JAVELLANA vs. LEDESMA

This Succession Case tackles the chronological issues in signing a will or codicil for that matter. Whether which should come first. Must the document be accomplished in one sitting? Or once acknowledgements had all been accomplished, the unfinished document can be set aside for another day or two where concluding parts of it such as the notarial requisite be accomplished in a subsequent act. 

Well the Old Civil Code of 1899 expressly requires that all be accomplished in one sitting, otherwise the instrument may be deemed invalid.

So I wonder how they pass on their inheritance in the olden days? Boy it must be all dramatic and all that stuff. Just imagine everyone is there, present. I mean if there be grudge and bad blood that runs in the family, consider the ordeal these documentary witnesses and notarial representative (should there'd be any) undergo when the family starts washing their dirty linens even in closed doors. 

Let's try to take a look at one case.

Court admitted to probate a will and codicil executed by the deceased Apolinaria Ledesma. The contestant was the sister and nearest surviving kin of the deceased. In her appeal she alleged that the will and codicil were not executed in accordance with law, well because:

1. The testament was executed at the house of the testator. [under the Old Civil Code of 1899] 2. But the codicil was executed and attested at the San Pablo hospital [after the enactment of the New Civil Code (NCC)], and therefore had to be acknowledged before a notary public. 

So basically were talking about the acknowledgement of a codicil here. What is acknowledgement by the way? Is it any different from attestation? How about a Jurat?

Now, the contestant, who happens to be one of the instrumental witnesses asserted that after the codicil was signed and attested at the San Pablo hospital, the Notary Public signed and sealed it on the same occasion. (Duh?) Notary public however, said that he did not do so, and that the act of signing and sealing was done afterwards. (Whut the...Is this the only difference between the old and the new code?.. this is what I hate about transitions) 

Well, one clear allegation was that the certificate of acknowledgement (were talking about the notarial act) to the codicil was signed elsewhere, most probably in the office of the notary. 

Nevertheless, what is the ISSUE here: 

The issue is whether or not the signing and sealing of the codicil by notary public in the absence of the testator and witnesses affects the validity of the will. 

RULING:

NO.  Court held that unlike in the Old Civil Code of 1899, the NCC does not require that the signing of the testator, the witnesses and the notary be accomplished in one single act. All that is required is that every will must be acknowledged before a notary public by the testator and witnesses. 

The subsequent signing and sealing is not part of the acknowledgement itself nor of the testamentary act. Their separate execution out of the presence of the testator and the witnesses cannot be a violation of the rule that testaments should be completed without interruption.

Alright let me get that straight: Let's do some differentiation here to somehow clear things up (I hope) and somehow make this post a reference:

NOTARIZATION vs. ATTESTATION 

It’s a common assumption that “notarization” and “attestation” refer to the same type of act. But you see, while a public notary can only perform notarial acts, attestations are required for certain documents.  

The act of notarization the signatures on a document can only by a legal public notary. it usually involves paying a fee, taking an oath, and being sworn in by the attesting authority.  

Attestations, on the other hand, can be performed by anyone, regardless as to whether or not the individual is a public notary. It's common for public documents to require witness attestations, which basically means that a 3rd party must bear witness to the document’s signing. You see this 3rd party attests that the document was signed by the said person.  So basically it is used in the context of validating the contents of a document.

Another key difference between notarial acts and attestations involves the way in which they are executed. When a notarial act is being performed, the public notary is usually required to place his or her official stamp or seal and recording log numbers on the document. 

Someone who’s attesting the signatures on a document and/or its contents, on the other hand, are not required to place a stamp or seal on the document.

ATTESTATION vs. ACKNOWLEDGEMENT  

An attestation however is different from an acknowledgement. Attestation is done by a witness. An acknowledgement is done by the party concerned. 

You will also come across the word “Subscribe” in legal documents. Strictly speaking, the word “Subscribe” does not impute personal knowledge of the matter in consideration and is more in the nature of appending the names of signatures in a mechanical manner.

The term attested, when used in relation to a deed or document, means that the deed or document concerned is attested by two or more witnesses. So it is imperative that each of the witnesses should have seen the Testator (who is the executor of the document) sign the document. And each of them (3 or more Witnesses as in the case of a notarial will) should have signed as a witness in the presence of the Testator and all other Witnesses. 

By the way, In the US their succession laws carries no specific or particular form prescribed for attestations. It is not necessary that the witnesses should sign in the presence of each other. It is only required that each of the witness has direct knowledge that the document had been signed by the Executor (which they refer to as  Executant for that matter).  Here in the Philippines on the other hand, our succession laws requires stricter application. Witnesses are expected to sign the notarial will as attestation in the presence of the Testator and other Witnesses.

Such in the case of Nera vs. Rimando two rooms were blocked by a curtain. One of the witnesses was in a the other room while the other witness was attaching his signature to the instrument in front of the testator. The lower court did not consider the position of the witnesses at the time of signing of vital importance. This lower court decision was based on an earlier ruling called the Jabonetta Case (Jabonetta vs. Gustillo) where it was held that it was not sufficient to invalidate execution of will. The CA affirmed this decision but when it reached the highest court the decision was overturned. The court said the line of vision of witness to the testator and other witnesses was blocked, 

I think in hindsight, the highest court was telling the lower court, 'You've used the right citational   jurisprudence but you've misapplied the doctrine'  Don't verbatim quote me on that. This is just my interpretation. You see the doctrine of the Jabonetta Case states that "True test of presence is not whether or not they saw each other sign but WHETHER THEY MIGHT HAVE SEEN EACH OTHER SIGN IF THEY CHOSE TO DO SO, considering their physical, mental condition and position in relation to each other at the moment of signing." 

So as if the SC was saying 'If the curtain wasn't there and nothing is blocking the winess' vision even if he is positioned in the other room it might have been considered. But the curtain was there what can we do, the Jabonetta Case had provided the standard' Again don't quote me on that. I just can't stop my creative juices coming out. So the bottom-line is they should see each other sign.

More on ACKNOWLEDGEMENT: 

You know at times, a person may sign his or her name in a deed or document for identifying an Executor. The purpose of this is only to confirm the identity and such. The identifier does not become an Attestor for the execution of deed or document concerned.

The term “Sign” generally mean affixing the signature or otherwise affixing the name or a mark to represent the name of a person. The “signing” should be such that it would bind the person concerned as relating to the aspect of signing. Even the insertion of a name, done in the manner required, may amount to signing, authentication or attestation as the case may be.

JURAT vs. ACKNOWLEDGEMENT  

Now, Acknowledgement and Jurat  are the two most common notarial acts. Actually there is confusion among law students about the difference between these two.   

A jurat is used when the signer is swearing to the content of the document.  The notary must administer an oath or affirmation to the signer in order to complete the jurat. A jurat also requires that the signer signs in the presence of the notary. it's quite easy to identify a Jurat in a legal document. Just find the portion that states “Subscribed and sworn to before me…” – subscribed meaning “signed” and sworn meaning that an oral oath or affirmation was given.  “Before me” means that both were done in the presence of the notary public.

In Acknowledgements however, acknowledgement portion is used to verify the identity of the signer and to confirm that they signed the document.  They are not swearing to the truthfulness or validity of the document, they are simply acknowledging that they signed the document.  

An acknowledgment certificate indicates that the signer:

1. personally appeared before the Notary,

2. was identified by the Notary, and

3. acknowledged to the Notary that the document was freely signed.

Acknowledgments do not need to be signed in the notary’s presence although it would be highly preferred whenever possible. For this matter I think the confusion lies from the fact that the signer must appear before the Notary at the time of notarization to acknowledge that he or she freely signed for the purposes stated in the document.

But take note of this, documents requiring a Jurat must be signed in the Notary’s presence, as dictated by the typical jurat wording, “Subscribed (signed) and sworn to before me…” okay? So in theory, it is imperative that it is the executor who was presenting the document to the notary. But in practice, sometimes if not, then must be duly identified. 

In executing a Jurat, a notary guarantees that the signer:

1. personally appeared before the notary,

2. was given an oath or affirmation by the notary, and finally

3. signed in the Notary Public’s presence.

To summarize, the key difference between a JURAT vs ACKNOWLEDGMENT is that the former (Jurat) is used primarily when dealing with sworn statements and the latter (Acknowledgment)  typically applies to documents that must be signed in front of an unbiased independent witness.

SAMAR MINING vs. NORDEUTSCHER

This Transpo Law case arose from an importation made by SAMAR MINING. The cargo was 1 crate of Optima Welded Wedge Wire. The freight-in ship was named M/S Schwabenstein, a German cargo ship owned by NORDEUTSCHER.  Which was represented in the Philippines by its agent CF SHARP.  The shipment was covered by a bill of lading duly issued to consignee SAMAR MINING.  

I hope I made it clear, the consignee in this case is the shipper himself SAMAR MINING.  The cargo was aboard a German vessel. The carrier here or the ship-owner of course  is a German company,  which is NORDEUTSCHER. And wait,  there’s a 3^rd party here. The shipper Samar Mining had availed of the services of a bonded warehouse called AMCYL beforehand. 

So upon arrival of the vessel at the port of Manila, importation was unloaded and delivered in good order and condition to the bonded warehouse AMCYL as was agreed upon.  The goods however was never delivered to and received by consignee Samar at the port of destination which is Davao.

Wait let me get that straight. You see the following are the pertinent ports as provided in the Bill of Lading:

1. Port of Loading – GERMANY
2. Port of Discharge from Ship – MANILA
3. Port of Destination (Discharge of Goods) - DAVAO  

So as plainly indicated on the face of the Bill, vessel  M/S Schwabenstein is to transport the goods only up to Manila.  Thereafter, the goods are to be TRANSHIPPED by the carrier to the port of destination. So what on earth is NORDEUTSCHER thinking?

So there you go, letters of complaint therefore were sent to  NORDEUTSCHER, which failed to elicit the desired response.   SAMAR therefore filed a formal complaint for claims of damage against NORDEUTSCHER, its local agent CF SHARP, and warehouse AMCYL as 3^rd party defendant .  

The lower court CFI of Manila favored SAMAR, but however stated that  NORDEUTSCHER may recoup whatever they may pay Samar by enforcing the judgment against 3^rd Party Defendant AMCYL.  

So what is the ISSUE here:

The issue is whether appellants NORDS, SHARP, and AMCYL were liable for the loss of goods under the bill of lading.

HELD:

The answer is NO.  SC said the Bill of Lading operates both as a:  1. RECEIPT for the goods on board and 2. A CONTRACT to transport and deliver the same as stipulated therein.

Geez what happened?  Say what?

Let’s take a look at the Bill of Lading then.

You see,  in Section 1 of Paragraph 3 of the Bill of Lading the parties stipulated that:

“The carrier shall not be liable in any capacity whatsoever for any delay, loss or damage occurring before the goods enter ship’s tackle to be loaded or after the goods leave ship’s tackle to be discharged, transshipped or forwarded. “

Question, was this a valid stipulation? The court said it’s VALID.  We are talking about what is not on carriers actual custody you see.  Therefore the carrier may be exempt from liability for loss or damage, for how can you oblige someone with something that is not in their actual custody?

Here’s an illustration I prepared to make it more clear to you:

Here’s the original deal. The 2 parties SAMAR and NORDEUTSCHER had a meeting of minds, the agreement was to transport and deliver the cargo from Germany to Davao. That is the intent. Manila is just a point of reference between Germany and Davao. And that a TRANSHIPMENT was bound to happen. Either NORDEUTSCHER reloads it from the warehouse into another ship they own which happen to be in the Manila port or hire another ship of local ownership to deliver the goods to the consignee in Davao.  So the bill of lading is very clear, we could infer from it that the shipper-consignee had no wish to obligate itself to handle any booking of further shipment other than the one starting from Germany. It is leaving it all to the carrier’s discretion. All it wanted to do was start the shipment in Germany and wait for the end of shipment in Davao.

If you look at my diagram you can see bold lines and broken lines right? The bold lines is where the carrier  NORDEUTSCHER has actual custody of the goods. And therefore must exercise extra-ordinary diligence as required by law. The broken lines are the moments it has no actual custody and control. And this does not require any kind of diligence, pursuant to what had been stipulated in the bill of lading. Right? So why oblige someone of something he has no control of?

And what the SC had decided upon is the part in the middle where the broken lines landed on the warehouse awaiting transshipment.  This is where this decision was based. SC said there was ACTUAL CONSTRUCTIVE DELIVERY during that time. The goods were discharged from the ship to the warehouse. Therefore the liability now shifts from the carrier to the warehouse. Meaning it is no longer in their custody and control. Therefore the requisite to exercise extra-ordinary diligence ceases, and they are no longer liable for loss or destruction of the goods. Why? Well basically by virtue of the above stipulation. (Section 1 of Paragraph 3 of the Bill of Lading).

Gets? 

TEOFISTO GUINGONA vs CITY FISCAL OF MANILA

A certain Clemente David made several investments with NSLA (National  Savings and Loan Association). But after almost 3 years of investing the bank was placed under receivership by the Central Bank.

So.. here we find out that NSLA is suppose to be a bank ok?  Don’t laugh. This is not a mainstream bank were talking about here such as BDO, BPI, MetroBank, RCBC and all those commercial banks we all see around.  These types are what you call S&L banks or Thrift Banks ok? The difference between the two is that thrift banks are governed by R.A. 7906 which is the Thrift Bank Act, whereas commercial banks are governed by R.A. 8791 the General Banking Law, though the latter law has suppletory application to thrift banks. Gets? So if the name doesn’t ring any bell, it’s suppose to be highly understandable.  

S&L,  meaning savings and loan association. These are financial institutions that specializes in accepting savings deposits and making mortgage and other loans.  They are often mutually held by a certain collective class , like teachers, soldiers, etc. often called mutual savings banks meaning that the depositors and borrowers are members with voting rights, and have the ability to direct the financial and managerial goals of the organization. I should know, I've worked in one type of bank my self during my Letran days.

To site some examples I think we have the Manila Teachers Savings and Loan Association, which has its office in UN Ave.  JUSLAI is another, the Judiciary Savings and Loan Association Inc., I think the Armed Forces have one of their own.  So generally these institutions are not stand alones, they are mostly subsidiaries of their mother institution to where their collective clients belong. 

So here we see in this case NSLA was placed under receivership by Central Bank, and whenever you hear that a certain bank (thrift banks included) is being placed under receivership by Banko Sentral,  take note that's a red flag, that only means one thing, that the bank is in a brink of insolvency.. in other words its getting bankrupt.  So better take your money immediately out of it. You see by law, thrift banks can have no more than 20 percent of their lending in commercial loans so their focus on mortgage and consumer loans makes them particularly vulnerable to housing downturns.

So here’s the scenario,  starting early of 1979 David and her sister were making several investments with said thrift bank NSLA right?  Three years later (1981) the bank gets bankrupt.  So by operation of law Central Bank has to come in right? in order to save bank assets  and see what can be done for its recovery. And of course to protect investors. Which they actually did. But sadly due to technical reasons, not in this case. But can you blame the petitioners here? I dont think so.

With regard to the owners of the bank I dunno correct me if I’m wrong but I’m just inferring from the digested case. I think the said bank was partly owned by the then Senator Teofisto Guingona Jr. , I’m talking about the old Guingona. No not the Sr. but the  Jr. because the current senate speaker, which is the good Senator Teofisto Guingona III is ofcourse the third.

This case was decided 1984. The senator assumed senate office in 1987. And that was mostly the start of his long political career. So.. this tells you aside from heading the Philippine Chamber of Commerce and being the top honcho of DBP before assuming his seats of power, the fellow was a simple businessman.

But as an investor of course suddenly knowing that the funds in the bank where you placed your money is at stake, you ofcourse kinda worry for your financial security you know?  So what David did was he requested  from Guingona and Martin a joint promissory note stating that they are absorbing the obligations of the bank in case of insolvency, and since the former senator as we all know is a man of his word, in good faith, he and his co-owner divided the indebtedness and issued the requested joint promissory note.   

Let’s take a look at what David is arguing for and how much he is trying to secure.  It says in the actual case Clement David, together with his sister, Denise Kuhne, invested with NSLA the sum of:

P1,145,546.20 on time deposits

P13,531.94 on savings account deposits  

 US$ 75,000.00 on foreign deposits

(plus interests)

Ladies and gentlemen were talking about year 1979-1981. So.. you could just figure out how much this amounts are valued during the time prevailing.  

But I’m not sure what triggered private respondent David to file a complaint with the Office of the City Fiscal of Manila charging Guingona and Martin with estafa and violation of Central Bank Circular No. 364 and related Central Bank regulations on foreign exchange transactions.  The actual case as I read it recounts that the promissory note was based on the statement of account as of June 30, 1981 prepared by the private respondent.  Thing was, the amount of indebtedness assumed appears to be bigger than the original claim because of the added interest and the inclusion of other deposits of private respondent's sister in the amount of P116,613.20 where Guingona by himself executed another promissory note antedated to June 17, 1981 whereby he personally acknowledged an indebtedness. So here it's clear, the former senator was aware of his obligation and had no plans to back down.

So, what do you think will happen next?  If I am the former senator and I am faced with a criminal law suit instead of a civil one, I would file a petition myself. Which they did. Hence this case.  

This is a petition for prohibition and injunction with a prayer for the immediate issuance of restraining order and/or writ of preliminary injunction seeking  to prohibit the public respondent which is the City Fiscal of Manila  from proceeding with the preliminary investigation, in which they were charged by private respondent Clement David.  

So as I said erlier, the charge was ESTAFA and a violation of Central Bank Circular No 364.  Now here lies the controversy .. Estafa is a criminal offense.   

So the ISSUE now is: Whether City Fiscal of Manila acted without jurisdiction when they investigated the charges of estafa and violation of CB Circular No. 364 and related regulations regarding foreign exchange transactions.

RULING:

Court HELD that the City Fiscal of Manila have NO JURISDICTION over the charge of ESTAFA.

When private respondent David invested his money  with the bank, the contract that was perfected was a CONTRACT OF SIMPLE LOAN or mutuum and not a Contract of Deposit.

So take note okay?  Time deposits are different from savings account deposits.  It’s an all too different bologna.  It’s more complicated than you’ll ever thought.  The rulebooks and the SC couldn’t have said it more clearly.  It’s an all too different contract meaning the repercussions and ramification are not the same.    

Check this out: Article 1980 of the New Civil Code provides that:  

“Fixed, savings, and current deposits of-money in banks and similar institutions shall be governed by the provisions concerning simple loan” 

Hence, the relationship between David and the NSLA is that of creditor and debtor.  David is the creditor the bank is the debtor.  So  if you do time deposits, consequently, the ownership of the amount deposited will be transmitted to the bank upon the perfection of the contract. That means the bank can make use of the amount deposited for its banking operations, such as to pay interests on deposits and to pay withdrawals.

Now, take note of this, while the Bank has the obligation to return the amount deposited, it has, however, no obligation to return or deliver the same money that was deposited.  Meaning the bank may return it in full or in half depending on its solvency.

And, take note further…  the failure of the Bank to return the amount deposited will not constitute estafa through misappropriation punishable under Article 315, par. l(b) of the Revised Penal Code, but it will only give rise to CIVIL LIABILITY, as in the case at bar public respondent City Fiscal of Manila therefore have no- jurisdiction.. since its suppose to be a civil case, tsk tsk tsk.

Coz you see… in order that a person can be convicted under the above-quoted provision, it must be proven that he has the obligation to deliver or return the sum of money, goods or  personal property that he received.   And as we have just pointed out, such in the prevailing contract, petitioners Guingona and Martin had no such obligation to return the same money they received from David. Okay?

This is because as clearly as stated earlier the sums of money that petitioners received were loans. The nature of simple loan is defined in Articles 1933 and 1953 of the Civil Code. So.. check it out for yourself.

If I were you, I’d hold on to that money and push aside that time deposit contract. Shake that manager’s hand and bid him farewell. Until you find a stronger, stable, and reliable bank for that matter.

 "Art. 1933. - By the contract of loan, one of the parties delivers to another, either something not consumable so that the latter may use the same for a certain time-and return it, in which case the contract is called a commodatum; or money or other consumable thing, upon the condition that the same amount of the same kind and quality shall be paid in which case the contract is simply called a loan or mutuum.

"Commodatum is essentially gratuitous." Simple loan may be gratuitous or with a stipulation to pay interest."In commodatum the bailor retains the ownership of the thing loaned while in simple loan, ownership passes to the borrower.

"Art. 1953. - A person who receives a loan of money or any other fungible thing acquires the ownership thereof, and is bound to pay to the creditor an equal amount of the same kind and quality."

So in simple loan(mutuum), as contrasted to commodatum the borrower acquires ownership of the money, goods or personal property borrowed right? And of course being the owner, the borrower can dispose of the thing borrowed (Article 248, Civil Code) and his act will not be considered misappropriation thereof. right?'

Uuuuh!! Gooey.