Case Digest (G.R. No. 22738)
Facts:
Ong Guan Can and the Bank of the Philippine Islands v. The Century Insurance Co., Ltd., G.R. No. 22738, December 02, 1924, the Supreme Court, Villamor, J., writing for the Court.The plaintiffs-appellees insured with the defendant-appellant a building for P30,000 and the goods and merchandise contained therein for P15,000. The policies were in force when the building and its contents were destroyed by fire on February 28, 1923. The plaintiff sued for the full insured amounts.
The Court of First Instance of Iloilo rendered judgment on April 19, 1924 in favor of the plaintiffs, awarding P45,000 (the aggregate insured sums) with legal interest from February 28, 1923, plus costs. The defendant appealed, contending that a clause in the policy (the parties referred to it as clause 14) authorized the insurer, at its option, to reinstate or replace the destroyed property instead of paying the insured sum, and that the insurer should therefore be permitted to rebuild the house — subject to street alignment — rather than be required to pay the sum insured.
At trial the insurer relied on testimony (witnesses Cedrun and Cacho) referring to proposed reconstruction, but the record showed no formal written or unequivocal notice of election to rebuild sent to the insured, and the plaintiff refused assent because the proposed structure would be smaller and of inferior materials. The trial judge found the insurer’s asserted election to rebuil...(Pro-only)
Issues:
- Was the insurer entitled to exercise the alleged option to reinstate the destroyed building (instead of paying the sum insured) without giving formal notice of election to the insured and without the insured’s consent?
- Did the trial court properly award the full insured amount where the insurer did not tender additional indemnity for a proposed rebuilding that was smaller and of inferior mat...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)