Académique Documents
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A. INTRODUCTION
5 CASES
PROMISSORY NOTE
120,000.00
FOR VALUE RECEIVED, I, RODRIGO RIVERA promise to pay spouses
SALVADOR C. CHUA and VIOLETA SY CHUA, the sum of One
Hundred Twenty Thousand Philippine Currency (P120,000.00) on
December 31, 1995.
It is agreed and understood that failure on my part to pay the
amount of (120,000.00) One Hundred Twenty Thousand Pesos on
December 31, 1995. (sic) I agree to pay the sum equivalent to FIVE
PERCENT (5%) interest monthly from the date of default until the
entire obligation is fully paid for.
Should this note be referred to a lawyer for collection, I agree to
pay the further sum equivalent to twenty percent (20%) of the total
amount due and payable as and for attorneys fees which in no
case shall be less than P5,000.00 and to pay in addition the cost of
suit and other incidental litigation expense.
Any action which may arise in connection with this note shall be
brought in the proper Court of the City of Manila.
Manila, February 24, 1995[.]
(SGD.) RODRIGO RIVERA4
In October 1998, almost three years from the date of payment
stipulated in the promissory note, Rivera, as partial payment for the
loan, issued and delivered to the SpousesChua, as payee, a check
numbered 012467, dated 30 December 1998, drawn against
Riveras current account with the Philippine Commercial
International Bank (PCIB) in the amount of P25,000.00.
On 21 December 1998, the Spouses Chua received another check
presumably issued by Rivera, likewise drawn against Riveras PCIB
current account, numbered 013224, duly signed and dated, but
1
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Thus, what remains for our disposition is G.R. No. 184458, the
appeal of Rivera questioning the entire ruling of the Court of
Appeals in CA-G.R. SP No. 90609.
It is a basic rule in civil cases that the party having the burden of
proof must establish his case by preponderance of evidence, which
simply means "evidence which is of greater weight, or more
convincing than that which is offered in opposition to it."
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The liability for damages of those who default, including those who
are guilty of delay, in the performance of their obligations is laid
down on Article 117024 of the Civil Code.
Corollary thereto, Article 2209 solidifies the consequence of
payment of interest as an indemnity for damages when the obligor
incurs in delay:
Art. 2209. If the obligation consists inthe payment of a sum of
money, and the debtor incurs in delay, the indemnity for damages,
there being no stipulation to the contrary, shall be the payment of
the interest agreed upon, and in the absence of stipulation, the
legal interest, which is six percent per annum. (Emphasis supplied)
Article 2209 is specifically applicable in this instance where: (1) the
obligation is for a sum of money; (2) the debtor, Rivera, incurred in
delay when he failed to pay on or before 31 December 1995; and
(3) the Promissory Note provides for an indemnity for damages
upon default of Rivera which is the payment of a 5%monthly
interest from the date of default.
We do not consider the stipulation on payment of interest in this
case as a penal clause although Rivera, as obligor, assumed to pay
additional 5% monthly interest on the principal amount
of P120,000.00 upon default.
Article 1226 of the Civil Code provides:
Art. 1226. In obligations with a penal clause, the penalty shall
substitute the indemnity for damages and the payment of interests
in case of noncompliance, if there isno stipulation to the contrary.
Nevertheless, damages shall be paid if the obligor refuses to pay
the penalty or is guilty of fraud in the fulfillment of the obligation.
The penalty may be enforced only when it is demandable in
accordance with the provisions of this Code.
The penal clause is generally undertaken to insure performance
and works as either, or both, punishment and reparation. It is an
exception to the general rules on recovery of losses and damages.
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As for the legal interest accruing from 11 June 1999, when judicial
demand was made, to the date when this Decision becomes final
and executory, such is likewise divided into two periods: (1) 12%
per annum from 11 June 1999, the date of judicial demand to 30
June 2013; and (2) 6% per annum from 1 July 2013 to date when
this Decision becomes final and executor. 31 We base this imposition
of interest on interest due earning legal interest on Article 2212 of
the Civil Code which provides that "interest due shall earn legal
interest from the time it is judicially demanded, although the
obligation may be silent on this point."
From the time of judicial demand, 11 June 1999, the actual amount
owed by Rivera to the Spouses Chua could already be determined
with reasonable certainty given the wording of the Promissory
Note.32
We cite our recent ruling in Nacar v. Gallery Frames:33
In this case, the petitions in G.R. Nos. 184458 and 184472 involve
an identity of parties and subject matter raising specifically errors
in the Decision of the Court of Appeals. Where the Court of Appeals
disposition on the propriety of the reduction of the interest rate was
raised by the Spouses Chua in G.R. No. 184472, our ruling thereon
affirming the Court of Appeals is a "bar by prior judgment."
At the time interest accrued from 1 January 1996, the date of
default under the Promissory Note, the then prevailing rate of legal
interest was 12% per annum under Central Bank (CB) Circular No.
416 in cases involving the loan or for bearance of money. 29 Thus,
the legal interest accruing from the Promissory Note is 12% per
annum from the date of default on 1 January 1996. However, the
12% per annumrate of legal interest is only applicable until 30 June
2013, before the advent and effectivity of Bangko Sentral ng
Pilipinas (BSP) Circular No. 799, Series of 2013 reducing the rate of
legal interest to 6% per annum. Pursuant to our ruling in Nacar v.
Gallery Frames,30 BSP Circular No. 799 is prospectively applied from
1 July 2013. In short, the applicable rate of legal interest from 1
January 1996, the date when Rivera defaulted, to date when this
Decision becomes final and executor is divided into two periods
reflecting two rates of legal interest: (1) 12% per annum from 1
January 1996 to 30 June 2013; and (2) 6% per annum FROM 1 July
2013 to date when this Decision becomes final and executory.
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Stipulated
Interest A & B
Interest
due
earning
legal
interest A & B
Attorney
s fees
February
24, A. January 1,
1995
to 1996
to
December
June 30, 2013
31, 1995
B. July 1 2013 to
date when this
Decision
becomes
final
and executory
Wholesal
e
Amount
P120,000.00
A.
12%
per P50,000.
annumon
the 00
total amount of
column
2
B.
6%
per
annumon
the
total amount of
column 235
A. 12 % per
annumon
the
principal amount
ofP120,000.00
B.
6%
per
annumon
the
principal amount
ofP120,000.00
Total
Amoun
t
Total
amoun
t
of
Colum
ns 1-4
The total amount owing to the Spouses Chua set forth in this
Decision shall further earn legal interest at the rate of 6% per
annum computed from its finality until full payment thereof, the
interim period being deemed to be a forbearance of credit.
WHEREFORE, the petition in G.R. No. 184458 is DENIED. The
Decision of the Court of Appeals in CA-G.R. SP No. 90609 is
MODIFIED. Petitioner Rodrigo Rivera is ordered to pay respondents
Spouse Salvador and Violeta Chua the following:
(1) the principal amount of P120,000.00;
(2) legal interest of 12% per annumof the principal amount
of P120,000.00 reckoned from 1 January 1996 until 30
June 2013;
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set aside the decisions of the Court of Tax Appeals (CTA) in CTA
Case Nos. 59514 and 6009,5 respectively, and dismissed the
petitions of petitioner Hongkong and Shanghai Banking Corporation
Limited-Philippine Branches (HSBC). The corresponding Resolutions,
on the other hand, denied the respective motions for
reconsideration of the said Decisions.
HSBC performs, among others, custodial services on behalf of its
investor-clients, corporate and individual, resident or non-resident
of the Philippines, with respect to their passive investments in the
Philippines, particularly investments in shares of stocks in domestic
corporations. As a custodian bank, HSBC serves as the
collection/payment agent with respect to dividends and other
income derived from its investor-clients passive investments. 6
HSBCs investor-clients maintain Philippine peso and/or foreign
currency accounts, which are managed by HSBC through
instructions given through electronic messages. The said
instructions are standard forms known in the banking industry as
SWIFT,
or
"Society
for
Worldwide
Interbank
Financial
Telecommunication." In purchasing shares of stock and other
investment in securities, the investor-clients would send electronic
messages from abroad instructing HSBC to debit their local or
foreign currency accounts and to pay the purchase price therefor
upon receipt of the securities.7
September 1997
P 6,981,447.90
October 1997
6,209,316.60
November 1997
3,978,510.30
June 4, 2014
10
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December 1997
2,403,717.30
Total
P19,572,992.10
January 1998
P 3,328,305.60
February 1998
4,566,924.90
Gentlemen:
March 1998
5,371,797.30
April 1998
4,197,235.50
May 1998
2,519,587.20
June 1998
2,301,333.00
This refers to your letter dated July 26, 1999 requesting on behalf of
your clients, the CITIBANK & STANDARD CHARTERED BANK, for a
ruling as to whether or not the electronic instructions involving the
following transactions of residents and non-residents of the
Philippines with respect to their local or foreign currency accounts
are subject to documentary stamp tax under Section 181 of the
1997 Tax Code, viz:
July 1998
1,586,404.50
August 1998
1,787,359.50
September 1998
1,231,828.20
October 1998
1,303,184.40
November 1998
2,026,379.70
December 1998
2,684,097.50
Total
P32,904,437.30
On August 23, 1999, the Bureau of Internal Revenue (BIR), thru its
then Commissioner, Beethoven Rualo, issued BIR Ruling No. 132-99
to the effect that instructions or advises from abroad on the
management of funds located in the Philippines which do not
involve transfer of funds from abroad are not subject to DST. BIR
Ruling No. 132-99 reads:
Date: August 23, 1999
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B. Other transactions:
An overseas client sends an instruction to its bank in the Philippines
to either:
(i) debit its local or foreign currency account and to pay a
named recipient, who may be another bank, a corporate
entity or an individual in the Philippines; or
(ii) receive funds from another bank in the Philippines for
deposit to its account and to pay a named recipient, who
may be another bank, a corporate entity or an individual in
the Philippines."
The above instruction is in the form of an electronic message (i.e.,
SWIFT MT 100 or MT 202) or tested cable, and may not refer to any
particular transaction.
The opening and maintenance by a non-resident of local or foreign
currency accounts with a bank in the Philippines is permitted by the
Bangko Sentral ng Pilipinas, subject to certain conditions.
In reply, please be informed that pursuant to Section 181 of the
1997 Tax Code, which provides that
SEC. 181. Stamp Tax Upon Acceptance of Bills of Exchange and
Others. Upon any acceptance or payment of any bill of exchange
or order for the payment of money purporting to be drawn in a
foreign country but payable in the Philippines, there shall be
collected a documentary stamp tax of Thirty centavos (P0.30) on
each Two hundred pesos (P200), or fractional part thereof, of the
face value of any such bill of exchange, or order, or Philippine
equivalent of such value, if expressed in foreign currency.
(Underscoring supplied.)
a documentary stamp tax shall be imposed on any bill of exchange
or order for payment purporting to be drawn in a foreign country
but payable in the Philippines.
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It should be noted that the receipt of funds from another local bank
in the Philippines by a local depository bank for the account of its
client residing abroad is part of its regular banking transaction
which is not subject to documentary stamp tax. Neither does the
receipt of funds makes the recipient subject to the documentary
stamp tax. The funds are deemed to be part of the deposits of the
client once credited to his account, and which, thereafter can be
disposed in the manner he wants. The payor-clients further
instruction to debit his account and pay a named recipient in the
Philippines does not involve transfer of funds from abroad.
Likewise, as stated earlier, such debit of local or foreign currency
account in the Philippines is not subject to the documentary stamp
tax under the aforementioned Section 181 of the Tax Code.
In the light of the foregoing, this Office hereby holds that the
instruction made through an electronic message by non-resident
payor-client to debit his local or foreign currency account
maintained in the Philippines and to pay a certain named recipient
also residing in the Philippines is not the transaction contemplated
under Section 181 of the 1997 Tax Code. Such being the case, such
electronic instruction purporting to draw funds from a local account
intended to be paid to a named recipient in the Philippines is not
subject to documentary stamp tax imposed under the foregoing
Section.
This ruling is being issued on the basis of the foregoing facts as
represented. However, if upon investigation it shall be disclosed
that the facts are different, this ruling shall be considered null and
void.
Very truly yours,
(Sgd.) BEETHOVEN L. RUALO
Commissioner of Internal Revenue8
With the above BIR Ruling as its basis, HSBC filed on October 8,
1999 an administrative claim for the refund of the amount
of P19,572,992.10 allegedly representing erroneously paid DST to
the BIR for the period covering September to December 1997.
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17
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18
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G.R. No. 170325
T.
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the spouses would replace the postdated checks with their own
checks issued in the name of the members.
It was PEMSLAs policy not to approve applications for loans of
members with outstanding debts. To subvert this policy, some
PEMSLA officers devised a scheme to obtain additional loans
despite their outstanding loan accounts. They took out loans in the
names of unknowing members, without the knowledge or consent
of the latter. The PEMSLA checks issued for these loans were then
given to the spouses for rediscounting. The officers carried this out
by forging the indorsement of the named payees in the checks.
In return, the spouses issued their personal checks (Rodriguez
checks) in the name of the members and delivered the checks to
an officer of PEMSLA. The PEMSLA checks, on the other hand, were
deposited by the spouses to their account.
Meanwhile, the Rodriguez checks were deposited directly by
PEMSLA to its savings account without any indorsement from the
named payees. This was an irregular procedure made possible
through the facilitation of Edmundo Palermo, Jr., treasurer of
PEMSLA and bank teller in the PNB Branch. It appears that this
became the usual practice for the parties.
For the period November 1998 to February 1999, the spouses
issued sixty nine (69) checks, in the total amount of P2,345,804.00.
These were payable to forty seven (47) individual payees who were
all members of PEMSLA.4
Petitioner PNB eventually found out about these fraudulent acts. To
put a stop to this scheme, PNB closed the current account of
PEMSLA. As a result, the PEMSLA checks deposited by the spouses
were returned or dishonored for the reason "Account Closed." The
corresponding Rodriguez checks, however, were deposited as usual
to the PEMSLA savings account. The amounts were duly debited
from the Rodriguez account. Thus, because the PEMSLA checks
given as payment were returned, spouses Rodriguez incurred losses
from the rediscounting transactions.
RTC Disposition
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In a Decision7 dated July 22, 2004, the CA reversed and set aside
the RTC disposition. The CA concluded that the checks were
obviously meant by the spouses to be really paid to PEMSLA. The
court a quo declared:
We are not swayed by the contention of the plaintiffs-appellees
(Spouses Rodriguez) that their cause of action arose from the
alleged breach of contract by the defendant-appellant (PNB) when
it paid the value of the checks to PEMSLA despite the checks being
payable to order. Rather, we are more convinced by the strong and
credible evidence for the defendant-appellant with regard to the
plaintiffs-appellees and PEMSLAs business arrangement that the
value of the rediscounted checks of the plaintiffs-appellees would
be deposited in PEMSLAs account for payment of the loans it has
approved in exchange for PEMSLAs checks with the full value of
the said loans. This is the only obvious explanation as to why all the
disputed sixty-nine (69) checks were in the possession of PEMSLAs
errand boy for presentment to the defendant-appellant that led to
this present controversy. It also appears that the teller who
accepted the said checks was PEMSLAs officer, and that such was
a regular practice by the parties until the defendant-appellant
discovered the scam. The logical conclusion, therefore, is that the
checks were never meant to be paid to order, but instead, to
PEMSLA. We thus find no breach of contract on the part of the
defendant-appellant.
According to plaintiff-appellee Erlando Rodriguez testimony,
PEMSLA allegedly issued post-dated checks to its qualified
members who had applied for loans. However, because of
PEMSLAs insufficiency of funds, PEMSLA approached the plaintiffsappellees for the latter to issue rediscounted checks in favor of said
applicant members. Based on the investigation of the defendantappellant, meanwhile, this arrangement allowed the plaintiffsappellees to make a profit by issuing rediscounted checks, while
the officers of PEMSLA and other members would be able to claim
their loans, despite the fact that they were disqualified for one
reason or another. They were able to achieve this conspiracy by
using other members who had loaned lesser amounts of money or
had not applied at all. x x x.8 (Emphasis added)
21
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The CA found that the checks were bearer instruments, thus they
do not require indorsement for negotiation; and that spouses
Rodriguez and PEMSLA conspired with each other to accomplish
this money-making scheme. The payees in the checks were
"fictitious payees" because they were not the intended payees at
all.
The spouses Rodriguez moved for reconsideration. They argued,
inter alia, that the checks on their faces were unquestionably
payable to order; and that PNB committed a breach of contract
when it paid the value of the checks to PEMSLA without
indorsement from the payees. They also argued that their cause of
action is not only against PEMSLA but also against PNB to recover
the value of the checks.
On October 11, 2005, the CA reversed itself via an Amended
Decision, the last paragraph and fallo of which read:
PNB argues anew that when the spouses Rodriguez issued the
disputed checks, they did not intend for the named payees to
receive the proceeds. Thus, they are bearer instruments that could
be validly negotiated by mere delivery. Further, testimonial and
documentary evidence presented during trial amply proved that
spouses Rodriguez and the officers of PEMSLA conspired with each
other to defraud the bank.
Our Ruling
4. Costs of suit.
WHEREFORE, in view of the foregoing premises, judgment is hereby
rendered by Us AFFIRMING WITH MODIFICATION the assailed
decision rendered in Civil Case No. 99-10892, as set forth in the
immediately next preceding paragraph hereof, and SETTING ASIDE
Our original decision promulgated in this case on 22 July 2004.
SO ORDERED.9
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(c) When it is payable to the order of a fictitious or nonexisting person, and such fact is known to the person
making it so payable; or
(d) When the name of the payee does not purport to be the
name of any person; or
(e) Where the only or last indorsement is an indorsement in
blank.12 (Underscoring supplied)
The distinction between bearer and order instruments lies in their
manner of negotiation. Under Section 30 of the NIL, an order
instrument requires an indorsement from the payee or holder
before it may be validly negotiated. A bearer instrument, on the
other hand, does not require an indorsement to be validly
negotiated. It is negotiable by mere delivery. The provision reads:
SEC. 30. What constitutes negotiation. An instrument is
negotiated when it is transferred from one person to another in
such manner as to constitute the transferee the holder thereof. If
payable to bearer, it is negotiated by delivery; if payable to order, it
is negotiated by the indorsement of the holder completed by
delivery.
A check that is payable to a specified payee is an order instrument.
However, under Section 9(c) of the NIL, a check payable to a
specified payee may nevertheless be considered as a bearer
instrument if it is payable to the order of a fictitious or non-existing
person, and such fact is known to the person making it so payable.
Thus, checks issued to "Prinsipe Abante" or "Si Malakas at si
Maganda," who are well-known characters in Philippine mythology,
are bearer instruments because the named payees are fictitious
and non-existent.
We have yet to discuss a broader meaning of the term "fictitious"
as used in the NIL. It is for this reason that We look elsewhere for
guidance. Court rulings in the United States are a logical starting
point since our law on negotiable instruments was directly lifted
from the Uniform Negotiable Instruments Law of the United
States.13
23
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25
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We note that the RTC failed to thresh out the merits of PNBs crossclaim against its co-defendants PEMSLA and MPC. The records are
bereft of any pleading filed by these two defendants in answer to
the complaint of respondents-spouses and cross-claim of PNB. The
Rules expressly provide that failure to file an answer is a ground for
a declaration that defendant is in default. 28 Yet, the RTC failed to
sanction the failure of both PEMSLA and MPC to file responsive
pleadings. Verily, the RTC dismissal of PNBs cross-claim has no
basis. Thus, this judgment shall be without prejudice to whatever
action the bank might take against its co-defendants in the trial
court.
To PNBs credit, it became involved in the controversial transaction
not of its own volition but due to the actions of some of its
employees. Considering that moral damages must be understood
to be in concept of grants, not punitive or corrective in nature, We
resolve to reduce the award of moral damages to P50,000.00.29
WHEREFORE, the appealed Amended Decision is AFFIRMED with the
MODIFICATION that the award for moral damages is reduced
to P50,000.00, and that this is without prejudice to whatever civil,
criminal, or administrative action PNB might take against PEMSLA,
MPC, and the employees involved. SO ORDERED.
G.R. No. 93397 March 3, 1997
TRADERS ROYAL BANK, petitioner, vs. COURT OF APPEALS,
FILRITERS GUARANTY ASSURANCE CORPORATION and
CENTRAL BANK of the PHILIPPINES, respondents.
TORRES, JR., J.:
Assailed in this Petition for Review on Certiorari is the Decision of
the respondent Court of Appeals dated January 29, 1990, 1 affirming
the nullity of the transfer of Central Bank Certificate of
Indebtedness (CBCI) No. D891, 2 with a face value of P500,000.00,
from the Philippine Underwriters Finance Corporation (Philfinance)
to the petitioner Trader's Royal Bank (TRB), under a Repurchase
Agreement 3 dated
February
4,
1981,
and
a
Detached
Assignment 4 dated April 27, 1981.
26
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27
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14. Subsequently, Alberto Fabella, Senior Vice-PresidentComptroller are Pilar Jacobe, Vice-President-Treasury of Filriters
(both of whom were holding the same positions in Philfinance),
without any consideration or benefit redounding to Filriters and to
the grave prejudice of Filriters, its policy holders and all who have
present or future claims against its policies, executed similar
detached assignment forms transferring the CBCI to plaintiff;
xxx xxx xxx
15. The detached assignment is patently void and inoperative
because the assignment is without the knowledge and consent of
directors of Filriters, and not duly authorized in writing by the
Board, as requiring by Article V, Section 3 of CB Circular No. 769;
16. The assignment of the CBCI to Philfinance is a personal act of
Alfredo Banaria and not the corporate act of Filriters and such null
and void;
a. The assignment was executed without consideration and
for that reason, the assignment is void from the
beginning (Article 1409, Civil Code);
b. The assignment was executed without any knowledge
and consent of the board of directors of Filriters;
c. The CBCI constitutes reserve investment of Filriters
against liabilities, which is a requirement under the
Insurance Code for its existence as an insurance
company and the pursuit of its business operations. The
assignment of the CBCI is illegal act in the sense
of malum in se or malum prohibitum, for anyone to
make, either as corporate or personal act;
d. The transfer of dimunition of reserve investments of
Filriters is expressly prohibited by law, is immoral and
against public policy;
e. The assignment of the CBCI has resulted in the capital
impairment and in the solvency deficiency of Filriters
28
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13
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16
The accepted rule is that the negotiability or nonnegotiability of an instrument is determined from the
writing, that is, from the face of the instrument itself. In the
construction of a bill or note, the intention of the parties is
to control, if it can be legally ascertained. While the writing
may be read in the light of surrounding circumstance in
order to more perfectly understand the intent and meaning
of the parties, yet as they have constituted the writing to be
the only outward and visible expression of their meaning, no
other words are to be added to it or substituted in its stead.
The duty of the court in such case is to ascertain, not what
the
parties
may
have
secretly
intended
as
contradistinguished from what their words express, but what
is the meaning of the words they have used. What the
parties meant must be determined by what they said.
Thus, the transfer of the instrument from Philfinance to TRB was
merely an assignment, and is not governed by the negotiable
instruments law. The pertinent question then is, was the transfer of
the CBCI from Filriters to Philfinance and subsequently from
Philfinance to TRB, in accord with existing law, so as to entitle TRB
to have the CBCI registered in its name with the Central Bank?
31
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A Yes, sir.
SO ORDERED.
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REPUBLIC
PLANTERS
BANK, petitioner, vs.
APPEALS and FERMIN CANLAS, respondents.
COURT
OF
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37
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Where the agent signs his name but nowhere in the instrument has
he disclosed the fact that he is acting in a representative capacity
or the name of the third party for whom he might have acted as
agent, the agent is personally liable to take holder of the
instrument and cannot be permitted to prove that he was merely
acting as agent of another and parol or extrinsic evidence is not
admissible to avoid the agent's personal liability. 13
On the private respondent's contention that the promissory notes
were delivered to him in blank for his signature, we rule otherwise.
A careful examination of the notes in question shows that they are
the stereotype printed form of promissory notes generally used by
commercial banking institutions to be signed by their clients in
obtaining loans. Such printed notes are incomplete because there
are blank spaces to be filled up on material particulars such as
payee's name, amount of the loan, rate of interest, date of issue
and the maturity date. The terms and conditions of the loan are
printed on the note for the borrower-debtor 's perusal. An
incomplete instrument which has been delivered to the borrower
for his signature is governed by Section 14 of the Negotiable
Instruments Law which provides, in so far as relevant to this case,
thus:
Sec. 14. Blanks: when may be filled. Where the
instrument is wanting in any material particular, the person
in possesion thereof has a prima facie authority to complete
it by filling up the blanks therein. ... In order, however, that
any such instrument when completed may be enforced
against any person who became a party thereto prior to its
completion, it must be filled up strictly in accordance with
the authority given and within a reasonable time...
Proof that the notes were signed in blank was only the self-serving
testimony of private respondent Fermin Canlas, as determined by
the trial court, so that the trial court ''doubts the defendant
(Canlas) signed in blank the promissory notes". We chose to believe
the bank's testimony that the notes were filled up before they were
given to private respondent Fermin Canlas and defendant Shozo
Yamaguchi for their signatures as joint and several promissors. For
signing the notes above their typewritten names, they bound
themselves as unconditional makers. We take judicial notice of the
COMMREV - NEGO
A. INTRODUCTION
5 CASES
In the 1ight of the foregoing analysis and under the plain language
of the statute and jurisprudence on the matter, the decision of the
respondent: Court of Appeals absolving private respondent Fermin
Canlas is REVERSED and SET ASIDE. Judgement is hereby rendered
declaring private respondent Fermin Canlas jointly and severally
liable on all the nine promissory notes with the following sums and
at 16% interest per annum from the dates indicated, to wit:
Under the promissory note marked as exhibit A, the sum of
P300,000.00 with interest from January 29, 1981 until fully paid;
under promissory note marked as Exhibit B, the sum of P40,000.00
with interest from November 27, 1980: under the promissory note
denominated as Exhibit C, the amount of P166,466.00 with interest
from January 29, 1981; under the promissory note denominated as
Exhibit D, the amount of P367,000.00 with interest from January 29,
1981 until fully paid; under the promissory note marked as Exhibit
E, the amount of P86,130.31 with interest from January 29, 1981;
under the promissory note marked as Exhibit F, the sum of
P140,000.00 with interest from November 27, 1980 until fully paid;
under the promissory note marked as Exhibit G, the amount of
39