[G.R. No. 128833. April 20, 1998.

]
RIZAL COMMERCIAL BANKING CORPORATION, UY CHUN BING AND ELI D. LAO, petitioner, vs. COURT
OF APPEALS AND GOYU & SONS, INC., respondent.

[G.R. No. 128834. April 20, 1998.

RIZAL COMMERCIAL BANKING CORPORATION petitioner, vs. COURT OF APPEALS, ALFREDO C.
SEBASTIAN, GOYU & SONS, INC., GO SONG HIAP, SPOUSES GO TENG KOK and BETTY CHIU SUK YING
alias BETTY GO, respondents.

[G.R. No. 128866. April 20, 1998.]

MALAYAN INSURANCE INC., petitioner vs. GOYU & SONS INC. respondent.

FACTS:
When GOYU & Sons, Inc. (GOYU) obtained a credit facility from Rizal Commercial Banking
Corporation (RCBC) it executed a mortgage contract in favor of the bank wherein it was expressly
stipulated that GOYU will insure all the subject properties with an insurance company approved by the
bank and to endorse and deliver the policies to the bank.
GOYU, through Alchester Insurance, Agency, Inc., took insurance policies from Malayan
Insurance Company, Inc. (MICO), sister company of RCBC, and endorsed them in favor of RCBC. Copies of
the endorsements were sent and received by GOYU, RCBC and MICO.
GOYU continued to enjoy the benefits of the credit facilities extended to it by the bank.
When GOYU's factory buildings were gutted by fire, GOYU and RCBC filed separate claims with
MICO but were both denied because the policies were either attached or claimed by other creditors.
GOYU then filed a complaint for specific performance and damages disowning the endorsements
or lack of authority of Alchester to prepare and issue said endorsements in favor of RCBC . The trial court
rendered judgment ordering, among others, MICO to pay fire loss claim of GOYU while ordering MICO
and RCBC to pay damages. GOYU was ordered to pay its loan obligations with RCBC with interests.

On appeal, the Court of Appeals sustained the findings of the trial court with respect to MICO
and RCBC's liabilities. Hence, this recourse.

ISSUE:
Whether or not RCBC, as mortgagee, has any right over the insurance policies taken by GOYU, the
mortgagor, in case of the occurrence of loss?

HELD: YES
The Supreme Court held that a mortgagor and a mortgagee have separate and distinct insurable
interests in the mortgaged property and may insure the same for his own sole benefit; that GOYU is
estopped from assailing the validity of the endorsements in favor of RCBC after it had voluntarily and
purposely took the insurance policies from a sister company of RCBC and failed to seasonably repudiate
the authority of the persons who prepared the endorsements; that to permit GOYU to capitalize on its
non-confirmation of the endorsements is to countenance grave contravention of public policy, fair
dealing, good faith and justice; that generally, the proceeds of an insurance shall exclusively apply to the
interest of the person in whose name or for whose benefit it is made except when otherwise intended by
the parties; and that insurance policies transferred by way of endorsement to a mortgagee can no longer
be attached by other creditors.