Case Digest (G.R. No. L-8437) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Estate of K. H. Hemady, Deceased v. Luzon Surety Co., Inc., decided on November 28, 1956 under G.R. No. L-8437, the Luzon Surety Company filed a contingent claim against the estate of K. H. Hemady in Special Proceeding No. Q-293 before the Court of First Instance of Rizal, presided over by Judge Hermogenes Caluag. The surety company sought recovery under twenty separate indemnity agreements (counterbonds) each signed by a different principal debtor and by Hemady as a solidary guarantor. These written counterbonds obligated the guarantors jointly and severally to pay premiums, indemnify the company for all losses, costs, taxes, penalties, interest at 12% per annum, and attorney’s fees of 15% (not less than ₱25), and expressly waived notice of extensions, renewals, and liens by way of mortgage. After Hemady’s death, the surety claimed reimbursement of the amounts advanced under its bonds, unpaid premiums, documentary stamps, and accrued interest. Before Luzon Surety Co. could f Case Digest (G.R. No. L-8437) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Procedural Background
- Luzon Surety Co., Inc. filed a claim against the Estate of K. H. Hemady (Special Proceeding No. Q-293) based on twenty indemnity agreements—all signed by distinct principals and co-signed by Hemady as solidary surety—in consideration of Luzon Surety’s guarantee of various principals to their creditors.
- Before answer was filed, the administratrix of Hemady’s estate moved to dismiss the claim for failure to state a cause of action.
- Substance of the Indemnity Agreements
- Premiums: Indemnitors agreed to pay specified premiums in advance for every period the bond (or its renewal) remained in effect.
- Indemnity Clause: Indemnitors undertook to hold Luzon Surety harmless against all damages, losses, costs (including documentary stamps and taxes), penalties, and attorney’s fees (15% of litigation amounts, minimum ₱25).
- Interest: Sums paid by Luzon Surety bore 12% annual interest, capitalized quarterly.
- Waivers: Indemnitors waived notice of bond renewals/extensions, waiver of venue except Manila.
- Primary Liability: Upon principal’s default, indemnitors’ joint, several, and primary liability became immediately exigible without need to sue the principal.
- Decision Below
- The Court of First Instance of Rizal, Judge Hermogenes Caluag presiding, dismissed the claim on September 23, 1953, holding that (a) premiums and stamp taxes were not liabilities “incurred after” the counterbonds and thus not indemnifiable, and (b) Hemady’s guaranty terminated on his death, since “integrity” is purely personal and not transmissible under Article 2046, New Civil Code.
Issues:
- Whether premiums and documentary stamp taxes, though incurred before Hemady’s death, formed part of his obligations under the indemnity agreements.
- Whether Hemady’s liability as a guarantor terminated upon his death or survived as a contingent claim against his estate.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)