Carandang v Heirs of de Guzman

GR No. 160347, November 29, 2006

FACTS:

 Quirino de Guzman and the Arcadio and Luisa Carandang are stockholders as
well as corporate officers of Mabuhay Broadcasting System (MBS for
brevity), with equities at fifty four percent (54%) and forty six percent (46%)
respectively.
 November 26, 1983, the capital stock of MBS was increased, from P500,000
to P1.5 million and P345,000 of this increase was subscribed by the spouses
Carandang.
 March 3, 1989, MBS again increased its capital stock, from P1.5 million to P3
million, spouses yet again subscribed to the increase. They subscribed to
P93,750 worth of newly issued capital stock
 De Guzman claims that he paid for part of the said subscriptions in the amount
of P293,250 for the November 26, 1983 capital stock increase and P43,125 for
the March 3, 1989 Capital Stock increase or a total of P336,375. He sent a
demand letter to the spouses on March 31, 1992.
 The spouses refused to pay the amount, contending that a pre-incorporation
agreement was executed between Arcadio Carandang and de Guzman,
whereby the latter promised to pay for the stock subscriptions of the former
without cost, in consideration for Arcadio Carandang’s technical expertise, his
newly purchased equipment, and his skill in repairing and upgrading
radio/communication equipment therefore, there is no indebtedness on their
part.
 De Guzman filed his complaint for the recovery of the aforementioned amount
and damages. The trial court decided in favor of De Guzman and ordered the
payment of the total amount plus interest and attorneys fees and the cost of the
suit.
 The spouses appealed the decision to the CA but CA affirmed the trial court’s
decision.

ISSUES:

 Whether or not the RTC Decision is void for failing to comply with Section
16, Rule 3 of the Rules of Court
 Whether or not the RTC should have dismissed the case for failure to state a
cause of action, considering that Milagros de Guzman, allegedly an
indispensable party, was not included as a party-plaintiff
 Whether or not respondents were able to prove the loan sought to be collected
from petitioners
 Whether or not the liability of the spouses Carandang is joint and solidary.

HELD:

 On the first issue, the court did not commit any error since lack of jurisdiction
over the person of the parties may be waived and in this case the heirs of De
Guzman did not interpose any objection and even claimed and subjected
 themselves to the jurisdiction of the court. Therefore, even if no valid
substitution in compliance with Section 16, Rule 3 of the Rules of Court, such
act of the heirs in subjecting themselves to the jurisdiction of the trial court is
deemed an express waiver made by them thus making the proceedings of the
court valid.
 On the second issue, the answer is still No. The SC held that the joint account
of the spouses from which the 4 checks were drawn is part of their conjugal
property and thus under the Civil Code and the Family Code the husband
alone may file an action to recover or protect the spouses’ conjugal property.
 In this second issue, the spouses interchanged real party in interest and
indispensable party, as Milagros de Guzman is not an indispensable party and
simply a real party in interest, and thus her not being included will not
invalidate the proceedings.
 On the third issue, Yes the respondents were able to prove the loan sought to
be collected from petitioners
 The spouses Carandang admitted that it was indeed the de Guzmans who paid
their stock subscriptions and their reason for not reimbursing the latter is the
alleged pre-incorporation agreement, to which they offer no clear proof as to
its existence.
 The spouses claim that payment of one party of the obligation of another party
will not give rise to a loan
 SC Held that the spouses are incorrect. This is pursuant to Articles 1236 and
1237 of the Civil Code, which provide: Art. 1236. The creditor is not bound to
accept payment or performance by a third person who has no interest in the
fulfillment of the obligation, unless there is a stipulation to the contrary.
Whoever pays for another may demand from the debtor what he has paid,
except that if he paid without the knowledge or against the will of the debtor,
he can recover only insofar as the payment has been beneficial to the debtor.
 The heirs have successfully proved their payment of the amount in favour of
the spouses but the latter have not proved the existence of the pre-
incorporation agreement they are relying on for non-payment.
 On the last issue, the spouses are to be held liable in their capacity as
representatives of the conjugal partnership and as such either of them may be
sued for the full amount similar to solidary liability, although such amount to
be collected shall be charged to the conjugal partnership property.