Sunteți pe pagina 1din 11

FORTUNE INSURANCE AND SURETY CO INC VS CA

1995 || Davide Jr, J


Facts
Producers Bank of the Phil was insured by Fortune Insurance
against robbery (Money, Security, and Payroll Robbery policy). The loss
took place along Taft Ave in Pasay City as Producers armored car was
robbed. The armored car was transferring P725k cash from the Pasay City
branch to the head office in Makati.
The cash was under the custody of teller Maribeth Alampay while
the car was driven by Benjamin Magalong and escorted by Security Guard
Saturnino Atiga. Driver Magalong was assigned by PRC Management
Systems while the guard was assigned by Unicorn Security Services Inc
(both contractors). Atiga and Magalong were both charged with several
others in violating PD 532 or the Anti-Highway Robbery Law.
Producers filed an action to recover P725k under the policy.
Fortune claims that, under the policy, the General Exceptions preclude
recovery when the loss is caused by any dishonest, fraudulent or
criminal act of the insured or any officer, employee, partner,
director, trustee or authorized representative of the Insured
whether acting alone or in conjunction with others. Fortune claims
that Atiga and Magalong are either employees or authorized
representatives of Producers.
RTC: Not employees, Fortune must pay

Driver and security guard were merely offered by the contractors and
assigned to Producers Bank

Producers did NOT have the power to (1) select and engage (2) pay
wages (3) dismiss or (4) control. It was the respective contractors.
CA affirmed.

Labor Code is a special law designed to protect labor. Its definition of


employee-employer relationships is inapplicable to an insurance
contract, which is to be constructed liberally in favor of the insured.

Had Fortune intended to apply the Labor Code in defining employee


it should have stated such expressly
Fortunes contentions:

When Producers commissioned a guard and a driver to transfer its


funds, they effectively and necessarily became its authorized
representatives in the care and custody of the money.

Employees of Producers. Existence of an employer-employee


relationship is determined by law and being such, it cannot be the
subject of agreement. The provisions in the contracts of Producers with

PRC Management System for Magalong and with Unicorn Security


Services for Atiga which state that Producers is not their employer and
that it is absolved from any liability as an employer, would not
obliterate the relationship.
Power of selection and engagement, payment of wages, dismissal and
control over Magalong and Atiga was vested in and exercised by
Producers
PRC and Unicorn merely labor-only contractors, thus the principal
(Producers) is the direct employer.

Producers arguments (reiterate basis of RTC and CA decisions)


Issue: WoN Magalong and Atiga were employees of Producers YES.
Fortune is NOT liable.
Ratio:

In burglary, robbery, and theft insurance, the opportunity to defraud


the insurer the moral hazard is so great that insurers have found
it necessary to fill up their policies with countless restrictions, many
designed to reduce this hazard.

Persons frequently excluded under such provisions are those in the


insured's service and employment. The purpose of the exception is to
guard against liability should the theft be committed by one having
unrestricted access to the property. The terms specifying the excluded
classes are to be given their meaning as understood in common
speech. "Service" and "employment" are generally associated with the
idea of selection, control, and compensation.
As far as Fortune is concerned, it was its intention to exclude and
exempt from protection and coverage losses arising from dishonest,
fraudulent, or criminal acts of persons granted or having unrestricted
access to Producers' money or payroll. When it used then the term
"employee," it must have had in mind any person who qualifies as such
as generally and universally understood, or jurisprudentially
established in the light of the 4 standards in the determination of the
employer-employee relationship.
Labor-only contracts is a question of fact. In the case, the stipulation
of facts is limited to the insurance policy, the contracts with PRC
Management Systems and Unicorn Security Services, the complaint for
violation of PD 532, and the information filed by the City Fiscal, there is
a paucity of evidence.
They were authorized representatives. Producers entrusted the three
with the specific duty to safely transfer the money to its head office,
with Alampay to be responsible for its custody in transit; Magalong to
drive the armored vehicle which would carry the money; and Atiga to

provide the needed security for the money, the vehicle, and his two
other companions. The three acted as agents
REPUBLIC GLASS CORP V QUA (2004)
Republic and Gervel seeks to recover from Qua his share in the payment
they made as sureties of Ladtek.
Ladtek obtained a loan from Metrobank. Republic Glass (RGC), Gervel, and
Qua were Ladtek's sureties.
Agreement: RGC, Gervel and Qua would reimburse each other the
proportionate share on any sum that any of them might pay to the creditor
(Metrobank).
Ladtek defaulted. RGC and Gervel paid a sum of money thereby partially
paying Ladtek's obligation to Metrobank. They then wrote to Qua
demanding that he pay them. Qua refused. As a result, RGC and Gervel
foreclosed several stocks Qua owned and sold them.

In addition to theP3,860,646 claimed by RGC and Gervel, Qua would have


to pay his liability of P6.2 million to Metrobank and more than P1 million to
PDCP. Since Qua would surely exceed his proportionate share, he would
then recover from RGC and Gervel the excess payment. This situation is
absurd and circuitous.
GUINGON V DEL MONTE (1967)
Plaintiffs: Guingon Family
Defendants: Iluminado Del Monte (jeepney driver), Julio Aguilar, Capital
Insurance & Surety Co
Ponente: Bengzon, JP

Qua is not happy.


TC & CA: Qua is not liable to reimburse RGC and Gervel. RGC and Gervel
only made partial payments and did not pay the entire obligation. Hence,
Qua remains to be solely liable for the remaining debt. The foreclosure and
sale of Qua's stocks was unjustified because the obligation secured by the
underlying pledgee had been extinguised by novation.
RGC and Gervel contention in this appeal: Payment of the entire obligation
is not a condition sine qua non for them to claim reimbursement from Qua.

WON Payment of the entire obligation is not a condition sine qua


non for them to claim reimbursement from Qua. NO
WON they are entitled to reimbursement. NO

Payment of entire obligation is not a requisite for liability to arise in a


contract of indemnity against liablity. The contract becomes operative as
soon as the liability of the person indemnified arises (because of default)
whether or not he has suffered actual loss.

HOWEVER, if we allow RGC and Gervel to collect from Qua, then Qua
would pay much more than his stipulated liability. They can recover
reimbursement from the co-debtor Qua only in so far as their payment
exceed their share in the obligation. This is not the case here. The two paid
less than their share in the obligation, therefore they cannot demand
reimbursement since their payment is actually less than their actual debt.

Julio Aguilar was a jeepney operator. He insured his jeepneys with


Capital Insurance against third-party liability.
A provision of the insurance policy called Liability to the Public
states that Capital Insurance will indemnify the INSURED in the event
of accident arising out of the use of the motor vehicle or in connection
with loading/unloading of passengers, against all sums including
the claimants costs and expenses which the INSURED shall be
liable to pay in respect of:
a Death of or bodily injury to any person
b Damage to property
One of Aguilars jeepney drivers, driving one of the jeepneys insured,
bumped Gervasio Guingon who had just alighted from another jeep.
Guingon died some days later.
The driver was charged and found guilty of homicide thru reckless
imprudence.
The heirs of Guingon filed an action for damages
they prayed that P80k be paid to them jointly and severally by
the driver, Julio Aguilar, and Capital Insurance
In the policy is a no action clause that says:
...nothing contained in this policy shall give any person the
right to join the Company as co-defendant in any action
against the Insured to determine the Insureds liability
Capital Insurance says:
The Guingons have no cause of action against it because of the no
action clause in the policy.

Issues:
1 W/N Capital Insurance may be sued by the Guingons
2 W/N Capital Insurance may be sued jointly with the Insured
Held:

Yes to both

Ratio:
Re: Capital Insurance may be sued

The policy involves insurance for third-party liability. Since the insured
is liable to the third person, such third person can sue the insurer.

The right of the person injured to sue the insurer of depends on


whether the contract of insurance is intended to benefit third
persons also or only the insured.
If the contract provides for indemnity against liability to third
persons , third persons can sue the insurer.
If the contract is for indemnity against actual loss or payment
third persons cannot sue the insurer (the contract being solely to
reimburse the insured for liability actually discharged by him thru
payment to third persons)
Re: May be sued jointly with Aguilar

Rules of Court Sec 5 Rule 2 (Joinder of causes of action) and Sec 6


Rule 3 (Permissive joinder of parties) are aimed at avoiding
multiplicity of suits.

The no action clause cannot override procedural rules


EASTERN ASSURANCE & SURETY v. IAC
Cebu Office of Dept. of Agrarian Reform put up a public bidding job or
project consisting of repair of 7 units of Willys Mitsubishi Jeeps. Motor
City won the bid, its bid was accompanied by the required Proposal Bond 1
of 33,275 pesos issued by Eastern Assurance as surety on behalf of Motor
City.
DAR entered into a Contract for Repair of Jeeps with Motor City on
January 31, 1976.
Motor City will repair the 7 jeeps within 90 days
failure to do so will obligate him to indemnify DAR the amount
equivalent to 1% of the quoted price for each day of late delivery
Motor City will put up 10k pesos as Performance bond upon award
of bid
Motor City fully repaired and returned on time 6 of the jeeps (minus 1).
DAR several letters/granted extensions but Motor City failed to comply.

1 Proposal bond: If Motor City shall become a successful bidder and 1) fails to guarantee performance of the
contract 2) refuse to accept it 3) shall not answer for any delay or default of the EXECUTION of the contact,
DAR shall be indemnified for loss or damage not to exceed 33k

DAR filed a suit for specific performance and damages v. Motor city
and co-defendant Eastern City.
Eastern argument: denied liability, the Proposal Bond was a
mere offer and not binding and pleaded by way of cross claim that
Motor City indemnify Easter whatever amount court would order it
to pay. Proposal bond to assure owner of project of the good faith
of bidder and that bidder will enter into the contract v.
performance bond which is to assure project owner that the
contractor will perform the contract and make good on damages.
TC: Motor City to deliver last unit and pay indemnity for later delivery. In
case of default, payment will be assumed by Eastern.
CA: re-affirmed but change on the date of computation for interest to
March 3, 1978.
ISSUE: WON Eastern liable for the contractual breach by Motor City? YES
HELD: Easterns liability under the Proposal Bond accured the moment
Motor failed to post the 10k performance bond, and incurred in delay and
defaulted in the repair/delivery of the 7th jeep. Delay and % of indemnity
counted from the date of last demand. Easterns liability shall NOT exceed
the amt in the Proposal Bond of 33k.
AS SURETY, EASTERN LIABLE upon happening of ANY of the
events:
1 refusal of Motor City to guarantee performance of contract.
-There was a breach of this, no performance bond of 10k was ever
posted. DAR did not waive this condition.
2 refusal of Motor City to enter into the contract
-NO, was entered into
3 to answer for any delay or default in the execution of the contract
as stated in the proposal
-Eastern argument: this pertains to the SIGNING or the conclusion
of the contract not the performance
The Proposal Bond was drafted by Eastern-contract of adhesion and any
ambiguity must be construed against Eastern.

ANTONIO ZARAGOZA v. MA. ANGELA FIDELINO and MABINI


INSURANCE & FIDELITY
1988 / Narvasa
Suretyship > Nature and extent of liability of surety > Proceeding against
a surety bond

Antonio Zaragoza sold a car to Angela Fidelino, but she failed to pay
the price in the manner stipulated in their agreement, so Zaragoza filed a
replevin suit. The car was taken from Fidelino's possession on the strength
of a writ of delivery. However, the car was returned to her when a
surety bond for the car's release was posted by Mabini Insurance.
The court ruled in favor of Zaragoza, ordering Fidelino to pay
the balance of the purchase price. Zaragoza moved for the
amendment of the decision to include Mabini Insurance as a party
solidarily liable with Fidelino, and the court granted his motion.

3
4
5

Statement in the application of the facts showing applicant's right


to damages and the amount thereof
Giving of due notice of the application to the attaching creditor and
his surety or sureties
Holding of a proper hearing at which the attaching creditor and the
sureties may be heard on the application

Enforcement of a surety's liability on a counter-bond given for the release


of property seized under a writ of preliminary attachment is governed by
Section 17 of Rule 57.

ISSUE & HOLDING


WON MABINI should be held liable. YES

SEC. 17. When execution returned unsatisfied, recovery had upon


bond. If the execution be returned unsatisfied in whole or in part, the
Applicable provisions are RoC Rule 60, Section 102, and Rule 57,
surety or sureties on any counter-bond given pursuant to the provisions of
Section 203
this rule to secure the payment of the judgment shall become charged on
SC notes that it would seem that Rule 57, Section 20 is not relevant.
such counter-bond, and bound to pay to the judgment creditor upon
demand, the amount due under the judgment, which amount may be
What the law says
In this case
recovered from such surety or sureties after notice and summary hearing
Title and first sentence speak of an illegal
The writ of delivery was not illegal
in the same action."
attachment
and of a judgment "in favor of the party against
The judgment was against, NOT in favor of
MABINI bound itself "jointly and severally" with Fidelino in the sum
whom (said illegal) attachment was issued
Fidelino
of P48k which is double the value of the property stated in the affidavit of
Zaragoza, for the delivery thereof if such delivery is adjudged, or for the
Although a party be adjudged liable to another, if it be established
payment of such sum to him as may be recovered against the defendant
that the attachment issued at the latter's instance was wrongful
and the costs of the action. MABINIs liability attached upon the
and the former had suffered injury thereby, recovery for damages
promulgation of the verdict against Fidelino. All that was necessary
may be had by the party thus prejudiced by the wrongful
to enforce the judgment against it was an application therefor with the
attachment, even if the judgment be adverse to him.
Court, with due notice to the surety, and a proper hearing.
The filing of the bond was an act of voluntary submission to the
To hold a surety on a counter-bond liable, what is entailed is:
Court's authority, which is one of the modes for the acquisition of
1 Filing of an application with the Court having jurisdiction of the
jurisdiction over a party.
action
2 Presentation before the judgment becomes executory

2 SEC. 10. Judgment to include recovery against sureties. The amount, if any, to be awarded to either
party upon any bond filed by the other in accordance with the provisions of this rule, shag be claimed,
ascertained, and granted under the same procedure as prescribed in section 20 of Rule 57.

3 SEC. 20. Claim for damages on account of illegal attachment. If the judgment on the action be in
favor of the party against whom attachment was issued, he may recover, upon the bond given or deposit made
by the attaching creditor, any damages resulting from the attachment. Such damages may be awarded only
upon application and after proper hearing, and shall be included in the final judgment. The application must be
filed before the trial or before appeal is perfected or before the judgment becomes executory, with due notice
to the attaching creditor and his surety or sureties, setting forth the facts showing his right to damages and the
amount thereof

STRONGHOLD INSURANCE CO. VS. COURT OF APPEALS


Justice Paras, 5 May 1992
Northern Motors Inc., (Northern) and Macronics Marketing entered into a
leased agreement wherein the Marcronics leased certain premises from the
Northern. Macronics failed to pay its bills so Northern was forced to
terminate the lease. Because of Macronics' unpaid liabilities, Northern was
forced to sell off the Marcronics properties in an auction sale wherein
Northern was the buyer. Macronics was duly notified of the sale. These

properties sold were the sole means available by which Northern Motors
Inc. could enforce its claim against Macronics.
On March 1985, Leisure Club, Inc. filed a civil case against Northern Motors
Inc. for replevin and damages. It sought the recovery of certain office
furniture and equipments. The lower court ordered the delivery of subject
properties to Leisure Club Inc. subject to the posting of the requisite bond.
Accordingly, Leisure Club Inc. posted a replevin bond in the amount
of P42,000.00 issued by Stronghold Insurance Co., Inc. In due
course, the lower court issued the writ of replevin, thereby enabling Leisure
Club Inc. to take possession of the disputed properties.
Northern Motors filed a counterbond for the release of the disputed
properties. However, efforts to recover these properties proved futile as
Leisure Club Inc. was never heard of again. The lower court eventually
rendered its decision in favor of Northern Motors Inc.
Northern Motors then filed a "Motion for Issuance of Writ of
Execution Against Bond of Plaintiff's Surety", which was treated by the
lower court as an application for damages against the replevin bond. The
lower court issued then issued the disputed Order finding Stronghold liable
under its surety bond for the damages awarded to Northern Motors Inc.
Petitioners Arguments

It is not a party to the case and that the decision clearly became
final and executory and, therefore, is no longer liable on the bond.

Northern Motors failed to prove any damage by reason of the


insurance of replevin bond.
Trial Court

Being the prevailing party, it is undeniable that the defendant is


entitled to recover against the bond. The application for that
propose was made before the decision became final and before the
appeal was perfected. Both the prevailing and losing parties may
appeal the decision.

with respect to the defendant the motion against the bond was
filed before any appeal was instituted and definitely on or before
the judgment became final.

Although the claim against the bond was denominated as a motion


for issuance of a writ of execution, the allegations are to the effect
that the defendant is applying for damages against the bond.

defendant suffered damages by reason of the wrongful replevin, in


that it has been deprived of the properties upon which it was
entitled to enforce its claim
CA: Affirmed

ISSUE AND HOLDING: Whether or not the Stronghold is liable under its
surety bond for the damages awarded to Northern Motors. YES
The Court found that Stronghold Insurance never denied that it issued a
replevin bond. Under the terms of the said bond, Stronghold Insurance
together with Leisure Club solidarily bound themselves for P42,000
(a) for the prosecution of the action,
(b) for the return of the property to the defendant if the return thereof be
adjudged, and
(c) for the payment of such sum as may in the cause be recovered against
the plaintiff and the costs of the action.
In the case at bar, all the necessary conditions for proceeding against the
bond are present, to wit:
(i) the plaintiff a quo, in bad faith, failed to prosecute the action, and after
relieving the property, it promptly disappeared;
(ii) the subject property disappeared with the plaintiff, despite a court
order for their return; and
(iii) a reasonable sum was adjudged to be due to respondent, by way of
actual and exemplary damages, attorney's fees and costs of suit.
Northern Motors proved the damages it suffered thru evidence
presented in the hearing of the case itself and in the hearing of its motion
for execution against the replevin bond. No evidence to the contrary was
presented by Stronghold Insurance Co., Inc. in its behalf.
The obligation of Stronghold Insurance Co., Inc., under the bond is
specific. It assures "the payment of such sum as may in the cause be
recovered against the plaintiff, and the costs of the action.
PETITION DENIED.
PHIL PRYCE ASSURANCE CORP VS CA
1994 || Nocon, J
Facts
Phil Pryce Assurance Corp (formerly known as Interworld Assurance
Corp) issued 2 surety bonds in behalf of its principal, Sagum General
Merchandise for P500k and P1M. The complaint for recovery of P1.5M was
filed by Gegroco Inc. Phil Pryce admitted to issuing the 2 surety bonds but
denied liability
Defense of Phil Pryce:
1 The checks which were to pay for the premiums bounced and were
dishonored hence there is no contract to speak of between
petitioner and its supposed principal;

The bonds were merely to guarantee payment of its principal's


obligation, thus, excussion4 is necessary.

RTC ordered Phil Pryce to pay. CA affirmed.


Issue: WoN Phil Pryce is liable for the P1.5M in the surety bonds YES
Ratio:
Defense #1 lacks merit Art 177. The surety is entitled to payment of the
premium as soon as the contract of surety ship or bond is perfected and
delivered to the obligor. No contract of surety ship or bonding shall be valid
and binding unless and until the premium therefore has been paid, except
where the obligee has accepted the bond in which case the bond
becomes valid and enforceable irrespective of whether or not the
premium has been paid by the obligor to the surety.
Phil Pryce: Art 177 is inapplicable because Gegroco (obligee) allegedly did
NOT accept the surety bond and could not delivery goods to Sagum no
merit

But facts show that Phil Pryce admitted to have issued the bonds.
Leonardo Guzman, witness for Gegroco, testified that (1) Sagum
was required to submit a surety bond to guaranty payment of
spare parts it purchased from Gegroco. (2) Sagum submitted the
surety bonds which Gegroco accepted

Evidence of delivery invoices addressed to Sagum proving that the


parts were purchased, delivered and received.

Surety stipulation: Distillery can proceed against Manila Fidelity without


proceeding against the Principal (Arranz) for the latters' obligation.
As added security in favor this time of Manila fidelity, Arranz also executed
a mortgage of his property for any loss that will be suffered by Manila
Fidelity (by virtue of Manila answering Arranz' obligations to Distillery.)
1950-1951
1st installment (50K) on the property became due and Manila Fidelity was
unable to pay Ylang-ylang.
2nd installment (40K) became due, and Manila fidelity still was unable to
pay.
Arranz, in order to be able to pay his obligations, wanted to mortgage the
same properties to PNB in order to secure a loan. But PNB will only agree if
Arranz were to cancel the initial mortgage he executed on the property in
favor of Manila Distillery. In response, Manila Distillery will only accede to
this cancellation of the mortgage originally established in its favor if Arranz
pays the premiums he owes for the years 1950-1945 amounting to
Php7,200.
Arranz was constrained to pay the premiums because he needed the loan
from PNB in order to be able to pay Ylang-ylang distillery.
Present case: Arranz wants to recover the amount he paid Manila Fidelity
as premium. He asserts that the premiums were not due and he is not
obliged to pay them since Manila fidelity failed to pay Ylang-ylang.

Phil Pryce: no authority to issue a Surety Bond no merit

Admission of fraud committed against Gegroco. No person can


benefit from a wrong he himself committed.

Is Arranz under obligation to pay the premiums because of his


surety (manila fidelity)'s failure to pay the indebtedness he
secured from Ylang-ylang? YES.

ARRANZ V MANILA FIDELITY AND SURETY CO.

Manila Fidelity, as Arranz' surety, committed no breach. Their agreement


only allowed the creditor (Ylang-ylang) to proceed against the surety
without the need of proceeding against Arranz. The failure or refusal of the
surety to pay the debt for the principal's account did not have the effect of
relieving the principal of his obligation to pay the premium on the bond
furnished.

Ylang ylang distillery: creditor/obligee


Arranz: principal
Manila fidelity: surety
Arranz brought a property from Ylang Ylang (did not say what property).
Manila fidelity undertook to be Arranz' surety in his obligation to Ylang
ylang distillery.

4 process or proceedings whereby a creditor must proceed against a principal debtor before proceeding
against a surety or subsidiary debtor

As long as the liability of the surety to creditor exists, the premium remains
to be collectible from Arranz. As the loan and interest to Ylang-ylang
remains unpaid, the surety continued to be bound to the creditor & as a
corrolary its right to premiums.
PETITION DENIED

REPARATIONS COMMISSION V. UNIVERSAL DEEP SEA FISHING


June 27, 1978 || Concepcion, J.
Universal Deep Sea-Fishing Corporation (UNIVERSAL) was awarded 6 trawl
boats by the Reparations Commission as end-user of reparations goods.
Boats
Delivere Contract
First
Installm
d on
(executed on)
installment ent #1
representin
date
g 10% cost
due
due date
M/S
Novemb K of Conditional
May 8, 1961
May 8,
UNIFI
er 20,
Purchase and
1982
SH 1
1958
Sale of
&2
Reparations of
Goods (Feb 12,
1960)
M/S
April 20, K of Conditional
July 1961
July
UNIFI
1959
Purchase and
1962
SH 3
Sale of
&4
Reparations of
Goods (Nov 25,
1959)
M/S
not
covered by
Oct 17, 1961 Oct 17,
UNIFI
stated
Contract for the
1962
SH 5
Utilization of
&6
Reparations
Goods (Feb 12,
1960)
*In all of the contracts, Manila Surety & Fidelity Co. Inc acted as surety.
There was also a corresponding indemnity agreement to indemnify the
surety company for any damage/loss which it may incur as a consequence
of having become a surety. One of the indemnitors was Pablo Sarmiento
(acting general manager of UNIVERSAL).
*In the first 2 contracts, it provided that the first installment representing
10% of the amount shall be paid within 24 months from the date of
complete delivery thereof
On August 10, 1962, Reparations Commission instituted present action
against UNIVERSAL and surety company to recover money due under these
contracts.
UNIVERSAL claims the amounts are not yet due and demandable.
Surety company also said the action was premature but set up a
cross-claim against UNIVERSAL for reimbursement of whatever

money it may have to pay. It also filed a complaint against Pablo


Sarmiento.
Pablo Sarmiento denied liability saying he signed it in his capacity
as acting general manager of UNIVERSAL.

Trial court ruled in favor of Reparations Commission.


1. UNIVERSAL must pay P100k in first cause of action, P141k in
second cause of action and P54k in third cause of action, with
interest starting from August 10, 1962
2. Surety company, jointly and severally with UNIVERSAL, pays P53k
in first cause, P68k in second cause and P54k in third cause of
action
3. UNIVERSAL and Pablo Sarmiento jointly and severally pays Manila
Surety P53k and P68k with interest starting from August 10, 1962
plus attorneys fees
4. UNIVERSAL pays Manila Surety P54k with interest starting from
August 10, 1962
5. UNIVERSAL shall pay costs
UNIVERSALs argument: there is obscurity in terms of the contracts and
they should first be fixed before a creditor can demand its payment from
the debtor. Schedule of payment in the contract says first installment is
due on May 8, 1961. However, amount of the first of the succeeding
itemized installments is due on May 8, 1962.
Issue: WON the first installments under the 3 contracts were already due
and demandable when the complaint was filed (August 10, 1962) YES
On first installments and due dates
Terms of the contracts are very clear and leave no doubt as to intent of
both parties first installment shall be paid within 24 months from the
date of complete delivery or on May 8, 1961, and the balance paid in 10
equal yearly installments.
What UNIVERSAL claims is obscure, the other first installment is
but the first of the 10 equal yearly installments of the balance of the
purchase price. (aka DIFFERENT from the real first installment stated in
contract)
In Reparations Commission vs Northern Lines Inc, the court faced a similar
situation. It held that the schedule of payments for the 10 equal yearly
installments DO NOT INCLUDE the one designated as first installment. The
10 equal yearly installments refer to the balance of the price to be paid by
the buyer after deducting the first installment, so that altogether there
would be 11 installments.

Thus, the obligation was already due and demandable for the first
installments as well as the first of the 10 equal yearly installments on the 2
contracts.
On premiums on the performance bonds
Surety company claims that RTC erred in not awarding it the amount of P7k
as premiums on performance bonds.
The premium is consideration for furnishing the bonds and the obligation to
pay subsists for as long as the liability of the surety exists.
SC agrees with Surety that UNIVERSAL should pay the P7k to Manila Surety
as it was expressly undertaken by UNIVERSAL.
Down payment of P10k by UNIVERSAL
Surety company claims RTC erred in not applying the down payment of
UNIVERSAL of P10,000 to the guaranteed indebtedness. NCC 1254 where
there is no imputation of payment made by either debtor or creditor, debt
which is most onerous to the debtor shall be deemed to have been
satisfied. P10k should be applied to the guaranteed portion of the debt,
thus releasing part of the liability (P53k P43k).
SC: Rules in NCC 1252-1254 applies to a person owing several debts of the
same kind to a single creditor. Cannot be made applicable to a person
whose obligation as a mere surety is both contingent and singular.
Obligation included the payment of not only the first installment but also of
the 10 equal yearly installments. No error was made in holding the surety
company to the full extent of its undertaking.
Pablo Sarmientos liability
He executed the indemnity agreements in both (1) capacity as acting
general manager of UNIVERSAL (2) individual capacity. He is liable.
WHEREFORE judgment affirmed with modification that UNIVERSAL should
pay Manila Surety P7k for premiums.
SHAFER v JUDGE , RTC
Sherman Shafer obtained a private car policy over his Ford Laser car
from Makati Insurance Company for third party liability (TPL). During the
effectivity of the policy, Shafer got into an accident while driving the
vehicle. He hit and bump and Volkswagen driven by Felipo Legaspi causing

damage amounting to 12,345 pesos and a passenger on the vehicle,


Jovencio Poblete, sustained physical injuries.
CASES:
Owner of the Volkswagen car filed a separate civil action v. Shafer
for damages
Criminal case-Poblete testified on claim to serious physical injuries
sustained from the accident.
Shafer was granted leave by the judge to file a 3rd party complaint
v. Makati insurance Co. Court dismissed this claiming it was prematureShafer would have to be convicted and sentenced to pay the offended
party first. Court suggested to wait for outcome of case to determine WON
Shafer has a cause of action v. insurer for 3rd party liability (TPL).
Shafer: dismissal of the 3rd party complaint would amount to
denial of this rights, must be allowed to legally implead the
insurance company in a criminal action for reckless imprudence
with a civil action jointly prosecuted.
Makati Insurance: TPL available only if defendant has a right ot
demand contribution/indemnity/or other relief. The contract of
motor vehicle insurance is DISTINCT from the criminal liability of
Shafer.
HELD: Petition granted, Shafers 3rd party complaint against Makati
Insurance Company is entered. The physical injuries of Poblete was
impliedly instituted with the criminal case.
ISSUES:
1 When does liability of the insurance company arise?
Compulsory Motor Vehicle Liability Insurance in this case was for loss or
damage, where the insurance policy insures directly against liability, the
insurers liability ACCURES IMMEDIATELY UPON THE OCCURRENCE OF THE
INJURY OR EVENT. No need for the insured to wait for the court decision.
Third party complaint is allowed by the rules of procedure to avoid
unnecessary lawsuits, predicated on the need for expediency and
avoidance of unnecessary lawsuits.
Intent of the Insurance contract: to provide compensation for death or
bodily injuries suffered by innocent 3rd parties or passengers as a result of
the negligent operation and use of vehicles
2 Can the injured sue the insurer directly?
The injured for whom the contract of insurance is intended can directly sue
the insurer. Intent was to protect the injured persons against insolvency of
the insured who causes such injury

PERLA COMPANIA DE SEGUROS, INC VS. COURT OF APPEALS (1992)


Justice Nocon, 7 May 1992
On December 1981, Sps. Herminio and Evelyn Lim executed a promissory
note in favor Supercars, Inc. in the sum of P77,940.00, payable in monthly
installments and secured by a chattel mortgage over a brand new red Ford
Laser, which is registered under the name of Herminio Lim and insured
with Perla Compania de Seguros, Inc. (Perla) for comprehensive coverage.
On the same date, Supercars, Inc., with notice to the Sps. Lim, assigned to
FCP Credit Corporation (FCP) its rights, title and interest on said promissory
note and chattel mortgage as shown by the Deed of Assignment.
On November 1982, said vehicle was carnapped. Evelyn Lim, who
was driving said car before it was carnapped, immediately called up the
Anti-Carnapping Unit of the Philippine Constabulary to report said incident
and thereafter, went to the nearest police substation to make a police
report regarding said incident.
Sps. Lim filed a claim for loss with Perla but said claim was denied
on the ground that Evelyn Lim, who was using the vehicle before it was
carnapped, was in possession of an expired driver's license at the time of
the loss of said vehicle which is in violation of the authorized driver
clause of the insurance policy.
Sps. Lim requests from FCP for a suspension of payment on the
monthly amortization agreed upon due to the loss of the vehicle and, since
the carnapped vehicle insured with Perla, said insurance company
should be made to pay the remaining balance of the promissory
note and the chattel mortgage contract. Perla denied Sps. Lims
claim. Consequently, FCP demanded that Sps. Lim pay the whole balance
of the promissory note or to return the vehicle but the latter refused.
FCP filed a complaint against Sps. Lim, who in turn filed an
amended third party complaint against Perla.
TC: Dismissed the Third-Party Complaint filed against Perla
CA: Reversed
Issue and Holding: Whether or not the Perla, the insurable company, is
liable for the payment of the outstanding balance of the mortgage at the
time of the loss. YES
The comprehensive motor car insurance policy issued by Perla undertook
to indemnify the Sps. Lim against loss or damage to the car:
a by accidental collision or overturning, or collision or overturning
consequent upon mechanical breakdown or consequent upon wear
and tear;

(by fire, external explosion, self-ignition or lightning or burglary,


housebreaking or theft; and
c by malicious act
Where a car is admittedly, as in this case, unlawfully and
wrongfully taken without the owner's consent or knowledge, such
taking constitutes theft, and, therefore, it is the "THEFT"' clause,
and not the "AUTHORIZED DRIVER" clause that should apply.
Theft is an entirely different legal concept from that of accident.
Theft is committed by a person with the intent to gain or, to put it in
another way, with the concurrence of the doer's will. On the other hand,
accident, although it may proceed or result from negligence, is the
happening of an event without the concurrence of the will of the person by
whose agency it was caused.
The risk against accident is distinct from the risk against
theft. The "authorized driver clause" in a typical insurance policy is in
contemplation or anticipation of accident in the legal sense in which it
should be understood, and not in contemplation or anticipation of an event
such as theft. The distinction often seized upon by insurance companies
in resisting claims from their assureds between death occurring as a
result of accident and death occurring as a result of intent may, by
analogy, apply to the case at bar. Thus, if the insured vehicle had figured in
an accident at the time she drove it with an expired license, then, appellee
Perla Compania could properly resist appellants' claim for indemnification
for the loss or destruction of the vehicle resulting from the accident. But in
the present case. The loss of the insured vehicle did not result from an
accident where intent was involved; the loss in the present case was
caused by theft, the commission of which was attended by intent
In addition, the Court finds that there is no causal connection
between the possession of a valid driver's license and the loss of a
vehicle. To rule otherwise would render car insurance practically a sham
since an insurance company can easily escape liability by citing restrictions
which are not applicable or germane to the claim, thereby reducing
indemnity to a shadow
Sps. Lim were able to secure an insurance policy from petitioner
Perla, and the same was made specifically payable to FCP. The insurance
policy was therefore meant to be an additional security to the
principal contract, that is, to insure that the promissory note will still be
paid in case the automobile is lost through accident or theft.
It is clear from then that upon the loss of the insured vehicle,
the insurance company Perla undertakes to pay directly to the
mortgagor or to their assignee, FCP, the outstanding balance of
the mortgage at the time of said loss under the mortgage
contract. If the claim on the insurance policy had been approved by Perla,
it would have paid the proceeds thereof directly to FCP, and this would
have had the effect of extinguishing Sps. Lims obligation to FCP. Therefore,

Sps. Lim were justified in asking petitioner FCP to demand the unpaid
installments from Perla.
THE MAGLANAs v. JUDGE FRANCISCO CONSOLACION and AFISCO
INSURANCE
1992 / Romero
Motor vehicle insurance > Comprehensive motor vehicle liability insurance
FACTS
Bureau of Customs [BoC] employee Lope Maglana was on his way to work,
driving a BoC-owned motorcycle, when a PUJ jeep bumped him. He was
thrown from the road, and he died on the spot.
Maglanas heirs filed an action for damages against the jeepney
operator and Afisco Insurance [AFISCO]. An information for homicide thru
reckless imprudence was filed against the driver. The lower court found
that the jeepney operator did not exercised sufficient diligence. AFISCO
was ordered to reimburse whatever amounts the jeepney operator
shall have paid only up to the extent of its insurance coverage.
ARGUMENTS
MAGLANAs AFISCO should not merely be held secondarily liable.
The 20k coverage of the insurance policy issued by AFISCO should
have been awarded in their favor.
o IC: The insurer's liability is direct and primary and/or jointly
and severally with the operator of the vehicle, although
only up to the extent of the insurance coverage.
o Insurance policy provides: In the event of the death of
any person entitled to indemnity under this Policy, the
Company will, in respect of the liability incurred to such
person indemnify his personal representatives in terms of,
and subject to the terms and conditions hereof.
AFISCO Presumption: JOINT obligation, since IC does not
expressly provide for a solidary obligation

Maglanas received 5k from AFISCO under the no-fault clause, AFISCO's


liability is now limited to 15k. The Maglanas can choose from either of the
following:
Claim P15,000 from AFISCO and the balance from the jeepney
operator
Enforce the entire judgment from the jeepney operator subject to
reimbursement from AFISCO to the extent of the insurance
coverage
RATIO
The UNDERLYING REASON behind the third party liability of the
Compulsory Motor Vehicle Liability Insurance is to protect injured
persons against the insolvency of the insured who causes such
injury, and to give such injured person a certain beneficial interest
in the proceeds of the policy.
Where an insurance policy insures directly against liability,
the insurer's liability accrues immediately upon the occurrence of the
injury or event upon which the liability depends, and does not depend on
the recovery of judgment by the injured party against the insured.
[Shafer v. RTC Judge]
AFISCO is directly liable, but NOT solidarily liable with jeepney
operator
Where the insurance contract provides for indemnity against liability to
third persons, such third persons can directly sue the insurer. However, the
insurers direct liability under indemnity contracts against third party
liability does not mean that the insurer can be held solidarily liable with the
insured and/or the other parties found at fault. Insurers liability is
based on contract; insureds liability based on tort.
While in solidary obligations, the creditor may enforce the entire
obligation against one of the solidary debtors, in an insurance contract,
the insurer undertakes for a consideration to indemnify the insured against
loss, damage or liability arising from an unknown or contingent event.
[Malayan Insurance v. CA]

The lower court denied the Maglanas MfR. Since the insurance
contract is in the nature of suretyship, then AFISCOs liability is secondary
only up to the extent of the coverage.

PERLA COMPANIA de SEGUROS, INC. vs. ANCHETA


Justice Cortes, 8 August 1988

ISSUE & HOLDING


WON AFISCO is directly liable with the jeepney operator up to the extent
of its insurance coverage. YES

On December 1977, private respondents vehicle collided with a


Superlines bus along a national highway. Because of the collision, private
respondents sustained physics injuries in varying degrees of gravity. As
such, they filed with a complaint for damages against Superlines, the bus
driver and Perla Compania de Seguros (Perla, the insurer of the bus. The
bus was insured with Perla for the amount of P50,000.00 as and for

AFISCOs liability based on the insurance contract is direct [but


NOT solidary with jeepney operators liability under NCC 2180]. Since the

Facts:

10

passenger liability and P50,000.00 as and for third party liability. On the
other hand, the vehicle in which private respondents were riding was
insured with Malayan Insurance Co.
On March 1978, the CFI judge issued an order requiring Perla to
pay immediately the P5,000.00 under the "no fault clause" as provided for
under Section 378 of the Insurance Code.

1.
2.

Petitioners Argument:

Under Sec. 378 of the Insurance Code, the insurer liable to pay the
P5,000.00 is the insurer of the vehicle in which private
respondents were riding, not petitioner, as the provision states
that "[i]n the case of an occupant of a vehicle, claim shall lie
against the insurer of the vehicle in which the occupant is riding,
mounting or dismounting from."

4.

Issue and Holding:


Whether or not petitioner is the insurer liable to indemnify private
respondents under Sec. 378 of the Insurance Code. NO
Ratio:
The Court finds that the key to the resolution of the issue is of
courts e Sec. 378, which provides:
Sec. 378. Any claim for death or injury to any passenger
or third party pursuant to the provision of this chapter shall
be paid without the necessity of proving fault or negligence
of any kind. Provided, That for purposes of this section
xxx
(iii) Claim may be made against one motor vehicle only. In
the case of an occupant of a vehicle, claim shall lie
against the insurer of the vehicle in which the
occupant is riding, mounting or dismounting from. In
any other case, claim shall lie against the insurer of the
directly offending vehicle. In all cases, the right of the party
paying the claim to recover against the owner of the
vehicle responsible for the accident shall be maintained.
From a reading of the provision, the following rules on claims under
the "no fault indemnity" provision, where proof of fault or negligence is not
necessary for payment of any claim for death or injury to a passenger or a
third party, are established:

3.

A claim may be made against one motor vehicle only.


If the victim is an occupant of a vehicle, the claim shall lie against
the insurer of the vehicle. in which he is riding, mounting or
dismounting from.
In any other case (i.e. if the victim is not an occupant of a vehicle),
the claim shall lie against the insurer of the directly offending
vehicle.
In all cases, the right of the party paying the claim to recover
against the owner of the vehicle responsible for the accident shall
be maintained.

The Court finds that the law is very clear the claim shall lie
against the insurer of the vehicle in which the "occupant" ** is
riding, and no other. The claimant is not free to choose from which
insurer he will claim the "no fault indemnity," as the law, by using
the word "shall, makes it mandatory that the claim be made against
the insurer of the vehicle in which the occupant is riding, mounting or
dismounting from.
That said vehicle might not be the one that caused the
accident is of no moment since the law itself provides that the
party paying the claim under Sec. 378 may recover against the
owner of the vehicle responsible for the accident. This is precisely
the essence of "no fault indemnity" insurance which was introduced to and
made part of our laws in order to provide victims of vehicular accidents or
their heirs immediate compensation, although in a limited amount,
pending final determination of who is responsible for the accident and
liable for the victims 'injuries or death. In turn, the "no fault indemnity"
provision is part and parcel of the Insurance Code provisions on
compulsory motor vehicle ability insurance [Sec. 373-389] and should be
read together with the requirement for compulsory passenger and/or third
party liability insurance [Sec. 377] which was mandated in order to ensure
ready compensation for victims of vehicular accidents.
Irrespective of whether or not fault or negligence lies with the
driver of the Superlines bus, as private respondents were not occupants of
the bus, they cannot claim the "no fault indemnity" provided in Sec. 378
from petitioner. The claim should be made against the insurer of the
vehicle they were riding.
PETITION GRANTED. ORDER ANNULED AND SET ASIDE.

11

S-ar putea să vă placă și