FACTS:

 Defendant Torrento applied with NASSCO for the purchse on credit of 60

tons of steel for a 120-day period.
 A contract of sale executed was where subsequent amendments were from
price changes and specifications of the steel bars.
 In the contract it was stipulated that the value of the steel bars sold to
Torrento is secured by a surety bond issued by a bonding company
MUTUAL SECURITY INSURANCE CORPORATIO, the latter as surety and
Torrento as the principal debtor.
 When NASSCO could no longer supply the steel bars in the contract NASSCO
and Torrento executed a supplemental agreement.
 NASSCO was able to deliver to Torrento the steel bars in total value of 25,
794, unfortunately, the 120 day period for payment by Torrento LAPSED.
 Demand letters were sent but the surety company MUTUAL SECURITY
INSURANCE did not reply.
 Torrent requested for a 3 month extension to settle her accoun but still
failed to do so.
 The lower court ordered that Torrent and MUTUAL SECURITY INSURANCE to
jointly and severally pay NASSCO. Thereafter, Torrento will pay the surety
company whatever it had paid to NASSCO.
 Torrento maintains that plaintiff has no cause of action against her for the
reason that inasmuch as she had paid the corresponding premium on the
surety bond, the right of action, in case of her default, is exclusively against
her surety.
 The cause of action alleged in the cross-claim does not arise until after
payment has been made by the surety to the plaintiff.

Issue:
1. W/N NASSCO has a cause of action against Torrento and MUTUAL
SECURITY INSURANCE as the surety. - YES
2. W/N MUTUAL SECURITY INSURANCE was released from its liability because
there was a material alteration on the principal contract. – NO.
RULING:

The SC ruled that the SURETY BOND states that both principal and surety are held
liable to NASSCO in the sum of P25,800.00 for the payment of which they bind
themselves, jointly and severally.

Since the relationship between Torrento and MUTUAL IS ONE OF SURETY, Art 2047
will apply with respect to joind and solidary obligation and Art 1216 which states
that the creditor may proceed against any of the solidary debtors or all of them
simultaneously. When a surety binds him solidarily or jointly with the PD the
creditor may bring an action against anyone of them either alone or together with
the PD.

Allegations that MUTUAL has not ocnsent over the supplement agreement is
untenable because The amount of steel bars to be sold to defendant Torrento
remained the same. The length and the deformed quality of the bars likewise
remained unchanged.

There was no alteration in the principal condition of the contract. The period of
payment was not changed, and the amount of the liability of the principal debtor
and of the surety was also untouched. There was no added burden imposed upon
or assumed by the buyer."

The supplemental agreement did not result in the principal debtor's assuming
more onerous conditions than those stipulated in the original contract, and for
which the surety furnished the bond. There was consequently, no material or
essential alteration of the original contract which woul relieve the surety from its
obligation.