G.R. No.
L-9146 January 27, 1959 Butterssed on the foregoing provision of law and the aforequoted
TERESA VDA. DE FERNANDEZ, ET AL., plaintiffs-appellants,
vs.
THE NATIONAL LIFE INSURANCE COMPANY OF THE
PHILIPPINES, defendant-appellee.
Jose G. Macatangay for appellants.
E. V. Filamor for appellee.
ENDENCIA, J.:
Appeal from a decision of the Court of First Instance of Manila
applying the Ballantyne scale of values upon the proceeds of life
insurance taken and maturing during the Japanese occupation but
claimed after liberation.
It is undisputed that on July 15, 1944, the National Life Insurance
Company of the Philippines insured the life of Juan D. Fernandez for
the sum of P10,000 under Policy No. 16346 upon payment by the
latter of the amount of P444 for the period from July 15, 1944, to July
14, 1945, the beneficiaries thereof being his mother Teresa Duat Vda.
de Fernandez and his sisters Maria Teresa Fernandez and Manuel
Fernandez. The insured died on November 2, 1944, at Muntinglupa,
Rizal, while the policy was in force.
After a lapse of more than seven years, or on August 1st, 1952, Atty.
Alberto L. de la Torre, in representation of the beneficiaries, wrote the
company advising it that and insured had died in 1944, and claimed
the proceeds of the policy. On August 21, 1952, the company
answered Atty. De la Torre stating that inasmuch as the status of the
policies issued during the Japanese occupation was still pending
consideration before the courts, it would like to know whether the
beneficiaries represented by him were willing to compute the value of
their claim under the Ballantyne scale of values. There was no reply
to this inquiry, but on July 9, 1954, the beneficiaries presented instead
proofs of death of the insured and at the same time filed Statement
Exhibit G claiming the amount of P10,000. On July 21, 1954, the
company advised the beneficiaries that inasmuch as the policy
matured upon the death of the insured on November 2, 1944, the
proceeds should be computed in accordance with the Ballantyne
scale, which amount only to P500. In view of this, the beneficiaries
commenced suit on August 6, 1954, but the lower court sustained the
stand of the company and dismissed the complaint, awarding
however to plaintiffs the sum of P500 in Philippine currency, without
interest; hence the appeal.
Appellants vigorously maintain that the obligation of the company to
pay the proceeds of the insurance accrued not upon the death of the
insured on November 2, 1944, but only upon receipt and approval by
the company, at its Home Office, of proof of death of the insured,
which was on July 9, 1954 in accordance with the provision of the
policy which reads —
National Life Insurance Company of the Philippine hereby agrees to
pay at its Home Office, Manila, Ten Thousand Pesos to Juan D.
Fernandez (hereinafter called the insured) on the 15th day of July,
1964, if the Insured is living and this Policy is in force, or upon receipt
and approved at its Office of due proofs of the title of the claimant and
of the prior death of the Insured while this Policy is in force to Teresa
Duat Vda. De Fernandez, Maria T. and Manuela Fernandez, mother
and sisters respectively of the Insured (Hereinafter called the
Beneficiary) subject to the right of the Insured to change the
beneficiary as stated on the second page of this Policy.
The above stipulation is apparently based on Sec. 91-A of the
Insurance Law which provides as follows:
The proceeds of a life insurance policy shall be paid immediately upon
maturity of the policy, unless such proceeds are made payable in
installments or a as an annuity, in which case the installments or
annuities shall be paid as they become due: Provided, however, That
in case of a policy maturing by the death of the insured, the proceeds
thereof shall be paid within sixty days after presentation of the claim
and filing of the proof of the death of the insured. Refused to pay the
claim within the time prescribed herein will entitle the beneficiary to
collect interest on the proceeds of the policy for the duration of the
delay at the rate of six per centum per annum, unless such failure or
refusal to pay is based on the ground that the claim is fraudulent . . . .
stipulation as well as on the allegation that the filing of proof of death
by the beneficiaries is a condition precedent of the demandability of
the obligation of the insurer to pay the proceeds, appellants claim that
they should be paid P10,000 in Philippine currency and not under the
Ballantyne scale of values.
We find appellants' contention untenable. In life insurance, the policy
matures either upon the expiration of the term set forth therein in
which case its proceeds are immediately payable to the insured
himself, or upon his death occuring at any time prior to the expiration
of such stipulated term, in which case, the proceeds are payable to
his beneficiaries within sixty days after their filing of proof of death
(Sec. 91-A Insurance Law). In the case at bar, the policy matured
upon the death of the insured on November 2, 1944, and the
obligation of the insurer to pay arose as of that date. The sixty-day
period fixed by law within which to pay the proceeds after presentation
of proof of death is merely procedural in nature, evidently to determine
the exact amount to be paid and the interest thereon to which the
beneficiaries may be entitled to collect in case of unwarranted refusal
of the company to pay, and also to enable the insurer to verify or check
on the fact of death which it may even validly waive. It is the happening
of the suspensive condition of death that renders a life policy matured
and not the filing of proof of death which, as a above stated, is merely
procedural, for even if such proof were presented but if turns out later
that the insured is alive, such filing does not give maturity to the policy.
The insured having died on November 2, 1944, during the Japanese
occupation, the proceeds of his policy should be adjusted accordingly,
for
The rule is already settled that where a debtor could have paid his
obligation at any time during the Japanese occupation, payment after
liberation must be adjusted in accordance with the Ballantyne
schedule (De Asis vs. Agdamag, 90 Phil., 249; Ang Lam vs.
Peregrina, 92 Phil., 506; Wilson vs. Berkenkotter, 92 Phil., 918; 49
Off. Gaz. No. 4 1401; Samson vs. Andal de Aguila, 94 Phil., 402).
(Valero vs. Sycip, L-1119. May 23, 1958.)
Appellants vehemently invoke our ruling in the case of Salvacion B.
Londres vs. The National Life Insurance Company of the Philippines,
94 Phil., 627 wherein, although the policy matured during the
Japanese occupation, we allowed the proceeds to be paid in the
present legal tender. That case, however, is not applicable to the
present. In that case the insured, Jose Londes, and his two sons were
massacred by Japanese soldiers on February 7, 1945, while the battle
for the liberation of Manila was still raging and downtown offices,
including that of the appelle, were closed for the duration. Thus we
declared:
It may therefore be said that the policy became due when the city of
Manila was still under the yoke of the enemy and became payable
only after liberation which took place on March 10, 1945, when
President Osmeña issued Proclamation No. 6 following the
restoration of the civil government by General Douglas MacArthur.
And we say that the policy became payable only after liberation even
if it matured sometime before, because before that eventuality the
insurance company, appellant herein, was not yet in a position to pay
the value of the policy for the simple reason that it has not yet
reopened. . . .
In the present case the Home Office of the appellee was open for
business until the last days of January, 1945, and had business
transactions not only with the bank but also with its customers before
its closure, and as a matter of fact had been making payments of
claims as they were presented. The policy in question having matured
on November 2, 1944, same could have been processed and paid
before the company closed its Home Office in January, 1945.
Appellants argue that they could not have presented their claim and
proof of death during the Japanese occupation even if they wanted to
because they knew that the deceased was insured only after liberation
when the policy was handed to them by Mr. Pablo P. Gabriel, a
business partner of the deceased. The delay in the presentation of
proof of death does not make any difference, for it does not alter the
date of maturity of the policy nor the ability of the company to pay the
proceeds of the insurance during the Japanese occupation. Moreover,
it is through no fault of the company that such delay was incurred. At
any rate, irrespective of whether there was delay or not in the filing of
proof of death, the hard fact remains that the policy matured and was
payable during the Japanese occupation, and under the doctrine in
the Valero vs. Sycip case, supra, payment should be adjusted in
accordance with the Ballantyne scale of values.
Finding no error in the decision appealed from, and there being no
question raised as to the adjusted amount of P500 under the
Ballantyne schedule, judgment affirmed, with costs.
EN BANC
[G.R. No. L-5921. March 29, 1954.]
SALVACION B. LONDRES, plaintiff and appellee, v. THE NATIONAL
LIFE INSURANCE COMPANY OF THE PHILIPPINES, Defendant-
Appellant.
This is an appeal from a decision of the Court of First Instance of
Manila ordering defendant to pay to plaintiff the sum of P3,000,
Philippine currency, plus legal interest thereon from the time of the
filing of the complaint until its full payment.
On April 14, 1943, the National Life Insurance Company of the
Philippines issued a policy on the life of Jose C. Londres whereby it
undertook to pay its beneficiary upon his death the sum of P3,000. All
the premiums due under the policy were actually paid on their dates
of maturity and the policy was in force when the insured died on
February 7, 1945. Salvacion B. Londres, as beneficiary, demanded
from the company the payment of the proceeds of the policy, and her
demand having been refused, she instituted the present action
against the company in the Court of First Instance of Manila.
Defendant in its answer denied, for lack of sufficient proof, the
allegation that the insured died on February 7, 1945, and set up the
following special defenses: (a) that plaintiff’s claim is covered by the
Moratorium Law; (b) that the policy having been issued during the
Japanese occupation, it is presumed that its face value should be paid
in Japanese currency, there being no provision in the policy from
which can be inferred that the parties contemplated payment in any
other currency; (c) that the money paid by the insured as premiums,
together with the money received from other policy-holders, was all
deposited by the defendant in the Philippine National Bank and said
deposit was declared without value by Executive Order No. 49 of the
President of the Philippines; and (d) that the policy having been issued
under abnormal circumstances, it should be considered in the light of
equity which does not permit anyone to enrich himself at the expense
of another. Defendant, however, as a proof of good faith, offered to
pay the value of the policy in accordance with the Ballantyne scale of
values, or the sum of P2,400, Philippine currency.
On April 15, 1952, plaintiff filed a motion for summary judgment
supported by an affidavit which contains a restatement of the
allegations of the complaint attaching thereto in support of the motion
certain annexes and affidavits which are intended to substantiate and
prove said allegations. Defendant, answering this motion, stated that
while it joins the plaintiff in her petition for summary judgment, it does
so only in so far as its defense of moratorium is concerned, but not as
regards the merits of the case because its answer raises questions of
fact which should be established, not by mere affidavits, but by
evidence duly presented in court. And on May 15, 1952, the court
rendered decision not only on the question of moratorium but on the
merits of the case, apparently disregarding the issue raised by
defendant as regards the necessity of presenting evidence on the
facts controverted by it in its answer. From this decision, the defendant
has appealed.
One of the errors assigned by appellant refers to the fact that the lower
court rendered judgment on the merits by virtue merely of the motion
for summary judgment filed by appellee without giving an opportunity
to appellant to present evidence on the facts on which, it alleges, its
answer and special defenses are predicated. Appellant contends that
the facts raised by its special defenses are "triable issues of facts"
which cannot be the subject of summary judgment unless established
by sufficient evidence, and that those facts are material to sustain its
point of view that it can only be made to pay under the policy an
indemnity in the amount of P2,400.
When appellee filed a motion for summary judgment upon her claim
she attached thereto in support of the motion certain annexes and
affidavits which were intended to substantiate and prove her
allegations. Appellant failed not only to interpose opposing affidavits
but announced to the court that it was joining the appellee in he
petition for summary judgment although it evinced its desire to present
evidence with regard to the questions of facts raised in its special
defenses. And acting on said motion, the lower court, after considering
the pleadings and affidavits submitted in support of the motion for
summary judgment, found that there was no substantial triable issue
of facts and concluded that the appellee was entitled to a judgment as
a matter of law. We find this to be in substantial compliance with the
rules (sections 1 and 2, Rule 36).
The material averments of the claim as regards the execution of the
policy, the payment of the premiums, and the death of the insured, are
not disputed. The only issues of fact which served as basis for the
opposition to the summary judgment are those raised in the special
defenses contained in the answer. But these facts are not material for
a decision on the merits, as correctly stated by the lower court, for
even if they are taken for granted the result would not materially
change the findings as to the question affecting the main claim. We
hold therefore that the lower court did not err in rendering a summary
judgment on the merits of the case.
The issue of moratorium, which was decided against the stand taken
by appellant, and which is also raised as one of the errors, has now
become moot in view of the ruling in the case of Rutter v. Esteban, 93
Phil., 68, wherein the Moratorium Law was declared invalid and
unconstitutional.
The main question to be determined refers to the amount to be paid
by appellant under the policy by way of indemnity to the insured.
Stated in another way, the question to be determined is whether the
amount of P3,000 which appellant bound itself to pay to the insured
under the policy upon his death should be paid in accordance with the
present currency or should be adjusted under the Ballantyne scale of
values. The answer to the question would depend upon the
interpretation to be placed on the facts surrounding the death of the
insured.
It appears that the deceased took up the policy under consideration
on April 15, 1943 for the sum of P3,000. All the premiums due under
the policy were actually paid on their dates of maturity and the policy
was in force when the insured died on February 7, 1945. On said date,
the battle for the liberation of the City of Manila was still raging. While
the northern part may have been liberated, not so the southern part,
as shown from the very affidavits submitted by appellee wherein it was
stated that on the aforesaid date, the insured, Jose Londres, and his
two sons were taken by the Japanese soldiers from their house at
Singalong Street and were massacred by their captors. It may
therefore be said that the policy became due when the City of Manila
was still under the yoke of the enemy and became payable only after
liberation which took place on March 10, 1945 when President
Osmeña issued Proclamation No. 6 following the restoration of the
civil government by General Douglas MacArthur. And we say that the
policy became payable only after liberation even if it matured
sometime before, because before that eventuality the insurance
company, appellant herein, was not yet in a position to pay the value
of the policy for the simple reason that it had not yet reopened. This
much the court can take judicial notice of, for during those days of
liberation, while the people were rejoicing because of the happy event,
the banks, the insurance companies, and for that matter other
commercial and business firms, were still feeling the adverse effects
of the sudden fall of values and were uncertain and apprehensive as
to the manner the readjustment would be made by the new
Government. It is for this reason that the beneficiary, after realizing
the truth about the death of her husband, and after gathering evidence
to substantiate his death, had difficulty in effecting the collection of her
claim from the insurance company because at that time it had not yet
reopened for business purposes. Although the record does not
disclose the exact date on which the insurance company reopened for
this purpose, this Court can take judicial notice that it only did so after
liberation. At that time the legal tender was already the present
currency.
However, it is an undisputed fact that the beneficiary submitted to the
company formally her claim and demanded payment thereof on May
16, 1949, attaching thereto sufficient proof of the death of the insured,
which claim however the company did not entertain, not because the
proof submitted was not sufficient in contemplation of law, but
because the policy was executed during the occupation and the
determination of its value has not yet been passed upon by the
Government. And following the provisions of our Insurance Law to the
effect that in case of maturity by death the proceeds are payable within
sixty days after the presentation of the claim and the filing of proof of
death, the conclusion is inescapable that from the point of view of the
insurance company, the proceeds of the policy became payable only
upon the expiration of that period. (Insurance Law, Section 91-A). In
this sense, this case may be likened to those already decided by this
Court wherein we said in substance that, where the parties have
agreed that the payment of the obligation will be made in the currency
that would prevail by the end of the stipulated period, and this takes
place after liberation, the obligation shall be paid in accordance with
the currency then prevailing, or Philippine currency. (Roño v. Gomez,
83 Phil., 890, 46 Off. Gaz., Sup. 11, 339; Gomez v. Tabia, 84 Phil.,
269, 47, Off. Gaz., 641.) We are, therefore, persuaded to conclude,
on the strength of these authorities, that the present claim should be
paid in accordance with the present legal tender, or the Philippine
currency.

With regard to the sufficiency of the proof presented by appellee as to

the death of the insured, we find that the same has been sufficiently
established in view of the death certificate issued by the Civil Register
of Manila on April 15, 1952, which was attached to the motion for
summary judgment. This certificate strengthens the proof submitted
by appellee on May 16, 1949 and as such it can serve as basis for the
determination of the interest that the company should pay under the
policy as required by law. (Insurance Law, Section 91-A). However,
the lower court, contrary to the claim of appellant, only required said
appellant to pay legal interest from the filing of the complaint until the
payment of the judgment.

As final plea, appellant invokes equity in its favor in view of the

nullification of the deposits made by it with the Philippine National
Bank of all fiat money received from its policyholders, which money
was declared without value by Executive Order No. 49 of the
President of the Philippines. Appellant claims that, considering the
unexpected circumstances that developed, the indemnity to be paid
by it should be ameliorated. This loss, painful as it is, should be
suffered by it under Article 307 of the Code of Commerce which
provides: "When the deposits are of cash, with a specification of the
coins constituting them, . . . the increase or reduction which their value
may suffer shall be for the account of the depositor." Moreover,
appellant, by entering into an insurance contract, cannot claim, if it
suffers loss, that the beneficiary cannot enrich herself at its expense.
This is a risk attendant to any wagering contract. 1 One who gambles
and loses cannot be heard to complain of his loss. To appellant, we
can only repeat the following admonition: "The parties herein gambled
and speculated on the date of the termination of the war and the
liberation of the Philippines by the Americans. This can be gleaned
from the stipulation about redemption, particularly that portion to the
effect that redemption could be effected not before the expiration of
one year from June 24, 1944. This kind of agreement is permitted by
law. We find nothing immoral or unlawful in it." (Gomez v. Tabia,
supra.)

Wherefore, the decision appealed from is affirmed, with costs

against Appellant.