If you’re the type whose quick to stand as guarantor to your friends’ loan applications, or credit card transactions. You better think twice. Although that could be a remarkable trait anyone would love to find in a good friend but just for the sake of this post think otherwise. Consider the consequences first if in the near future you’d be faced with the same dilemma of choosing between preserving yourself from sudden unwanted cash outlay or helping your friend in dire need.Maybe the question to ask should be, is he/she really in dire need. Remember, If your friend suddenly gets bankrupt and lost his capability to pay his obligation, it could get ugly for you.
This is a case of a co-maker. Who out of his good intent and for the sake of friendship perhaps entered his friend’s transaction of bank loan in good faith as a co-maker. Let’s see what happened.
Naybe took out a bank loan in the amount of P50 K. This is 1983 so, during those times you wouldn’t say 50K is just 50K you get what I mean? For that loan he executed a promissory note. Promissory note, negotiable instrument ok? And Naybe was able to convince INCIONG and another friend Pantanosas to co-sign with him as co-makers. Remember, if you’re a co-maker you will be held jointly and severally liable together with the loan maker and your other co-makers. And thing is, just as you think everything’s turning out smoothly, the dreadful thing happens. And true enough the promissory note went due and it was left unpaid.Bank demanded payment from the three but still no payment was made. Bank then filed a suit for collection. (Geez this is one thing court hates, the law on Obligations and Contracts seemed to have conferred to them the duties of a collection agency). I bet if there’s a judge reading this blog he’d probably say “You can say that again.”
So, what happened was, the bank sued the three, but later released Pentanosas from its obligation. Eto masaklap, the principal borrower Naybe took flight and left for Saudi Arabia hence can’t be issued summons and so the complaint against him was subsequently dropped. Here’s the sad part, INCIONG WAS LEFT TO FACE THE SUIT.
In his defense Inciong alleged that 1. he was TRICKED into signing the promissory note. Having an understanding that he would only be a co-maker for the loan of P5,000 he set his hand into it. His second defense, 2. That the PROMISSORY NOTE IS NOT A PUBLIC DOCUMENT with the formalities prescribed by law but a mere commercial paper which does not bear the signature of an attesting witnesses.
ISSUE:
Is the petitioner’s contention tenable?
The lower court had resolved the typewritten figure P50T appears below his signature in the promissory note, hence Inciong’s uncorroborated testimony on his limited liability cannot be given merit.
RULING:
The SC finds the petition unmeritorious.
His first contention of fraud. (tanong ko lang, pano ba papasok yung FRAUD sa Parol Evidence Rule, Sec.9 of Rule 130 when it was not expressly stated. Probably in letter (c) ‘The validity of the written agreement). The court states “Fraud must be established by clear and convincing evidence”, so I guess ‘mere Preponderance of Evidence is insufficient evidence.’
2nd contention. Court says, Parol Evidence Rule may overcome contents of PN. (Of course, it’s an ‘agreement reduced in writing’) But the rule does not specify that the written agreement be a public document. It’s only requirement is that it be reduced in writing. Court even said it need not be signed by both parties.
But take note what the court said. that “as a General Rule, bills, notes and other instruments of a similar nature are not subject to be varied or contradicted by parol evidence.” Huh? So, I guess that means the PN does not come under what was being described in Sec. 9 of Rule 130. So, kawawa naman si Inciong? I thought Parol Evidence Rule may overcome contents of PN? I wonder what’s the exception to that General Rule the court stated. They’ve admitted parol evidence in the PN in Maulini vs. Serrano.
So, obviously Inciong lost this case. Anyway it’s just a civil case. And what is P50K anyway right?.
