Task Performance

In Partial Fulfillment of the Requirements

In the Subject BM1707
Business Law (Oblication and Contracts)

To be Submitted to

Barundia, Lorela

Submitted by

MARTICIO, JOYCE ANN MENDEZ

Date of Submission: 06 March 2021

Make a digest for each of the following cases.
A digest is a summary of the Supreme Court cases. It has three (3) parts: facts, issue, and
ruling. The facts part consists only of the essential facts relevant to the ruling in the case
while the issue should be relevant to the topic under which the case belongs. The ruling
should answer the issue raised in the case.

1.) ASUNCION vs. CA, G.R. NO. 109125, December 2, 1994

FACTS: Ang Yu Asuncion filed a complaint for Specific Performance against Bobby

Cu Unjieng and Jose Tan.  The complainants were tenants or renters in Binondo's residential and
commercial areas. On a number of occasions, the defendant has informed the complainants that
she offers and prioritizes the sale of the property. Cu Unjieng offered P6 million during
negotiations, while the complainants made an offer of P5-million.  The complainant subsequently
asked the accused in writing to submit their offer for accession to the defendants. In answer of the
letter of the defendant, the complainants wrote requesting that the conditions of the sale offer
should be specified. If the complainants received no reply, they sent the same request by another
letter. As the defendant could not indicate the terms and conditions of the selling offer, the
complainant was obliged to file the complaint to compel the defendant to sell the property, and
the accuser received information that the defendant was about to sell the property. The Court
rejected the complaint because of the failure of the parties to agree on the conditions of the
proposed sale, so no contact existed at all for the sale. The Cu Unjieng wives have carried out a
sales document transferring the land claim to the Buen Realty and Development Corporation. As
the new owner to the property. Buen Realty wrote to the locators that the latter were to leave the
property. In its reply, it stated that Buen Realty and Development Corporation brought the
property subject to the notice of lis pendens.

ISSUE: Can the complainant oblige the defendant to execute in lawsuits the necessary
Deed of Sale of the property to the complainant having a right of first refusal?

RULING: NO, a "right of first refusal" was the final judgement in favor of the
complainant. The result of this statement does not involve anything more than what has been said
previously. Finally, if the applicants, as it is thus communicated to us, Claimants are aggrieved of
the failure to honor the right to first refuse by private respondents, the remedy does not constitute
a declaration of execution concerning the judgment as none exists but a claim of damages for the
purposes of an appropriate forum.

2.) DBP vs. CONFESSOR, G.R. NO. L -48889 May 11, 1989

FACTS: The partners of the Agricultural and Industrial Bank, which is now
Development Bank of the Philippines, Patricio Confesor and Jovita Villafuerte received the
agricultural loan for P2,000 on the 10th of February 1940, as demonstrated by a promissory note
dated on that occasion by which they jointly and severally paid the amount in ten equal annual
amortizations. Since this obligation was not paid even after the period of 10 years, on 11 April
1961, Confessor, who was then a member of the Congress of the Filipinos, expressly
acknowledged this loan and promises to pay it on or before 15June 1961. The second
promissory note was issued. At the fixed date, spouses have still not paid the obligation.
Therefore, on 11 September 1970 the DBP submitted a complaint to the Iloilo City Court.
Payment of partners was ordered by the city court. It was upheld by Iloilo's CFI.
 ISSUE: Is it valid or not to execute a promissory note which is already prohibited on a
prescription, taking into account the prior promissory notice?

RULING: Yes, the second promissory note has been valid because it does not merely
recognize the debt that has already been prescribed by that promissory note. Rather, the payment
of the debt is a new agreement. A new promise is a new cause for action. Although a prescriptive
debt is enforceable, it will be valid and enforceable to acknowledge and accept a new agreement
to the prescribed debt.

3.) PELAYO V. LAURON 12 Phil. 453

FACTS: An action against Marelo Lauron and Juane Abellana was filed on 23
November 1906 by a doctor named Arturo Pelayo. The claimant was summoned to provide
medical help to the defendant's daughter-in-law, that was about to give birth, on the night of
October 13 of that year. After Dr. Escafio's consultation, it was considered hard for the operation
for the childbirth but irrespective of the fact that Dr. Pelayo did his job on it and also removed the
post-birth. The operation continued until morning, several times on the same day and charged the
defendants for P500, which they decided not to pay for. In response of the petition, the
defendant's counsel denied all the allegations, and accused that her daughter in law was dead as a
result of her childbirth, that when she was alive she lived separately with her husband, and in a
different house, unrelated to them. And that if she was at the time of the complaint, she was in the
defendant’s house. Consequently he pleaded for the accused to be acquitted by the petitioner at
costs.

ISSUE: Whether the defendants are obliged or not, to pay their daughter-in-law's medical
assistance provided by the claimant.

RULING: No. In accordance with Article 1089, obligations shall be established by law,
by contract, by quasicontract, by illegal actions or omissions or by any other kind of fault or
negligence. Law-related obligations are not presumed. The exclusively claimable ones are those
explicitly defined in the code or in special laws, etc. Contractual obligations are legally binding
and are to be fulfilled as stated by the contracting parties.   The provision of medical support in
the event of sickness was one of the mutually binding duties of mutual support for the spouses. If
each obligation is to give, or to do something and if the spouses are bound together to support
each other, there is no question, however, that if either of them is in need of healthcare due to
illness, the other is in inevitable need of providing physician services in order to rehabilitate
health. Thus, all costs, including the fees of the healthcare professional, were the responsibility of
the party obliged to provide such support.

4.) METROPOLITAN BANK AND TRUST COMPANY vs. ANA GRACE ROSALES
AND YO YUK TO, G.R. No. 183204, January 13, 2014.

FACTS: Petitioner Metrobank is a properly organized domestic banking company and

operates under Philippine law. Answer Rosales is the owner of a travel agency, and Yo Yuk To is
her mother. A joint Peso account10 with the Pritil-Tondo Branch of complainants was opened in
2000. In May 2002, Rosales responded to the petitioners' branch in Escolta by accompanying
their client, Liu Chiu Fang, a Taiwanese national applying for the Philippine Leisure and
Retirement Authority (PLRA) retirement visa. As the respondent officer Rosales acted as a
translator for her since Liu Chiu Fang was able to speak only Mandarin. A Joint Dollar Account
with an original deposit of US$14,000 was initiated on 3 March 2003 by the respondents from the
Pritil-Tondo Branch of the petitioner. A "Hold Out" order against the accounts of the respondents
was issued by the petitioner on 31 July 2003. The petitioner submitted, on 3 September 2003, a
criminal case to the office of the Manila Prosecutor for Estafa through misrepresentation,
misrepresentation and the use of fake documentation through his Special Audit department head
Antonio Ivan Aguirre, but Rosales refused to take part in Liu Chiu Fang's deceitful and
unauthorized withdrawal from his dollar account. A settlement dismissing a criminal case for lack
of probable cause, was issued by the Office of the City Prosecutor of Manila on 15 December
2003 and  with infringements and damages contracts were filed before the RTC in Manila on 10th
of September 2004.

ISSUE: Does Metrobank has infringed its agreement with respondent Rosales?

RULING: Yes. The Court found that the agreement for deposit account application and
agreement is misplaced for Metrobank's reliance on the "hold-out" clause. The depositor must be
paid on request for deposits in banks that fall under the nature of a simple loan or mutual funds.
The “hold out” clause only applies if there is a valid and existing duty under the law, contracts,
quasi contracts, delict and quasi-delict arising from any source of obligations listed herein. In this
case, the petitioner was unable to demonstrate that respondents were obliged under all legislation,
contracts, quasi-contracts, crimes or virtual crimes. While the petitioner filed a criminal
proceeding against Rosales, the reason for the petitioner's request is still in pending and no final
conviction against Rosales was issued. This is not sufficient for him to issue a "hold-out" order.
Actually, it should be noted that the criminal case had not yet been filed when the complainant
filed the "Hold-Out" order. There was thus no legal basis for the complainant to issue the order
"Hold Out" given that the respondent was not liable under any of these five sources of obligation.
We therefore agree with the RTC's and the CA's conclusions that in the instant case the clause of
the "Hold Out" does not apply. The Court decided that the petitioner had unjustifiably declined to
release the deposit of the intimate, even though the petitioner requested a breach of the contract.
The petitioner is liable for damages after breaking his contract with the respondents.

5.) ADILLE vs. CA, G.R. NO. 124378

FACTS: The original owner of the property in question was Felisa Alzul who married
twice. Rustico Adile's first marriage and the respondents Emetria Asejo et al. She made her
second marriage. Felisa Alzul sold the estate in a retro contract with a repurchase period of three
years during her lifetime. Before she was able to buy the property, Felisa died. Rustico Adille
repurchased the property for his sake and then carried out the extrajudicial partition act, which
represents himself as his only mother's heir and child, Felisa. As a consequence he could secure
title by himself. The respondent his half-sisters filed a partitioning and accountability proceeding
arguing that, when he redeemed the land, Rustico could only be a trustee of the implicit trust and
thus not take sole ownership of all the properties.

ISSUE: Whether a co-owner can or cannot acquire sole ownership of a common

property and whether Rustico himself was a negotiator.

RULING: No. In relation to his share, the right to repurchase may be exercised by the
co-owner. Although Rustico Adille had completely redeemed the property, the costs had not
made him the owner.
 Yes. The petitioner acquired land in respect of his co-herds, and was a negotiorum
manager pursuant to Article 2144 of the Civil Code, or for his exclusive benefit, whereby the
petitioner was guilty of fraud and had to serve as trustee.

6.) ANDRES vs. MANUFACTURERS HANOVER & TRUST CORPORATION, G.R. NO.
82670 September 15, 1989

FACTS: Petitioner Metrobank is a properly organized domestic banking company and

operates under Philippine law. Answer Rosales is the owner of a travel agency, and Yo Yuk To is
her mother. A joint Peso account10 with the Pritil-Tondo Branch of complainants was opened in
2000. In May 2002, Rosales responded to the petitioners' branch in Escolta by accompanying
their client, Liu Chiu Fang, a Taiwanese national applying for the Philippine Leisure and
Retirement Authority (PLRA) retirement visa. As the respondent officer Rosales acted as a
translator for her since Liu Chiu Fang was able to speak only Mandarin. A Joint Dollar Account
with an original deposit of US$14,000 was initiated on 3 March 2003 by the respondents from the
Pritil-Tondo Branch of the petitioner. A "Hold Out" order against the accounts of the respondents
was issued by the petitioner on 31 July 2003. The petitioner submitted, on 3 September 2003, a
criminal case to the office of the Manila Prosecutor for Estafa through misrepresentation,
misrepresentation and the use of fake documentation through his Special Audit department head
Antonio Ivan Aguirre, but Rosales refused to take part in Liu Chiu Fang's deceitful and
unauthorized withdrawal from his dollar account. A settlement dismissing a criminal case for lack
of probable cause, was issued by the Office of the City Prosecutor of Manila on 15 December
2003 and  with infringements and damages contracts were filed before the RTC in Manila on 10th
of September 2004.

ISSUE: Does Metrobank has infringed its agreement with respondent Rosales?

RULING: Yes. The Court found that the agreement for deposit account application and
agreement is misplaced for Metrobank's reliance on the "hold-out" clause. The depositor must be
paid on request for deposits in banks that fall under the nature of a simple loan or mutual funds.
The “hold out” clause only applies if there is a valid and existing duty under the law, contracts,
quasi contracts, delict and quasi-delict arising from any source of obligations listed herein. In this
case, the petitioner was unable to demonstrate that respondents were obliged under all legislation,
contracts, quasi-contracts, crimes or virtual crimes. While the petitioner filed a criminal
proceeding against Rosales, the reason for the petitioner's request is still in pending and no final
conviction against Rosales was issued. This is not sufficient for him to issue a "hold-out" order.
Actually, it should be noted that the criminal case had not yet been filed when the complainant
filed the "Hold-Out" order. There was thus no legal basis for the complainant to issue the order
"Hold Out" given that the respondent was not liable under any of these five sources of obligation.
We therefore agree with the RTC's and the CA's conclusions that in the instant case the clause of
the "Hold Out" does not apply. The Court decided that the petitioner had unjustifiably declined to
release the deposit of the intimate, even though the petitioner requested a breach of the contract.
The petitioner is liable for damages after breaking his contract with the respondents.

7.) NAPOCOR vs. CA, G.R. NO. 124378, March 8, 2005

FACTS: "Prescribing Measures To Preserve Lake Lanao Watershed, Areas

Around Reservation Below Lake Seven Hundred Two Meet and Other Purposes" has been issued
by the Philippine President's Office. The decree is no. 398. In this decree, the NPC ordered the
Agus Regulation Dam to be built at the mouth of the Agus River in Lanao del Sur, at the normal
highest water level of Lanao Lake, at 702 meters above sea level. The petitioner constructed and
operated the dam in 1978 accordingly. Hadji Abdul Carim Abdullah and Caris Abdullah, private
respondents, owned fish ponds in Barangay Bacong, Marantao Municipality and Lanao del South,
while Hadji Ali Langco and Diamel Pangcatan, private interviewees, managed to built fish ponds
in the same province, Poona-Marantao. These were all fish ponds located on the banks of Lanao
lake. The lakes' water level grew and the lakeshore area flooded, all of which was washed away
in October and November 1986. Private respondents accused the flood of the 1978 NPC-built
Agus Regulation Dam. The NPC was arguing that even with heavy rainfall, the water supplies
could not be increased even as the lake level rose. Respondents wrote individual letters to R.B.
Santos, the vice-chairman of the NPC based in the city of Iligan in Ditucalan. They sought help
and compensation for each one of them's damages. The NPC argued that from 1974 to 1983
visual monuments and benchmarks had been established around the lake to prevent private
interviewees from making any improvements below the 702-metre-level, as prohibited. The
private intimates brought a claim for damages to the Marawi City RTC without any other
recourse.

ISSUE: Does the Court of Appeals made a mistake by affirming the court's judgment
that the petitioner was legally accountable for the damages suffered by the personal respondent?

RULING: No. The responsibility lies with Napocor. With regards to its task of
maintaining the lake's normal max. level at 702 meters, the Court of Appeal has noted with regret
that, as rainy season raises, the NPC should release additional water into the Agus River to
prevent flooding and to prevent it from rising above the maximum water levels. The Court of
Appeal took up a decision of the Court of First Instance.Without clear explanation what the
floods in the adjacent properties of the Dam might have explained otherwise, it is reasonably to
bear in mind that the incident was due to the failure of the NPC to maintain the water level of the
Dam at maximum 702 meters in normal lake elevation. When the res ipsa loquitur doctrine is
applied, it speaks for itself and becomes clear. Where the cause of the injury appears to be under
the defendant's control and the accident is such that in normal course it doesn't take place if the
managing directors have proper care, it offers reasonable proof that the accident was caused by a
lack of care in the absence of an explanation from the defendant. The dam was built in 1978 but
only in July and August 1984 the benchmarks had been set up, with a large number of
benchmarks apparently worn out to be replaced in October 1986. Many farms and homes were
already swamped at this time, and many fish ponds, including private individuals, were damaged.
The New Civil Code, Article 2176 states that that "Anyone who is responsible for the
compensation of any damage done to another person by act or omission, be it failure or
negligence. This liability or failure is referred to as a quasi-criminality, where there is no pre-
existing contractual relationship between the parties." Both the Court of Appeal and the Court of
Appeal consistently held that the NPC directly caused such negligence in the fisheries of private
respondents

8.) PHOENIX ASSURANCE COMPANY OF NEW YORK, MCGEE & CO., INC., G.R.
NO. 162467, May 8, 2009

FACTS: Del Monte Philippines, Inc. contracted the stevedoring company Mindanao

Terminal and Brokerage Services, Inc. to load and stock a cargo shipment for M/V Mistrau, with
fresh green Philippine bananas and fresh apples from Del Monte Fresh Produce International, Inc.
The ship was at the harbor. The goods were to be carried in favor of the consignee Taegu
Industries Inc. to the harbor of Inchon, Korea.  The ship sailed from Davao's port and reached
Inchon port, Korea. On the discharge of  the cargo, it was then found to be in poor condition. The
Incok Loss and Average Adjuster of Korea's Marine Cargo Damage Surveyor examined the
extent of ship's damage along with its representative Byeong Yong Ahn. In a survey report
16,069 banana cartons and 2,185 pineapple cartons were reported to be such a damage that their
commercial value was no longer in place.The Mindanao Terminal was brought to action
by Phoenix and McGee for damages. After the trial, RTC concluded that the Mindanao Terminal
only participated in the loading of cargoes by the M/V Mistrau under the supervision and
management of the officers of the ship who did not accept cargoes on the ship and signed the
report of the overseer unless the cargo was correctly organized and tightly sealed to withstand
open seas travel. Accordingly, after loading and storing the cargos, Mindanao Terminal cannot be
held responsible for anything that happened. In addition, the RTC found in a survey report that
the cargo's damage was caused by a typhoon encountered by M/V Mistrau during the trip. It also
was found that the Mindanao Terminal had no cause of action since the latter, which was
contracted by Del Monte, a company distinct from Del Monte Produce, did not have a contract
with the Del Monte Produce. The latter had not been contracted by the company. The RTC
rejected the complaint and requested that Mindanao Terminal receive a countersuit in the amount
of P83,945.80 as actual damages and P100,000.00 as attorney’s fees.

ISSUE: Whether Mindanao Terminal is liable for exceptional diligence in the cargo's
transportation and storage.

RULING: No, Mindanao Terminal, as a stevedore in this case, is only responsible for
loading and storing freight from pier into the cargo carrier of the ship. It has never been the
caretaker of the Del Monte product shipment. A stevedore isn't a common carrier, because it
carries goods or passengers and it does not store goods for profit.  The Court of Appeal was
called by Phoenix and McGee. The Court of Appeal reversed the decision and set aside The same
court ordered Mindanao Terminal to pay "totals of $210,265,45 plus statutory interest for Phoenix
and McGee from the submission of the complaint to full payment and 20% for lawyers' fees."
Phoenix and McGee argued that the damage to the cargoes had been caused by inappropriate
storage by the Mindanao Terminal.  In its resolution of 26 February 2004, the Court of Appeal
denied Mindanao Terminal motion for a reconsideration.

9.) SPOUSES CHIN KONG WONG CHOI AND ANA O. CHUA VS. UNITED COCONUT
PLANTERS BANK, G.R. No. 207747. March 11, 2015

FACTS: Chin Kong Wong Choi and Ana O. Chua, Choi's Spouse, entered into a selling
contract with Primetown Property Group, Inc., a domestic company engaged in the construction
and development of condominiums.  It provides for Partners Choi's consent to the acquisition
from Primetown of the condominium unit no. A-322, with a down payment of P100,000.00 and
the balance remaining of 40 in the same monthly payments of P26,292.97, between 16 January
1997 and 16 April 2000, at a time of considering P151,718.75. A Commercial Bank duly
established and operational under the Philippine Legislation, the United Coconut Planters Bank
(UCPB), respondent, executed a Memorandum of Agreement, sale of receivables, as well
as, right and interest agreement with Primetown on April 23, 1998. The Agreement provided for
Primetown's assignment of all receivables from Primetown's Kiener in consideration of
P748,000,000.00 to UCPB, "in conjunction with its assignment of all privileges, titles,
engagement and interest to UCPB, and to assign all the units covered by, or emanating from, the
Contracts to Sell out of which the receivables are derived." The accounts of the Spouses Choi,
which claimed on February 3, 1999 that they paid a monthly allowance to UCPB, have been
included in the assigned accounts receivable. In the case of the Regional Field Office of the
Housing and Land Use Regulatory Board (HLURB), the Spouses Choi filed a refund of money,
with interest and damages on Primetown and UCPB on 11 April 2006. Spouses Choi claimed that
Primetown failed to complete the construction of Kiener and deliver the condominium unit to
them in regardless of their full full payment.

ISSUE: Whether UCPB assumed Primetown's obligations and duties under its contract
with Spouses Choi, pursuant to the Agreement between Primetown and UCPB.

RULING: It is stated in a decision of 29 November 2006 that only the condominium

unit accounts payable had been transferred to UCPB. The fact that UCPB only received part of
the consideration after the assignment of claims, would not make it unjust to order UCPB to
refund all payments made by the Choi Spouses. In view of both Spouses Choi, UCPB and
Primetown were liable and of Primetown's corporate rehabilitation, HLURB RFO VI held it
appropriate, to wit, that the proceedings should be suspended.The transfer of credit to another
person, known as the obligor, who acquires the authority to enforce the loan as the obligor could,
to the same degree as the obligor, have been defined as an agreement in accordance with which
the creditor, is completely liable for a legal reason, such as the sale, dation of payment
or exchange or donation, and without the obliger's consent. The obligations between the
obligor and the creditor will in any event depend on the legal relation on which the agreement is
based. In accordance with the building rules generally applicable to contracts, an agreement shall
be construed in the first place to always verify and fulfill the intention of the parties. This aim is
to be derived from an analysis of the instrument as a whole, which should be applied in the words
and the language employed in all parts of it.

10) PHILIPPINE COMMERCIAL INTERNATIONAL BANK (now BDO UNIBANK

INC.), vs. ARTURO P. FRANCO, substituted by his heirs, namely: MAURICIA P.
FRANCO, FLORIBEL P. FRANCO, AND ALEXANDER P. FRANCO, R.R. No. 180069,
March 5, 2014 (1271)

FACTS: A 51-year-old respondent then made the decision to save money and to invest
his money he earned hard for his retirement. His savings have been deposited with the plaintiff's
bank mainly because of the latter description that he actually provides for his future by making
such investments since his investments will be mixed, combined and automatically roll-over for
better returns and which will satisfy his requirements on retirement and without further measures
being taken by him. Several Trust Indenture Certificates were secured by the bank. At some point
in 1995, the respondent found that one of his children had leukemia and during the subsequent
medication and treatment, he had to spent lots of his money that as his money was already
drained, the respondent then went to the Certificates of trust and began to ask about how he could
covert the trust into cash. At first, the defendant bank consistently asked for time to check and
promised to receive a response in ahead of time of 15 July 1998. However, on 22 June, the
complainant received a letter from the obligor counsel denying payment requests by stating that
all PCIBank trust indenture certificates were rendered null and void by virtue of the conversion of
all remaining PCIBank trust accounts into common trust certificates. The claimant also argues
that the action under appeal had already begun. Claimants are now hoping for the payment, as
well as interest, moral and exemplary damaged costs and fees, of amounts under the Trust
Indenture Certificates.

ISSUE: Whether the petitioner claims the relief he is seeking.

RULING: Yes, in Civil Law the burden of proof is on anyone who calls for payments.
Petitioner was unable to provide documents or evidence to prove that the four TICs have been
paid or cancelled, or that the participation of the respondents was already withdrawn. With all
these conclusions, the CA concluded that a prescription is not still prohibited for the respondent’s
claim, as the express trust established between the parties did not end with the maturity of the
four TICs. There is a great deal of jurisprudence in civil cases where the burden of proving
payment exists. Even if the complainant must claim non-payment the rule is that it will be the
defendant who will demonstrate payment instead of the claimant who will show non-payment. If
the creditor has the credit document, he must not prove that he is unpaid because he is presumed
to be not payed. The creditors who have the debt proof are proof that the debt is not paid out.

11. ) CESAR V. AREZA and LOLITA B. AREZA VS. EXPRESS SAVINGS BANK, INC. and
MICHAEL POTENCIANO. G.R. No. 176697, September 10, 2014

FACTS: Cesar V. Areza and Lolita B. Areza maintained two bank deposits with the
Biñan branch of Respondent Express Savings Bank. They were involved in the "buy and sell"
business of new and second-hand cars. Their order to purchase a Mitsubishi Pajero and a brand
new Honda CRV from some Gerry Mambuay was issued on 2 May 2000. Mambuay, a purchaser,
paid petitioners with nine PVAO checks payable to various payees, each of them valued at
P200,000.00, for a total of P1,800,000.00. On this opportunity, the petitioners alleged that the
respondent's branch manager, Michael Potenciano Express Savings Bank, was available during
the transaction and offered the bank's services immediately for the processing and possible
crediting of such checks. Such checks were deposited in the Bank's savings account with the
complainants. In turn, the bank deposited the checks in Biñan, Laguna, with its depository,
Equitable PCI Bank. The Issuer, the Philippine Veterans Bank who honored the checks, received
the checks from Equitable-PCI Bank. The petitioners were informed that their checks had been
paid to the bank. He claims the petitioners have warned that the checks only relate to the
availability, and do not mean that they have not been informed about the checks. The subject
checks were returned to the Issuer by PVAO some time in July 2000, because the amount on the
checks has changed from P4,000.00 to P200,000.00. The checks have been originally carried out.
The Bank has been informed that the dragon has dishonored the controls on the basis of material
changes by Equitable-PCI Bank. By supplying copies of the documents provided by the bank's
depositary, the Bank insisted that in August 2000 it informs the complainants. The petitioners, on
the other hand, claimed that the Bank had never informed them of the improvements. A check of
P500,000.00 was issued by the petitioners on 9 March 2001. For the reason of "Deposit Under
Hold," the bank dishonored this check. The Bank unilaterally and illegally placed its bank
account on hold, according to complainants. The petitioners have filed complaints against the
Bank and Potenciano regarding the alleged unreasonable and unfounded dishonor of their checks
and the illegally and unilaterally withdrawal from their savings accounts. In the case at issue,
when they dealt with P1,800,000,00 from the petitioners' accounts the court characterized those
acts as badly attended by respondents. A request for reconsideration was submitted by the
respondents while defendants submitted a request to be executed on the grounds that the RTC
decision on the basis that the motion for reconsideration by the respondents did not comply with
Article 5, Rule 16 of the Rules of Court. RTC granted the request for reconsider, set the Poza
decision aside, and revoked the complaint by Judge Pairing Romeo C. De Leon. The Court
awarded the respondents their counterclaim of P100,000.00 in moral and exemplary damages.
Initially, in the motion for reconsideration by the Court, the principle of liberality was applied
when it disregarded the suspected absence of a hearing. On the facts, the Court considered the
Bank's relations with complainants as a loan agreement with the bank as debtor, and petitioners as
creditors as their savings accounts deposits. The Court of Appeal confirmed the trial court's ruling
on appeal, but deleted the granting of damages. The petitioners have submitted a petition to
review the procedural and substantive issues raised by certiorari.
 ISSUE: Whether or not the Honorable Court of Appeal in violating the Laws of Civil
Procedure has committed a serious error of law and abuse of discretion in maintaining the legality
and/or ownership of the motion of reconsideration

RULING: Petitioners claim that the communication to the Court has been sent not to the
adverse party, as required by the rules, but to the Clerk of the Court. The petitioner added que
later than 10 days were scheduled for the hearing on the motion of reconsideration. As stated in
Maturan v. Araula, when copied to the counsel of the opponent of the request for reconsideration,
combined with the fact that the Court of Justice acting on that notice of hearing, and issued the
order establishing the hearing of the motion on 26 March 2004, the rule required that a notice be
addressed to the opposing party was substantially complied with. In this case, the Issuing
bank, the Philippine Veterans Bank is only liable before change. The Philippine Veterans Bank
may return liabilities as they did to the Equitable-PCI Bank, the receiving bank, because it paid
the altered amount of the checks. Ultimately liability of the materially modified check is borne by
the recovering banks, Equitable-PCI Bank and the Bank. The petitioner cannot be held liable for
any further failure to show negligence on the part of the petitioners that contributed significantly
to the loss due to the change. Only irrelevant as long as it has ordered the obligors  to pay the
petitioner together and severally, we affirm the Pozas decision, which is the amount withdrawn
from this latter account. The finding of fraudulent misrepresentation on the part of the
respondents and its failure to comply with the 24-hour clarification rule are not in accordance
with this decision. The request must therefore be granted.

12. ) LEONARDO BOGNOT, vs. RRI LENDING CORPORATION, REPRESENTED BY ITS

GENERAL MANAGER, DARIO J. BERNANDEZ, G.R. No. 180144, September 24, 2014

FACTS: RRI Lending is a lending company that is the respondent, a company that
provides money to Metro Manila's lenders. Applications and loan of five hundred thousand pesos
P500,000 was received from the respondents by the petitioner and his younger brother, Rolando
A. Bognot. The loan was shown with a bill and secured with a post-dated check. Records show
that several times on a monthly basis the petitioner renewed the loan. For every renewal, he paid
a renewal fea of P54, 600.00, issued a new post-dated security check to carry out or renew the
previously issued promissory note. On the other hand, the respondent canceled and returned the
postdated checks issued before renewal to the petitioner. The petitioner requested a renewal of the
loan. He executed again as director of the Promise Note and signed it. The petitioner also issued a
BPI Check as security for the loan. A number of days before the loan matured, Julieta Bognot,
Rolando's wife, went to the office of the defendant and applied to have the loan renewed. She
issued a P54,600.00 renewal fee check for the respondent Promissory and International Bank
Exchange (IBE). Mrs. Bognot asked her clerk to release the promissory note, the statement and
the check for the Bognot brothers, on the excuse she needs to bring back the loan papers for
signatures and replacement of the Bognot siblings. However, Mrs. Bognot never returned the
documents and never issued a new post-dated check. As a result, the intimate sent a letter
requesting payment, plus interest and penalty charges to the petitioner. The demands were not
taken into account. The intimate lodged a complaint against the Bognot siblings via Bernardez for
money in the Regional Trial Court (RTC). The respondent alleges mainly that the loan renovation
requested by the Bognot siblings remains unpaid and that Bognot's siblings do not pay their joint
and solidarity obligations despite repeated demands.

ISSUE: Whether or not payment extinguished the obligation of the parties.

 RULING: No, The law tells us that it is up to the defendant to prove the payment, rather
than the claimant to prove that the payment is nonpayment. After all, the burden of demonstrating
with legal certainty that the obligation has been paid off by payment lies on the debtor when the
existence of a debt has been duly proved. In the present case, the petitioner failed to demonstrate
satisfactorily that the payment extinguished his obligation. As the CA rightly observed, there is
no evidence that the respondent actually cashed his check and applied the revenue to pay the loan.
The petitioner did not provide evidence. He neither submitted official payment receipts, nor proof
of the dishonoring of the check. Article 1249(2) of the Civil Code provides for the transmission
of promissory notes, bills of exchange, or other commodifices only when cash or the fault of the
creditor has impaired them. The delivery shall only result in an effect of payment. We also had
the rule that payment has to be made in a legal tender, settled at Bank of the Philippine Islands v.
Spouses Royeca. There is no legal tender for a check, and therefore a valid tender for payment
cannot be made. Since a negotiable tool is just a replacement for money and not for money, it
does not by itself serve as payment to deliver such a tool. Under a judgment, mere delivery of
checks does not fulfill the obligation. The obligation shall not be extinct and shall remain
suspended until payment is actually made by commercial document.