7/24/2019 INSURANCE 26 Philamgen v Sweet Lines

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DLSU Commercial Law Review Digest G02(2015-2016)

[INSURANCE 16]Vicente Ong Lim Sing, Jr. vs. FEB Leasing & Finance Corp.,G.R. No. 1611!, J"ne , #$$%opic' (NS)R*BLE (NERES

+onente'OCR(NE' Section 17 of the Insurance Code provides that the measure of an insurabe interest inpropert! is the e"tent to #hich the insured mi$ht be damnified b! oss or in%ur! thereof&

F*CS'

'E( )easin$ and 'inance Corporation entered into a ease of e*uipment and motor vehices #ith +,)'ood -roducts& ,icente .n$ )im Sin$/ +r& e"ecuted an Individua 0uarant! A$reement #ith 'E( to$uarantee the prompt and faithfu performance of the terms and conditions of the aforesaid easea$reement& Correspondin$ )ease Schedues #ith eiver! and Acceptance Certificates over thee*uipment and motor vehices formed part of the a$reement& Under the contract/ +,) #as obi$ed topa! 'E( an a$$re$ate $ross month! renta of -172/343&22&

+,) defauted in the pa!ment of the month! rentas& As of +u! 51/ 222/ the amount in arrears/incudin$ penat! char$es and insurance premiums/ amounted to -5/313/36&78& .n Au$ust 5/ 222/'E( sent a etter to +,) demandin$ pa!ment of the said amount& 9o#ever/ +,) faied to pa!&

'E( fied a Compaint #ith the R:C of ;ania for sum of mone!/ dama$es/ and repevin a$ainst +,)/)im/ and +ohn oe&

In the Amended Ans#er/ +,) and )im admitted the e"istence of the ease a$reement but asserted thatit is in reait! a sae of e*uipment on instament basis/ #ith 'E( actin$ as the financier& +,) and )imcaimed that this intention #as apparent from the fact that the! #ere made to beieve that #hen fupa!ment #as effected/ a eed of Sae #i be e"ecuted b! 'E( as vendor in favor of +,) and )im asvendees& 'E( purported! assured them that documentin$ the transaction as a ease a$reement is

%ust an industr! practice and that the proper documentation #oud be effected as soon as fu pa!mentfor ever! item #as made& :he! aso contended that the ease a$reement is a contract of adhesion andshoud/ therefore/ be construed a$ainst the part! #ho prepared it/ i&e&/ 'E(&

R:C rued that it is a sae on instament and there is no chatte mort$a$e on the thin$ sod& 9o#ever/on appea/ the CA reversed and set aside the ruin$ of the R:C and decared that the transactionbet#een the parties is a financia ease a$reement under Repubic Act

7/24/2019 INSURANCE 26 Philamgen v Sweet Lines

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DLSU Commercial Law Review Digest G02(2015-2016)

(S+OS((VE +OR(ON'-EREFORE, in t/e 0ig/t o a00 t/e oregoing, t/e petition is EN(E./e ecision o t/e C* in C*2G.R. CV No. %%34 5ate5 arc/ 1!, #$$! an5 Reso0"tion 5ate5a7 #8, #$$! are *FF(RE. Costs against petitioner.

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