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Vs.
COURT OF APPEALS, MANUEL CUAD and LILIA
CUADY
FACTS:
Manuel and Lilia obtained from Super Cars a credit covering the amount of
one vehicle. This credit was evidenced by a promissory note executed by the
borrowers in favor of Supercars.
To secure compliance under the promissory note, spouses constituted a
chattel mortgage.
Supercars assigned the promissory note to BA Finance. Spouses paid to the
Finance Corporation partial amounts of the loan.
The Finance corporation obtained a renewal of the insurance coverage over
the vehicle with an insurance company when Spouses failed to renew the
said insurance.
Under the terms of Insurance, loss under the policy is to be paid to the
finance corporation.
The vehicle then figured an accident. The Spouses then asked the finance
corporation to consider the accident as a total loss, claim the insurance
proceeds from the insurance company, apply the same to the unpaid balance
and return to the Spouses any surplus.
But instead of heeding the request, the finance corporation had the
car repaired. Eventually, the car bogged down.
Again, the spouses asked the finance corporation to pursue their prior
instruction which the latter did not respond to. Spouses stopped paying the
note.
Corporation filed an action to recover unpaid balance which was dismissed
and thereafter affirmed.
ISSUE:
Did the corporation waived its right to collect from the spouses by failing to
enforce and collect the insurance of the vehicle?
SC RULING:
Yes.
The finance corporation subrogated Supercars making the former bound by
the terms and conditions of the chattel mortgage which made the finance
corporation the attorney-in-fact of the Spouses with full power to file,
prosecute, compromise or settle insurance claims and to deliver
corresponding documents to prove the claim and to collect the same.
In granting the same, agency was created making finance corporation bound
to carry out the agency and liable for damages due to its refusal to do the
prior instructions.
It would be unjust, unfair and inequitable to require the spouses to pay the
unpaid balance on account of stubborn refusal and failure of the finance
corporation to avail the insurance money.
BRITISH AIRWAYS
Vs.
COURT OF APPEALS, GOP MAHTANI and
PHILIPPINE AIRLINES
FACTS:
Mahtani decided to visit his relatives in India. He obtained the services of a
certain Mr. Gumar to prepare his travel plans.
Agent then purchased a ticket from British Airways. Since the airline
company has no direct flight from Manila to India, Mahtani had to take a
flight to Hongkong via PAL and upon arrival to Hongkong, Mahtani had to
take a connecting flight to Bombay.
However, when Mahtani arrived in India, he discovered that his
luggage was missing and upon inquiry from BA, he was told that it
might have been diverted to London. He waited for a week for his
luggage.
Back in the Philippines, Mahtani filed for damages against BA and Gumar.
BA then filed a complaint against PAL alleging that the reason for the nontransfer of the luggage was because of PALs late arrival in HongKong.
Trial Court favored Mahtani which was affirmed by the CA.
The complaint against PAL was dismissed.
ISSUE:
Is there a contract of agency between BA and PAL?
SC RULING:
Yes.
The contract of air transportation was exclusively between Mahtani and
BA, the latter merely endorsing the Manila to HongKong flight to PAL, as its
subcontractor or agent. In fact, the conditions in the ticket provides that the
carriage to be performed is regarded as a single operation.
As an agent, PAL should be responsible for any negligence in the
performance of its function and is liable for damages which BA may suffer by
reason of the negligent act.
Both BA and PAL are members of the International Air Transport Association
wherein member airlines are regarded as agent of each other in the issuance
of the tickets and other matters.
However, since there is a breach of contract which is exclusively between BA
and Mahtani, Mahtani can sue BA alone since PAL is not a party to the
contract. But PAL is liable for its negligent acts if it was the proximate cause
of Mahtanis unfortunate experience.
SC reinstated the 3rd pary complaint.
NICHOLAS Y. CERVANTES
Vs.
COURT OF APPEALS AND PHILIPPINE AIRLINES
FACTS:
PAL issued to Cervantes a round trip plane ticket. The ticket provides an
expiry date of one year from issuance in accordance with the Compromise
Agreement entered into by the 2 parties in 2 previous suits.
4 days before expiry date, Cervantes used it. Upon arrival in the desired
destination, Cervantes booked his return ticket (LA to Manila) with PAL which
was confirmed a week and a half after he used the ticket by 2 PAL agents.
Upon learning that PAL would stop over in San Francisco, Cervantes made
arrangements with PAL to board him in the San Francisco flight, instead of
LA.
JESUS M. GOZUN
Vs.
JOSE TEOFILO T. MERCADO
FACTS:
Jose ran for the gubernatorial post. Upon Joses request, Gozun, owner of a
publishing house, submitted to Jose draft samples and price quotation of
campaign materials.
According to Gozun, Joses wife told him that Jose approved such proposals
and Gozun can start printing the campaign materials.
Due to the urgency and limited time, Gozun availed the service of 2 printing
press owned by Gozuns mother and daughter.
Gozun delivered the materials to Jose.
Meanwhile, Joses sister in law obtain from Gozun cash advance of
P253,000 for the allowance of poll watchers who were attending a seminar
and for other expenses.
Gozun then sent a statement of account to Jose containing the campaign
materials and cash advance.
Joses wife partially paid to Gozun who issued a receipt. However, despite
repeated demands and promise to pay [after 3 years], Jose was not
able to pay the balance.
Gozun filed a suit for the collection of the amount. Jose denied having
transacted with Gozun saying that the materials are donations.
As to the cash advance, Jose denied giving authority to his sister-inlaw to receive the same. He also denied giving his wife the authority
to enter into a contract with Gozun.
ISSUE: