I.
LOANS IN GENERAL
PEOPLE vs. VENANCIO CONCEPCION
G.R. No. L-19190
November 29, 1922
MALCOLM, J.:
FACTS
An extension of credit was authorized by the defendant in favor "Puno y Concepcion,
S. en C.” to
the manager of the Aparri branch of the Philippine National Bank. Defendant was a
partner of the co-partnership "Puno y Concepcion, S. en C.” Further, defendant was
found guilty of violating Sec. 35 of Act No. 2747 which provides that the National
Bank shall not, directly or indirectly, grant loans to any of the members of the Board
of Directors of the bank or to agents of the branch banks. As a defense, defendant’s
counsel argued that the documents of record only prove a concession of a credit, and
not a loan.
ISSUE
Whether or not the granting of credit to the co-partnership was considered as a loan
within the
meaning of Sec. 35 of Act No. 2747.
HELD
YES, it is considered as a loan and not merely a concession of credit.
The "credit" of an individual means his ability to borrow money by virtue of the
confidence or
trust reposed by a lender that he will pay what he may promise. A "loan" means the
delivery by one party and the receipt by the other party of a given sum of money,
upon an agreement, express or implied, to repay the sum loaned, with or without
interest. The concession of a "credit" necessarily involves the granting of "loans" up
to the limit of the amount fixed in the "credit.”
DBP vs. GUARINA
G.R. No. 160758
January 15, 2014
BERSAMIN, J.:
FACTS
Guariña Corporation applied for a loan from DBP to finance the development of its
resort complex situated in Trapiche, Oton, Iloilo. Guariña Corporation executed a
promissory note worth P3,387,000.00 that would be due on November 3, 1988.
Guariña Corporation executed a real estate mortgage over several real properties in
favor of DBP as security for the repayment of the loan.
Thereafter , Guariña Corporation executed a chattel mortgage over the personal
properties existing at the resort complex and those yet to be acquired out of the
proceeds of the loan, also to secure the performance of the obligation. Prior to the
release of the loan, DBP required Guariña Corporation to put up a cash equity of
P1,470,951.00 for the construction of the buildings and other improvements on the
resort complex. The loan was released in several instalments. In all, the amount
released totaled P3,003,617.49, from which DBP withheld P148,102.98 as interest.
Guariña Corporation demanded the release of the balance of the loan, but DBP
refused. Instead, DBP directly paid some suppliers of Guariña Corporation over the
latter's objection. DBP found upon inspection of the resort project, its developments
and improvements that Guariña Corporation had not completed the construction
works. DBP thus demanded that Guariña Corporation expedite the completion of the
project, and warned that it would initiate foreclosure proceedings should Guariña
Corporation not do so. Unsatisfied with the non-action and objection of Guariña
Corporation, DBP initiated extrajudicial foreclosure proceedings. A notice of
foreclosure sale was sent to Guariña Corporation Guariña Corporation sued DBP in
the RTC to demand specific performance of the latter's obligations under the loan
agreement, and to stop the foreclosure of the mortgages. However, DBP moved for
the dismissal of the complaint, stating that the mortgaged properties had already been
sold to satisfy the obligation of Guariña Corporation at a public auction. Due to this,
Guariña Corporation amended the complaint to seek the nullification of the
foreclosure proceedings and the cancellation of the certificate of sale.
ISSUE
WON the foreclosure of a mortgage prior to the mortgagor’s default on the principal
obligation is valid.
HELD
NO, the foreclosure of the mortgage is premature and should be nullified.
The agreement between DBP and Guariña Corporation was a loan. Under the law, a
loan requires the delivery of money or any other consumable object by one party to
another who acquires ownership thereof, on the condition that the same amount or
quality shall be paid. Loan is a reciprocal obligation, as it arises from the same cause
where one party is the creditor, and the other the debtor. The obligation of one party in
a reciprocal obligation is dependent upon the obligation of the other, and the
performance should ideally be simultaneous. This means that in a loan, the creditor
should release the full loan amount and the debtor repays it when it becomes due and
demandable.
DE LOS SANTOS vs. JARRA
G. R. No. L-4150
February 10, 1910
TORRES, J.:
FACTS
A certain Magdaleno Jimenea borrowed from Felix de los Santos 10 first-class
carabaos, to be used at the animal mill of his hacienda from 1901-02 without
recompense or remuneration whatever for the use thereof, under the sale condition
that he will return them after the completion of the work at the mill, but Jimenea did
not return the carabaos. He died in 1904 and the trial court appointed Agustina Jarra
as the administratrix of his estate. De los Santos claimed to the estate requesting for
the return of his carabaos, but it was rejected. Jarra was summoned by the trial court
and denied the allegation of de los Santos, that the late Jimenea only obtained 3
second-class animals, and in case of the carabaos, 4 died of rinderpest, in which only
six surviving carabaos were in issue. The trial court ruled in favour of de los Santos
and ordered Jarra to return the 6 carabaos and 3 second-class animals or its value.
ISSUE
Whether or not the contract is a loan, in this case a commodatum.
HELD
Yes. The carabaos delivered to be used not being returned by the defendants upon
demand there is no doubt that she is under obligation to indemnify the owner thereof
by paying him their value. Since the six carabaos were not the property of the
deceased or of any of his descendant s it is the duty of the administrator of the estate
to either return them or indemnify the owner thereof their value.
SAURA IMPORT & EXPORT CO., INC. vs. DBP
44SCRA 445
1972
MAKALINTAL, J.:
FACTS
Saura Inc. applied for a loan of 500k from to the RFC (before its conversion to DBP)
secured by a first mortgage of the factory building to finance for the construction of a
jute mill factory, including its equipment. RFC accepted and approved the loan
application subject to some conditions which Saura admitted it could not comply
with. Without having received the amount being loaned, and sensing that it could not
at anyway obtain the full amount of loan, Saura Inc. then asked for cancellation of the
mortgage which RFC also approved. Nine years after the cancellation of the
mortgage, Saura sued RFC for damages for its non-fulfillment of obligations arguing
that there was indeed a perfected consensual contract between them.
ISSUE
Whether there was a perfected consensual contract.
HELD
Yes, there was indeed a perfected consensual contract, as recognized in Article 1934
of the Civil Code. Article 1934 provides: An accepted promise to deliver something
by way of commodatum or simple loan is binding upon the parties, but the
commodatum or simple loan itself shall not be perfected until delivery of the object of
the contract. There was undoubtedly offer and acceptance in this case: the application
of Saura, Inc. for a loan of P500,000.00 was approved by resolution of the defendant,
and the corresponding mortgage was executed and registered.
However, the loan came with conditions and Saura, Inc. obviously was in no position
to comply with RFC’s conditions. So instead of doing so and insisting that the loan be
released as agreed upon, Saura, Inc. asked that the mortgage be cancelled. The actions
thus taken by both parties was of a mutual desistance, which is a mode of
extinguishing obligations. It is a concept that derives from the principle that since a
mutual agreement can create a contract, a mutual disagreement by the parties can
cause its extinguishment.
NAGUIAT vs. CA
412 SCRA 591
October 3, 2003
TINGA, J.:
FACTS
Queaño applied with Naguiat for a loan in the amount of P200,000.00, which Naguiat
granted. Naguiat indorsed to Queaño Associated Bank Check for the amount
P95,000.00, which was earlier issued to Naguiat by the Corporate Resources
Financing Corporation. She also issued her own Filmanbank Check, to the order of
Queaño, and for the amount of P95,000.00. The proceeds of these checks were to
constitute the loan granted by Naguiat to Queaño. To secure the loan, Queaño
executed a Deed of Real Estate Mortgage in favor of Naguiat, and surrendered to the
latter the owner’s duplicates of the titles covering the mortgaged properties. Queaño
issued to Naguiat a promissory note for the amount of P200,000.00, with interest at
12% per annum. Queaño also issued a Security Bank and Trust Company check,
postdated for the amount of P200,000.00 and payable to the order of Naguiat. Upon
presentment
on its maturity date, the Security Bank check was dishonored for insufficiency of
funds. Queaño received a letter from Naguiat’s lawyer, demanding settlement of the
loan. Queaño and one Ruby Ruebenfeldt met with Naguiat. At the meeting,Queaño
told Naguiat that she did not receive the proceeds of the loan, adding that the checks
were retained by Ruebenfeldt, who purportedly was Naguiat’s agent. Naguiat applied
for the extrajudicial foreclosure of the mortgage. Before the scheduled sale, Queaño
filed annulment of the mortgage deed.
ISSUE
Whether the mere issuance of check results in the perfection of loan.
HELD
No. The loan was not perfected by the mere issuance of check because there was no
proof that the checks were encashed. Absolutely no evidence was submitted by
Naguiat that the checks she issued or endorsed were actually encashed or deposited.
The mere issuance of the checks did not result in the perfection of the contract of
loan. For the Civil Code provides that the delivery of bills of exchange and mercantile
documents such as checks shall produce the effect of payment only when they have
been cashed. It is only after the checks have produced the effect of payment that the
contract of loan may be deemed perfected. A loan contract is a real contract, not
consensual and, as such, is perfected only upon the delivery of the object of the
contract.
In this case, the objects of the contract are the loan proceeds which Queaño would
enjoy only upon the encashment of the checks signed or indorsed by Naguiat. Since
Naguiat presented no such proof, it follows that the checks were not encashed or
credited to Queaño’s account.
