Case Digest (G.R. No. 150711) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
On July 6, 1979, Luzon Stevedoring Corporation (“LUSTEVECO”) and PNOC Shipping and Transport Corporation (“PSTC”) executed an Agreement of Assumption of Obligations, whereby PSTC agreed to assume “all the obligations of LUSTEVECO” relating to specified claims in Annexes A and B, including the pending case Caltex (Philippines), Inc. v. LUSTEVECO (AC-G.R. CV No. 62613) before the Intermediate Appellate Court (“IAC”). In November 1985, the IAC rendered a final decision ordering LUSTEVECO to pay Caltex P126,771.22 and P103,659.44 with interest, attorney’s fees and costs. When the judgment became executory, LUSTEVECO’s assets were already foreclosed by other creditors, and garnishment against its banks failed. Learning of the Agreement, Caltex demanded PSTC’s satisfaction of the judgment, but PSTC refused, claiming it was not a party to the IAC case. Caltex then filed suit against PSTC on February 5, 1992 (Civil Case No. 91-59512), and on June 1, 1994 the Regional Trial Court (“RTC”) Case Digest (G.R. No. 150711) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Agreement of Assumption of Obligations (6 July 1979)
- Luzon Stevedoring Corporation (LUSTEVECO) executed with PNOC Shipping and Transport Corporation (PSTC) an Agreement by which PSTC assumed all LUSTEVECO’s obligations in respect of claims enumerated in Annexes “A” and “B.”
- PSTC was granted control over pending or future litigation on those claims, the records and files were delivered to PSTC, and PSTC was appointed attorney-in-fact to demand and receive any claims or counterclaims.
- Caltex v. LUSTEVECO (AC-G.R. CV No. 62613)
- Trial court ordered LUSTEVECO to pay Caltex ₱103,659.44 plus interest; on appeal the IAC on 12 November 1985 modified the award to:
- ₱126,771.22 (first cause) and ₱103,659.44 (second cause), both with legal interest until fully paid;
- 10% attorney’s fees and costs.
- The decision became final; writ of execution issued but LUSTEVECO’s remaining properties were foreclosed and garnishees did not respond.
- Demand on PSTC and suit for sum of money
- Caltex discovered the Agreement, repeatedly demanded PSTC to satisfy the judgment, but PSTC disclaimed liability, asserting it was not a party to AC-G.R. CV No. 62613.
- On 5 February 1992 Caltex filed Civil Case No. 91-59512 against PSTC; on 1 June 1994 the RTC awarded Caltex the sums in the IAC decision with interest, attorney’s fees and costs. PSTC appealed.
- Court of Appeals proceedings
- In its 31 May 2001 Decision, the CA held Caltex had no personality to sue PSTC, that only LUSTEVECO and PSTC could enforce or question the Agreement, and that Caltex was not a beneficiary of a stipulation pour autrui.
- The CA reversed and dismissed the complaint; on 9 November 2001 it denied Caltex’s motion for reconsideration. Caltex petitioned to the Supreme Court.
Issues:
- Whether PSTC is bound by the Agreement to assume and satisfy LUSTEVECO’s obligations.
- Whether Caltex is a real party in interest entitled to sue PSTC for the judgment debt against LUSTEVECO.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)