Case Digest (G.R. No. L-22796)
Facts:
Delfin Nario and Alejandra Santos-Nario v. The Philippine American Life Insurance Company, G.R. No. L-22796, June 26, 1967, the Supreme Court En Banc, Reyes, J., writing for the Court.
On June 12, 1959, Alejandra Santos‑Nario was issued Life Policy No. 503617 by The Philippine American Life Insurance Company under a 20‑year endowment plan with a face value of P5,000; she designated her husband Delfin Nario and their unemancipated minor son, Ernesto Nario, as irrevocable beneficiaries. In mid‑June 1963 Mrs. Nario applied for a policy loan (a privilege available after three years of the policy) to pay the minor’s school expenses; the loan application bore the written signature and consent of Delfin both as an irrevocable beneficiary and as father‑guardian and legal administrator of the minor’s property pursuant to Art. 320 of the Civil Code.
The Insurance Company denied the loan, asserting that the father’s written consent for the minor was insufficient and that court authorization in a guardianship proceeding was required for acts of disposition involving the ward’s property. Mrs. Nario then sought to surrender the policy for its cash surrender value (P520.00), which the Company likewise refused for the same reason. On September 10, 1963 the Narios filed suit in the Court of First Instance of Manila (Civil Case No. 54942) to compel the insurer to grant the loan and/or accept the policy surrender.
The insurer’s answer admitted material facts but pleaded an affirmative defense: the proposed loan and surrender were acts of disposition or alienation of the minor’s property outside the scope of the parents’ powers as legal administrators under Arts. 320 and 326 of the Civil Code, and thus required judicial authority. The parties dispensed with trial evidence by joint motion and submitted memoranda. The trial court found that the policy endorsement made the beneficiaries irrevocable, that the beneficiaries thereby acquired a vested right measured by the policy’s face value (citing Gercio v. Sun Life Assurance of Canada), and that the transactions were dispositions requiring court consent (citing U.S.V.A. v. Bustos and Visaya v. Suguitan). On January 28, 1964 the Court of First Instance dismissed the complaint. A motion to set aside or reconsider was denied.
The plaintiffs appealed directly to the Supreme ...(Subscriber-Only)
Issues:
- Did the father, acting as legal administrator/guardian of the minor under Articles 320 and 326 of the Civil Code, need prior court authority to consent to a policy loan or to surrender the policy that would affect the minor’s vested interest?
- Is the minor beneficiary’s vested interest in an irrevocable life policy to be measured by the policy’s full face value o...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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