As regards the liabilities of the defendants, there is no dispute that a credit line to the

maximum amount of P900,000.00 was granted to the defendant corporation on the

guaranty of the merchandise or stocks in goods of the said corporation which were
covered by chattel mortgage duly registered as required by law. There is likewise no
dispute that the defendants Syyap guaranteed absolutely and unconditionally and
without the benefit of excussion the full and prompt payment of any indebtedness
incurred by the defendant corporation under the credit line granted it by the plaintiff.
As of June 16, 1967, its indebtedness was in the total amount of P601,633.01. This
was admitted by defendant Antonio V. Syyap in the deed of real estate mortgage
executed by him. No part of the amount has been paid by either of the defendants.
Hence their liabilities cannot be questioned. (pp. 3-6, Brief for Appellee; p. 26, Rollo)

In their brief, appellants assign the following errors:

The lower court erred in not holding that the obligation secured by the Chattel
Mortgage sought to be foreclosed in the above-entitled case was novated by the
subsequent execution between appellee and appellant Antonio V, Syyap of a real
estate mortgage as additional collateral to the obligation secured by said chattel
mortgage.

II

The lower court erred in not dismissing the above-entitled case and in finding
appellants liable under the complaint.

III

The lower court erred in not holding that the writ of preliminary attachment is devoid
of any legal and factual basis whatsoever.

IV

The lower court erred in dismissing appellants'counterclaim and in not holding

appellee liable to appellants for the consequent damages arising out of a wrongful
attachment. (pp. 1-2, Brief for the Appellants, p. 25, Rollo)

Appellants admit that they are indebted to the appellee bank in the amount of P601,633.01,
breakdown of which is as follows: P568,577.76 as principal and P33,055.25 as interest. After the
filing of the case and during its pendency, defendant Antonio V. Syyap proposed to have the case
amicably settled and for that purpose a conference was held in which Mr. Antonio de las Alas, Jr.,
Vice President of plaintiff People's Bank and Trust Company, defendant Antonio V. Syyap and Atty.
Mendoza were present. Mr. Syyap requested that the plaintiff dismiss this case as he did not want to
have the goodwill of Syvel's Incorporated impaired, and offered to execute a real estate mortgage on
his real property located in Bacoor, Cavite. Mr. de las Alas consented, and so the Real Estate
Mortgage (Exhibit "A") was executed by defendant Antonio Syyap and his wife Margarita Bengco
Syyap on June 22, 1967. Defendants did not agree with plaintiffs motion to dismiss which included
the dismissal of their counterclaim and filed instead their own motion to dismiss (Record on Appeal,
pp. 68-72) on the ground that by the execution of said real estate mortgage, the obligation secured
by the chattel mortgage subject of this case was novated, and therefore, appellee's cause of action
thereon was extinguished.