Case Summary (G.R. No. 131086)
Factual Background
BECC operates a credit card system offering credit accommodations to cardholders for purchasing goods and services. Olalia became a member of BECC and received a credit card with a limit of P5,000. Upon the expiration of his card in January 1991, a renewal card was issued alongside an extension card in the name of his ex-wife, Cristina G. Olalia. BECC claims Olalia received the extension card at the same time as the renewal card; however, Olalia denies ever receiving or applying for it. The extension card was used for purchases amounting to P101,844.54, which Olalia contested, arguing he had no involvement with the extension card.
Proceedings in Lower Courts
BECC filed a collection lawsuit in the Regional Trial Court (RTC), where Olalia acknowledged responsibility for only P13,883.27, attributed to his own credit card usage. The RTC initially ruled in favor of BECC but later amended the decision to increase Olalia's liability, citing the terms of the card agreement. Olalia appealed to the Court of Appeals, which ultimately reduced his liability back to P13,883.27 while imposing interest and a penalty for late payment on this amount.
Issues on Appeal
The Supreme Court identified two central issues for determination:
- Whether the extension card in Cristina’s name was validly issued and received by Olalia.
- Whether Olalia could be held liable for purchases made using the extension card.
Findings of the Court
The Court examined the stipulations in the contract governing the issuance of supplementary cards, which included requirements for payment of a fee and submission of an application. Both the trial and appellate courts found no evidence showing Olalia had fulfilled these requirements when the extension card was issued. The absence of a receipt for any fee and Olalia's denial of application were also crucial points.
Contract Interpretation
The Court noted that contracts of adhesion, like the credit card agreement in question, are construed against the party that drafted them—in this case, BECC. The petitioner bore the burden of proving the existence of a valid contract for the extension card, which it failed to do. Furthermore, the Court highlighted that BECC did not provide any evidence of a signed specimen from the purported cardholder, complicating
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Case Overview
- The petition for review seeks to annul the decision of the Court of Appeals (CA) in CA-G.R. CV No. 49618, which reversed the Regional Trial Court (RTC) order that found Eddie C. Olalia liable to BPI Express Card Corporation (BECC) for the amount of P136,290.97.
- The CA reduced Olalia's liability to P13,883.27, leading to the current petition by BECC.
- The pivotal issues revolve around the validity of the extension card issued to Cristina G. Olalia and whether Eddie C. Olalia can be held liable for the charges incurred on this card.
Factual Antecedents
- BECC operates a credit card system that allows members to purchase goods and services, with reimbursement required later.
- Respondent Eddie C. Olalia applied for and received a credit card with a limit of P5,000.
- In January 1991, Olalia's card expired, and a renewal card was issued. An extension card in the name of Cristina G. Olalia, his ex-wife, was also allegedly issued.
- Olalia denies having applied for or received the extension card, asserting that all purchases made with it were unauthorized.
- The extension card was reportedly used for purchases totaling P101,844.54 in Iloilo and Bacolod, which Olalia contests.
- The RTC initially found Olalia liable only for P13,883.27, representing the charges on his own card.