Gr.

No 217044, January 16, 2019

Spouses Rainier Jose M. Yulo and Juliet L. Yulo, petitioners

Vs.

Bank of the Philippine Islands, Respondents

FACTS
On October 9, 2006, BPI issued Rainier Yulo a pre-approved credit card, and his
wife Juliet Yulo an extension of his account. The yulo spouses regularly used and paid
their cards but by July 2008. They had an outstanding balance of P 264, 773.56 by
November 29, 2008. On Nov. 11, 2008 BPI sent the spouses a demand letter for the
payment of their outstanding balance of P 253, 017.62. On Feb. 12, 2009 BPI sent
another demand letter but this time for the outstanding balance of P 325, 398.42.
On Feb. 23, BPI filed a complaint in the MTC of Makati City against the Yulo
spouses. The Yulo spouses said that the liabilities were only P20,000 and that BPI did not
fully disclose the Terms and Conditions on the use of their cards. Attempts at mediation
were unsuccessful and this issue forwarded to a trial. On June 24,2012, the MTC
rendered its decision for the bank and that the spouses pay to pay the sum of P 229,
378.68. The MTC also stated that the spouses violated their contract with BPI but still
reduced the 3% penalty charge to 1%
The Yulo spouses filed an appeal to the RTC, but was dismissed on June 26, 2013.
The RTC also stated that although it is the credit card provider who has to prove the
petitioners agreed to the Terms and Conditions contract. BPI has given sufficient
evidence as presented by the charge slips signed by the Yulo spouses as well as the
regular use of the card. The spouses then appealed to the CA, but was also dismissed for
the reason of the spouses cannot pretend they did not know the contract and their
obligations to BPI.
The petitioners then appealed this issue to the Supreme Court with the following
claims:
1. That BPI failed to prove their liability because all they presented was a
valid proof that they availed the credit line not the Statement of Account
, they did not present that the petitioners consented to the Terms and
Conditions.
2. That the Terms and Conditions for being "written in fine print and in
breathlessly long sentences for the purpose of being ignored altogether, to
the prejudice of the public."
3. That the respondent's original charges and penalties for being close-fisted,
and that the penalties should be counted from March 9, 2008 because that
was the date when the demand letter was sent.
ISSUE
Whether or not petitioners are bound by the Terms and Conditions on their use of credit
cards issued by respondent.
RULING
The Petitioners are bound by the Terms and Conditions of BPI and is DIRECTED
TO PAY BPI the amount of Two Hundred Twenty Thousand Fifty-Seven Pesos and
Fifty-One Centavos (P220,057.51) plus twelve percent (12%) legal interest per annum
from November 11, 2008 until June 30, 2013, and six percent (6%) legal interest per
annum from July 1, 2013 until their entire obligation is fully paid.
Because the petitioners signed and accepted card by using the card, a contractual
relationship was created, which the Terms and Conditions binds and governs them. the
According to the cases Alcaraz v. Court of Appeals and Ledda v. Bank of the Philippine
Islands, the credit card provider also failed to prove the client's consent to the credit
card's terms and conditions but because of the client’s use and the non-denial of the
purchases made with card it binds the client to the credit card provider and is required to
pay the sum and the legal interests.