Case Digest (G.R. No. 127232)
Facts:
Goldenrod, Incorporated and Sonia G. Mathay v. Honorable Court of Appeals and Pathfinder Holdings (Philippines), Inc., G.R. No. 127232, September 28, 2001, the Supreme Court Second Division, De Leon, Jr., J., writing for the Court.Petitioner Goldenrod, Inc. (a real estate developer) borrowed Seventy-Six Million Pesos (P76,000,000.00) from respondent Pathfinder Holdings (Phils.), Inc. on June 30, 1988, evidenced by a promissory note due September 28, 1988. Co‑petitioner Sonia G. Mathay, Goldenrod’s president, signed a document titled “Joint and Several Guarantee” as surety for the loan. The loan contract provided for interest at respondent’s cost of funds plus 1.75% per annum.
Goldenrod failed to pay on the September 28, 1988 maturity. On April 27, 1989, Goldenrod sought to settle; respondent prepared a statement of account showing total indebtedness of P95,069,609.00. That same day Goldenrod delivered two checks totaling P85,000,000.00 (one for P80,000,000.00 and one for P5,000,000.00), and executed two promissory notes (P5,000,000.00 each) dated the same day, maturing July 26, 1989 and October 24, 1989. As security for the two new notes, Goldenrod and Mathay executed a real estate mortgage over four titled parcels, but that mortgage was not notarized.
When the two promissory notes matured Goldenrod did not pay. Respondent’s demand letter of April 1, 1991 calculated the obligation (including interest and liquidated damages) as P30,667,833.33 as of March 31, 1991. On April 1, 1991 respondent filed Civil Case No. 91‑1050 for judicial foreclosure of the mortgage and collection of the indebtedness.
On March 18, 1993, the Regional Trial Court, Branch 132, Makati City, rendered judgment ordering defendants to pay P30,667,833.33, 5% attorney’s fees and costs, but denied the judicial foreclosure for lack of perfected mortgage. Both sides appealed. The Court of Appeals (Ninth Division) rendered its decision on July 29, 1996, affirming the trial court but modifying the award of attorney’s fees to 10% of the total am...(Subscriber-Only)
Issues:
- Under the circumstances, can Goldenrod, Inc. be held liable for the amounts stated in the two promissory notes, or did the P85,000,000.00 paid by checks extinguish the original indebtedness such that the notes constituted a new, distinct loan?
- Is Sonia G. Mathay solidarily liable with Goldenrod, Inc. for the nonpayment of the balance — i.e., does the contract denominated “Joint and Several Guarantee” operate as a suretyship making her jointly an...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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