Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Scribd Logo
Upload

Welcome to Scribd!

  • 21 views

    Case Digest 1

    Uploaded by

    Pat Espinoza

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Case Digest 1

    Uploaded by

    Pat Espinoza
    21 views6 pages

    Original Title

    case digest 1

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    21 views6 pages

    Case Digest 1

    Uploaded by

    Pat Espinoza

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 6

    CU UNJIENG E HIJOS VS.

    MABALACAT SUGAR COMPANY


    G.R. NO. 45351
    JUNE 29, 1940

    Facts:

    Mabalacat was indebted to Hijos, with mortgage and interest. Hijos now seeks payment. He
    imposed compounded interest charges in estimating the amount of indebtedness.

    Argument:

    Hijos: In the mortgage, there had been a stipulation that, “Interest, to be computed upon the
    still unpaid capital of the loan, shall be paid monthly, at the end of each month.” Thus, this
    justifies the imposition of compounded interest charges.

    Issue: Whether or not the imposition of compounded interest charges is justified.

    Held:

    No. The provision in the mortgage quoted by Hijos merely requires the debtor to pay interest
    monthly at the end of each month, such interest to be computed upon the capital of the loan
    not already paid.

    In the absence of express stipulation for the accumulation of compound interest, no interest can
    be collected upon interest until the debt is judicially claimed, and then the rate at which interest
    upon accrued interest must be computed is fixed at 6 per cent per annum.
    DAVID VS. COURT OF APPEALS
    G.R. NO. 115821
    OCTOBER 13, 1999
    Facts:

    RTC Manila Judge Diaz issued a writ of attachment over the real properties of private
    respondents. Judge Diaz ordered private respondent to pay petitioner P 66,500.00 with interest
    from July 24, 1974, until fully paid. However, Judge Diaz amended said Decision, so that the
    legal rate of interest should be computed from January 4, 1966, instead of from July 24, 1974.
    Private respondent appealed to CA and SC, which both affirmed the decision of the lower court.
    Subsequently, entries of judgment were made and the record of the case was remanded to RTC
    Branch 27, presided by respondent Judge Cruz, for the final execution of the decision as
    amended.

    Upon petitioner's motion, Judge Cruz issued an alias writ of execution by virtue of which
    respondent Sheriff Peña conducted a public auction. Sheriff Peña informed the petitioner that
    the total amount of the judgment is P 270,940.52. The amount included a computation of
    simple interest. Petitioner, however, claimed that the judgment award should be P
    3,027,238.50, because the amount due ought to be based on compounded interest. Although
    the auctioned properties were sold to the petitioner, Sheriff Peña did not issue the Certificate of
    Sale because there was an excess in the bid price in the amount of P 2,941,524.47, which the
    petitioner failed to pay despite notice.

    Petitioner filed a motion praying that respondent Judge Cruz issue an order directing
    respondent Sheriff Peña to prepare and execute a certificate of sale in favor of the petitioner,
    placing therein the amount of the judgment as P 3,027,238.50, the amount he bid during the
    auction which he won. His reason is that compound interest, which is allowed by Article 2212 of
    the Civil Code, should apply in this case.

    RTC and CA did not favor petitioner. Petitioner argued that the Court of Appeals erred in ruling
    that Article 2212 of the Civil Code applies only where the parties to an obligation stipulated or
    agreed to pay compounded interest.

    Issue:

    Whether respondent appellate court erred in affirming respondent Judge's order for the
    payment of simple interest only rather than compounded interest?

    Ruling:

    Petitioner insists that in computing the interest due of the P 66,500.00, interest should be
    computed at 6% on the principal sum of P 66,500.00 pursuant to Article 2209 and then "interest
    on the legal interest" should also be computed in accordance with the language of Article 2212
    of the Civil Code. In his view, said article meant "compound interest". However, Article 2212
    contemplates the presence of stipulated or conventional interest which has accrued when
    demand was judicially made. In cases where no interest had been stipulated by the parties, no
    accrued conventional interest could further earn interest upon judicial demand.

    Furthermore, “when the judgment sought to be executed ordered the payment of simple "legal
    interest" only and said nothing about payment of compound interest, but the respondent judge
    orders payment of compound interest, then, he goes beyond the confines of a judgment which
    had become final.” Note that in this case, the Court of Appeals made the finding that "... no
    interest was stipulated by the parties.”
    VELEZ VS. BALSARZA
    FACTS:
    Plaintiff prayed for the return of certain parcels of land which she alleged had been sold by the
    defendants to plaintiff’s deceased husband, Ramon Neri San Jose, with right of repurchase. She
    further alleged that defendants had remained in possession of said land under a contract of
    lease, but that for over two years defendants had not paid the agreed rentals. In their amended
    answer, defendants alleged that the real agreement was loan secured by a mortgage of those
    lands; and that whereas the amount borrowed was only P2,400, defendants had however
    already paid P4,420.88. Defendants therefore prayed for the return of the excess, or P2,029.88.
    Balzarsa alleged that the real agreement was a loan secured by a mortgage of those lands. Trial
    court found that the payments made by defendants were not made by way of interest but as
    payments for the principal. Balsarza overpaid and plaintiff should return the excess.

    ISSUE:
    Whether or not the excess payment should be returned

    HELD:
    The liability of plaintiff to return the excess payments is in keeping with Article 1895 (Old Civil
    Code) which provides that, “when something is received which there is no right to collect, and
    which by mistake has been unduly delivered , the obligation to restore it arises. “The 2
    requisites are present: 1) There is no right to collect these excess sums; and 2) the amounts
    have been paid through mistake by defendants. Such mistake is shown by the fact that when
    these payments were made, they were intended by defendants to be applied on the principal,
    but they overpaid the amounts loaned to them.
    GSIS VS. COURT OF APPEALS
    G.R. NO. L-40824
    FEBRUARY 23, 1989
    FACTS
    Private respondents, Mr. and Mrs. Isabelo R. Racho, together with the spouses Mr. and Mrs.
    Flaviano Lagasca, executed a deed of mortgage, in favor of petitioner Government Service
    Insurance System (GSIS) and subsequently, another deed of mortgage, in connection with two
    loans granted by the latter in the sums of P 11,500.00 and P 3,000.00, respectively. A parcel of
    land co-owned by said mortgagor spouses, was given as security under the aforesaid two
    deeds. They also executed a ‘promissory note” which states in part:

    … for value received, we the undersigned … JOINTLY, SEVERALLY and SOLIDARILY, promise to
    pay the GOVERNMENT SERVICE INSURANCE SYSTEM the sum of . . . (P 11,500.00) Philippine
    Currency, with interest at the rate of six (6%) per centum compounded monthly payable in . . .
    (120)equal monthly installments of . . . (P 127.65) each.
    Both parties relied on the provisions of Section 29 of Act No. 2031, otherwise known as the
    Negotiable Instruments Law, which provide that an accommodation party is one who has signed
    an instrument as maker, drawer, acceptor of indorser without receiving value therefor, but is
    held liable on the instrument to a holder for value although the latter knew him to be only an
    accommodation party.

    ISSUE
    Whether or not the executed promissory note is a negotiable instrument.

    RULING
    NO. The promissory note hereinbefore quoted, as well as the mortgage deeds subject of this
    case, are clearly not negotiable instruments. These documents do not comply with the fourth
    requisite to be considered as such under Section 1 of Act No. 2031 because they are neither
    payable to order nor to bearer. The note is payable to a specified party, the GSIS. Absent the
    aforesaid requisite, the provisions of Act No. 2031 would not apply; governance shall be
    afforded, instead, by the provisions of the Civil Code and special laws on mortgages.

    LIGUTAN VS. COURT OF APPEALS


    G.R. NO. 138677
    FACTS:
    Petitioners Tolomeo Ligutan and Leonidas dela Llana obtained a loan in the amount of
    P120,000.00 from Security Bank and Trust Co. The obligation matured and the bank granted an
    extension. Despite several demands from the Bank, petitioners failed to settle the debt which
    then amounted to P114,416.10. The Bank sent a final demand letter however petitioners still
    defaulted on their obligation. The Bank then filed a complaint for recovery of the due amount.
    Petitioners instead of presenting their evidence had the schedule reset for two consecutive
    occasions. On the third hearing date, the trial court resolved to consider the case submitted for
    decision.
    Two years later petitioners filed a motion for reconsideration which was denied by the trial
    court. Petitioners then interposed an appeal with the Court of Appeals, the appellate court
    affirmed the judgement of the trial court except the 2% service charge which was deleted
    pursuant to Central Bank Circular No. 763. The two parties filed their motions for
    reconsiderations and the Court of Appeals resolved the two motions: that the payment of
    interest and penalty commence on the date when the obligation became due and a penalty of
    3% per month would suffice. The petitioners filed an omnibus motion for reconsideration which
    was then denied by the Court of Appeals.
    ISSUE:
    Whether or not the 15.189% interest and the penalty of 3% per month (36% per annum) is
    exorbitant, iniquitous, and unconscionable.
    RULING:
    Petition is DENIED.
    HELD:
    The question of whether a penalty is reasonable or iniquitous can be partly subjective and
    partly objective. Its resolution will depend on such factors as, but not confined to, the type,
    extent and purpose of the penalty, the nature of the obligation, the mode of breach and its
    consequences, the supervening realities, the standing and relationship of the parties, and the
    like, the application of which, by and large, is addressed to the sound discretion of the court.
    The Court of Appeals, exercising its good judgement has reduced the penalty interest from 5% a
    month to 3% a month. Given the circumstances and the repeated acts of breach by petitioners
    of their contractual obligation, the Court sees no cogent ground to modify the ruling of the
    appellate court.
    The stipulated interest of 15.189% per annum, does not appear as being excessive. The essence
    or rationale for the payment of interest, quite often referred to as cost of money, is not exactly
    the same as that as a surcharge or a penalty. A penalty stipulation is not necessarily preclusive
    of interest, if there is an agreement to that effect, the two being distinct concepts which may
    separately be demanded. The interest prescribed in loan financing arrangements is a
    fundamental part of the banking business and the core of a banks existence.

    You might also like