Case Digest (G.R. No. 140033) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
On April 28, 1980, the Private Development Corporation of the Philippines (PDCP) granted Falcon Minerals, Inc. a US$320,000 loan. On that day, respondent Rafael Ortigas, Jr. and two Scholey brothers executed an Assumption of Solidary Liability for Falcon’s debt. Independently, petitioners Salvador P. Escaño and Mario M. Silos, among others, signed separate guaranties for the same loan. In June 1982, Escaño, Silos and Joseph M. Matti acquired Falcon control from Ortigas, Inductivo and the Scholeys. To facilitate release of the sellers from their prior obligations, the parties signed an Undertaking whereby Escaño, Silos and Matti (the “Sureties”) agreed to assume and indemnify Ortigas and the other “Obligors” for any demand or payment made to PDCP under the original guarantees. Falcon drew down US$178,655.59 but defaulted, resulting in a P5,031,004.07 deficiency after foreclosure. On April 28, 1989, PDCP sued Falcon, Ortigas, Escaño, Silos and others before the RTC of Makati (Civi Case Digest (G.R. No. 140033) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Loan agreement and initial liabilities
- On April 28, 1980, Private Development Corporation of the Philippines (PDCP) agreed to lend Falcon Minerals, Inc. (Falcon) US$320,000 under specified terms.
- On the same day, Falcon officers—Ortigas, George A. Scholey and George T. Scholey—executed an Assumption of Solidary Liability for Falcon’s loan.
- Guaranties by petitioners and others
- Salvador P. Escaño executed a personal guaranty for the loan.
- Mario M. Silos, Ricardo C. Silverio, Carlos L. Inductivo and Joaquin J. Rodriguez likewise executed a joint guaranty on the same indebtedness.
- Assignment of shares and the 1982 Undertaking
- In 1982, Falcon shares were assigned by Ortigas, the Scholeys and Inductivo to Escaño, Silos and Matti, part of the consideration being the former’s release from their liabilities.
- An Undertaking (June 11, 1982) identified Escaño, Silos and Matti as “Sureties” and Ortigas, Inductivo and the Scholeys as “Obligors,” providing that:
- Obligers must promptly notify sureties of any PDCP demand;
- Sureties must defend obligors in any PDCP suit;
- If any obligor “for any reason” pays PDCP, sureties shall reimburse the amount within seven days.
- Default, foreclosure and PDCP’s deficiency claim
- Falcon defaulted; PDCP foreclosed on a chattel mortgage, leaving a deficiency of P5,031,004.07.
- On April 28, 1989, PDCP sued Falcon, Ortigas, Escaño, Silos, Silverio and Inductivo (RTC Makati Civil Case No. 89-5128).
- Settlements with PDCP
- December 1993: Escaño compromised, paying P1,000,000 for release of one-third of PDCP’s claim.
- February 24, 1994: Ortigas compromised, paying P1,300,000 “without admitting liability,” securing PDCP’s release.
- 1995: Silos compromised, paying P500,000 for waiver of PDCP’s claims against him.
- Cross-claims, third-party complaint and summary judgment
- Ortigas filed a cross-claim against Escaño and Silos and a third-party complaint against Silos and Matti under the 1982 Undertaking.
- RTC granted summary judgment (Oct. 5, 1995), ordering Escaño, Silos and Matti to pay Ortigas jointly and severally P1,300,000 plus P20,000 attorney’s fees.
- CA affirmed (Jan. 23, 2002), finding no genuine issue of material fact.
- Escaño and Silos petitioned the Supreme Court, contesting their liability under the Undertaking, the nature of their obligation (joint vs. solidary), interest rate and attorney’s fees.
Issues:
- Are petitioners obligated to reimburse Ortigas under the 1982 Undertaking?
- Is their liability to Ortigas joint only or solidary?
- Are they liable for attorney’s fees?
- What is the proper interest rate and computation date on the reimbursable sum?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)