DBP vs.

Adil
Petition for Certiorari to Review CFI Iloilo decision

Facts:

On Feb. 10, 1940, spouses Patricio Confesor & Jovita Villafuerte obtained agricultural loan from
DBP in the amount of 2k payable in 10 years. Unable to pay despite of 3 times of promises, DBP
filed complaint against spouses, inferior court decided in favor of DBP & thus ordered spouses
to pay debt + interests. CFI Iloilo reversed the decision & dismissed complaint against the
spouses. Also, a motion for reconsideration filed by the DBP was denied.

Issues & Ratio:

1. WON rights of prescription of promises may be waived

Held:

CFI decision reversed, CC Art. 1112 Rights to prescription may be tacitly renounced resulting
from acts w/c imply abandonment of such rights. Prescription only bars the remedy that is the
payment of the debt, but not the debt itself. The new promise made by Confessor constitutes a
new cause of action.

DBP vs. Adil

Petition for Certiorari to Review CFI Iloilo decision

Facts:

On Feb. 10, 1940, spouses Patricio Confesor & Jovita Villafuerte obtained agricultural loan from
Agricultural & Industrial Bank (AIB w/c is now DBP). Amount is P2k evidenced by a promissory
note payable in 10 equal yearly amortizations. After the aforesaid period, they were still not
able to pay. On April 11, 1961 Confesor, who was then a member of Congress, issued a 2nd
promissory note acknowledging the loan & promising to pay on or before June 15, 1961. He
further agreed to the foreclosure of the mortgage if & when he fails to pay. Another stipulation
is that if he secures certificate of indebtedness from government for his back pay, hell be
allowed to pay amount out of it. Yet, they were still not able to pay on the assigned date. On
Sept. 11, 1970 DBP filed complaint against spouses, inferior court decided in favor of DBP &
thus ordered spouses to pay debt + interests. CFI Iloilo reversed the decision & dismissed
complaint against the spouses. Also, a motion for reconsideration filed by the DBP was denied.

Issues & Ratio:

1. WON rights of prescription may be waived or renounced. YES

a. CC Art. 1112 Rights to prescription may be tacitly renounced resulting from acts w/c imply
abandonment of such rights.

b. True that prescription has set in as to the 1st promissory note. However, 2nd
promissory note, acknowledged such debt & even promised to pay the same thereby, rights to
prescription was effectively & expressly renounced.

c. Villaroel vs. Estrada Debt barred by prescription cant be enforced by creditor. But a new
contract recognizing & assuming prescribed debt would be valid & enforceable.
d. Remember, prescription only bars the remedy that is the payment of the debt, but not
the debt itself. The new promise made by Confessor constitutes a new cause of action.

2. WON 2nd promissory note is binding on the conjugal partnership. YES

a. CFI claims its not binding pursuant to new CC Art. 166: unless wife is spendthrift, serving civil
interdiction or confined in leprosarium, husband cant alienate/encumber real prop of CP
w/o her consent. Court may compel her to give such if she refuses to do so.

b. But CC Art. 165 provide that husband is administrator of CP & thus, all debts & obligations he
contracted for the benefit of the CP are chargeable to the CP. He signed 2 nd promissory note for
the benefit of the CP, thus, CP is liable for obligation.

Held:
CFI decision reversed & set aside. City Court decision reinstated.