Case Digest (G.R. No. 136603)
Facts:
Emilio Y. Tanedo v. Allied Banking Corporation, G.R. No. 136603, January 18, 2002, the Supreme Court First Division, Pardo, J., writing for the Court.
Petitioner Emilio Y. Tanedo (a guarantor) was one of the guarantors under a Continuing Guaranty for promissory notes issued by Cheng Ban Yek & Co., Inc. in favor of plaintiff Allied Banking Corporation, the respondent. Allied Bank sued Cheng Ban Yek to recover on seven past-due promissory notes whose principals totaled P10,000,000.00; the complaint was accompanied by a petition for preliminary attachment, which the trial court granted upon the required bond and maintained.
The Regional Trial Court (Branch XLIV, Manila) thereafter rendered summary judgment in favor of Allied Bank. The decretal portion ordered Cheng Ban Yek to pay specified amounts (with interest, service charges and penalty charges) on each of the seven causes of action, awarded 25% of the amount due as attorneys’ fees, declared the Continuing Guaranty extinguished after Allied Bank branded it a worthless security and elected to proceed by attachment, and declared defendants Alfredo Ching and Emilio Tanedo relieved of their obligations under the Continuing Guaranty; the trial court also ordered Cheng Ban Yek to pay costs.
Both Allied Bank and Cheng Ban Yek appealed to the Court of Appeals (docketed CA-G.R. CV No. 04612). The Court of Appeals, in a decision promulgated March 27, 1990 (Cui, J., ponente), reversed in part: it deleted paragraph 9 of the RTC’s decretal portion and declared Alfredo Ching and Emilio Tanedo solidarily liable with Cheng Ban Yek for all items of the money judgment and costs; it otherwise affirmed the RTC’s order. Petitioner Tanedo filed a motion for reconsideration before the Court of Appeals arguing, among other things, that while the case was pending the bank and Cheng Ban Yek agreed to extend the indebtedness without his consent thereby releasing him as guarantor; the Court of Appeals denied the motion on November 27, 1998.
Petitioner then filed a petition for review on certiorari with the Supreme Court (petition filed January 29, 1999; given due course Se...(Subscriber-Only)
Issues:
- Did the execution of the Fourth Amendatory Agreement (an extension of the promissory notes) without petitioner’s consent extinguish petitioner’s obligations as surety under the Continuing Guaranty?
- Is the Continuing Guaranty void as a contract of adhesion such that petitioner’s obligations as sur...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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