Facts:

The case, Rolando Limpo v. Court of Appeals and Security Bank and Trust Company, G.R. No. 144732, was decided on February 13, 2006. The petitioner, Rolando Limpo, challenged the resolutions of the Court of Appeals in CA-G.R. CV No. 45821 issued on April 5, 2000, and August 30, 2000. The core of the dispute arose from a complaint for a sum of money filed by Security Bank and Trust Company (plaintiff) against Limpo and his co-defendants, spouses Miguel F. Uy and Brigitte E. Uy, on November 11, 1980, to recover an outstanding balance involving a promissory note. On February 1, 1983, the Uy spouses entered into a Compromise Agreement with the bank, outlining their admission of liability for P38,833.44 and detailing specific repayment terms. After the Uy spouses defaulted on the agreement, Security Bank sought a writ of execution on November 27, 1984. The bank subsequently filed a complaint for Revival of Judgment on July 22, 1992, alleging Limpo’s liability under the original note.

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Facts:

Procedural Background

• On November 11, 1980, Security Bank & Trust Company filed a complaint for a sum of money with the Regional Trial Court (RTC) of Pasig, Branch 158, seeking recovery of an outstanding balance on a promissory note executed by the defendants.
• The defendants named were Miguel F. Uy, Brigitte E. Uy, and Rolando Limpo.

Execution and Terms of the Compromise Agreement

• On February 1, 1983, defendant spouses Miguel F. Uy and Brigitte Uy entered into a Compromise Agreement with the plaintiff bank.
• On March 22, 1983, the RTC rendered a decision which incorporated the key provisions of the Compromise Agreement, including:
• An acknowledgment by the defendant spouses of a liability to the plaintiff amounting to P38,833.44 as of January 12, 1983.
• An agreement to pay the stated amount with interest at 20% per annum computed on a declining balance; detailed installment payments were prescribed as follows:
• An initial payment of P4,644.00 (with specified allocations for attorney’s fee and cost of suit) due on or before March 14, 1983.
• Subsequent monthly payments of P4,000.00 starting in April 1983 up to June 1, 1983.
• Monthly payments of P1,500.00 commencing in July 1983 until the debt and accrued interest were fully paid.
• A clause stating that failure to pay any installment on the due date would render the entire balance immediately due and payable without further demand, in addition to a default penalty assessed at 3% per month, and entitling the plaintiff to obtain a writ of execution by ex-parte motion.

Default, Revival of Judgment, and Subsequent Rulings

• The defendant spouses’ non-compliance with the agreed payment terms led the plaintiff bank to file:
• An ex-parte motion for issuance of a writ of execution on November 27, 1984.
• A subsequent complaint for revival of judgment on July 22, 1992 due to the inaction on the writ.
• In their pleadings, the defendant spouses argued laches, asserting that the plaintiff delayed enforcement of its rights by more than eight years.
• Defendant Rolando Limpo claimed he was not obligated under the Compromise Agreement since it was executed solely between the bank and the defendant spouses, without his knowledge or consent.
• On February 5, 1993, the plaintiff bank filed a Motion for Judgment on the Pleadings, asserting that the answers of the defendant spouses failed to present genuine issues.
• An RTC judgment on April 20, 1993 ordered the defendant spouses to pay the outstanding amount with accrued interest, based on the Compromise Agreement.
• In subsequent proceedings:
• The defendant spouses’ appeal was dismissed by the Court of Appeals (CA) for abusing extension periods provided under Rule 50 of the Rules of Court.
• Defendant Limpo filed a manifestation and motion on June 30, 1993, seeking dismissal on the ground that the revived judgment did not pertain to him, which eventually led to his dismissal from the complaint in orders issued on November 3, 1993, and reiterated on April 19, 1994.
• Despite his dismissal at the trial level, the Court of Appeals initially ruled that the Compromise Agreement did include all executing parties, thereby binding Limpo. However, upon reconsideration of the bank’s motion, the CA reversed its earlier ruling and ordered proceedings in Civil Case No. 62226 against Limpo.

Issues Raised at the Supreme Court Level

• Limpo contested his inclusion in the judgment by arguing that the Compromise Agreement was executed solely between the bank and the defendant spouses, and thus he should not be bound by its terms.
• The issue arose as to whether the RTC judgment based on the Compromise Agreement, which did not expressly include Limpo, could be revived against him.
• Limpo further argued that an action on the underlying promissory note would have prescribed given the elapsed period and associated suspensions between the note’s due date and the revival of judgment.

Issue:

• Whether Rolando Limpo is bound by the Compromise Agreement entered into solely between Security Bank & Trust Company and defendants Miguel F. Uy and Brigitte Uy, given that he did not participate in its execution.
• Whether Rolando Limpo is liable to Security Bank under the RTC judgment based on the Compromise Agreement, considering he was not a party to the agreement.
• Whether the action for revival of judgment against Limno is barred by prescription, taking into account the periods during which the claim was suspended.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)