Lessons Applicable: Promissory notes and checks (Negotiable Instruments Law)
FACTS:
- Astro was granted several loans by the Philippine Trust Company (Philtrust) amounting P3M w/ interest and secured by 3 promissory notes:
- December 14, 1981: P600,000.00
- December 14, 1981: P400,000.00
- August 27, 1981: P2,000,000.00
- Roxas signed twice the promissory notes
- as President of Astro
- in his personal capacity
- Roxas also signed a Continuing Surety ship Agreement in favor of Philtrust Bank, as President of Astro and as surety
- Philguarantee, with the consent of Astro, guaranteed in favor of Philtrust the payment of 70% of Astros loan, subject to the condition that upon payment by Philguanrantee, it shall be proportionally subrogated to the rights of Philtrust against Astro
- Upon Astros failure to pay, Philguarantee paid 70% of the guaranteed loan to Philtrust.
- Subsequently, Philguarantee filed against Astro and Roxas a complaint for sum of money with the RTC
- Roxas: alleged that he merely signed the same in blank and the phrases in his personal capacity and in his official capacity were fraudulently inserted without his knowledge
- RTC: favored Philguarantee holding Astro and Roxas jointly and severally liable
- if Roxas really intended to sign the instruments merely in his capacity as President of Astro, then he should have signed only once
- CA affirmed RTC
ISSUE: W/N Roxas should be jointly and severally liable with Astro
HELD: YES. CA affirmed
- Under the Negotiable Instruments Law, persons who write their names on the face of promissory notes are makers,promising that they will pay to the order of the payee or any holder according to its tenor.
- even without the phrase personal capacity, Roxas will still be primarily liable as a joint and several debtor under the notes considering that his intention to be liable as such is manifested by the fact that he affixed his signature on each of the promissory notes twice which necessarily would imply that he is undertaking the obligation in 2 different capacities, official and personal.
- 3 promissory notes uniformly provide: FOR VALUE RECEIVED, I/We jointly, severally and solidarily, promise to pay to PHILTRUST BANK or order...
- begins with I, We, or Either of us promise to pay, when signed by two or more persons = solidarily liable
- Subrogation is the transfer of all the rights of the creditor to a third person, who substitutes him in all his rights
- Philguarantee has all the right to proceed against petitioner, it is subrogated to the rights of Philtrust to demand for and collect payment from both Roxas and Astro since it already paid the value of 70% of roxas and Astro Electronics Corp.s loan obligation
- Roxas acquiescence is not necessary for subrogation to take place because the instant case is one of the legal subrogation that occurs by operation of law, and without need of the debtors knowledge
- Philguarantee, as guarantor, became the transferee of all the rights of Philtrust as against Roxas and Astro because the guarantor who pays is subrogated by virtue thereof to all the rights which the creditor had against the debtor