ARANETA vs.

DE JOYA
G.R. No. L-25172. May 24, 1974.

FACTS:
Ace Advertising filed a case against Antonio R. De Joya for the recovery of P5,043 that was illegally
disbursed and use to pay the salary of an employee in an unauthorized trip abroad.

Respondent Joya argued that as the general manager of the company, he was authorized to perform
such acts if it was for the good of the company and that his actions were with the knowledge of the
company vice president Vicente Arpanet and treasurer Luis Araneta who respectively signed the
checks disbursed.

RTC held Joya sole responsible.

CA, on appeal, held both Joya and Aranetas solidary liable for paying the company based on Art
2194 of the Civil Code

Issue:
Whether or not CA ruling is correct.

Held:
Supreme Court held to rule to uphold the Court of Appeals decision.
Petitioner's assertion that he signed the questioned payroll checks in good faith has not been
substantiated, he in particular not having testified or offered testimony to prove such claim. Upon the
contrary, in spite of his being a vice-president and director of the Ace Advertising, the petitioner
remained passive, throughout the period of Taylor's stay abroad, concerning the unauthorized
disbursements of corporate funds for the latter. Plus the fact that he even approved thrice payroll
checks for the payment of Taylor's salary demonstrate quite distinctly that the petitioner neglected
to perform his duties properly, to the detriment of the firm of which he was an officer. The fact that
he was occupying a contractual position at the Ace Advertising is of no moment. The existence of a
contract between the parties, as has been repeatedly held by Supreme Court, is not a bar to the
commission of a tort by one against the other and the consequent recovery of damages