7/26/2019 CRDIT

1/61

G.R. No. 124049 June 30, 1999

RODOLFO P. VELASQUEZ, vs. COURT OF APPEALS, n!P"#L#PP#NE CO$$ERC#AL #NTERNAT#ONAL %AN&,#NC.

The Pick-up Fresh Farms, Inc. (PUFFI), of which Velasquez

was an officer an s!ockholer, file an applica!ion for a loanof P",#$$,$$$.$$ wi!h P%I& uner !he 'overnmen!suaran!ee Fun for *mall +eium n!erprises (F*+). Thepar!ies eecu!e !he corresponin' loan a'reemen!. ssecuri!/ for !he loan, promissor/ no!es for !he amoun!s ofP0,$$$,$$$.$$ an P1,#$$,$$$.$$, respec!ivel/, were si'ne2/ Ini'o . 3e2ria an +ariano %anilao, 4r. as officers ofan for 2o!h PUFFI an ircon 5efri'era!ion Inus!ries, Inc.(5II). cha!!el mor!'a'e was also eecu!e 2/ 5II overi!s equipmen! an machineries in favor of P%I&. Velasquez

alon' wi!h 3e2ria an %anilao, 4r. also eecu!e ees ofsure!/ship in favor of P%I&. *epara!e ees of sure!/shipwere fur!her eecu!e 2/ %esar 5. 6ean an r!emio 7.5a/muno.

8hen PUFFI efaul!e in !he pa/men! of i!s o2li'a!ions P%I&foreclose !he cha!!el mor!'a'e. The procees of !he saleamoun!e !o P9":,$$$.$$. Thus, P%I& file an ac!ion !orecover !he remainin' 2alance of !he en!ire o2li'a!ionincluin' in!eres!s, penal!ies an o!her char'es.

Velasquez an %anilao file !heir ;oin! answer wi!hcoun!erclaim en/in' personal lia2ili!/ an in!erposin' !heefense of nova!ion.

The !rial cour! renere a summar/ ;u'men! in favor ofP%I& holin' Velasquez an %anilao soliaril/ lia2le !o pa/P",

7/26/2019 CRDIT

2/61

ones !ha! sense which ma/ resul! from all of !hem!aken ;oin!l/.

ppl/in' !he Ecomplemen!ar/ con!rac!s cons!rue !o'e!herEoc!rine leaves no ou2! !ha! i! was !he in!en!ion of !hepar!ies !ha! Velasquez woul 2e personall/ lia2le in !he eeof sure!/ship 2ecause !he loan a'reemen!, amon' o!hers,

provie

r!. 1. 7?3 *%U5ITB. . . . . 1.0 *ure!/ship. Tofur!her secure !he o2li'a!ions of !he &?55?85 !o !he7365, +essrs. 3e2ria, 5a/muno, %anilao, 6eanan Velasquez an ircon an 5efri'era!ion In. Inc.shall each eecu!e a sure!/ship a'reemen! in favor of!he 7365 in form an su2s!ance accep!a2le !o !he7365.

I! woul have 2een a ifferen! ma!!er ha Velasquez properl/con!es!e !he ee of sure!/ship. &u! he i no!. Theomission, as properl/ no!e 2/ !he !rial cour!, was fa!al for i!resul!e in VelasquezD amission of !he ue eecu!ion an'enuineness of !he con!rac!. The amission effec!ivel/elimina!e an/ efense rela!in' !o !he au!hen!ici!/ an ueeecu!ion of !he ocumen!, e.'., !ha! !he ocumen! wasspurious, coun!erfei!, or of ifferen! impor! on i!s face as !heone eecu!e 2/ !he par!iesG or !ha! !he si'na!uresappearin' !hereon were for'eriesG or !ha! !he si'na!ureswere unau!horize.

Pe!i!ioner also claims !ha! P%I&s accep!ance of ro/al!/ feeswhich were !he frui!s of !he Franchisin' 'reemen! 2e!weenPUFFI an r!uro 5osales cons!i!u!e a nova!ion of !he loana'reemen! an ees of sure!/ship, !herefore, a 'enuineissue of fac!.

This con!en!ion is un!ena2le. !inc!ive nova!ion has !hese

requisi!esH (a) !he eis!ence of a previous vali o2li'a!ionG(2) !he a'reemen! of all !he par!ies !o !he new con!rac!G (c)

!he e!in'uishmen! of !he ol o2li'a!ion or con!rac!G an, ()!he valii!/ of !he new one. Thus, nova!ion is effec!e onl/when a new con!rac! has e!in'uishe an earlier con!rac!2e!ween !he same par!ies.3ecessaril/, !here is no nova!ionwhen !he new con!rac! is no! 2e!ween !he same par!ies as in!he ol con!rac!.

The franchise a'reemen! was onl/ 2e!ween PUFFI an5osales. P%I& was never men!ione !hereinG nei!her was!here an/ reference !o !he su2;ec! loan a'reemen!. 8ha!P%I& simpl/ i was !o accep! ro/al!/ pa/men!s ou! of !hefranchise an ac! which was alrea/ 2e/on !he scope of!he franchise a'reemen! 2u! which was no! in conflic! wi!h!he pa/men! arran'emen! in !he loan a'reemen!. ?ur rulin'in !he Magdalena Estates Inc. v. Rodriguez is ins!ruc!ive, !owi!

n o2li'a!ion !o pa/ a sum of mone/ is no! nova!e, ina new ins!rumen! wherein !he ol is ra!ifie, 2/chan'in' onl/ !he !erms of pa/men! an ain' o!hero2li'a!ions no! incompa!i2le wi!h !he ol one, orwherein !he ol con!rac! is merel/ supplemen!e 2/!he new one. The mere fac! !ha! !he crei!or receivesa 'uaran!/ or accep!s pa/men!s from a !hir personwho has a'ree !o assume !he o2li'a!ion, when !hereis no a'reemen! !ha! !he firs! e2!or shall 2e releasefrom responsi2ili!/, oes no! cons!i!u!e a nova!ion, an!he crei!or can s!ill enforce !he o2li'a!ion a'ains! !he

ori'inal e2!or.

8@5F?5, !he pe!i!ion is 63I6. The 6ecision of !he%our! of ppeals affirmin' !he ;u'men! of !he 5T%- &r. 9=,+aka!i %i!/, orerin' 5oolfo P. Velasquez an +ariano 3.%anilao, 4r. !o soliaril/ pa/ Philippine %ommercial anInus!rial &ank (P%I&) !he amoun! of P",

7/26/2019 CRDIT

3/61

G.R. No. 113931 $' (, 199)

E. ZO%EL, #NC., vs. T"E COURT OF APPEALS,CONSOL#DATED %AN& AND TRUST CORPORAT#ON, n!SPOUSES RAUL n! ELEA R. CLAVER#A.

*pouses 5aul an lea %laveria, oin' 2usiness uner !hename E'ro &rokers,E applie for a loan wi!h %onsolia!e&ank an Trus! %orpora!ion (now *?7I6&3J) in !he amoun!of P

7/26/2019 CRDIT

4/61

failure !o re'is!er, e!inc!ion of !he lia2ili!/ woul no!lie.

Issue(s)H

8A3 Ko2el, uner !he E%on!inuin' uaran!/,E o2li'a!e i!self!o *?7I6&3J, as a 'uaran!or. C 3o.

8A3 r!icle

7/26/2019 CRDIT

5/61

deand, to you o! any and all such instruents,loans, advances, credits and"or other obligationsherein be!ore re!erred to, and also any and all otherindebtedness o! every #ind which is now or ayherea!ter becoe due or owing to you by the$orrower, !o'e!her wi!h an/ an all epenses whichma/ 2e incurre 2/ /ou in collec!in' all or an/ such

ins!rumen!s or o!her ine2!eness or o2li'a!ionsherein2efore referre !o, an or in enforcin' an/ ri'h!shereuner, an also !o make or cause an/ an all suchpa/men!s !o 2e mae s!ric!l/ in accorance wi!h !he!erms an provisions of an/ a'reemen! ('), epress orimplie, which has (have) 2een or ma/ hereaf!er 2emae or en!ere in!o 2/ !he &orrower in reference!here!o, re'arless of an/ law, re'ula!ion or ecree,now or hereaf!er in effec! which mi'h! in an/ manneraffec! an/ of !he !erms or provisions of an/ sucha'reemen!s(s) or /our ri'h! wi!h respec! !here!o asa'ains! !he &orrower, or cause or permi! !o 2e invokean/ al!era!ion in !he !ime, amoun! or manner ofpa/men! 2/ !he &orrower of an/ such ins!rumen!s,o2li'a!ions or ine2!enessG . . . (Ephasis %urs)

?ne nee no! look !oo eepl/ a! !he con!rac! !o e!ermine!he na!ure of !he uner!akin' an !he in!en!ion of !hepar!ies. The con!rac! clearl/ isclose !ha! Ko2el assumelia2ili!/ !o *?7I6&3J, as a re'ular par!/ !o !he uner!akin'an o2li'a!e i!self as an ori'inal promissor. I! 2oun i!self

;oin!l/ an severall/ !o !he o2li'a!ion wi!h !he spouses.

&hould the $orrower at this or at any !uture tie!urnish, or should be hereto!ore have !urnished,another surety or sureties to guarantee the payento! his obligations to you, the undersigned herebye'pressly waives all bene!its to which the undersignedight be entitled under the provisions o! Article ()*+o! the Civil Code bene!icio division-, the liability o! theundersigned under any and all circustances being

oint and severalG (Ephasis %urs)

The use of !he !erm EguaranteeE oes no! ipso !actomean!ha! !he con!rac! is one of 'uaran!/. u!hori!ies reco'nize!ha! !he wor EguaranteeE is frequen!l/ emplo/e in 2usiness!ransac!ions !o escri2e no! !he securi!/ of !he e2! 2u! anin!en!ion !o 2e 2oun 2/ a primar/ or inepenen!o2li'a!ion. s ap!l/ o2serve 2/ !he !rial cour!, !hein!erpre!a!ion of a con!rac! is no! limi!e !o !he !i!le alone

2u! !o !he con!en!s an in!en!ion of !he par!ies.

@avin' !hus es!a2lishe !ha! Ko2el is a sure!/, r!icle

7/26/2019 CRDIT

6/61

par!nership of an/ one or more new par!ners.(mphasis supplie)

G.R. No. 1100)( Ju' 19, 1999

PARA$OUNT #NSURANCE CORPORAT#ON, vs.CA n! DAGUPAN ELECTR#C CORPORAT#ON.

+core Finance an Inves!men!, Inc. (+c6?5) was !heowner an opera!or of !he +core In!erna!ional Palace@o!el in 6a'upan %i!/. 6a'upan lec!ric %orpora!ion(6%?5P), on !he o!her han, was !he 'ran!ee of a franchise!o opera!e an main!ain elec!ric services in !he province ofPan'asinan, incluin' 6a'upan %i!/.

+c6?5 an 6%?5P en!ere in!o a con!rac! where2/6%?5P shall provie elec!ric power !o +c6?5s @o!el.6urin' !he !erm of !heir con!rac! for power service, 6%?5Pno!ice iscrepancies 2e!ween !he ac!ual mon!hl/ 2illin'san !he es!ima!e mon!hl/ 2illin's of +c6?5. Uponinspec!ion, i! was iscovere !ha! !he !erminal in !he!ransformers connec!e !o !he me!er ha 2een in!erchan'eresul!in' in !he slow ro!a!ion of !he me!er. %onsequen!l/,6%?5P issue a correc!e 2ill 2u! +c6?5 refuse !o pa/.s a resul! of +c6?5s failure an con!inue refusal !o pa/!he correc!e elec!ric 2ills, 6%?5P isconnec!e powersuppl/ !o !he ho!el.

''rieve, +c6?5 commence a sui! a'ains! 6%?5P forama'es wi!h pra/er for a wri! of preliminar/ in;unc!ion.+c6?5 pos!e in;unc!ion 2ons from several sure!ies, oneof which was P5+?U3T, which issue an in;unc!ion 2onwi!h a face amoun! of P#$$,$$$.$$. ccorin'l/, a wri! ofpreliminar/ in;unc!ion was issue wherein 6%?5P wasorere !o con!inue suppl/in' elec!ric power !o !he ho!el anres!raine from fur!her isconnec!in' i!.

f!er ue hearin', !he 5e'ional Trial %our! renere;u'men! in favor of 6%?5P, !here 2ein' preponerance ofevience, !he cour! here2/ ismisses !he amenecomplain!. Fur!her, !he cour! rescins !he service con!rac!2e!ween !he par!ies, an orers +core !o pa/ 6ecorp !hefollowin'H

=. c!ual ama'es consis!in' of !o!al arreara'es forelec!ric services renere, plus in!eres! a! !he le'alra!e, compu!e from !he a!e of eman un!il fullpa/men!G

8hile !his case was uner li!i'a!ion, !he cour! issue anum2er of res!rainin' orers or in;unc!ions. 6urin'!hese incien!s, +core file !he followin' 2onsHPolic/ 3o. :$

7/26/2019 CRDIT

7/61

@ence !his pe!i!ion.

P5+?U3T asser!s !ha! E(!)he 2one of con!en!ion in !heins!an! case is !he ma!!er of evience (or lack !hereof)presen!e urin' !he hearin' of !he case a 1uo, no!ice (orlack !hereof) !o !he sure!/ rela!ive !o !he proceein's 2efore!he cour! a 1uourin' which sai evience was presen!e,

as well as !he ac!ual proceein's !hemselves.E P5+?U3Tfur!her assevera!es !ha! Eno evience rela!ive !o ama'essuffere 2/ 6ecorp as a resul! of !he in;unc!ion was everpresen!e, or !ha! if an/ such evience was presen!e, !hesame was one wi!hou! no!ice !o P5+?U3T an inviola!ion of i!s ri'h! !o ue process.E +oreover, P5+?U3Tmain!ains !ha! !he in;unc!ion 2on was issue an approve!o 'uaran!ee Eac!ual an ma!erial ama'es as ma/ 2esus!aine an ul/ prove 2/ 6ecorp.E Thus, i! can onl/cover !he perio prospec!ivel/ from !he a!e of i!s issuancean oes no! re!roac! !o !he a!e of !he ini!ial con!rovers/.

In i!s %ommen!, 6%?5P claims !ha! P5+?U3Tpar!icipa!e in !he proceein's an was 'iven i!s a/ incour!. This is evience 2/ !he E3o!ice of @earin'E aresse!o !he !hree sure!ies. In fac!, a! !he hearin', P5+?U3Twas in a!!enance represen!e 2/ !!/. 3oni!o L. %orero.7ikewise, P5+?U3T was no!ifie of !he ne! hearin'scheule. 6%?5P fur!her s!resse !ha! !he ne! hearin'proceee as scheule wi!hou! an/ commen!, o2;ec!ion,opposi!ion or reserva!ion from P5+?U3T.

8A3 Paramoun! is lia2le on i!s in;unc!ion 2on.

Bes. The pe!i!ion is evoi of meri!. Paramoun!s su2missionsnecessi!a!es 'oin' in!o !he na!ure of an in;unc!ion as well asover !he proceure in claimin', ascer!ainin' an awarin'

ama'es upon !he in;unc!ion 2on.

In;unc!ion is an e!raorinar/ reme/ calcula!e !o preserve!he status 1uoof !hin's an !o preven! ac!ual or !hrea!eneac!s viola!ive of !he rules of equi!/ an 'oo conscience aswoul consequen!l/ affor an in;ure par!/ a cause of ac!ionresul!in' from !he failure of !he law !o provie for anaequa!e or comple!e relief. preliminar/ in;unc!ion is anorer 'ran!e a! an/ s!a'e of an ac!ion or proceein' prior

!o !he ;u'men! or final orer, requirin' a par!/ or a cour!,a'enc/ or a person !o refrain from a par!icular ac! or ac!s. I!ma/ also require !he performance of a par!icular ac! or ac!s,in which case i! shall 2e known as a preliminar/ mana!or/in;unc!ion. I!s sole purpose is no! !o correc! a wron' of !hepas!, in !he sense of reress for in;ur/ alrea/ sus!aine, 2u!!o preven! fur!her in;ur/.

preliminar/ in;unc!ion or !emporar/ res!rainin' orer ma/2e 'ran!e onl/ when, amon' o!hers, !he applican!, unlesseemp!e 2/ !he cour!, files wi!h !he cour! where !he ac!ionor proceein' is penin', a 2on eecu!e !o !he par!/ orperson en;oine, in an amoun! !o 2e fie 2/ !he cour!, !o!he effec! !ha! !he applican! will pa/ such par!/ or person allama'es which he ma/ sus!ain 2/ reason of !he in;unc!ion or!emporar/ res!rainin' orer if !he cour! shoul finall/ ecie!ha! !he applican! was no! en!i!le !here!o. Upon approval of!he requisi!e 2on, a wri! of preliminar/ in;unc!ion shall 2eissue. ! !he !rial, !he amoun! of ama'es !o 2e aware !oei!her par!/, upon !he 2on of !he averse par!/, shall 2eclaime, ascer!aine, an aware uner !he same

proceure prescri2e in *ec!ion

7/26/2019 CRDIT

8/61

o2li'ee or his sure!/ or sure!ies, se!!in' for!h !he fac!sshowin' his ri'h! !o ama'es an !he amoun! !hereof.*uch ama'es ma/ 2e aware onl/ af!er properhearin' an shall 2e inclue in !he ;u'men! on !hemain case.

If !he ;u'men! of !he appella!e cour! 2e favora2le !o

!he par!/ a'ains! whom !he a!!achmen! was issue, hemus! claim ama'es sus!aine urin' !he penenc/ of!he appeal 2/ filin' an applica!ion in !he appella!ecour! wi!h no!ice !o !he par!/ in whose favor !hea!!achmen! was issue or his sure!/ or sure!ies,2efore !he ;u'men! of !he appella!e cour! 2ecomeseecu!or/. The appella!e cour! ma/ allow !heapplica!ion !o 2e hear an ecie 2/ !he !rial cour!.

3o!hin' herein con!aine shall preven! !he par!/a'ains! whom !he a!!achmen! was issue fromrecoverin' in !he same ac!ion !he ama'es aware !ohim from an/ proper!/ of !he a!!achin' o2li'ee no!eemp! from eecu!ion shoul !he 2on or eposi!'iven 2/ !he la!!er 2e insufficien! or fail !o full/ sa!isf/!he awar. ( utatis utandis).

The a2ove rule comes in!o pla/ when +c6?5 for in;unc!ionfails !o sus!ain his ac!ion, an 6%?5P is !here2/ 'ran!e!he ri'h! !o procee a'ains! !he 2on pos!e 2/ !he former.In !he case a! 2ench, !he !rial cour! ismisse +c6?5s

ac!ion for ama'es wi!h pra/er for wri! of preliminar/in;unc!ion an even!uall/ a;u'e !he pa/men! of ac!ual,moral, an eemplar/ ama'es a'ains! i!. %onsequen!l/,6%?5P can procee a'ains! !he in;unc!ion 2on pos!e 2/+c6?5 !o recover !he ama'es occasione 2/ !heissuance 2/ !he !rial cour! of !he wri! of in;unc!ion.

The recors of !his case reveal !ha! urin' i!s penenc/ in!he !rial cour!, 6%?5P file i!s nswer raisin' compulsor/coun!erclaims for rescission of con!rac!, moral ama'es,

eemplar/ ama'es, a!!orne/s fees an li!i'a!ion epenses.6urin' !he !rial, !!/. 3oni!o %orero appeare as counsel for

P5+?U3T. P5+?U3T as well as !he o!her sure!ies wereproperl/ no!ifie of !he hearin' an 'iven !heir a/ in cour!.*pecificall/, no!ice was sen! !o !!/. %orero of !he hearin',which was se! for !he purpose of e!erminin' !he lia2ili!/ of!he sure!ies. The coun!erclaims for ama'es of 6%?5P wereproven a! !he !rial an /e! P5+?U3T i no! eer! an/effor! !o con!rover! !he evience presen!e 2/ 6%?5P.

iven !hese circums!ances, P5+?U3T canno! hie uner!he cloak of non-lia2ili!/ on i!s in;unc!ion 2on on !he mereepeienc/ !ha! i! was eprive of ue process. I! 2earss!ressin' !ha! wha! !he law a2hors is no! !he a2sence ofprevious no!ice 2u! ra!her !he a2solu!e lack of oppor!uni!/ !oven!ila!e a par!/s sie. In o!her wors, P5+?U3T canno!successfull/ invoke enial of ue process where i! was 'iven!he chance !o 2e hear. s ap!l/ hel 2/ !he %H

The recors of !he case isclose !ha! urin' !he !rial of!he case, P5+?U3T was presen! an represen!e2/ i!s counsel !!/. 3oni!o L. %orero as shown in !he!rial cour!s orer. In !he sai orer, P5+?U3T wasul/ no!ifie of !he ne! hearin' which was scheule.vien!l/, P5+?U3T was well-apprise of !he ne!hearin' an i! canno! fei'n lack of no!ice. @avin' 2een'iven an oppor!uni!/ !o 2e hear urin' !he mainhearin' for !he ma!!er of ama'es, P5+?U3T!herefore, canno! 2ewail !ha! i! was no! 'iven anoppor!uni!/ !o 2e hear upon enial of i!s mo!ion !ocancel i!s in;unc!ion 2on. ?f wha! use, !herefore, is

!here !o conuc! ano!her hearin' when !he issue ofama'es has 2een !he su2;ec! of !he main ac!ion ofwhich P5+?U3T ha 2een ul/ no!ifieM newno!ice an hearin' prescri2e 2/ *ec.

7/26/2019 CRDIT

9/61

an/!hin' of !his sor!. ?nl/ when an averse ;u'men!was renere 2/ !he !rial cour! a'ains! i!s principal+core i i! whimper a enial of proceural ueprocess.

?n !he same poin!, P5+?U3T ar'ues !ha! con!rar/ !o !herulin' of !he %our! of ppeals, !here is a nee for a separa!e

hearin' for !he purpose of presen!in' evience on !healle'e ama'es claime 2/ 6%?5P on pe!i!ionersin;unc!ion 2on. P5+?U3T con!ens !ha! a separa!ehearin' is neee as no evience ealin' wi!h 6%?5Psclaim for ama'es on pe!i!ioners 2on was presen!e urin'!he hearin' wherein pe!i!ioners counsel a!!ene nor in !hene! hearin' wherein pe!i!ioner was no!ifie 2u! faile !oa!!en. *ince no hearin' was hel for !he purpose ofes!a2lishin' i!s lia2ili!/ on !he in;unc!ion 2on, P5+?U3Tconclues !ha! i! is release from i!s o2li'a!ion as sure!/.

%on!rar/ !o pe!i!ioners !hesis, i! is nei!her mana!or/ norfa!al !ha! !here shoul 2e a separatehearin' in orer !ha!ama'es upon !he 2on can 2e claime, ascer!aine anaware, as can 2e 'leane from a cursor/ reain' of !heprovisions of 5ule #", *ec!ion

7/26/2019 CRDIT

10/61

a!!orne/s fees an cos!s of !he sui!. To ar'ue !herefore !ha!P5+?U3T is onl/ lia2le on i!s in;unc!ion 2on from !he!ime of i!s issuance an no! from !he !ime !he sui! wascommence is prepos!erous if no! a2sur. Inee, i! woul2e impossi2le !o e!ermine !he reckonin' poin! when moralama'es, eemplar/ ama'es, a!!orne/s fees an cos!s of!he sui! were suppose !o have 2een incurre. %onsequen!l/,

i! can 2e safel/ euce !ha! !he 2on answers for an/ anall ama'es arisin' from !he in;unc!ion, re'arless ofwhe!her i! was sus!aine 2efore or af!er !he filin' of !hein;unc!ion 2on.

P5+?U3T fur!her main!ains !ha! i! is lia2le !o pa/ ac!ualama'es onl/. @owever, 5ule #:, *ec!ion 0(2), clearl/provies !ha! !he in;unc!ion 2on is answera2le for allama'es. EThe 2on insures wi!h all prac!ica2le cer!ain!/!ha! !he efenan! ma/ sus!ain no ul!ima!e loss in !he even!!ha! !he in;unc!ion coul finall/ 2e issolve. %onsequen!l/,!he 2on ma/ o2li'a!e !he 2onsmen !o accoun! !o !heefenan! in !he in;unc!ion sui! for allH (=) such ama'esG(

7/26/2019 CRDIT

11/61

G.R. No. /4231 A+* 10, 19)/

CORAZON J. V#ZCONDE, vs. #NTER$ED#ATE APPELLATE

COURT PEOPLE OF T"E P"#L#PP#NES.

Vizcone an Pilar . Pa'ula/an were char'e in !he Trial%our! wi!h misappropria!ion an conversion of an :-cara!iamon rin' 2elon'in' !o 6r. +ar/lon 4. Perlas in aninforma!ion which avers !ha! !he/H

N N N wilfull/, unlawfull/ an feloniousl/, wi!h in!en! of'ain an wi!h unfai!hfulness anAor a2use ofconfience, efrau(e) 65. +5B7?U 4. P57* in

!he followin' manner, !o wi!H !he sai accuse receivefrom !he offene par!/ one (=) :-kara! solo iamonrin', whi!e, ou2le cu!, 2rillian! cu! wi!h mul!iple2en!i!os, value a! P:#,$$$.$$, !o 2e sol 2/ !hem oncommission 2asis, wi!h !he o2li'a!ion !o !um over !heprocees of !he sale !o !he offene par!/, or !o re!urn!he sai rin' if unsol, 2u! !he accuse, once inpossession !hereof, con!rar/ !o !heir o2li'a!ion,misapplie, misappropria!e an conver!e !he same!o !heir own personal use an 2enefi!, an in spi!e ofrepea!e emans mae upon !hem, 2o!h accuse

faile, omi!!e an refuse, an s!ill fai! omi! anrefuse up !o !he presen!, !o compl/ wi!h !heiraforesai o2li'a!ion, !o !he ama'e an pre;uice of!he offene par!/, in !he aforemen!ione amoun! ofP:#,$$$.$$, Philippine currenc/.

f!er !rial 2o!h accuse were convic!e an each sen!ence!o serve an ine!ermina!e prison !erm of from ei'h! (:)/ears, four (0) mon!hs an one (=) a/ !o !en (=$) /ears an!wo (

7/26/2019 CRDIT

12/61

receip! prepare 2/ Perlas. This receip!-peoples hi2i! EE-reas as followsH

5%IPT

5eceive from 6ra. +ar/lon 4avier-Perlas one (=) solo: kara! iamon rin', whi!e, ou2le cu!, 2rillian! cu!

wi!h mul!iple 2rillian!i!os, which I a'ree !o sell forP:#,$$$.$$ (ei'h!/-five !housan pesos) oncommission 2asis an pa/ her in !he followin'mannerH

P:#,$$$.$$ pos!a!e check

P3& check "1$

7/26/2019 CRDIT

13/61

%orazon Vizcone

Vizcone an Pa'ula/an havin' alle'el/ rene'e on apromise !o comple!e pa/men! for !he rin' on !he ver/ ne!a/, Perlas file wi!h !he Luezon %i!/ Fiscals office acomplain! a'ains! !hem for esta!a This no!wi!hs!anin',Pa'ula/an s!ill pai Perlas various sums !o!allin' P

7/26/2019 CRDIT

14/61

classma!es, !ha! i! was Vizcone who in!rouce Pa'ula/an!o Perlas, !ha! Vizcone was presen! on !he !wo occasionswhen !he rin' was en!rus!e !o Pa'ula/an an when par!pa/men! of P#,$$$.$$ was mae, an !ha! she si'ne !hereceip!s, hi2i!s EE an E6,E on !hose occasions are, a!2es!, inconclusive. The/ are no! inconsis!en! wi!h wha!Vizcone has asser!e !o 2e an innocen! esire !o help her

frien ispose of !he rin'G nor o !he/ eclue ever/reasona2le h/po!hesis o!her !han complici!/ in apremei!a!e swinle.

The fore'oin' conclusion in nowise suffers from !he fac! !ha!!he secon receip!, hi2i! E6E, appears !o confirm !ha! !herin' EN N N was 'iven !o +rs. Pilar Pa'ula/an an Mrs.Corazon de 2esus 3izcondeon

7/26/2019 CRDIT

15/61

s alrea/ s!a!e, !he *olici!or eneral however main!ains!ha! !he appellan! shoul 2e hel ha2le !o pa/ !hecomplainan! !he amoun! of P##,$$$.$$, or wha!ever par! ofsuch amoun! remains unpai, for !he value of !he rin'.'ain, !his is a correc! proposi!ion, !here 2ein' no ques!ion as in fac! ami!!e 2/ her !ha! !he appellan! eecu!e!he 'uaran!ee alrea/ referre !o.

8@5F?5, ecep! insofar as i! affirms !he ;u'men! of !heTrial %our! orerin' appellan! %orazon 4. Vizcone, soliari!/wi!h Pilar . Pa'ula/an, !o inemnif/ !he complainan!+ar/lon 4. Perlas in !he amoun! of P##,$$$.$$ for !heunaccoun!e 2alance of !he value of !he la!!ers rin', !heappellan! appeale 6ecision of !he %our! of ppeals isreverse an se! asie, an sai appellan! is acqui!!e.

G.R. No. L1())0 A+* 30, 19(3

LUNETA $OTOR CO$PAN, vs. ANTON#O $ENENDEZ

n! CARLOS %ARANDA,LUZON SURET CO., #NC.,.

I! appears !ha! n!onio +enenez o2!aine a loan from !he7une!a +o!or %o. in !he amoun! of P9,

7/26/2019 CRDIT

16/61

!he sale shall 2e pai in pa/men! of !he sum a;u'e !o !heplain!iff in !his ecision. If !he procees of !he sale is no!enou'h or !he car canno! 2e elivere !o !he *heriff, !heamoun! a;u'e !o 7une!a +o!or in !his ecision or an/unpai 2alance, shall 2e sa!isfie 2/ !he lev/ on !hecoun!er2on pu! up 2/ !he &arana an su2scri2e 2/ his2onsman, 7uzon *ure!/ %o., Inc. 4he said /u'on &urety

Co., Inc. shall be noti!ied and served a copy o! this decision.E(mphasis supplie.)

6espi!e !he las! s!a!emen! in !he a2ove quo!a!ion, !he 7uzon*ure!/ was no! furnishe a cop/ of !he ecision.

3o! sa!isfie wi!h sai ecision, &arana in!erpose anappeal !o !he %our! of ppeals which affirme !he ecision intoto. 'ain, !he recor oes no! show !ha! !he sure!/ wasserve a cop/ of !he same.

Penin' finali!/ of !he % ecision, 7une!a +o!or file withthe trial courta mo!ion for leave !o claim ama'es from !he7uzon *ure!/ %o. 'ains! !he sure!/s opposi!ion, !he claimwas ami!!e 2/ !he !rial cour!, 2u! ac!ion !hereon was helin a2e/ance un!il !he recor of !he case was re!urne from!he %. a/ 2efore !he ecision was !o 2e final aneecu!or/, 7une!a +o!or file wi!h !he % a mo!ion !o have!he recor of !he case remane !o !he !rial cour! for properac!ion on !he claim. The sai cour!, however, allowe firs! !heecision !o 2ecome final an eecu!or/ 2efore remanin' !he

recor of !he case !o !he lower cour!.

*u2sequen!l/, 7uzon *ure!/ %o., Inc., move forreconsiera!ion of !he !rial cour!s orer ami!!in' plain!iffsclaim for ama'e. The mo!ion was enie, 2u! movan!sa!!orne/ was allowe !o file his answer !o plain!iffs claim forama'es. @earin' was ha af!er !he ecision in !he maincase ha alrea/ 2ecome final an eecu!or/, an i! was onl/several mon!hs !hereaf!er !ha! an orer for ama'es a'ains!!he 7uzon *ure!/ %o. was issue. The sai orer is now !he

su2;ec! of !he presen! appeal in!erpose 2/ !he sai sure!/.

ppellan! sure!/ pra/s for !he annulmen! of !he orer holin'i! lia2le for ama'es upon !he 2on su2scri2e 2/ i! forefenan!s on !he 'rouns !ha! (=) !he plain!iff-appellee hasno! sufficien!l/ complie wi!h !he proceure prescri2e for!he recover/ of ama'es a'ains! sure!iesG an !ha! (

7/26/2019 CRDIT

17/61

an !he amoun! !hereof. 6ama'es sus!aine urin'!he penenc/ of !he appeal ma/ 2e claime 2/ !heefenan!, if !he ;u'men! of !he appella!e cour! 2efavora2le !o him, 2/ filin' an applica!ion !herewi!h,wi!h no!ice !o !he plain!iff an his sure!/ or sure!ies,an !he appella!e cour! ma/ allow !he applica!ion !o 2ehear an ecie 2/ !he !rial cour!. (mphasis

supplie.) (*ec!ion

7/26/2019 CRDIT

18/61

filin' i!s claim !herefor wi!h !he %FI few a/s 2efore !hefinali!/ of !he ecision of !he %.

In summar/, !he applica!ion for ama'es a'ains! !he sure!/mus! 2e file in !he %FI 2efore !rial, or even af!er !rial, 2u!2efore ;u'men! 2ecomes eecu!or/G an if appeal is !aken,!hen applica!ion mus! 2e mae in !he appella!e cour!, 2u!

alwa/s 2efore ;u'men! of !he la!!er 2ecomes final aneecu!or/ so !ha! !he awar, if an/, ma/ 2e inclue in sai;u'men!.

7une!a +o!or havin' faile !o compl/ wi!h !he proceurea2ove-summarize, !he appeale orer is eclare null anvoi an !he same is here2/ se! asie. %os!s a'ains! !he7une!a +o!or.

G.R. No. L933 $' 21, 19/

$AN#LA SURET AND F#DEL#T, #NC.,vs. %ATUCONSTRUCT#ON AND CO$PAN, CARLOS N.%AQU#RAN, GONZALO P. A$%O n! ANDRES TUNAC.

In a complain! file in !he %our! of Firs! Ins!ance of +anila,!he plain!iff, a omes!ic corpora!ion en'a'e in !he 2onin'2usiness, hereaf!er calle !he compan/, alle'es !ha! !he &a!u%ons!ruc!ion O %ompan/, a par!nership !he mem2ers ofwhich are !he o!her !hree efenan!s, reques!e i! !o pos!,as i! i, a sure!/ 2on for P:,:=< in favor of !heovernmen! of !he Philippines !o secure !he fai!hfulPerformance of !he cons!ruc!ion of !he &acarra &ri'e,Pro;ec! P5-"< (1), in Ilocos 3or!e, uner!aken 2/ !hepar!nership, as s!ipula!e in a cons!ruc!ion on con!rac!en!ere in!o on == 4ul/ =#$ 2/ an 2e!ween !he par!nershipan !he overnmen! of !he Philippines, on coni!ion !ha! !heefenan!s woul Einemnif/ !he %?+P3B for an/ ama'e,loss, cos!s, or char'es, or epenses of wha!ever kin anna!ure, incluin' counsel or a!!orne/s fees, which !he%?+P3B ma/, a! an/ !ime, sus!ain or incur, as a

consequence of havin' 2ecome sure!/ upon !he a2ovemen!ione 2onG sai a!!orne/s fees shall no! 2e less !hanfif!een (=#>) per cen! of !he !o!al amoun! claime in an/ac!ion which !he %?+P3B ma/ ins!i!u!e a'ains! !heunersi'ne (!he efenan!s ecep! nres Tunac) in %our!,Ean !ha! E*ai inemni!/ shall 2e pai !o !he %?+P3B assoon as i! has 2ecome lia2le for !he pa/men! of an/ amoun!,uner !he a2ove-men!ione 2on, whe!her or no! i! shallhave pai such sum or sums of mone/, or an/ par! !hereof,Eas s!ipula!e in a con!rac! eecu!e on : 4ul/ =#$ (hi2i!

&)G !ha! on 1$ +a/ =#= 2ecause of !he unsa!isfac!or/pro'ress of !he work on !he 2ri'e, !he 6irec!or of Pu2lic

7/26/2019 CRDIT

19/61

8orks, wi!h !he approval of !he *ecre!ar/ of Pu2lic 8orksan %ommunica!ions, annulle, !he cons!ruc!ion con!rac!referre !o an no!ifie !he plain!iff %ompan/ !ha! !heovernmen! woul hol i! (!he %ompan/) lia2le for an/amoun! incurre 2/ !he overnmen! for !he comple!ion of!he 2ri'e, in ecess of !he con!rac! price (hi2i! 6)G !ha!on = 6ecem2er =#= (shoul 2e

7/26/2019 CRDIT

20/61

a2ou! !o remove an ispose of his proper!ies, 2ecause hehas no proper!/G !ha! has 2een no liquia!ion of !heepenses incurre in !he cons!ruc!ion of !he &acarra &ri'e,Pro;ec! P5-"

7/26/2019 CRDIT

21/61

a'ains! i! an !he +anila *ure!/ an Fieli!/ %o., Inc.,for unpai wa'es amoun!in' !o P#,9$.=$.

an, 2ein' of !he opinion !ha! !he provisions of ar!icle

7/26/2019 CRDIT

22/61

in!ens !o a2scon.E I! oes no! come uner para'raph ",2ecause !he efenan!s, as principal e2!ors, are no! inimminen! an'er of 2ecomin' insolven!, !here 2ein' no proof!o !ha! effec!.

&u! !he plain!iffs cause of ac!ion comes uner para'raph =of ar!icle

7/26/2019 CRDIT

23/61

G.R. No. 13)44 O5-o6e+ 3, 2000

SECUR#T %AN& AND TRUST CO$PAN, #n5., vs.RODOLFO $. CUENCA.

&ein' an onerous uner!akin', a sure!/ a'reemen! is s!ric!l/cons!rue a'ains! !he crei!or, an ever/ ou2! is resolve infavor of !he soliar/ e2!or. The funamen!al rules of fairpla/ require !he crei!or !o o2!ain !he consen! of !he sure!/!o an/ ma!erial al!era!ion in !he principal loan a'reemen!, ora! leas! !o no!if/ i! !hereof. @ence, pe!i!ioner 2ank canno!hol herein responen! lia2le for loans o2!aine in ecess of!he amoun! or 2e/on !he perio s!ipula!e in !he ori'inala'reemen!, a2sen! an/ clear s!ipula!ion showin' !ha! !hela!!er waive his ri'h! !o 2e no!ifie !hereof, or !o 'iveconsen! !here!o. This is especiall/ !rue where, as in !his case,responen! was no lon'er !he principal officer or ma;ors!ockholer of !he corpora!e e2!or a! !he !ime !he la!ero2li'a!ions were incurre. @e was !hus no lon'er in aposi!ion !o compel !he e2!or !o pa/ !he crei!or an ha no

more reason !o 2in himself anew !o !he su2sequen!o2li'a!ions.

*!a. Ines +elale (*!a. InesD) is a corpora!ion en'a'e inlo''in' opera!ions. I! was a holer of a Tim2er 7icense'reemen! issue 2/ !he 635.

*ecuri!/ &ank an Trus! %o. 'ran!e *!a. Ines +elale

%orpora!ion Q*I+%R a crei! line in !he amoun! of

P:,$$$,$$$.$$ !o assis! !he la!!er in mee!in' !he ai!ionalcapi!aliza!ion requiremen!s of i!s lo''in' opera!ions.

EThe %rei! pproval +emoranum epressl/ s!a!e !ha! !heP:+ %rei! 7oan Facili!/ shall 2e effec!ive un!il 1$ 3ovem2er=:=H

4?I3T %?36ITI?3*H=. 'ains! %ha!!el +or!'a'e on lo''in' !rucks anAorinven!ories (ecep! lo's) value a! of !he linesplus 4** of 5oolfo +. %uenca.

7/26/2019 CRDIT

24/61

of !he 2ank for !he pa/men!, upon eman anwi!hou! !he 2enefi! of ecussion of wha!ever amoun! !he clien! ma/ 2e ine2!e !o !he 2ank 2/vir!ue of aforesai crei! accommoa!ion(s) *n5u!*n -7e >o+e*! 5+e!*-

55o::o!-*on?@ 8 8 8 .(mphasis supplie).Prior !he epira!ion of !he perio of effec!ivi!/ of !he P:+-%rei! 7oan Facili!/, *I+% mae a firs! rawown from i!screi! line wi!h *&T% in !he amoun! of P9,=$$,$$$.$$. Tocover sai rawown, *I+% ul/ eecu!e promissor/ 3o!e3o. T6AT7*-1#-:= for sai amoun!.

%uenca resi'ne as Presien! an %hairman of !he &oar of6irec!ors of *!a. Ines. *u2sequen!l/, !he shareholin's of%uenca in *!a. Ines were sol a! a pu2lic auc!ion. *ai

shares were 2ou'h! 2/ olfo n'ala who was !he hi'hes!2ier urin' !he pu2lic auc!ion.

E*u2sequen!l/, *I+% repea!el/ availe of i!s crei! line ano2!aine si (9) o!her loanQsR from *&T% in !he a''re'a!eamoun! of P9,19,$=.#$. ccorin'l/, *I+% eecu!ecorresponin' Promissor/ 3o!es !o cover !he amoun!s of !heai!ional loans a'ains! !he crei! line.

E *I+%, however, encoun!ere ifficul!/ in makin' !he

amor!iza!ion pa/men!s on i!s loans an reques!e *&T% for acomple!e res!ruc!urin' of i!s ine2!eness. *&T%accommoa!e *I+%Ds reques! an si'nifie i!s approval in ale!!er a!e =: Fe2ruar/ =:: wherein *&T% an *!a. Ines,wi!hou! no!ice !o or !he prior consen! of %uenca, a'ree !ores!ruc!ure !he pas! ue o2li'a!ions of *!a. Ines. *ecuri!/&ank a'ree !o e!en !o *!a. Ines !he followin' loansH

a. Term loan in !he amoun! of P:,:$$,$$$.$$, !o 2eapplie !o liquia!e !he principal por!ion of *!a. InesQR

!o!al ou!s!anin' ine2!eness !o *ecuri!/ &ank an

2. Term loan in !he amoun! of P1,0$$,$$$.$$, !o 2eapplie !o liquia!e !he pas! ue in!eres! an penal!/por!ion of !he ine2!eness of *!a. Ines !o *ecuri!/&ank.D

EI! shoul 2e poin!e ou! !ha! in res!ruc!urin' *!a. InesDo2li'a!ions !o *ecuri!/ &ank, !he Promissor/ 3o!e in !he

amoun! of P9,=$$,$$$.$$, which was !he onl/ loan incurreprior !o !he epira!ion of !he P:+-%rei! 7oan Facili!/ on 1$3ovem2er =:= an !he onl/ one covere 2/ !he Inemni!/'reemen! a!e, was no! se're'a!e from, 2u! was ins!ealumpe !o'e!her wi!h, !he o!her loans o2!aine 2/ *!a. Ineswhich were no! secure 2/ sai Inemni!/ 'reemen!.

EPursuan! !o !he a'reemen! !o res!ruc!ure i!s pas! ueo2li'a!ions !o *ecuri!/ &ank, *!a. Ines !hus eecu!e !hefollowin' promissor/ no!es, 2o!h a!e $ +arch =:: infavor of *ecuri!/ &ankH

P5?+I**?5B 3?T 3?. +?U3T

57A"0A#9A:: P:,:$$,$$$.$$

57A"0A#"A:: P1,0$$,$$$.$$

T?T7 P=

7/26/2019 CRDIT

25/61

(!he *econ 7oanD) !o 2e applie in !he manner anfor !he purpose s!ipula!e herein2elow.

=.$

7/26/2019 CRDIT

26/61

E5T. =

7/26/2019 CRDIT

27/61

This ar'umen! mus! 2e re;ec!e. To 2e'in wi!h, !he =:7oan 'reemen! epressl/ s!ipula!e !ha! i!s purpose was !oEliquia!e,E no! !o renew or e!en, !he ou!s!anin'ine2!eness. +oreover, %uenca i no! si'n or consen! !o!he =: 7oan 'reemen!, which ha alle'el/ e!ene !heori'inal P: million crei! facili!/. @ence, his o2li'a!ion as asure!/ shoul 2e eeme e!in'uishe, pursuan! !o r!icle

7/26/2019 CRDIT

28/61

In !his case, *&T%Ds asser!ion - !ha! %uenca consen!e !o !heal!era!ions in !he crei! accommoa!ion -- fins no suppor! in!he !e! of !he Inemni!/ 'reemen!, which is reproucehereunerH

E5oolfo +. %uenca of le'al a'e, wi!h pos!al aress cAo *!a.Ines +alale Fores! Prouc!s %orp., lco &l'., 1= &uenia

venue !., +aka!i +e!ro +anila for an in consiera!ion of!he crei! accommoa!ion in !he !o!al amoun! of ei'h! millionpesos (P:,$$$,$$$.$$) 'ran!e 2/ !he *%U5ITB &3J 36T5U*T %?+P3B, a commercial 2ank ul/ or'anize aneis!in' uner an 2/ vir!ue of !he laws of !he Philippine,9"": /ala venue, +aka!i, +e!ro +anila hereinaf!erreferre !o as !he &3J in favor of *T. I3* +77F?5*T P5?6U%T* %?5P., ---- hereinaf!er referre !oas !he %7I3T, wi!h !he s!ipula!e in!eres!s an char'es!hereon, evience 2/ !ha!A!hose cer!ain P5?+I**?5B3?TQ(*)R, mae, eecu!e an elivere 2/ !he %7I3T in

favor of !he &3J here2/ binds- hisel!"theselves ointlyand severally with the C/IEN4 in !avor o! the $AN7 !or thepayent , upon deand and without bene!it o! e'cussion o!whatever aount or aounts the C/IEN4 ay be indebtedto the $AN7 under and by virtue o! a!oresaid creditaccoodations- including the substitutions, renewals,e'tensions, increases, aendent, conversions and revivalso! the a!oresaid credit accoodations-,as well as of !heamoun! or amoun!s of such o!her o2li'a!ions !ha! !he %7I3Tma/ owe !he &3J, whe!her irec! or inirec!, principal or

seconar/, as appears in !he accoun!s, 2ooks an recors of!he &3J, plus in!eres! an epenses arisin' from an/a'reemen! or a'reemen!s !ha! ma/ have here!ofore 2eenmae, or ma/ hereaf!er 2e eecu!e 2/ an 2e!ween !hepar!ies !here!o, incluin' !he su2s!i!u!ions, renewals,e!ensions, increases, amenmen!s, conversions an revivalsof !he aforesai crei! accommoa!ion(s), an fur!her2in(s) himselfA!hemselves wi!h !he %7I3T in favor of !he&3J for !he fai!hful compliance of all !he !erms anconi!ions con!aine in !he aforesai crei!accommoa!ion(s), all of which are incorpora!e herein anmae par! hereof 2/ reference.E

8hile %uenca hel himself lia2le for !he crei!accommoa!ion or an/ moifica!ion !hereof, such clauseshoul 2e uners!oo in !he con!e! of !he P: million limi!an !he 3ovem2er 1$, =:= !erm. I! i no! 'ive !he 2ank or*!a. Ines an/ license !o moif/ !he na!ure an scope of !heori'inal crei! accommoa!ion, wi!hou! informin' or 'e!!in'!he consen! of %uenca who was soliaril/ lia2le. Takin' !he2ankDs su2mission !o !he e!reme, %uenca (or hissuccessors) woul 2e lia2le for loans even amoun!in' !o, sa/,P=$$ 2illion o2!aine =$$ /ears af!er !he epira!ion of !hecrei! accommoa!ion, on !he 'roun !ha! he consen!e !oall al!era!ions an e!ensions !hereof.

Inee, i! has 2een hel !ha! a con!rac! of sure!/ Ecanno!e!en !o more !han wha! is s!ipula!e. I! is s!ric!l/cons!rue a'ains! !he crei!or, ever/ ou2! 2ein' resolvea'ains! enlar'in' !he lia2ili!/ of !he sure!/.E 7ikewise, !he%our! has rule !ha! Ei! is a well-se!!le le'al principle !ha! if

!here is an/ ou2! on !he !erms an coni!ions of !he sure!/a'reemen!, !he ou2! shoul 2e resolve in favor of !hesure!/. m2i'uous con!rac!s are cons!rue a'ains! !he par!/who cause !he am2i'ui!/.E In !he a2sence of an unequivocalprovision !ha! %uenca waive his ri'h! !o 2e no!ifie of or !o'ive consen! !o an/ al!era!ion of !he crei! accommoa!ion,we canno! sus!ain *&T%Ds view !ha! !here was such a waiver.

I! shoul also 2e o2serve !ha! !he %rei! pproval+emoranum clearl/ shows !ha! !he 2ank i no! have

a2solu!e au!hori!/ !o unila!erall/ chan'e !he !erms of !heloan accommoa!ion. Inee, i! ma/ o so onl/ upon no!ice!o !he 2orrower, pursuan! !o !his coni!ionH

E#. The &ank reserves !he ri'h! !o amen an/ of !heaforemen!ione !erms an coni!ions upon wri!!enno!ice !o !he &orrower.E

8e re;ec! !he 2ankDs su2mission !ha! onl/ *!a. Ines as !he2orrower, no! %uenca, was en!i!le !o 2e no!ifie of an/

moifica!ion in !he ori'inal loan accommoa!ion. Followin'!he 2ankDs reasonin', such moifica!ion woul no! 2e vali as

7/26/2019 CRDIT

29/61

!o *!a. Ines if no no!ice were 'ivenG 2u! woul s!ill 2e valias !o %uenca !o whom no no!ice nee 2e 'iven. The la!!erDslia2ili!/ woul !hus 2e more 2urensome !han !ha! of !heformer. *uch un!ena2le !heor/ is con!rar/ !o !he principle!ha! a sure!/ canno! assume an o2li'a!ion more onerous!han !ha! of !he principal.

The presen! con!rovers/ mus! 2e is!in'uishe fromPhilagen v. Mutuc, in which !he %our! sus!aine as!ipula!ion where2/ !he sure!/ consen!e !o 2e 2oun no!onl/ for !he specifie perio, E2u! !o an/ e!ension !hereaf!ermae, an e!ension !ha! coul 2e ha wi!hou! hishavin' !o 2e no!ifie.E

In !ha! case, !he sure!/ a'reemen! con!aine !hisunequivocal s!ipula!ionH EI! is here2/ fur!her a'ree !ha! incase of an/ e!ension of renewal of !he 2on, we equall/2in ourselves !o !he %ompan/ uner !he same !erms an

coni!ions as herein provie wi!hou! !he necessi!/ ofeecu!in' ano!her inemni!/ a'reemen! for !he purpose an!ha! we hereby e1ually waive our right to be noti!ied o! anyrenewal or e'tension o! the bond which ay be grantedunder this indenity agreeent.E

In !he presen! case, !here is no such epress s!ipula!ion. !mos!, !he alle'e 2asis of responen!Ds waiver is va'ue anuncer!ain. I! confers no clear au!horiza!ion on !he 2ank or*!a. Ines !o moif/ or e!en !he ori'inal o2li'a!ion wi!hou!

!he consen! of !he sure!/ or no!ice !here!o.

Continuing &urety

%on!enin' !ha! !he Inemni!/ 'reemen! was in !he na!ureof a con!inuin' sure!/, pe!i!ioner main!ains !ha! !here was nonee for responen! !o eecu!e ano!her sure!/ con!rac! !osecure !he =: 7oan 'reemen!.

This ar'umen! is incorrec!. Tha! !he Inemni!/ 'reemen! is

a con!inuin' sure!/ oes no! au!horize !he 2ank !o e!en!he scope of !he principal o2li'a!ion inorina!el/. In 8ino v.

CA, !he %our! hel !ha! Ea con!inuin' 'uaran!/ is one whichcovers all !ransac!ions, incluin' !hose arisin' in !he fu!ure,which are within the description or conteplation o! thecontract o! guaranty, until the e'piration or terinationthereo!.E

To repea!, in !he presen! case, !he Inemni!/ 'reemen! wassu2;ec! !o !he !wo limi!a!ions of !he crei! accommoa!ionH(=) !ha! !he o2li'a!ion shoul no! ecee P: million, an (

7/26/2019 CRDIT

30/61

I! is a common 2ankin' prac!ice !o require !he 4** (E;oin!an soliar/ si'na!ureE) of a ma;or s!ockholer or corpora!eofficer, as an ai!ional securi!/ for loans 'ran!e !ocorpora!ions. There are a! leas! !wo reasons for !his. ;irst, incase of efaul!, !he crei!orDs recourse, which is normall/limi!e !o !he corpora!e proper!ies uner !he veil of separa!ecorpora!e personali!/, woul e!en !o !he personal asse!s of!he sure!/. &econd, such sure!/ woul 2e compelle !oensure !ha! !he loan woul 2e use for !he purpose a'reeupon, an !ha! i! woul 2e pai 2/ !he corpora!ion.

Followin' !his prac!ice, i! was !herefore lo'ical anreasona2le for !he 2ank !o have require !he 4** of %uenca,who was !he chairman an presien! of *!a. Ines in =:$when !he crei! accommoa!ion was 'ran!e. There was noreason or lo'ic, however, for !he 2ank or *!a. Ines !o assume!ha! he woul s!ill a'ree !o ac! as sure!/ in !he =: 7oan'reemen!, 2ecause a! !ha! !ime, he was no lon'er an officer

or a s!ockholer of !he e2!or-corpora!ion. Veril/, he was no!in a posi!ion !hen !o ensure !he pa/men! of !he o2li'a!ion.3ei!her i he have an/ reason !o 2in himself fur!her !o a2i''er an more onerous o2li'a!ion.

Inee, !he s!ipula!ion in !he =: 7oan 'reemen!proviin' for !he sure!/ of responen!, wi!hou! eveninformin' him, smacks of ne'li'ence on !he par! of !he 2ankan 2a fai!h on !ha! of !he principal e2!or. *ince !ha! 7oan'reemen! cons!i!u!e a new ine2!eness, !he ol loan

havin' 2een alrea/ liquia!e, !he spiri! of fair pla/ shoulhave impelle *!a. Ines !o ask some2o/ else !o ac! as asure!/ for !he new loan.

In !he same vein, a li!!le pruence shoul have impelle !he2ank !o insis! on !he 4** of one who was in a posi!ion !oensure !he pa/men! of !he loan. ven a perfunc!or/ a!!emp!a! crei! inves!i'a!ion woul have reveale !ha! responen!was no lon'er connec!e wi!h !he corpora!ion a! !he !ime. si! is, !he 2ank is now rel/in' on an unclear Inemni!/'reemen! in orer !o collec! an o2li'a!ion !ha! coul have

2een secure 2/ a fairl/ o2!aine sure!/. For i!s efea! in !hisli!i'a!ion, !he 2ank has onl/ i!self !o 2lame.

In sum, we hol !ha! !he =: 7oan 'reemen! e!in'uishe2/ nova!ion !he o2li'a!ion uner !he =:$ P: million crei!accommoa!ion. @ence, !he Inemni!/ 'reemen!, whichha 2een an accessor/ !o !he =:$ crei! accommoa!ion,was also e!in'uishe. Fur!hermore, we re;ec! pe!i!ionerDssu2mission !ha! responen! waive his ri'h! !o 2e no!ifie of,or !o 'ive consen! !o, an/ moifica!ion or e!ension of !he=:$ crei! accommoa!ion.

G.R. No. )9// Noe:6e+ 2(, 1992

JAC#NTO U D#BO n! NOR%ERTO U, vs. CA n!$ETROPOL#TAN %AN& AND TRUST CO$PAN.

I! appears !ha! U/ Tiam n!erprises an Frei'h! *ervices(UTF*), !hru i!s represen!a!ive U/ Tiam, applie for ano2!aine crei! accommoa!ions (le!!er of crei! an !rus!receip! accommoa!ions) from !he +e!ropoli!an &ank anTrus! %ompan/ (+T5?&3J) in !he sum of P"$$,$$$.$$ (.

To secure !he aforemen!ione crei! accommoa!ions3or2er!o U/ an 4acin!o U/ 6iSo eecu!e separa!e%on!inuin' *ure!/ships in favor of !he la!!er. Uner !heaforesai a'reemen!s, 3or2er!o U/ a'ree !o pa/+T5?&3J an/ ine2!eness of UTF* up !o !he a''re'a!esum of P1$$,$$$.$$ while 4acin!o U/ 6iSo a'ree !o 2e2oun up !o !he a''re'a!e sum of P:$$,$$$.$$.

@avin' pai !he o2li'a!ion uner !he a2ove le!!er of crei! in="", UTF*, !hrou'h U/ Tiam, o2!aine ano!her crei!

accommoa!ion from +T5?&3J in =":, which crei!accommoa!ion was full/ se!!le 2efore an irrevoca2le le!!er

7/26/2019 CRDIT

31/61

of crei! was applie for an o2!aine 2/ !hea2ovemen!ione 2usiness en!i!/ in =".

The Irrevoca2le 7e!!er of %rei! 3o. *3-7oc-1$, in !he sumof P:=#, 9$$.$$, covere UTF* purchase of E:,$$$ &a'sPlan!ers Urea an 0,$$$ &a's Plan!ers

7/26/2019 CRDIT

32/61

efenan! U/ Tiam !o 2o!h eis!in' o2li'a!ions an fu!ureones. I! relie on r!icle

7/26/2019 CRDIT

33/61

7/26/2019 CRDIT

34/61

recall !he 'uaran!/ is epressl/ reserve. @ence, where !hecon!rac! of 'uaran!/ s!a!es !ha! !he same is !o secureavances !o 2e mae Efrom !ime !o !imeE !he 'uaran!/ will2e cons!rue !o 2e a con!inuin' one.

In o!her ;urisic!ions, i! has 2een hel !ha! !he use ofpar!icular wors an epressions such as pa/men! of Ean/e2!,E Ean/ ine2!eness,E Ean/ eficienc/,E or Ean/ sum,E or!he 'uaran!/ of Ean/ !ransac!ionE or mone/ !o 2e furnishe!he principal e2!or Ea! an/ !ime,E or Eon such !imeE !ha! !heprincipal e2!or ma/ require, have 2een cons!rue !oinica!e a con!inuin' 'uaran!/.

In !he case a! 2ar, !he per!inen! por!ion of para'raph I of !hesure!/ship a'reemen! eecu!e 2/ pe!i!ioner U/ provies!husH

I. For an in consiera!ion of an/ eis!in'

ine2!eness !o !he &3J of UB TI+ (hereinaf!ercalle !he E&orrowerE), for !he pa/men! of which !he*U5TB is now o2li'a!e !o !he &3J, ei!her as'uaran!or or o!herwise, and"or in order to induce the$AN7, in its discretion, at any tie or !ro tie totie herea!ter, to a#e loans or advances or toe'tend credit in any other anner to, or at there1uest, or !or the account o! the $orrower, ei!herwi!h or wi!hou! securi!/, anAor !o purchase oriscoun!, or !o make an/ loans or avances evience

or secure 2/ an/ no!es, 2ills, receiva2les, raf!s,accep!ances, checks, or o!her ins!rumen!s oreviences of ine2!eness (all hereinaf!er calleEins!rumen!sE) upon which !he &orrower is or ma/2ecome lia2le as maker, enorser, accep!or, oro!herwise, !he &

7/26/2019 CRDIT

35/61

'uaran!ee, which ma/ 2e hel 2/ !he &3J, or inwhich !he &3J ma/ have an/ in!eres! a! !he !ime of!he receip! (sic) of such no!ice. 3o ac! or omission ofan/ kin on !he &3J* par! in !he premises shall inan/ even! affec! or impair !his 'uaran!/, nor shallsame (sic) 2e affec!e 2/ an/ chan'e which ma/ arise2/ reason of !he ea!h of !he *U5TB, or of an/par!ner(s) of !he *U5TB, or of !he &orrower, or of !heaccession !o an/ such par!nership of an/ one or morenew par!ners.

The fore'oin' s!ipula!ions unequivocall/ reveal !ha! !hesure!/ship a'reemen! in !he case a! 2ar are con!inuin' inna!ure. Pe!i!ioners o no! en/ !hisG in fac!, !he/ canil/ami!!e i!. 3ei!her have !he/ enie !he fac! !ha! !he/ hano! revoke !he sure!/ship a'reemen!s. ccorin'l/, ascorrec!l/ hel 2/ !he pu2lic responen!H

Unou2!el/, !he purpose of !he eecu!ion of !he%on!inuin' *ure!/ships was !o inuce appellan! !o'ran! an/ applica!ion for crei! accommoa!ion (le!!erof crei!A!rus! receip!) UTF* ma/ esire !o o2!ainfrom appellan! 2ank. &/ i!s !erms, each sure!/ship is acon!inuin' one which shall remain in full force aneffec! un!il !he 2ank is no!ifie of i!s revoca!ion.

8hen !he Irrevoca2le 7e!!er of %rei! 3o. *3-7oc-1$was o2!aine from appellan! 2ank, for !he purpose of

o2!ainin' 'oos (covere 2/ a !rus! receip!) fromPlan!ers Prouc!s, !he con!inuin' sure!/ships were infull force an effec!. @ence, even if sure!ies-appelleesi no! si'n !he E%ommercial 7e!!er of %rei! anpplica!ion, !he/ are s!ill lia2le as !he crei!accommoa!ion (le!!er of crei!A!rus! receip!) wascovere 2/ !he sai sure!/ships. 8ha! makes !hemlia2le !hereuner is !he coni!ion which provies !ha!!he &orrower Eis or ma/ 2ecome lia2le as maker,enorser, accep!or or o!herwise.E n since UTF*which (sic) was lia2le as principal o2li'or for havin'faile !o fulfill !he o2li'a!or/ s!ipula!ions in !he !rus!

receip!, !he/ as insurers of i!s o2li'a!ion, are lia2le!hereuner.

Pe!i!ioners main!ain, however, !ha! !heir %on!inuin'*ure!/ship 'reemen!s canno! 2e mae applica2le !o !he=" o2li'a!ion 2ecause !he la!!er was no! /e! in eis!encewhen !he a'reemen!s were eecu!e in =""G uner r!icle

7/26/2019 CRDIT

36/61

P1$$,$$$.$$, respec!ivel/. The law is clear !ha! a 'uaran!orma/ 2on himself for less, 2u! no! for more !han !heprincipal e2!or, 2o!h as re'ars !he amoun! an !he onerousna!ure of !he coni!ions. In !he case a! 2ar, 2o!h a'reemen!sprovie for lia2ili!/ for in!eres! an epenses, !o wi!H

. . . an such in!eres! as ma/ accrue !hereon ei!her2efore or af!er an/ ma!uri!/(ies) !hereof an suchepenses as ma/ 2e incurre 2/ !he &3J referre !oa2ove.

The/ fur!her provie !ha!H

In !he even! of ;uicial proceein's 2ein' ins!i!u!e 2/!he &3J a'ains! !he *U5TB !o enforce an/ of !he!erms an coni!ions of !his uner!akin', !he *U5TBfur!her a'rees !o pa/ !he &3J a reasona2lecompensa!ion for an as a!!orne/s fees an cos!s of

collec!ion, which shall no! in an/ even! 2e less !han!en per cen! (=$>) of !he amoun! ue (!he same !o 2eue an pa/a2le irrespec!ive of whe!her !he case isse!!le ;uiciall/ or e!ra;uiciall/).

Thus, 2/ epress mana!e of !he %on!inuin'*ure!/ship 'reemen!s which !he/ ha si'ne,pe!i!ioners separa!el/ 2oun !hemselves !o pa/in!eres!, epenses, a!!orne/s fees an cos!s. The las!!wo i!ems are pe''e a! no! less !han !en percen!

(=$>) of !he amoun! ue.

ven wi!hou! such s!ipula!ions, !he pe!i!ioners woul,never!heless, 2e lia2le for !he in!eres! an ;uicial cos!s.r!icle

7/26/2019 CRDIT

37/61

5ules of %our! (5ule #1, sec!ion 9) an wi!h r!icle==$: of !he %ivil %oe (now r!.

7/26/2019 CRDIT

38/61

ll o!her isposi!ions in !he isposi!ive por!ion of !hechallen'e ecision no! inconsis!en! wi!h !he a2ove areaffirme.

G.R. No. L2(4/3 Fe6+u+' 29, 19/2

REPU%L#C OF T"E P"#L#PP#NES, vs. PALFO LU$%ERCO., #NC. AND FAR EASTERN SURET #NSURANCECO$PAN, #NC., !e>en!n-, FAR EASTERN SURET #NSURANCE CO., #NC. FAR EASTERN SURET

#NSURANCE CO., #NC., -7*+!+-' *n-*>>en-,. GASPAR PALANCA JOSEP" LEE,

%laimin' !ha! !he Pal-Fo 7um2er %o., Inc. was ine2!e !o!he &ureau of In!ernal 5evenue for fores! char'es ansurchar'es amoun!in' !o P==,:#=.#9, an !ha! !he Faras!ern *ure!/ O Insurance %o., Inc. was ;oin!l/ anseverall/ lia2le wi!h !he lum2er compan/ for !he pa/men! ofsai fores! char'es up !o P#,$$$.$$ on accoun! of a fores!r/2on which !he sure!/ compan/ eecu!e in favor of !he

plain!iff on 3ovem2er an = per annum, respec!ivel/, on !he !o!alamoun! ue, !he sai in!eres! !o 2e compounequar!erl/ from 3ovem2er

7/26/2019 CRDIT

39/61

The firs! le'al poin! which arises in connec!ion wi!hsai ehi2i!s isH 8ha! is !he pro2a!ive value ofocumen!s which were ami!!e onl/ as par! of !he!es!imon/ of !he wi!ness who ien!ifie !hemM 6o !he/cons!i!u!e evience of !he !ru!h of !heir con!en!s orno!M In o!her wors, are !he/ evience of emans forpa/men! consierin' !ha! +r. Kali!a merel/ !es!ifie!ha! sai ehi2i!s are cer!ifie copies of recors anocumen!s now in !he possession of !he 5ecor%on!rol *ec!ion of !he &ureau of In!ernal 5evenueM

The ne! issue !o resolve is who has !he 2uren ofprovin' !ha! !he claim of !he plain!iff is no! /e! paiM

In !he !hir assi'ne error, appellan! raises !heques!ion of prescrip!ion of ac!ion. ...E

6urin' !he penenc/ of !his case 2efore !his %our!, cer!ain

per!inen! evelopmen!s have come a2ou! which prac!icall/rener !he resolu!ion of appellan!s assi'ne errorsunnecessar/. Thus in a manifes!a!ion file on Fe2ruar/ =$,=9" !he sure!/ compan/ epresse i!s willin'ness !o pa/!he sum of P#,$$$.$$ uner i!s fores!r/ 2on an/!ime E!ha!an orer is issue (2/ !his %our!) irec!in' !he efenan!sure!/ !o so pa/ accorin' !o !his manifes!a!ion.E In aresolu!ion a!e Fe2ruar/

7/26/2019 CRDIT

40/61

eclues !his in!eres!, an r!icle

7/26/2019 CRDIT

41/61

$#-

7/26/2019 CRDIT

42/61

appoin!men! of a receiver or assi'nee, all !he ees,vouchers, 2ooks of accoun!, papers, no!es, 2ons,2ills, an securi!ies of !he e2!or an all his real anpersonal proper!/, es!a!e an effec!s . *ai orershall fur!her for2i !he pa/men! !o !he crei!or of an/e2!s ue !o him an !he eliver/ !o !he e2!or, or !oan/ person for him, of an/ proper!/ 2elon'in' !o him,an !he !ransfer of an/ proper!/ 2/ him, an shallfur!her appoin! a !ime an place for a mee!in' of !hecrei!ors !o choose an assi'nee of !he es!a!e. *aiorer shall Q2e pu2lisheR . Uon -7e *! o+!e+, 5** +o5ee!*n*n ;u! -7e !e6-o+ o+ o> n' 5+e!*-o+, o+-7e * -7e5ou+- *n *noen5', :' +o5ee! -o ;u!o+u+oe o> 5e+-*n*n< -7e :oun- !ue, whichamoun!, when a;u'e, ma/ 2e allowe in !heinsolvenc/ proceein's, 6u- e8e5u-*on 7 6e

-'e! >o+e*!. (mphasis supplie.)ppl/in' !he aforequo!e provisions, i! can ri'h!full/ 2e sai!ha! !he issuance of !he insolvenc/ orer of 6ecem2er

7/26/2019 CRDIT

43/61

c! 3o. =#9 which in a wa/ provie !he % wi!h a;us!if/in' !ool !o con!inue an !o procee !o ;u'men! in %-.5. %V 3o. :$"10, 2u! onl/ for !he purpose of ascer!ainin'!he amoun! ue from a!ewa/. ! an/ even!, on !hepos!ula!e !ha! ;urisic!ion over !he proper!ies of !heinsolven!-eclare a!ewa/ lies wi!h !he insolvenc/ cour!,eecu!ion of !he % insolvenc/ ;u'men! a'ains! a!ewa/can onl/ 2e pursue 2efore !he insolvenc/ cour!. sian2ank,no less, !ens !o a'ree !o !his conclusion when i! s!a!eHEQRven i! if is assume !ha! !he eclara!ion of insolvenc/ ofa!ewa/ can 2e !aken co'nizance of, such fac! oes relieveeronimo anAor nrew elos 5e/es from performin' !heiro2li'a!ions 2ase on !he 6ees of *ure!/ship .E

eronimo, however, is a ifferen! s!or/.

sian2ank ar'ues !ha! !he s!a/ of !he collec!ion sui! a'ains!a!ewa/ is wi!hou! 2earin' on !he lia2ili!/ of eronimo as a

sure!/, ain' !ha! claims a'ains! a sure!/ ma/ proceeinepenen!l/ from !ha! a'ains! !he principal e2!or.Pursuin' !he poin!, sian2ank avers !ha! eronimo ma/ no!invoke !he insolvenc/ of a!ewa/ as a efense !o evaelia2ili!/.

eronimo coun!ers wi!h !he ar'umen! !ha! his lia2ili!/ as asure!/ canno! 2e separa!e from a!ewa/Ds lia2ili!/. ssure!/, he con!inues, he is en!i!le !o avail himself of all !heefenses per!ainin' !o a!ewa/, incluin' i!s insolvenc/,

su''es!in' !ha! if a!ewa/ is even!uall/ release from wha!i! owes sian2ank, he, !oo, shoul also 2e so relieve.

eronimoDs a2ove con!en!ion is un!ena2le.

*ure!/ship is covere 2/ r!icle

7/26/2019 CRDIT

44/61

unless permi!!e 2/ s!a!u!e an in !he a2sence of an/a'reemen! limi!in' !he applica!ion of !he securi!/,require !he crei!or or o2li'ee, 2efore proceein'a'ains! !he sure!/, !o resor! !o an ehaus! hisremeies a'ains! !he principal, par!icularl/ where 2o!hprincipal an sure!/ are equall/ 2oun.

%learl/, sian2ankDs ri'h! !o collec! pa/men! for !he fullamoun! from eronimo, as sure!/, eis!s inepenen!l/ of i!sri'h! a'ains! a!ewa/ as principal e2!orG i! coul !husprocee a'ains! one of !hem or file separa!e ac!ions a'ains!!hem !o recover !he principal e2! covere 2/ !he ee onsure!/ship, su2;ec! !o !he rule prohi2i!in' ou2le recover/from !he same cause. This le'al pos!ula!e 2ecomes all !hemore co'en! in case of an insolvenc/ si!ua!ion where, ashere, !he insolvenc/ cour! is 2eref! of ;urisic!ion over !hesure!ies of !he principal e2!or. s sian2ank ap!l/ poin!sou!, a sui! a'ains! !he sure!/, insofar as !he sure!/Ds soliar/

lia2ili!/ is concerne, is no! affec!e 2/ an insolvenc/proceein' ins!i!u!e 2/ or a'ains! !he principal e2!or. Thesame principle hols !rue wi!h respec! !o !he sure!/ of acorpora!ion in is!ress which is su2;ec! of a reha2ili!a!ionproceein' 2efore !he *ecuri!ies an chan'e %ommission(*%). s we hel in Coercial $an#ing Corporation v. CA,a sure!/ of !he is!resse corpora!ion can 2e sue separa!el/!o enforce his lia2ili!/ as such, no!wi!hs!anin' an *% orereclarin' !he former uner a s!a!e of suspension of pa/men!.

eronimo also s!a!es !ha!, as !hin's s!an, his lia2ili!/, ascompare !o !ha! of a!ewa/, is con!e!uall/ more onerousan 2urensome, preclue as he is from seekin' recoursea'ains! !he insolven! corpora!ion. From !his premise,eronimo claims !ha! since a!ewa/ canno!, owin' !o !heorer of insolvenc/, 2e mae !o pa/ i!s o2li'a!ion, he, !oo,2ein' ;us! a sure!/, canno! also 2e mae !o pa/, o2viousl/havin' in min r!.

7/26/2019 CRDIT

45/61

mor!'a'e over efenan! a!ewa/Ds equipmen! for 5-G 2u! !he requiremen! of an oa!h oes no! appl/when !he averse par!/ oes no! appear !o 2e a par!/!o !he ins!rumen! or when compliance wi!h an orer

for an inspec!ion of !he ori'inal ins!rumen! is refuse.(mphasis supplie.)

iven !he a2ove perspec!ive, sian2ank, 2/ a!!achin' apho!ocop/ of !he 6ee of *ure!/ship !o i!s unerl/in'complain!, hewe !o !he requiremen!s of !he a2ove !winprovisions. sian2ank, !hus, effec!ivel/ alle'e !he ueeecu!ion an 'enuineness of !he sai ee. From !ha! poin!,eronimo, if he in!ene !o con!es! !he sure!/ ee, shoulhave specificall/ enie !he ue eecu!ion an 'enuineness

of !he ee in !he manner provie 2/ *ec. =$, 5ule : of !he5ules of %our!, !husH

*ec. =$. &peci!ic denial.CA !e>en!n- :u- e5*>'e57 :-e+* e >5- -7e -+u-7 o>=7*57 7e !oe no- !:*- n!, =7enee++5-*56e, 7 e- >o+-7 -7e u6-n5e o> -7e:--e+ uon =7*57 7e +e*e -o uo+- 7*!en*.8here a efenan! esires !o en/ onl/ a par!of an avermen!, he shall specif/ so much of i! as is!rue an ma!erial an shall en/ onl/ !he remainer.

8here a efenan! is wi!hou! knowle'e or

7/26/2019 CRDIT

46/61

informa!ion sufficien! !o form a 2elief as !o !he !ru!h ofa ma!erial avermen! mae in !he complain!, he shallso s!a!e, an !his shall have !he effec! of a enial.(mphasis supplie.)

In !he ins!an! case, eronimo shoul have ca!e'oricall/s!a!e !ha! he i no! eecu!e !he 6ee of *ure!/ship an!ha! !he si'na!ure appearin' on i! was no! his or wasfalsifie. @is nswer oes no!, however, con!ain an/ suchs!a!emen!. 3ecessaril/ !hen, eronimo ha no! specificall/enie, an, !hus, is eeme !o have ami!!e, !he'enuineness an ue eecu!ion of !he ee in ques!ion. In!his re'ar, *ec. ==, 5ule : of !he 5ules of %our! s!a!esH

*ec. ==.Allegations not speci!ically denied deeedaditted.C+a!erial avermen! in !he complain!, o!her!han !hose as !o !he amoun! of unliquia!e ama'es,shall 2e eeme ami!!e when no! specificall/

enie.

?win' !o eronimoDs vir!ual amission of !he 'enuinenessan ue eecu!ion of !he ee of sure!/ship, sian2ank,con!rar/ !o !he view of a!ewa/ an eronimo, nee no!presen! !he ori'inal of !he ee urin' !he hearin's of !hecase. *ec. 0, 5ule = -7e

+o5ee!*n. The amission ma/ 2e con!raic!e onl/ 2/showin' !ha! i! was mae !hrou'h palpa2le mis!ake or!ha! no such amission was mae. (mphasissupplie.)

Ge+on*:o # L*6e >o+ PN No. FCD0992/49un!e+ "* Dee! o> Su+e-'7*

This 2rin's us !o !he !hir 'roun which involves !he issue of!he covera'e of !he sure!/ship. Preliminaril/, an overview on!he process of !akin' ou! loans shoul firs! 2e mae.

enerall/, especiall/ for lar'e loans, 2anks firs! approve aline or facili!/ ou! of which a clien! ma/ avail i!self of loans in!he form of promissor/ no!es wi!hou! nee of fur!herprocessin' anAor approval ever/ !ime a raw own is mae.In !he ins!an! case, sian2ank approve in favor of a!ewa/!he PhP =$ million-6omes!ic &ills Purchase 7ine an !heU*6 1 million-?mni2us %rei! 7ine. sian2ank approve!hese crei! lines which were covere 2/ a cha!!el mor!'a'e

as well as !he ees of sure!/ship, such !ha! loans e!enefrom !hese lines woul alrea/ 2e secure an pre-approve.In o!her wors, !hese facili!ies are no! financial o2li'a!ions/e!. sian2ank i no! /e! len ou! an/ mone/ !o a!ewa/wi!h !he approval of !hese lines. The loan !ransac!ionoccurre or !he principal o2li'a!ion, as secure 2/ a sure!/a'reemen!, was 2orn af!er !he eecu!ion of loan ocumen!s,such as P3 3o. F%6-$#-

7/26/2019 CRDIT

47/61

!here2/ is 2orn, an/ more !han !here woul 2e insa/in' !ha! o2li'a!ions which are su2;ec! !o a coni!ionpreceen! are vali an 2inin' 2efore !he occurrenceof !he coni!ion preceen!.

Co:+e7en*e o+ 5on-*nu*n< u+e-' 5- u*-e 5o::on5e *n +een- !'>*nn5* n! 5o::e+5* +5-*5e. A 6n o+>*nn5*n< 5o:n' =7*57 n-*5*-e en-e+*n 5+e!*- -+n5-*on =*-7 +-*5u+ 5o:n', 5o::on' +eu*+e -7e+o;e5-e! +*n5* !e6-o+ -o e8e5u-e 5on-*nu*n< u+e-'

7/26/2019 CRDIT

48/61

as i! was onl/ !his loan !ha! was referre !o in !he con!inuin'sure!/ship. The %our! wro!e in 0arciaH

Par!icular a!!en!ion mus! 2e pai !o !he s!a!emen!appearin' on !he face of !he Inemni!/ Q*ure!/shipR'reemen! Ee*!en5e! 6' -7oe 5e+-*n on!o5u:en- !-e! A+* 20, 19)2E . From !hiss!a!emen!, i! is clear !ha! !he Inemni!/ 'reemen!

refers onl/ !o !he loan ocumen! of pril

7/26/2019 CRDIT

49/61

a!ewa/ were ves!e upon a!ewa/Ds assi'nee inaccorance wi!h *ec. 1< of !he Insolvency /aw.

The !ransfer of a!ewa/Ds proper!/ !o !he insolvenc/assi'nee, if !his 2e !he case, oes no! ne'a!e eronimoDsri'h! of su2ro'a!ion, for such ri'h! ma/ 2e ha or eercisein !he insolvenc/ proceein's. The possi2ili!/ !ha! he ma/onl/ recover a por!ion of !he amoun! he is lia2le !o pa/ is !he

risk he assume as a sure!/ of a!ewa/. *uch loss oes no!,however, rener ineffec!ual, le! alone invalia!e, hissure!/ship.

eronimoDs o!her ar'umen!s !o escape lia2ili!/ are puerilean reall/ par!ake more of a plea for li2erali!/. The/ nee no!e!ain us lon'. In 'is!, eronimo ar'uesH !irst, !ha! he is a'ra!ui!ous sure!/ of a!ewa/G second, sian2ank evia!efrom normal 2ankin' prac!ice, such as when i! e!ene !heperio for pa/men! of a!ewa/Ds o2li'a!ion an when i!

op!e no! !o foreclose !he cha!!el mor!'a'e cons!i!u!e as'uaran!ee of a!ewa/Ds loan o2li'a!ionG an third,implemen!in' !he appeale %Ds ecision woul cause him'rea! harm an in;ur/.

nen! !he firs! ar'umen!, suffice i! !o s!a!e !ha! eronimowas !hen !he presien! of a!ewa/ an, as such, was2enefi!e, al2ei! perhaps inirec!l/, 2/ !he loan !hus 'ran!e2/ sian2ank. n as we sai in &ecurity Paci!ic AssuranceCorporation, !he sure!/ is lia2le for !he e2! of ano!her

al!hou'h !he sure!/ possesses no irec! or personal in!eres!over !he o2li'a!ion nor oes !he sure!/ receive an/ 2enefi!from i!.

8he!her or no! sian2ank reall/ evia!e from normal2ankin' prac!ice 2/ e!enin' !he perio for a!ewa/ !ocompl/ wi!h i!s loan o2li'a!ion or 2/ no! 'oin' af!er !hecha!!el mor!'a'e aver!e !o is reall/ of no momen!. &anksare primaril/ in !he 2usiness of e!enin' loans an earnincome from !heir lenin' opera!ions 2/ wa/ of service anin!eres! char'es. This is wh/ sian2ank op!e !o 'ive

a!ewa/ ample oppor!uni!/ !o pa/ i!s o2li'a!ions ins!ea of

foreclosin' !he cha!!el mor!'a'e an in !he process holin'on !o asse!s of which !he 2ank has reall/ no irec! use.

The followin' ecerp!s from Palares are in poin!H

8e a'ree wi!h responen! corpora!ion !ha! i!s merefailure !o immeia!el/ sue pe!i!ioner on her o2li'a!ionoes no! release her from lia2ili!/. 8here a crei!orrefrains from proceein' a'ains! !he principal, !hesure!/ is no! eonera!e. In o!her wors, mere wan! ofili'ence or for2earance oes no! affec! !he crei!orDsri'h!s visDvis!he sure!/, unless !he sure!/ requireshim 2/ appropria!e no!ice !o sue on !he o2li'a!ion.*uch 'ra!ui!ous inul'ence of !he principal oes no!ischar'e !he sure!/ whe!her 'iven a! !he principalDsreques! or wi!hou! i!, an whe!her i! is /iele 2/ !hecrei!or !hrou'h s/mpa!h/ or from an inclina!ion !ofavor !he principal . The ne'lec! of !he crei!or !o

sue !he principal a! !he !ime !he e2! falls ue oesno! ischar'e !he sure!/, even if such ela/ con!inuesun!il !he principal 2ecomes insolven!. n, in !hea2sence of proof of resul!an! in;ur/, a sure!/ is no!ischar'e 2/ !he crei!orDs mere s!a!emen! !ha! !hecrei!or will no! look !o !he sure!/,or !ha! he nee no!!rou2le himself. The consequences of !he ela/, suchas !he su2sequen! insolvenc/ of !he principal, or !hefac! !ha! !he remeies a'ains! !he principal ma/ 2elos! 2/ lapse of !ime, are imma!erial.

T7e Cou+- Eu*-' Ju+*!*5-*onF*n! No A*5-*on -o -7e #n-n- Ce

eronimo ur'es !he %our! !o release an ischar'e him froman/ lia2ili!/ arisin' from sian2ankDs claims if wha! he !ermsas Ecomple!e ;us!iceE is !o 2e serve. @e ci!es, as suppor!in'reference, Agcaoili v. 0&I&, presen!in' in !he same 2rea!h!he followin' ar'umen!s? !irst, !he 6ee of *ure!/ship is a'ra!ui!ous con!rac! from which he i no! 2enefi!G secon,sian2ank assure him !ha! !he ee woul no! 2e enforce

a'ains! himGthird, !he enforcemen! of !he ;u'men! of !he

7/26/2019 CRDIT

50/61

% woul reuce eronimo an his famil/ !o a life of penur/Gan !ourth, eronimo woul 2e una2le !o eercise his ri'h! ofsu2ro'a!ion, a!ewa/ havin' alrea/ 2een eclare asinsolven!.

The firs! an las! ar'umen!s have alrea/ 2een aressean foun !o 2e wi!hou! meri!. The secon ar'umen! is ama!!er of efense which has remaine unprove an even

2elie 2/ sian2ank 2/ i!s filin' of !he complain!. 8e see nonee !o fur!her 2ela2or an/ of !hem.

s re'ars !he !hir alle'a!ion, suffice i! !o s!a!e !ha! !hepreicamen! eronimo fins himself in is his ver/ own oin'.@is misfor!une is 2u! !he resul! of !he implemen!a!ion of abona !idecon!rac! he freel/ eecu!e, !he !erms of which heis presume !o have !horou'hl/ eamine. @e was no! a! allcompelle !o ac! as sure!/G he ha a choice. I! ma/ 2e moreoffensive !o pu2lic polic/ or 'oo cus!oms if he 2e allowe !o

'o 2ack on his uner!akin' uner !he sure!/ con!rac!. The%our! canno! 2e a par!/ !o !he con!rac!Ds impairmen! anrelieve a sure!/ from !he effec!s of an unwise 2u!none!heless a vali sure!/ con!rac!.

"EREFORE, !he ins!an! pe!i!ion is here2/ DEN#ED.

G.R. No. L)43/. Noe:6e+ 2), 19(

STATE OF &. ". "E$AD, , . LUZON SURET CO. #NC.

ppeal 2/ 7uzon *ure!/ %o., Inc., from an orer of !he %our!of Firs! Ins!ance of 5izal, presie 2/ 4u'e @ermo'enes%alua', ismissin' i!s claim a'ains! !he s!a!e of J. @.

@ema/ (*pecial Proceein' 3o. L-

7/26/2019 CRDIT

51/61

renewal of !his XXXXXXXX we equall/ 2in ourselvesfor !he pa/men! !hereof uner !he same !erms anconi!ions as a2ove men!ione wi!hou! !he necessi!/of eecu!in' ano!her inemni!/ a'reemen! for !hepurpose an !ha! we here2/ equall/ waive our ri'h! !o2e no!ifie of an/ renewal or e!ension of !hisXXXXXXXX which ma/ 2e 'ran!e uner !his inemni!/a'reemen!.

In!eres! on amoun! pai 2/ !he %ompan/. n/ anall sums of mone/ so pai 2/ !he compan/ shall 2earin!eres! a! !he ra!e of = per annum which in!eres!,if no! pai, will 2e accummula!e an ae !o !hecapi!al quar!erl/ orer !o earn !he same in!eres!s as!he capi!al an !he !o!al sum !hereof, !he capi!al anin!eres!, shall 2e pai !o !he %?+P3B as soon as !he%?+P3B shall have 2ecome lia2le !herefore, whe!heri! shall have pai ou! such sums of mone/ or an/ par!!hereof or no!.

8aiver. I! is here2/ a'ree upon 2/ an 2e!ween!he unersi'ne !ha! an/ ques!ion which ma/ arise2e!ween !hem 2/ reason of !his ocumen! an whichhas !o 2e su2mi!!e for ecision !o %our!s of 4us!iceshall 2e 2rou'h! 2efore !he %our! of compe!en!;urisic!ion in !he %i!/ of +anila, waivin' for !hispurpose an/ o!her venue. ?ur ri'h! !o 2e no!ifie of!he accep!ance an approval of !his inemni!/a'reemen! is here2/ likewise waive.

?ur 7ia2ili!/ @ereuner. I! shall no! 2e necessar/ for!he %?+P3B !o 2rin' sui! a'ains! !he principal uponhis efaul!, or !o ehaus! !he proper!/ of !he principal,2u! !he lia2ili!/ hereuner of !he unersi'neinemni!or shall 2e ;oin!l/ an severall/, a primar/one, !he same as !ha! of !he principal, an shall 2eei'i2le immeia!el/ upon !he occurrence of suchefaul!.Y (5ec. pp. pp. :- =$

7/26/2019 CRDIT

52/61

securi!/ compan/. The securi!/ compan/ has no! emanefrom J. @. @ema/ !o compl/ wi!h !his requiremen! of 'ivin'securi!/ 2/ wa/ of firs! mor!'a'e. In !he suppor!in' papersof !he claim presen!e 2/ 7uzon *ure!/ %ompan/, no realproper!/ was men!ione in !he lis! of proper!ies mor!'a'ewhich appears a! !he 2ack of !he inemni!/ a'reemen!.Y

8e fin !his reasonin' un!ena2le. Uner !he presen! %ivil

%oe (r!icle =1==), as well as uner !he %ivil %oe of =::(r!icle =

7/26/2019 CRDIT

53/61

@ema/ when i! accep!e !he la!!er as sure!/ in !hecoun!er2onsM 3o!hin' 2u! !he reim2ursemen! of !hemone/s !ha! !he 7uzon *ure!/ %o. mi'h! have !o is2urse onaccoun! of !he o2li'a!ions of !he principal e2!ors. Thisreim2ursemen! is a pa/men! of a sum of mone/, resul!in'from an o2li'a!ion !o 'iveG an !o !he 7uzon *ure!/ %o., i!was inifferen! !ha! !he reim2ursemen! shoul 2e mae 2/@ema/ himself or 2/ some one else in his 2ehalf, so lon' as

!he mone/ was pai !o i!.The secon ecep!ion of r!icle =1==, p. =, isin!ransmissi2ili!/ 2/ s!ipula!ion of !he par!ies. &ein'ecep!ional an con!rar/ !o !he 'eneral rule, !hisin!ransmissi2ili!/ shoul no! 2e easil/ implie, 2u! mus! 2eepressl/ es!a2lishe, or a! !he ver/ leas!, clearl/ infera2lefrom !he provisions of !he con!rac! i!self, an !he !e! of !hea'reemen!s sue upon nowhere inica!e !ha! !he/ are non-!ransfera2le.

W(2) In!ransmisi2ilia por pac!o. 7o 'eneral es la!ransmisi2ilia e arechos / o2li'acionesG chanro2lesvir!ualawli2rar/le ecepcion, la in!ransmisi2ilia.+ien!ras naa se i'a en con!rario impera el principio e la!ransmision, como elemen!o na!ural a !oa relacion ;uriica,salvo las personalisimas. si, para la no !ransmision, esmenes!er el pac!o epreso, porque si no, lo convenio en!repar!es !rasciene a sus hereeros.

*ieno es!os los con!inuaores e la personalia elcausan!e, so2re ellos recaen los efec!os e los vinculos

;uriicos creaos por sus an!ecesores, / para evi!arlo, si asise quiere, es inespensa2le convension !erminan!e en !alsen!io.

Por su esencia, el erecho / la o2li'acion !ienen a ir mZsallZ e las personas que les ieron via, / a e;ercer presionso2re los sucesores e esa personaG chanro2lesvir!ualawli2rar/cuano no se quiera es!o, se imponeuna es!ipulacion limi!a!iva epresamen!e e la!ransmisi2ilia o e cu/os !irminos claramen!e se euzcala concresion el concre!o a las mismas personas que lo

o!or'on.Y (*caevola, %oi'o %ivil, Tomo , p. #0=-#0

7/26/2019 CRDIT

54/61

The fore'oin' concep! is confirme 2/ !he ne! r!icle

7/26/2019 CRDIT

55/61

G.R. No. 14/), Noe:6e+ 1), 200

JOSE C. TUPAZ #V n! PETRON#LA C. TUPAZ, vs.T"E COURT OF APPEALS n! %AN& OF T"E

P"#L#PP#NE #SLANDS.

4ose %. Tupaz IV an Pe!ronila %. Tupaz (Epe!i!ionersE) wereVice-Presien! for ?pera!ions an Vice-Presien!ATreasurer,respec!ivel/, of l ?ro n'raver %orpora!ion. l ?ro%orpora!ion ha a con!rac! wi!h !he Philippine rm/ !o suppl/!he la!!er wi!h Esurvival 2olos.E

To finance !he purchase of !he raw ma!erials for !he survival2olos, pe!i!ioners, on 2ehalf of l ?ro %orpora!ion, applie

wi!h &ank of !he Philippine Islans (E&PIE) for !wocommercial le!!ers of crei!. The le!!ers of crei! were infavor of l ?ro %orpora!ionDs suppliers, Tanchaoco+anufac!urin' Incorpora!e (ETanchaoco Incorpora!eE) an+aresco 5u22er an 5e!reain' %orpora!ion (E+aresco%orpora!ionE). &PI 'ran!e pe!i!ionersD applica!ion an issue7e!!er of %rei! 3o.

7/26/2019 CRDIT

56/61

lia2le !o !he &PI. The mere fac! !ha! !he/ were una2le !ocollec! in full from !he FP anAor !he 6epar!men! of 3a!ional6efense !he procees of !he sale of !he elivere survival2olos manufac!ure from !he raw ma!erials covere 2/ !he!rus! receip! a'reemen!s is no vali efense !o !he civil claimof !he sai complainan! an surel/ coul no! wipe ou! !heircivil o2li'a!ion. f!er all, !he/ are free !o ins!i!u!e an ac!ion!o collec! !he same.

Pe!i!ioners appeale !o !he %our! of ppeals. Pe!i!ionerscon!ene !ha!H (=) !heir acqui!!al Eopera!es !o e!in'uishQ!heirR civil lia2ili!/E an (

7/26/2019 CRDIT

57/61

no!wi!hs!anin' !heir acqui!!al in !he criminal casesfile a'ains! !hem.

@ence, !his pe!i!ion. Pe!i!ioners con!en !ha!H

=. 4U6+3T ?F %LUITT7 ?P5TQ*R T? TI3UI*@T@ %IVI7 7I&I7ITB ?F PTITI?35*QGR

7/26/2019 CRDIT

58/61

In !he !rus! receip! a!e ?c!o2er =:=, pe!i!ioners si'ne2elow !his clause as officers of l ?ro %orpora!ion. Thus,uner Pe!ronila TupazDs si'na!ure are !he wors EVice-PresCTreasurerE an uner 4ose TupazDs si'na!ure are !he worsEVice-PresC?pera!ions.E &/ so si'nin' !ha! !rus! receip!,pe!i!ioners i no! 2in !hemselves personall/ lia2le for l?ro %orpora!ionDs o2li'a!ion. In ?n' v. %our! of ppeals, acorpora!e represen!a!ive si'ne a soliar/ 'uaran!ee clause

in !wo !rus! receip!s in his capaci!/ as corpora!erepresen!a!ive. There, !he %our! hel !ha! !he corpora!erepresen!a!ive i no! uner!ake !o 'uaran!ee personall/ !hepa/men! of !he corpora!ionDs e2!s, !husH

QPRe!i!ioner i no! si'n in his personal capaci!/ !hesoliar/ 'uaran!ee clause foun on !he orsal por!ionof !he !rus! receip!s. Pe!i!ioner place his si'na!ureaf!er !he !/pewri!!en wors E5+%? I36U*T5I7%?5P?5TI?3E foun a! !he en of !he soliar/

'uaran!ee clause. vien!l/, pe!i!ioner i no!uner!ake !o 'uaran!/ personall/ !he pa/men! of !heprincipal an in!eres! of 5+5IDs e2! uner !he!wo !rus! receip!s.

@ence, for !he !rus! receip! a!e ?c!o2er =:=, wesus!ain pe!i!ionersD claim !ha! !he/ are no! personall/ lia2lefor l ?ro %orpora!ionDs o2li'a!ion.

For !he !rus! receip! a!e 1$ *ep!em2er =:=, !he orsalpor!ion of which 4ose Tupaz si'ne alone, we fin !ha! he iso in his personal capaci!/. 4ose Tupaz i no! inica!e !ha!he was si'nin' as l ?ro %orpora!ionDs Vice-Presien! for?pera!ions. @ence, 4ose Tupaz 2oun himself personall/lia2le for l ?ro %orpora!ionDs e2!s. 3o! 2ein' a par!/ !o !he!rus! receip! a!e 1$ *ep!em2er =:=, Pe!ronila Tupaz isno! lia2le uner such !rus! receip!.

The 3a!ure of Pe!i!ioner 4ose TupazDs 7ia2ili!/

Uner !he Trus! 5eceip! 6a!e 1$ *ep!em2er =:=

s s!a!e, !he orsal sie of !he !rus! receip! a!e 1$*ep!em2er =:= proviesH

To !he &ank of !he Philippine Islans

In consiera!ion of /our releasin' !o[[[[[[[[[[[[[ uner !he !erms of !his Trus!5eceip! !he 'oos escri2e herein, IA8e, ;oin!l/ an

severall/, a'ree an promise !o pa/ !o /ou, oneman, wha!ever sum or sums of mone/ which /ouma/ call upon meAus !o pa/ !o /ou, arisin' ou! of,per!ainin' !o, anAor in an/ wa/ connec!e wi!h, !hisTrus! 5eceip!, in !he even! of efaul! anAor non-fulfillmen! in an/ respec! of !his uner!akin' on !hepar! of !he sai [[[[[[[[[[[[[[. IAwe fur!hera'ree !ha! m/Aour lia2ili!/ in !his 'uaran!ee shall 2e6I5%T 36 I++6IT, wi!hou! an/ neewha!soever on /our par! !o !ake an/ s!eps or ehaus!

an/ le'al remeies !ha! /ou ma/ have a'ains! !he sai[[[[[[[[[[[[[[[[[. &efore makin' emanupon meAus. (Unerlinin' supplieG capi!aliza!ion in!he ori'inal)

The lower cour!s in!erpre!e !his !o mean !ha! 4ose 2ounhimself soliaril/ lia2le wi!h l ?ro %orpora!ion for !he la!!erDse2! uner !ha! !rus! receip!.

This is error.

In Pruen!ial &ank v. In!ermeia!e ppella!e %our!, !he %our!in!erpre!e a su2s!an!iall/ ien!ical clause in a !rus! receip!si'ne 2/ a corpora!e officer who 2oun himself personall/lia2le for !he corpora!ionDs o2li'a!ion. The pe!i!ioner in !ha!case con!ene !ha! !he s!ipula!ion Ewe ;oin!l/ an severall/a'ree an uner!akeE renere !he corpora!e officersoliaril/ lia2le wi!h !he corpora!ion. 8e ismisse !his claiman hel !he corpora!e officer lia2le as 'uaran!or onl/. The%our! fur!her rule !ha! ha !here 2een more !han onesi'na!ories !o !he !rus! receip!, !he soliar/ lia2ili!/ woul

eis! 2e!ween !he 'uaran!ors. 8e helH

Pe!i!ioner QPruen!ial &ankR insis!s !ha! 2/ vir!ue of @owever &PIDs sui! a'ains! 4ose s!ans espi!e !he %our!Ds

7/26/2019 CRDIT

59/61

Pe!i!ioner QPruen!ial &ankR insis!s !ha! 2/ vir!ue of!he clear worin' of !he clause E we ;oin!l/an severall/ a'ree an uner!ake ,E an !heconcluin' sen!ence on ehaus!ion, Qresponen!R %hiDslia2ili!/ !herein is soliar/.

?ur reain' of !he ques!ione soliar/ 'uaran!/clause /iels no o!her conclusion !han !ha! !he

o2li'a!ion of %hi is onl/ !ha! of a 'uaran!or. This isfur!her 2ols!ere 2/ !he las! sen!ence which speaks ofwaiver of ehaus!ion, which, never!heless, isineffec!ive in !his case 2ecause !he space !herein for!he par!/ whose proper!/ ma/ no! 2e ehaus!e wasno! fille up. Uner r!icle perannum un!il full/ pai since !his was !he s!ipula!e ra!e in!he applica!ions for !he le!!ers of crei!.

The accoun!in' of l ?ro %orpora!ionDs e2!s as of

7/26/2019 CRDIT

60/61

The accoun!in' of l ?ro %orpora!ion s e2!s as of of !he !o!al amoun! compu!e as offinali!/ of ;u'men!

To!al amoun! ue as of !he a!e of finali!/ of ;u'men! willearn an in!eres! of =:> per annum un!il full/ pai.

In so ele'a!in' !his !ask, we rei!era!e wha! we sai in 5izal%ommercial &ankin' %orpora!ion v. lfa 5T8 +anufac!urin'%orpora!ion where we also orere !he !rial cour! !o compu!e!he amoun! of o2li'a!ion ue 2ase on a formula

su2s!an!iall/ similar !o !ha! inica!e a2oveHThe !o!al amoun! ue QunerR !he con!rac!QR ma/ 2e easil/ e!ermine 2/ !he !rial cour!!hrou'h a simple ma!hema!ical compu!a!ion 2ase on!he formula specifie a2ove. +a!hema!ics is an eac!science, !he applica!ion of which nees no fur!herproof from !he par!ies.

4ose TupazDs cqui!!al i no! !in'uish his %ivil 7ia2ili!/

The rule is !ha! where !he civil ac!ion is impliel/ ins!i!u!ewi!h !he criminal ac!ion, !he civil lia2ili!/ is no! e!in'uishe2/ acqui!!al

QwRhere !he acqui!!al is 2ase on reasona2le ou2! as onl/ preponerance of evience is require incivil casesG where !he cour! epressl/ eclares !ha! !helia2ili!/ of !he accuse is no! criminal 2u! onl/ civil in

na!ure as, for ins!ance, in !he felonies of es!afa,!hef!, an malicious mischief commi!!e 2/ cer!ainrela!ives who !here2/ incur onl/ civil lia2ili!/ (*ee r!.11

7/26/2019 CRDIT

61/61

eecu!in' !he !rus! receip!s !o secure pa/men! of !he raf!srawn uner !he le!!ers of crei!.

8@5F?5, we 53T !he pe!i!ion in par!. 8e FFI5+ !he6ecision of !he %our! of ppeals a!e " *ep!em2er