G.R. No. 160905 - Goma vs. Pamplona Plantation, Inc.

On July 2, 2003, Spouses Jerome and Quinnie Briones took out a loan of ₱3,789,216.00 from International Exchange Bank (iBank), now Union Bank of the Philippines, to purchase a BMW Z4 Roadster.
The monthly amortization was ₱78,942.00 for two years.
The Spouses executed a promissory note with chattel mortgage requiring them to take out an insurance policy on the vehicle.
The promissory note granted iBank irrevocable authority as their attorney-in-fact to file insurance claims and collect insurance proceeds payable to iBank.

On November 5, 2003, at approximately 10:50 p.m., the mortgaged BMW was carnapped by three armed men in Quezon City.
Jerome Briones reported the incident to the Philippine National Police Traffic Management Group.
The Spouses notified iBank of the loss, which instructed them to continue paying three monthly installments as a sign of good faith; they complied and paid accordingly.
On March 26, 2004, after the three-month installment payment, iBank demanded full payment of the loan balance for the lost vehicle.
On April 30, 2004, the Spouses filed a notice of claim with their insurance company, which denied the claim on June 29, 2004, due to the delayed reporting of the loss.

On May 14, 2004, iBank filed a complaint for replevin or sum of money against the Spouses and John Doe, alleging default in payment of the mortgaged vehicle.
Pre-trial efforts, mediation, and judicial dispute resolution failed to settle the case.
Upon trial, the Regional Trial Court (RTC), Branch 138, dismissed the complaint. It held that iBank, as attorney-in-fact, was obligated to file and pursue the insurance claim and that its failure to do so was a breach of duty causing damages to the Spouses.
The RTC ruled that iBank prioritized its own interest and dismissed the case on the grounds of extinguishment of obligations by compensation.
iBank appealed to the Court of Appeals (CA), which affirmed the RTC decision on September 27, 2012, holding iBank liable for damages due to non-performance as agent and recognizing the insurance claim denial was due to iBank’s inaction.
iBank’s motion for reconsideration was denied by the CA on February 6, 2013.
iBank filed a Petition for Review on Certiorari before the Supreme Court, asserting it had the right to recover the vehicle or the unpaid loan balance and disputed the existence and revocation of the agency relationship.

Whether an agency relationship existed between iBank and the Spouses Briones under the promissory note with chattel mortgage.
Whether the agency relationship was revoked or terminated when the Spouses filed their own insurance claim.
Whether iBank is entitled to recover the mortgaged vehicle or, alternatively, to collect the outstanding balance of the loan on the vehicle.