Case Summary (G.R. No. L-27155)
Key Dates and Transactions
– April 17, 1956: Tapnio leases 1,000-picul sugar export quota to Jacobo C. Tuazon at ₱2.50/picul.
– August 10, 1956: Tuazon agrees to PNB’s minimum lease rental of ₱2.80/picul and has loan funds ready.
– September 7, 1956: Branch Manager and Vice-President of PNB recommend approval of lease at ₱2.80.
– Late 1956: PNB Board insists on ₱3.00/picul; request for reconsideration is not acted upon.
– February 22, 1957: Tuazon withdraws; Tapnio loses ₱2,800 she could have applied to her bank debt.
– September 18, 1957: Philamgen pays PNB ₱2,379.91 on Tapnio’s behalf under surety bond.
– May 18, 1978: Supreme Court affirms lower courts’ judgment ordering PNB to indemnify.
Procedural History
- Philamgen sues Tapnio and Gueco for repayment of ₱2,379.91 plus interest and fees under an indemnity agreement.
- Tapnio and Gueco implead PNB as third-party defendant, claiming its fault deprived Tapnio of funds to discharge her debt.
- Trial Court orders PNB to pay Philamgen’s recovery and Tapnio’s damages (₱2,800), plus attorney’s fees and costs.
- Court of Appeals affirms. PNB’s motion for reconsideration is denied.
- PNB petitions to the Supreme Court, arguing its Board’s pricing decision was a valid policy exercise.
Applicable Law
– New Civil Code, Article 19: Duty to act with justice, honesty, and good faith.
– New Civil Code, Article 21: Liability for willfully causing injury contrary to morals or good customs.
– Corporate liability principles: A corporation is liable for torts committed by its agents or directors acting under its authority.
Factual Findings
– Tapnio’s debt to PNB (₱2,000 plus interest) was secured by her sugar quota.
– Approval of the lease was a condition precedent to its consummation within the milling season.
– Branch Manager and Vice-President approved ₱2.80/picul; Board’s insistence on ₱3.00/picul delayed approval beyond feasible crop utilization.
– No alternative lessee at ₱3.00/picul emerged; Tapnio could not realize ₱2,800 and thus could not repay her debt.
– Philamgen paid PNB under the indemnity bond; Tapnio remained indebted to Philamgen.
Issue
Did PNB, in unreasonably refusing to approve the lease at ₱2.80/picul and delaying approval past the crop year, incur civil liability for damages sustained by Tapnio?
Analysis
- PNB had ultimate authority to approve the lease but owed a duty of care and good faith toward Tapnio’s interests given its security interest in her quota.
- Time-sensitive nature of sugar quota utilization imposed heightened obligation to act without undue delay or unreasonable conditions.
- The Board’s insistence on an additional ₱200 tota
Case Syllabus (G.R. No. L-27155)
Facts of the Case
- Rita Gueco Tapnio incurred a crop‐loan indebtedness with the Philippine National Bank (PNB) secured by a bond (Exh. A) and an indemnity agreement (Exh. B) with Philippine American General Insurance Co., Inc. (Philamgen) as surety.
- The original bond amount of ₱4,000.00 was later reduced to ₱2,000.00, plus accumulated unpaid interest; Tapnio defaulted despite repeated demands (Exhs. C, E, F).
- Philamgen, having paid PNB ₱2,379.91 on September 18, 1957 (Exhs. D, D-1), sued Tapnio and her co-indemnitor Cecilio Gueco to recover that sum, plus 12% annual interest from September 19, 1957, ₱200.00 attorney’s fees, and costs.
- Tapnio and Gueco impleaded PNB as third-party defendant, alleging PNB’s negligence in handling an export sugar‐quota lease that would have allowed Tapnio to realize ₱2,800.00 to satisfy her bank debt.
Procedural History
- Civil Case No. 34185 (Court of First Instance, Manila): Ordered PNB, as third-party defendant, to pay Tapnio ₱2,379.71, 12% interest from September 19, 1957, ₱200.00 attorney’s fees, costs, and an additional ₱500.00 attorney’s fees to Tapnio.
- Court of Appeals: Affirmed the CFI decision and adopted its factual findings regarding PNB’s fault.
- Petitioner PNB filed a petition for certiorari to this Court, contesting only questions of law and urging that the CA misapplied legal standards on corporate discretion and market statistics.
Issues Presented
- Whether the Court of Appeals erred in finding that the rescission of Tapnio’s sugar-quota lease with Jacobo C. Tuazon was due to PNB’s unjustified refusal to approve the lease at ₱2.80 per picul and unreasonable insistence on ₱3.00 per picul.
- Whether, as a matter of law and policy, PNB’s Board of Directors had the absolute authority to fix the lease price at ₱3.00 based on statistical market data and could not be held liable for Tapnio’s resulting loss.