Case Digest (G.R. No. 109172)
Facts:
Trans-Pacific Industrial Supplies, Inc. v. The Court of Appeals and Associated Bank, G.R. No. 109172, August 19, 1994, Supreme Court Third Division, Bidin, J., writing for the Court. Petitioner Trans-Pacific Industrial Supplies, Inc. obtained several loans from respondent Associated Bank beginning in 1979, evidenced by four promissory notes, a real estate mortgage over three parcels, and a chattel mortgage over stock and inventories. After difficulty in servicing the debt, the parties agreed to a restructuring: duplicate-original promissory notes were executed to reflect a restructured obligation and the original security was substituted. Petitioner later sold the released lots and, it asserts, the proceeds were applied to the restructured loan; the bank returned the duplicate promissory notes to Trans‑Pacific stamped “PAID.”On December 12, 1985 Associated Bank demanded payment of P492,100.00 as accrued interest on Promissory Note No. TL-9077-82, contending the notes had been erroneously released. Trans‑Pacific initially expressed willingness to pay but then filed suit in the Regional Trial Court of Makati, Branch 146, seeking specific performance (release of the mortgages) and damages, and alleging full payment of its obligation.
The trial court found for Trans‑Pacific, declared its obligations fully paid, ordered releases of the mortgages, and awarded moral and attorney’s fees. Associated Bank appealed to the Court of Appeals, which reversed: it set aside the trial court’s decision, dismissed the complaint, and on counterclaim ordered Trans‑Pacific to pa...(Pro-only)
Issues:
- Did Trans‑Pacific fully discharge its indebtedness so that the return of the promissory notes stamped “PAID” and the bank’s delivery of duplicate originals effected a renunciation of the bank’s claim (Art. 1271, Art. 1253, Art. 1273, Civil Code)?
- Was the award of attorney’s fees to Associated Bank proper under the Civil Cod...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)