Case Digest (G.R. No. L-30771) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Liam Law v. Olympic Sawmill Co. and Elino Lee Chi (G.R. No. L-30771, May 28, 1984), plaintiff-appellee Liam Law advanced a loan of ₱10,000.00 without interest to the partnership Olympic Sawmill Co. and its managing partner, Elino Lee Chi, on September 7, 1957. The obligation fell due on January 31, 1960, but debtors requested and obtained an extension to April 30, 1960. On March 17, 1960, the parties executed a new agreement extending payment to April 30, 1960 and adding ₱6,000.00 “to answer for attorney’s fees, legal interest, and other costs” as part of the principal. When defendants again defaulted, Law filed a collection suit on September 23, 1960, and secured a writ of attachment on defendants’ Nueva Ecija properties. The trial court allowed cross-motions for summary judgment and, on June 26, 1961, ordered defendants to pay ₱10,000.00 plus ₱6,000.00 as liquidated damages with legal interest from April 30, 1960. Defendants appealed, contending that the additional ₱6,000.0 Case Digest (G.R. No. L-30771) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Parties and Procedural Posture
- Plaintiff-Appellee: Liam Law.
- Defendants-Appellants: Olympic Sawmill Co. (a partnership) and Elino Lee Chi (managing partner).
- Original decision by the Court of First Instance of Bulacan; appeal endorsed by the Court of Appeals to the Supreme Court as an issue of law.
- Loan Transactions and Extensions
- On or about September 7, 1957, plaintiff loaned P10,000.00 (no interest) to defendants; due January 31, 1960.
- Debtors requested extension to April 30, 1960; on March 17, 1960, they executed a new agreement:
- Principal P10,000.00 extended to April 30, 1960.
- Additional P6,000.00 “to answer for attorney’s fees, legal interest, and other cost” added to the principal obligation.
- Default, Attachment and Summary Judgment
- Defendants failed to pay by April 30, 1960; plaintiff filed a collection case on September 23, 1960.
- Same day, the Trial Court issued a writ of attachment on defendants’ real and personal properties in Nueva Ecija.
- On January 18, 1961, the Trial Court permitted simultaneous motions for summary judgment.
- Plaintiff filed his motion on January 31, 1961.
- Defendants filed theirs on February 2, 1961.
- Trial Court decision (June 26, 1961) ordered defendants to pay P10,000.00 plus P6,000.00 as liquidated damages, with legal interest from April 30, 1960.
Issues:
- Whether the additional P6,000.00 constituted unlawful usurious interest.
- Whether defendants’ allegation of usury should be deemed admitted for failure to deny it under oath as allegedly required by the Usury Law (Act 2655) and Rule 9 Section 1, Rules of Court.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)