TOPIC: JOINT SOLIDARY OBLIGATIONS (Passive Solidarity)

CASE: INCHAUSTI & CO. v GREGORIO YULO

DOCKET NO.: G.R. No. L-7721

DATE: 25 March 1914

PONENTE: Arellano. C.J.

DOCTRINE

The Court stated that the debtors having obligated themselves in solidum, the creditor can bring its action in
toto against any one of them, inasmuch as this was surely its purpose in demanding that the obligation contracted
in its favor should be solidary having in mind the principle of law that, "when the obligation is constituted as a conjoint
and solidary obligation each one of the debtors is bound to perform in full the undertaking which is the subject matter
of such obligation.

FACTS

● For the exploitation and cultivation of the numerous haciendas of the late Teodoro Yulo located at Negros
Occidental, had been borrowing money from the petitioner under specific conditions.
● He died testate and the following year, his wife.
● Upon their deaths, they left the administration and preservation of the said land, including it debts and
obligations, to their children, duly represented by the respondent, Gregorio Yulo.
● They remain in a harmonious relationship with the petitioner, until when they defaulted in paying their
remaining liability amounting to P200k.
● Yulo, on behalf of his brothers, executed a notarial document admitting their indebtedness and order to
secure the same with interest, they mortgaged their properties before the petitioner.
● The instrument issued in 1909 was novated, executed by his other siblings.
● On 1909, Yulo and his siblings ratified all the contents of the priori document, severally and jointly
acknowledged and admitted their indebtedness to the petitioner.
○ The Yulos failed to pay the 1st Installment, prompting the petitioner to file an ordinary action before
the Court of First Instance.
■ The said trail court ruled in favor of the respondents.

ISSUE

● Whether the court can sue Gregorio Yulo alone, there being other obligors.

RULING

● The Court stated that the debtors having obligated themselves in solidum, the creditor can bring its action in
toto against any one of them, inasmuch as this was surely its purpose in demanding that the obligation
contracted in its favor should be solidary having in mind the principle of law that, "when the obligation is
constituted as a conjoint and solidary obligation each one of the debtors is bound to perform in full the
undertaking which is the subject matter of such obligation.
○ And even though the creditor may have stipulated with some of the solidary debtors diverse
installments and conditions, as in this case, Inchausti & Company did with its debtors Manuel,
Francisco, and Carmen Yulo through the instrument of May 12, 1911, this does not lead to the
conclusion that the solidarity stipulated in the instrument of August 12, 1909 is broken, as it is
already known the law provides that "solidarity may exist even though the debtors are not bound
in the same manner and for the same periods and under the same conditions."
● The contract of May 12, 1911, has affected the action and the suit, to the extent that Gregorio Yulo has
been able to make in his favor the defense of remission of part of the debt, thanks to the provision of article
1148, because it is a defense derived from the nature of the obligation, so that although the said defendant
was not party to the contract in question, yet because of the principle of solidarity he was benefited by it.
○ The defendant Gregorio Yulo cannot be ordered to pay the P253,445.42 claimed from him in the
suit here, because he has been benefited by the remission made by the plaintiff to three of his
codebtors.
■ The defendant Gregorio Yulo cannot be ordered to pay the P253,445.42 claimed from
him in the suit here, because he has been benefited by the remission made by the plaintiff
to three of his codebtors