075.00 which
asked the latter to fill up another application form. On Virginia Perez had paid
November 1, 1987, Perez was made to undergo the
required medical examination, which he passed.
> Lifeman filed for the rescission and the declaration of
nullity. Perez, on the other hand, averred that the
> Lalog forwarded the application for additional deceased had fulfilled all his prestations under the
insurance of Perez, together with all its supporting contract and all the elements of a valid contract are
papers, to the office of BF Lifeman Insurance present.
Corporationn in Quezon which office was supposed to
forward the papers to the Manila office.
> RTC ruled in favor of Perez. CA reversed.
April 6, 1918