Case Digest (G.R. No. L-49401)
Facts:
Rizal Commercial Banking Corporation v. Hon. Jose P. Arro and Residoro Chua, G.R. No. L-49401, July 30, 1982, Supreme Court Second Division, De Castro, J., writing for the Court.The petition sought certiorari relief to annul two orders of Hon. Jose P. Arro, Judge of the Court of First Instance of Davao, dated October 6, 1978 and November 7, 1978, which granted Residoro Chua’s motion to dismiss a complaint for a sum of money on the ground that the complaint stated no cause of action as against him. After filing the petition the bank submitted a manifestation and motion (dated December 14, 1978) asking that the special civil action be treated as a petition for review; that filing was noted by the Court in a January 10, 1979 resolution.
On October 19, 1976 Residoro Chua and Enrique Go, Sr. executed a comprehensive surety agreement to guarantee existing and future indebtedness of Davao Agricultural Industries Corporation (the "Borrower" or "Daicor") to the bank, with joint and several liability not to exceed P100,000.00. The instrument expressly described itself as a continuing guaranty and provided it remained in force until revoked in writing.
On April 29, 1977 a promissory note for P100,000.00 payable to Rizal Commercial Banking Corporation was executed and signed by Enrique Go, Sr. in his personal capacity and on behalf of Daicor. When the note was not paid, the bank filed a complaint on June 30, 1978 against Daicor, Enrique Go, Sr., and Residoro Chua to collect the indebtedness. On September 23, 1978 Chua moved to dismiss the complaint, arguing he could not be held liable because he did not sign the promissory note. The bank opposed on September 26, asserting that the earlier comprehensive surety agreement was a continuing guaranty covering the loan.
The Court of First Instance granted Chua’s motion and dismissed the complaint by decision of October 6, 1978, and denied the bank’s motion for reconsideration by order of November 7, 1978. The trial court’s ruling rested on its interpretation of the comprehensive surety agreement: it held that the guaranty required a cor...(Subscriber-Only)
Issues:
- Did the Court of First Instance commit reversible error in dismissing the complaint for failure to state a cause of action as against Residoro Chua?
- Is Residoro Chua liable for the obligation evidenced by the April 29, 1977 promissory note under the comprehensive surety agreement he signed even though he did not ...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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