OBLICON DIGESTS
RONQUILLO V. CA
“Individually and Jointly” = Solidary obligation; enforceable against one of numerous
obligors
Facts:
 Ronquillo, Offshore Catertrade Inc, Johnny Tan and Pilar Tan liable for
dishonored checks issued for Antonio So
 LC—Compromise Agreement: Pay claims Jointly and Individually
(P110,000) payable in 2 different periods
 Motion for execution for judgment
 Petitioner and Pilar Tan tendered P13,750 each: Pro rata share of initial
payment of P55,000
 Amount was subsequently withdrawn by So
 LC: Writ of Execution against Johnny Tan and Catertrade Inc
 Reconsideration: Moved for modification of Execution : Claim of entirety
against all defendants jointly and severally
 Petitioner claims: Liability was not expressly declared to be solidary, he is
only liable for the pro-rata share payable by each
 Court grated writ of execution stating that payment is a condition sine qua
non for lifting of preliminary attachment and execution of affidavit of
resistance
 1980: Writ was issued for the collection of P82,500 against their properties
including that of petitioner’s
 Special Sheriff sent a notice of sale of properties to the petitioners to fully
satisfy the entire obligation
 CA: Case was filed prematurely, remedies not yet exhausted
ISSUE:
WON THE CONTRACT ENTERED INTO IS SOLIDARY
HELD: YUP
 Art 1207: The concurrence of two or more debtors in oone and the same
obligation does not imply that each one of the former has a right to
demand or that each one of the latter is bound to render entire compliance
with the prestation. There is solidary liability only when the obligation
expressly so states or when law or nature of the obligation requires
solidary
 Art 1208: If from law or nature or wording of the obligation to which the
preceding article refers the contrary does not appear, the credit or debt
shall be presumed to be divided into as many equal shares there are
creditors and debtors, the credits or debts being considered distinct from
one another, subject to the rules of court governing multiplicity of suits
 LC Decision: “defendants individually and jointly agree to pay within a
period of 6 months from Jan 1980 or before June 1980
 Clearly, by express term of compromise agreement and the decision based
upon it, the defendants obliged themselves their obligation individually
and jointly.
 Term individually = “collectively” “separately” “distinctively” or
“severally” ; undoubtedly it creates a several obligation
 A several obligation is one by which one individual binds himself to
perform the whole obligation
MALAYAN INSURANCE CO INC V. CA
Insurance Company cannot be made solidarily liable with tortfeasors
Insurance company by virtue of subrogation could claim from other tortfeasors
Facts:
 1967: Malayan Insurance insured Sio Choy’s jeepney
 It figured into an accident with a passenger bus owned by PANTRANCO
 Injured: Driver (Died) and Vallejo (Private Respondent)
 Vallejo ordered Sio Choy, Malayan Insurance and PANTRANCO to jointly
and severally pay medical expenses and damages
PANTRANCO’S CLAIM
- Negligence: with the Jeepney driver
- Observed diligence of good father of a family in the selection and
supervision of employees
SIO CHOY an MALAYAN
- Denied liability
- Fault and injury directly imputable against PANTRANCO
SIO CHOY
- Paid Vallejo P5,000 for hospital and other expenses
- Malayan Insurance obligated itself to indemnify claims (Demands
reimbursement)
MALAYAN
- Claims from San Leon Rice Mill Inc (Employer of the driver) Art 2180
 TC: Jointly and severally (Sio Choy, Malayan, San Leon)
 CA : Affirmed : (it ruled however that San Leon Rice Mill has no obligation
to indemnify or reimburse petitioner insurance company since it is not a
privity to the contract of insurance between S and M
ISSUE X HELD
 OBLICON DIGESTS
WON INSURANCE COMPANY COULD BE HELD SOLIDARILY LIABLE WITH
SIO CHOY AND SAN LEON—NO
 Only respondent Sio Choy and San Leon Rice Mill Inc could be solidarily
liable to Vallejos for damages awarded.
 Sio Choy liable as owner of ill fated jeep pursuant to Art 2184
 2184: owner solidarily liable with driver if the former could have used due
diligence to prevent misfortune
 San Leon Rice Mill is liable for being the employer of the driver under
2180
 2180: employers shall be liable for damages caused by employees and
household helpers acting within their assigned task
 Sio Choy and San Leon Rice Mill are the principal tortfeasors who are
primarily liable to respondent Vallejos
 Law states that responsibility of 2 or more persons who are liable for
quasi-delict is solidary
 Petitioners liability is its insurance contract with Sio Choy
 If petitioner is adjudged to pay respondent Vallejos in the amount of not
ore than P20,000, this is on account of bein the insurer of Sio Choy under
the third party liability clause
 While it is true that where the insurance contract provides for indemnity
against liability to third persons, such third persons can directly sue the
insurer.
 However, directly liability of insurer under indemniy contract against
liability does not mean that insurer can be held solidarily liable with
insured and/or third parties found at fault
 Petitioner as insurer of Sio Cho is liable to respondent Vallejos but it
cannot be held “solidarily” liable with 2 principal tortfeasors
 In solidary obligation, creditor may enforce the entire obligation against
one of the solidary debtors
 Insurance: contract whereby one undertakes for a consideration to
indemnify another against loss, damages, or liability arising from
unknown or contingent event
 Amount stated in insurance policy : only P20,000 (x) P29,103
WON PETITIONER HAS RIGHT OF CLAIM AGAINST SAN LEON--YUP
 Subrogation is a normal incident of insurance contracts
 Upon loss, insurer is entitled to be subrogated pro tanto any rigt of action
which insured may have against 3rd person whose negligence or wrongful
act caused loss
 Such right does not dependend upon nor does it grow out of privity of
contract
 It is subrogated to whatever rights the latter has agaist San Leon Rice Mill
 Art 1217 :
Payment made by one of the solidary debtors extinguishes obligation. If 2
or more solidary debtors offer to pay, the creditor may choose which to
accept
He who made payment may claim from his co-debtors only the share
which corresponds to each, with the interest of payment made. If payment
is made before the debt is due, no interest for intervening period may be
demanded
 In accordance with Art 1217: petitioner upon payment of Vallejos and
thereby becoming a subrogee of solidary debtor Choy is entitled to
reimbursement from San Leon : ½ of P29,103
RIZAL COMMERCIAL BANKING CORP V. CA
Corporate Officer held Solidarily liable with corporation under Surety
Agreement ; Contract expressly provides
Facts:
 Alfredo Ching: signed a Comprehensive Surety Agreement with RCBC,
binding himself jointly and severally guarantee the prompt payment of all
PBM (Phil. Blooming Mills) Obligation with RCBC : P40,000
 PMB Obligations :P7,982,619.08
 RCBC filed a complaint for collection of money from RCBC and Ching
PBM Clams
- Maturity dates extended until the end of stipulated dates (Customary
practice of RCBC with PBM
 PBM filed a petition for suspension of payments and rehabilitation with
SEC
 SEC Granted
 All claims pending before courts are suspended for SEC to pass upon
feasibility of rehabilitation plan
 RCBC still pursued RCBC and Ching, it contended that the two had not
denied their indebtedness to RCBC
 CFI—RCBC & Ching: Jointly and Severally liable for P7,982.619.08
 CA—precipitate and improper for lower court to have continued with
proceedings despite SEC Order of suspension
RCBC Claims
 OBLICON DIGESTS

- SEC injunctive order pertains and affects only PBM, the corp under  1983(1st agreement) Construction and Service Agreement : Quiombing and
rehabilitation and that it is the right, as a creditor, to proceedagainst Biscocho bound themselves to jointly and severally construct the house of
Ching, a surety, who is not affected by said order Saligo for P137,940
- To hold that injuctive order applicable to both would deprive RCBC of  1984(2nd agreement) Quiombing and Saligo : Acknowledgement and
its right to proceed against Surety based on latter’s separate and Completion of house and payment of balance in manner prescribed by said
independent undertaking agreement
PBM and Ching  Saligo : Promisory note P125,363.50 (Amount still due)
- Liabilities incurred by PBM were corporate in character and hence as a  Quiombing filed for recovery (Charge and Interest against Saligo)
corporate officer, CHing could not be held liable.  Saligo, instead of filing an answer moved to dismiss the case because
ISSUE: Biscocho is an indispensible party as co-plaintiff
WON CA ERRED IN RULING THAT RCBC CANNOT ENFORCE ITS CLAIM  TC: Dismissed :: Cannot decde withoit Bischocho whose rights will
AGAINST CHING, A SURETY necessarily be affected since he is part of the first party in contract
HELD: NO  CA:: Affirmed Original Agreement : Second agreement referred to, is
 ART 1207 : Where an obligation expressly states a solidary liability, the merely a part of the original agreement
concurrence of two or more creditors or two or more debtors in one and Tolentino:::
the same obligation implies that each one of the former has a right o Joint Obligation Solidary Obligation
demand and that each one of the latter is bound to render the entire Each debtor is liable only for the Each debtor is liable for the entire
compliance with the prestation proportionate part of debt and each obligation and each creditor is
 Art 1216: The creditor may proceed against any one of the solidary debtors creditor is entitled only for a entitled to demand the whole
or some or all of them simultaneously proportionate part of credit obligation
 There exist a Comprehensive Surety Agreement between RCBC and Creditor can recover only his share of Each creditor can enforce the entire
respondent Ching ---liability binds Ching as he is bou by the said contract obligation obligation and each debtor is obliged
 He is charged as an original promisor by virtue of the primary obligation to pay in full
under the Surety Agreement Active Solidarity
 That Ching acted for and on behalf of PBC is not supported by evidence Authority of each creditor to claim and enforce the rights of all, with the
nor pleadings on record resulting obligation of paying every one what belongs to him; there is no
 Liability therefore may not be restricted unless expressly so stated merger, much less a renunciation of rights but only mutual representation
 SEC injuctive order can not effect a suspension of payment of respondent ISSUE:
Surety’s due and demandable obligation, it being clear therefrom that the WON BISCOCHO AS SOLIDARY CREDITOR IS AN INDISPENSIBLE PARTY
rehabilitation receivers were limited to “taking custody and control over FOR THE COLLECTION OF DEBT
all existing assets and property of PBM HELD: NO
QUIOMBING V. CA  Question of who should sue was a personal issue between Quiombing and
Art 1212: Each one of the solidary creditors may do whatever may be useful to
Biscocho in which the spouses Saligo has no right to interfere
the others but not anything which may be prejudicial to the latter
Art 1214: Debtor may pay any of the solidary creditors; but if any demand,  It did not matter who between them filed the complaint because private
judicial or extrajudicial what has been made by any one of them, payment respondent were liable to either of the two as a solidary creditor for the
should be made to him whole amount of debt
Facts:  It was not necessary for both Quiombing and Biscocho to file complaint, it
will be a useless formality
 OBLICON DIGESTS
 Art 1212: Each one of the solidary creditors may do whatever may be
useful to the others but not anything which may be prejudicial to the
latter
 Art 1214: Debtor may pay any of the solidary creditors; but if any demand,
judicial or extrajudicial what has been made by any one of them, payment
should be made to him
 If Quiombing eventually collects the amount due from solidary debtors,
Biscocho may later claim his share thereof, that decision is for him alone
to make
 Possibility that private respondents might plead breach: premature to
consider and even remote
 Respondent court was correct in ruling that 2nd agreement which was
concluded alone by petitioner with private respondents was based on
original construction and service agreement.
 Indispensible = interest in the controversy that a final decree would
necessarily affect their rights so that court cannot proceed without their
presence
 J: Feria- where obligation of parties is solidary, either one of the parties is
indispensible and the other is not even necessary because complete relief
may be obtained from either.
 Quiombing as as solidary creditor and by himself alone enforce payment
of construction cost by private respondents.
REPUBLIC PLANTERS BANK V. CA
Negotiable instruments law : persons who write their names on the face of a promissory
note are makers and are liable as such. By signing the notes, maker promises to pay to
order of the payee or any holder
Change in name (x) change in liability
“I”,”We” Either of Us” promise to pay = solidarily liable
Facts:
 IAC Decision: Pinch Manuf Co (Former Worldwide Garment Manuf Inc) ,
Shozo Yamaguchi and Fermin Canlas : PAY JOINTLY AND SEVERALLY
P300,000 with interest until fully paid
 Only Fermin appealed: Claiming that he should not be held liable as he
signed only in his capacity as officer of World Wide, he should both be
made personally liable
Contention of RPB
- 1979: Having unconditionally signed the 9 promissory notes with
Yamaguchi (Pres/Chief Operating Officer) , jointly and severally :
Fermin (Treasurer) is solidarily liable with Yamaguchi on each of the
9 promissory notes
- They were authorized to apply for credit facilities with RPB in forms
of export advances and letters of credit/trust receipts
- Bottom margin: Printed names with “In his personal capacity”
 1982 : Chage of name Worldwide Garment Manuf Inc -> Pinch Manuf Corp
Fermin Claims
- Not of Pinch
- Issued said promissory notes in behalf of Worldwide, same was in
blank, typewriter entries not appearing prior to affixing signature
ISSUE:
WO PRIVATE RESPONDENT FERMIN IS SOLIDARILY LIABLE WITH OTHER
DEFENDANTS (PINCH AND YAMAGUCHI)
HELD: YUP
 Femin is solidarily liable with other defendants bearing his signature in
said document
 Negotiable instruments law : persons who write their names on the face of
a promissory note are makers and are liable as such. By signing the notes,
maker promises to pay to order of the payee or any holder
 Fermin: one of the makers
 “I promise to pay” = Joint & Severally :: Solidarily liable
 In this case, solidary liability is even made clear by the words “Joint and
several describing unconditional promise to pay”
 “in his personal capacity” (x) affect liability, with or without it, he is
primarily liable as a co-maker
 Change of name (x) New Corp : It is the same corp with a different name,
no change in its property, rights and liability
 GR: Officers or directors under the old corp name bear no personal
liability for acts done or contracts entered into by officers of the corp if
duly authorized.
 Change of name – continuation of old juridical entity, it is still bound by
its agents
 Signing document w/o indicating “acting in a represtative capacity” / 3rd
party for who he might have acted as agent = agent personally liable to
holder and cannot be permitted to prove that he was merely acting as
agent of another
 Proof that document was signed in blank = self-serving
 Note was not incomplete, therefore Sec 14 of NIL (x) applicable
 Judgment is hereby rendered declaring private respondent Canlas jointly
and severally liable on all 9 promissory notes with 16% interest per annum
 OBLICON DIGESTS

INCIONG JR. V. CA  Thus for parol evidence rule to apply a written contract need not be in any
Facts: particular form or be signed by both parties
 RTC decision: affirmed by CA: Inciong Solidarily liable to pay P50,000 to  As a general rule, bills, notes and other instruments of similar nature are
PBC not subject to be varied and contradicted by parol or extrinsic evidence
 Liability: Promissory note of P50,000 signed with Naybe and Pantanosas :  Fraud must be established by clear and convincing evidence, mere
holding themselves jointly and severally liable to PBC preponderance of evidence (x) adequate
 Due date expired, therefore PBC sent petitioners telegrams demanding Claim:
payment thereof - Release of Naybe, the principal debtor and Pantanosas (co-maker) =
 Both Obligors did not respond : complaint for collection of P50,000 releases him from obligation
against 3 debtors were filed - Art 2180 “the guarantors, even though they be solidary, are released
Inciong Claim: from their obligation whenever by some act of the creditor, they
- He was persuaded to be a Co-maker for only P5,000 (Business) cannot be subrogated to the rights, mortgages and preferences of the
- 5 copies of bank promissory notes were filed up by employing fraud, latter”
trickery and misrepresentation  It should be noted however that petitioner signed the promissory note as a
 LC: odd for petitioner have indicated in a copy and not the original that solidary co-maker and not as a guarantor
his supposed obligation is P5,000 only; even granting that said limited  A solidary or joint and several obligation is one which each debtor is liable
amount had actually een agreed upon, same would have been merely for the entire obligation and each creditor is entitled to demand the whole
collateral between him and Naybe and therefore not binding upon private obligation
respondent as creditor bank  Art 2047: by guaranty, a person called as guarantor binds himself to the
 CA: affirmed creditor to fulfill the obligations of the principal debtor in case the latter
CLAIMS should fail to do so .
- Promissory note was signed in Office of Judge Pantanosas, outside the  If a person binds himself solidarily, with the principal debtor, the
premises of bank provision of Sec 4, Chapt 3, Title I of this book shall be observed
- Lon was ncurred for purpose of buying a secondhand chainsaw which Guarantor Solidary Debtor
cost only P5,000 Binds himself I solidum with the Two or more debtors in one and the
- Even a new hainsaw would cost only P27,500 principal debtor under the provisions same obligation, the presumption is
- Loan had no collateral of 2nd par does not become solidary that the obligation is join so that each
- Petitioner and Judge Pantanosas were not present at time loan was co-debtor to all intents and purposes of the debtors is liable only for a
released proportionate part of debt. There is
- Notices of default, sent simultaneously but no notice was sent to him solidary liability only when obligation
- Signing promissory note, his consent was vitiated by fraud, loan was expressly so states when law so
for the amount of P5,000 only and not P50,000 provides or when nature of obligation
ISSUE: so requires
WON INCIONG IS LIABLE FOR THE PAYMENT OF DEBT Outside liability, he assumes to pay No other rights than that bestowed
HELD: YES the debt before the property of upon him by Sec 4, Chapt 3 Title I,
 What is required is that the agreement be in writing as the rule is in fact principal debtor has been exhausted Book IV of CC
founded on log experience that written evidence is so much more certain retains all the other rights, actions
and accurate than that which rests in fleeting memory only that it would and benefits which pertain to him
be unsafe when parties have expressed the terms of contract I writing
 OBLICON DIGESTS
 Promissory note involved expressly states that three signatories are jointly
and severally liable, any one, some or all of the may be proceeded against
the entire obligations
 The choice is left to the solidary creditor to determine against whom he
will enforce the entire collection
 Dismissal of case against Judge Pantanosas may no be deemed as having
discharged petitioner from liablility as well
 As regards Naybe, suffice it is to state that the court never acquired
jurisdiction over him
 Petitioner therefore may onnl have recourse against his co-makers
TIU V CA
Facts:
 Petitioner Rosalina and George Tiu (mother and son)filed an action for
reformation of contract, delivery of personal property and damages before
RTC against Juan Go and Spouses Juanito Lim and Lim Lee Show Fong
Allegations of complaint
- George Tiu is the registered owner of 2 Condo Units
- 1986: George and Rosalina Tiu negotiated loan of P300,000 with Juan
Go (asked for mortgage of the aforesaid Condo units as security for
payment and in addition a pledge of jewelries and checks from
plaintiff Tiu)
- Juan Go ageed to extend loan without any fixed period of re-payment
and with further condition that plaintiffs shall have ample time to pay
when demanded and they can remain in possession of condo
- Juan Go prepared, based on condo certificates a Deed of Sale of Condo
with right to repurchase and another contract of lease prepared in
favor of defendant Juanito Lim and Lim Lee Show fog , while latter
was prepared in favor of George Tiu
- When such document was presented, he asked why there was a need
to include other parties in the contract, loan was purely between
George Tiu, Rosalina Tiu and Juan Go
- Juan Go reasoned out that : he cannot carry real estate property in his
own name as he is a Chinese National and that there was no harm in
covering instruments as the agreement of mortgage intend to secure
the loan will always prevail George Tiu signed
- Deed of Sale of Condo with right to repurchase and contract of lease
were later verified before notary and registered by defendant’s agent
with registry of deeds
- From execution of document, George and Rosalina Tiu remained and
continue to remain in possession said Condo unit as lessee
- The real intention of parties n the transaction was covered by Deed of
Sale of Condo units with right of repurchase being a mortgage and not
a sale, plantiff George Tiu is entitled to redemption of property as
sanctioned by Art 1601 of CC
- After lapse of the unlawful period of repurchase stated in Deed of Sale
of Condo with right of repurchase, plaintiff Tiu ried to redeem
mortgaged condo but defendants refused redemption of condo as well
as the jewelries
- Defendant Juan Go and Juanito Lim acted I bad faith, unlawfully and
contrary to agreement ;
Spouses Lim claims:
- By virtue of George Tiu’s failure to exercise right of repurchase,
spouses irrevocably acquired absolute ownership of units,
GO
- Tius incurred various loans with the amount much greater than sum
of P200,000 alleged in complaint which remained unpaid
- Tius had not offered or given any security to answer of paument for
loans and bligations
- Tius transaction with Spouses Lm, should thus be treated separatetly
and distinctly from various loan transactions between him and Tius
- Rosalina Tiu secured loan advances in total amoung of P1,060,000.00
which remained unpaid despite demands
Tiu
- Money received, but loans had already been paid for by Tabocco
delivered to Go
Go
- Joquin Tiu, in behalf of Tius received money as loan in the total
amount of P700,000 for which Joaquin Tiu should be held jointly and
severally liable with Tius
 TC: Complaint of plaintiiffs dismissed; Tiu ordered to pay Juan Go
P1,060,000:: issue Condo Cert : in the name of Juanito Lim and Lm Lee
Show Fong
 CA: affirmed
 Appellant Tiu admitted not only the due execution, genuineness and
authenticity of deed of sale of condominium with right to repurchase and
contract of lease
 OBLICON DIGESTS

 Appelants Tiu admitted that hey have updated the real estate txes due on
the condominium only up to the time of transaction after which they had
never paid anymore taxes thereon
ISSUE: WON TIUS ARE LIABLE SOLIDARILY
HELD: NO
 Deed of sale with right of repurchase was drawn up in favor of Spouses
Lim instead of mortgage with Go as creditor-mortgagee because Go can
not own real estate being a Chinese citizen re-echoig that aliens are not
disqualified from being mortgagees of real estate property
 We shall not disturb the ruling of CA that George and Joaquin Tiu are not
solidarily liable with Rosalina Tiu in the amount of P1,600,000
 George Tiu never signed the receipts nor received any money from
appellant Go while Joaquin Tiue signed and received he money for and in
behalf of Rosalina
 They are not liable solidarily for said amounts even if money were used for
their Tobacco business
 Even if they admitted that they received the money, both are not liable in
solidum
 There is solidary obligation only when obligation expressly so states or
when law or nature of obligation requires solidarity(Art 1207)
 No truth in the allegation that George and Joaquin Tiu admitted that they
are jointly and solidarily liable for said amount
 Only Rosalina Tiu received monies
 Assuming arguendo that they admitted their solidary liability, still they
are not liable
 (Un Fak Leang v Nigurra) admission of two debtors in their brief that their
liability in the contract is a solidary one does not convert the joint
character of their obligation as appearing in the contract, for what
determines the nature of obligation is the tenor of the contract itself, not
the admission of parties.