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Prof. Joselito Guianan Chan's The Labor Code of the Philippines, Annotated Labor Standards & Social Legislation Volume I of a 3-Volume Series 2019 Edition (3rd Revised Edition)
 

 
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UNITED STATES SUPREME COURT JURISPRUDENCE
 

 
PHILIPPINE SUPREME COURT JURISPRUDENCE
 

   
May-1939 Jurisprudence                 

  • G.R. No. 45383 May 2, 1939 - MARIA V. SERAPIO v. MARIANO SERAPIO, ET AL.

    067 Phil 701

  • G.R. No. 45502 May 2, 1939 - SAPOLIN CO., INC. v. CORNELIO BALMACEDA

    067 Phil 705

  • G.R. No. 45915 May 2, 1939 - ESCOLASTICO BUENAVENTURA v. GERINO Z. LAYLAY

    067 Phil 717

  • G.R. No. 45486 May 3, 1939 - TIBURCIO SUMERA v. EUGENIO VALENCIA

    067 Phil 721

  • G.R. No. 45322 May 4, 1939 - WALTER BULL v. REDO L. YATCO

    067 Phil 728

  • G.R. No. 45524 May 4, 1939 - MUNICIPALITY OF VICTORIAS v. VICTORIAS MILLING CO., INC.

    067 Phil 733

  • G.R. No. 45969 May 4, 1939 - TAN TIAH v. Yu JOSE

    067 Phil 739

  • G.R. No. 45122 May 5, 1939 - VISAYAN SURETY & INSURANCE CORPORATION v. FRUCTUOSA TABARES

    067 Phil 743

  • G.R. No. 45496 May 5, 1939 - ROMAN CATHOLIC ARCHBISHOP OF MANILA v. EL MONTE DE PIEDAD Y CAJA DE AHORROS DE MANILA

    068 Phil 1

  • G.R. No. 45662 May 5, 1939 - JUAN GOROSTIAGA v. MANUELA SARTE

    068 Phil 4

  • G.R. No. 45889 May 5, 1939 - CRISPINO ENRIQUEZ v. PEOPLE OF THE PHIL.

    068 Phil 8

  • G.R. No. 45987 May 5, 1939 - PEOPLE OF THE PHIL. v. CAYAT

    068 Phil 12

  • G.R. No. 46405 May 6, 1939 - RAYMUNDO TRANS. CO., INC. v. PUBLIC SERVICE COMMISSION

    068 Phil 22

  • G.R. No. 45667 May 9, 1939 - HARRY IVES SHOEMAKER v. TONDEÑA

    068 Phil 24

  • G.R. No. 45696 May 9, 1939 - GIL BUENDIA v. VICENTE SOTTO

    068 Phil 31

  • G.R. No. 45865 May 10, 1939 - PEOPLE OF THE PHIL. v. TI YEK JUAT

    068 Phil 37

  • G.R. No. 45993 May 11, 1939 - GERONIMO SANTIAGO v. FABIAN R. MILLAR

    068 Phil 39

  • G.R. No. 45318 May 12, 1939 - JACINTO MESINA v. PETRA DELINO

    068 Phil 43

  • G.R. No. 45427 May 12, 1939 - PHIL. NATIONAL BANK v. PHIL. TRUST CO.

    068 Phil 48

  • G.R. No. 45433 May 12, 1939 - ROSARIO GONZALEZ CASTRO VIUDA DE AZAOLA v. GASTON O’FARRELL

    068 Phil 74

  • G.R. No. 45648 May 12, 1939 - DIRECTOR OF LANDS v. ANICETO ABA

    068 Phil 85

  • G.R. Nos. 46119-46121 May 12, 1939 - PEOPLE OF THE PHIL. v. IGNACIO BELTRAN

    068 Phil 90

  • G.R. No. 46584 May 13, 1939 - MARIANO MARCOS v. ROMAN A. CRUZ

    068 Phil 96

  • G.R. No. 45616 May 16, 1939 - FELICIANO SANCHEZ v. FRANCISCO ZULUETA

    068 Phil 110

  • G.R. No. 45543 May 17, 1939 - SURIGAO MINE EXPLORATION CO. v. C. HARRIS

    068 Phil 113

  • G.R. No. 46432 May 17, 1939 - PEOPLE OF THE PHIL. v. TEODORICO MARTIN

    068 Phil 122

  • G.R. No. 45924 May 18, 1939 - CELESTINO RODRIGUEZ v. EUGENIO YAP

    068 Phil 126

  • G.R. No. 45160 May 23, 1939 - JOSE GREY v. SERAFIN FABIE

    068 Phil 128

  • G.R. Nos. 45705-45707 May 23, 1939 - TEODORA DOMINGO v. MARGARITA DAVID

    068 Phil 134

  • G.R. No. 45842 May 23, 1939 - MARCARET STEWART MITCHELL MCMASTER v. HENRY REISSMANN & CO.

    068 Phil 142

  • G.R. No. 46177 May 23, 1939 - PEOPLE OF THE PHIL. v. MELCHOR TAGASA

    068 Phil 147

  • G.R. No. 46437 May 23, 1939 - EUFEMIO P. TESORO v. DIRECTOR OF PRISONS

    068 Phil 154

  • G.R. No. 45213 May 24, 1939 - H. P. L. JOLLYE v. EMETERIO BARCELON

    068 Phil 164

  • G.R. No. 45486 May 24, 1939 - ASIATIC PETROLEUM CO. v. JOSEFA VALENCIA VIUDA DE MOLINA

    068 Phil 172

  • G.R. No. 45218 May 26, 1939 - CONSUELO CEMBRANO v. CARMEN PARDO DE TAVERA DE GONZALEZ

    068 Phil 175

  • G.R. No. 45446 May 25, 1939 - C. N. HODGES v. PEOPLE OF THE PHIL.

    068 Phil 178

  • G.R. No. 45530 May 25, 1939 - CHINA INSURANCE v. Y. CHONG

    068 Phil 189

  • G.R. No. 45615 May 25, 1939 - TEOFILO SINCO v. SILVESTRA TEVES

    068 Phil 200

  • G.R. No. 46000 May 25, 1939 - PEOPLE OF THE PHIL. v. JOSE M. BAES

    068 Phil 203

  • G.R. No. 46024 May 25, 1939 - SOTERA ARAVEJO v. ALFONSO DORONILA

    068 Phil 210

  • G.R. No. 46078 May 25, 1939 - GREGORIA REYNOSO v. JOSE E. TOLENTINO

    068 Phil 213

  • G.R. No. 45189 May 26, 1939 - PHIL. SUGAR ESTATE DEV’T. CO., INC. v. JUAN POSADAS

    068 Phil 216

  • G.R. No. 45264 May 26, 1939 - JOSEFA CASTELLTORT v. BALBINA PASION

    068 Phil 224

  • G.R. No. 45736 May 26, 1939 - CONCEPCION LOPEZ v. ADELA LOPEZ

    068 Phil 227

  • G.R. No. 46100 May 26, 1939 - ALFREDO HIDALGO RIZAL v. JOSEFA RIZAL MERCADO

    068 Phil 231

  • G.R. No. 43585 May 27, 1939 - RIZALINA DE LA ROSA v. MAXIMIANA EDRALIN

    068 Phil 234

  • G.R. No. 45307 May 27, 1939 - COMPAÑIA GENERAL DE TABACOS DE FILIPINAS v. COLLECTOR OF INTERNAL REVENUE

    068 Phil 238

  • G.R. No. 45324 May 27, 1939 - GOVERNMENT OF THE PHIL. v. FRANCISCO ABADINAS

    068 Phil 254

  • G.R. No. 45374 May 27, 1939 - MANUEL RODRIGUES v. DANIEL TIRONA

    068 Phil 264

  • G.R. No. 45608 May 27, 1939 - JESUS AZCONA v. PACIFIC COMMERCIAL CO.

    068 Phil 269

  • G.R. No. 46248 May 27, 1939 - TIMOTEO TAROMA v. ROMAN A. CRUZ

    068 Phil 281

  • G.R. No. 45350 May 29, 1939 - BACHBACH MOTOR CO. v. ESTEBAN ICARAÑGAL

    068 Phil 287

  • G.R. No. 45121 May 31, 1939 - DEMETRIO GAMBOA v. SERAFIN GAMBOA

    068 Phil 304

  •  





     
     

    G.R. No. 45213   May 24, 1939 - H. P. L. JOLLYE v. EMETERIO BARCELON<br /><br />068 Phil 164

     
    PHILIPPINE SUPREME COURT DECISIONS

    FIRST DIVISION

    [G.R. No. 45213. May 24, 1939.]

    H. P. L. JOLLYE, Plaintiff-Appellant, v. EMETERIO BARCELON and LUZON SURETY COMPANY, INC., Defendants. LUZON SURETY COMPANY, INC., Appellee.

    Ross, Lawrence, Selph & Carrascoso for Appellant.

    Santiago & Vicente for Appellee.

    SYLLABUS


    1. CONTRACTS; PACTS, CLAUSES AND CONDITIONS ESTABLISHED BY PARTIES THERETO. — It is the law that in every contract the parties may establish any pacts, clauses and conditions they may deem advisable, provided, they are not contrary to law morals or public order (art. 1255 of the Civil Code.) , and that if the terms of a contract are clear and leave no doubt the intention of the contracting parties, the literal sense of its wording shall be followed (art. 1281 of the Civil Code).

    2. ID.; ID.; LIMITATION OF OBLIGATIONS. — There is certainly nothing in the clause of the surety bond, Exhibit B, that is contrary to law, morals or public order. The acts provided therein by reason of which the contract of suretyship was executed could have taken place within the stipulated period of twelve months;. Hence, the parties fixed that period exactly at twelve months, limiting thereby the obligation of the appellee to answer for the payment to the appellant of the aforesaid sum of P7,500 to not more than the stipulated period.

    3. ID.; ID.; ID.; CONTRACT OF SURETYSHIP AND GUARANTY. — The clauses of a contract of suretyship, as has been said on more than one occasion, determine the degree of liability of the surety (Government of the Philippine Islands v. Herrero, 38 Phil, 410), which must not be extended by mere implications beyond the clear terms of the contract. The surety must only be bound in the manner and to the extent, and under the circumstances which are set forth or which may be inferred from the contract of suretyship (La Insular V8. Machuca Go-Tauco and Nubla Co-Siong, 39 Phil., 567; Solon v. Solon, 38 Off. Gaz., 2015).


    D E C I S I O N


    DIAZ, J.:


    Plaintiff attempted to recover from defendants the sum of P7,500 with legal interest from August 28, 1936, when he filed his complaint, besides the costs of the suit, basing his claim upon the facts which he averred in said pleading and hereafter to be mentioned. He contended that said defendants were bound to pay him the sum referred to, jointly and severally.

    Upon the trial of the case, after defendants had filed their respective answers, the Court of First Instance of Manila where it was commenced, rendered judgment, sentencing defendant Emeterio Barcelon to pay plaintiff the amount claimed, with legal interest. It, however, dismissed the case as to the defendant Luzon Surety Company, declaring that the obligation assumed by said defendant, as surety, has been extinguished, and that said defendant is accordingly no longer subject to any liability. From the judgment thus rendered by said court, plaintiff took an appeal and, in his brief, maintains that the court erred: (1) m declaring that the surety bond, Exhibit B, executed by the Luzon Surety Company in his favor, lapsed after twelve months from its execution; and (2) in denying his motion for new trial.

    The facts alleged by plaintiff and established at the trial are briefly as follows: Through his agent, Felicisimo Santiago, plaintiff bought from defendant Emeterio Barcelon, on February 13, 1933 seventy-five shares of stock of the North Electric Company, a corporation duly organized and engaged in business having its principal office in the City of Manila. Said 75 shares of stock were represented by two certificates, certificate No. 2 for twenty-five shares and certificate No. 19 for fifty shares. When the sale took place, defendant Barcelon executed the document appearing of record as Exhibit A, reading as follows:jgc:chanrobles.com.ph

    "DEED OF SALE OF SHARES OF CAPITAL STOCK OF THE NORTH

    ELECTRIC COMPANY

    "For and in consideration of the sum of seven thousand five hundred pesos (P7,500) which I have this day received from Mr. H. P. L. Jollye, I, Emeterio Barcelon, owner of seventy-five shares of capital stock of the North Electric Company (Certificate No. 38 [2-19] for 75 shares), do hereby sell, transfer and convey unto the said H. P. I. . Jollye, his heirs, successors and assigns, the aforesaid shares and do hereby warrant that I have good and sufficient title on them.

    "It is agreed between the parties hereto that should any judgment in the case there is against Vicente Diosomito in the Court of First Instance of Cavite invalidate my title to the shares herein sold, I hereby obligate myself to give the money back to Mr. H. P. L. Jollye; and for the purpose of guaranteeing the fulfillment of this obligation, I have caused the Luzon Surety Company to issue in favor of the said H. P. L. Jollye, his heirs, successors and assigns, a surety bond in the sum of P7,500 a copy of which is attached hereto and made part hereof as Schedule A; it being understood, however, that all expenses in connection with the said bond shall be borne and paid by the beneficiary Mr. H. P. L. Jollye, his heirs, successors or assigns.

    In witness whereof, I have hereunto signed this document, in this City of Manila, this 13th day of February, 1933.

    (Sgd.) "EMETERIO BARCELON

    "In the presence of:chanrob1es virtual 1aw library

    (Sgd.) "R. J. GONZALEZ

    "F. SANTIAGO"

    Since according to the said document Exhibit A, the seventy-five shares of stock in question which were sold by Barcelon to plaintiff, were at the time subject of suit in civil case No. 2525 of the Court of First Instance of Cavite, entitled "Toribia Uson, Plaintiff, v. Vicente Diosomito, defendant", the two, Barcelon and the herein plaintiff, agreed that the first would execute, as he in fact did, in favor of the latter a surety bond in an amount equal to what was then given to him in payment of the seventy-five shares of stock in order to secure the return of said sum in the event that Vicente Diosomito from whom Barcelon had acquired them should lose in said case. Pursuant to that agreement, Barcelon and defendant Luzon Surety Company, Inc., the latter in its capacity as surety, executed in favor of plaintiff Exhibit B, reading as follows:jgc:chanrobles.com.ph

    "SURETY BOND

    "Know all men by these presents:jgc:chanrobles.com.ph

    "That we, Emeterio Barcelon of No. 16 Brixton Hill, Manila, as principal, and Luzon Surety Company, Inc., a corporation duly organized and existing under and by virtue of the laws of the Philippine Islands, as sureties, are held and firmly bound unto H. P. L. Jollye of Manila, P. I. in the sum seven thousand five hundred only (P7,500), Philippine currency, for the payment of which sum, well and truly to be made, we bind ourselves, our heirs, executors, administrators, successors, and assigns, jointly and severally, firmly by these presents.

    ‘The conditions of this obligation are as follows:jgc:chanrobles.com.ph

    "Whereas, the above bounden principal, on 13th day of February, 1933 entered into an agreement with H. P. L. Jollye of Manila, P. I., to fully and faithfully refund to said Mr. H. P. L. Jollye the above stated sum of P7,500 representing the purchase price of the 75 shares of the capital stock of the North Electric Company (certificate No. 38) paid by said Mr. H. P. L. Jollye to the undersigned principal, Mr. Emeterio Barcelon, in the event the title thereto of said Mr. Barcelon is invalidated by any judgment which may be rendered by the court in the case now pending in the Court of First Instance of Cavite against Vicente Diosomito or in the event that any of the warranties contained in that certain deed of sale executed by the undersigned principal on this 13th day of February, 193~, be invalidated, a copy of which is hereto attached and made an integral part hereof, marked Exhibit A.

    "Whereas, said H. P. L. Jollye requires said principal to give a good and sufficient bond in the above stated sum to secure the full and faithful performance on his part of said agreement.

    "Now therefore, if the principal shall well and truly perform and fulfill all the undertakings, covenants, terms, conditions and agreements stipulated in said agreement, then this obligation shall be null and void; otherwise it shall remain in full force and effect.

    "The liability of Luzon Surety Company, Inc., under this bond will expire twelve (12) months from date hereof.

    "In witness whereof, we have set our hands and signed cur names on this 13th day of February, 1933.

    (Sgd.) "EMETERIO BARCELON

    "Principal

    "LUZON SURETY COMPANY, INC.

    (Sgd.) "EULOGIO RODRIGUEZ

    "Manager

    "Surety

    "In the presence of:chanrob1es virtual 1aw library

    (Sgd.) "C . G. RAMOS

    "Witness to principal

    (Sgd.) ILLEGIBLE

    "Witness to surety"

    Upon the commencement of case No. 2626 above-mentioned in the early part of January, 1932, Toribia Uson, as plaintiff, secured a writ of preliminary attachment against Vicente Diosomito and by virtue of that writ the seventy-five shares of stock in question, which then still appeared in the books of the North Electric Company in the name of and as belonging to Diosomito, were attached. Thereafter, judgment was rendered against him in said case, sentencing him to pay the plaintiff Uson the sum of P2,300. is this judgment became final because he did not take any appeal, the corresponding writ of execution was thereafter issued. After the giving of the prescribed notices, the sheriff sold the attached seventy-five shares of stock to Toribia Uson as the highest bidder at the public sale. However, when she appeared in the offices of the North Electric Company with the certificate of sale issued in her favor by the sheriff, to ask for the transfer of her name of the aforesaid certificates Nos. 2 and 19 which represented the seventy-five shares of stock sold to her by the sheriff she discovered that the same had already been cancelled because another had been issued in their place, being at first certificate No. 38 in favor of Emeterio Barcelon subsequently, certificate No. 47 in favor of the herein plaintiff. This was due to the fact that Diosomito, the former owner of the shares of stock aforementioned, sold them to Barcelon, although he had been informed that they had been attached in the case brought against him by Toribia Uson (Civil case No. 2525) because he had been timely notified of the attachment and because that fact was also noted in certificates Nos. 2 and 19 and in the books of the North Electric Company.

    In view of this fact, Toribia Uson, who insisted on the validity and force of her right as a purchaser in good faith of the aforementioned shares of stock, commenced civil case No. 2816 in the Court of First Instance of Cavite, against Vicente Diosomito, Angel Limjoco, Emeterio Barcelon, H. P. L. Jollye, and the North Electric Company, to secure a judicial determination of who among them had the right of ownership over said shares. The court decided the case in her favor, declaring that she was their real owner and ordering accordingly the North Electric Company to cancel certificate No. 47 with which certificates Nos. 2 and 19 were substituted and to issue a new one in favor of Toribia Uson as evidence of her right over said shares.

    The court reserved to H. P. L. Jollye, defendant and appellant in this case, the right to recover from Emeterio Barcelon the amount of P7,500 for which he had bought the shares, and to Barcelon the right in turn to recover from Vicente Diosomito what he had paid the latter therefor. The judgment by which all this was ordered, was appealed to this court, but u as affirmed in its entirety.

    Desiring to recover the P7,500 he had paid Barcelon, appellant now brings his action against the surety of said defendant, which is the appellee, Luzon Surety Company, Inc.

    It will be noted that the last clause of the surety bond executed by the appellee in favor of the appellant clearly says:jgc:chanrobles.com.ph

    "The liability of Luzon Surety Company, Inc., under this bond will expire twelve (12) months from date hereof." The date to which the aforecited clause refers is February 13, 1933.

    It is the law that in every contract, the parties may establish any pacts, clauses and conditions they may deem advisable, provided, they are not contrary to law, morals or public order (art. 1255 of the Civil Code), and that if the terms of a contract are clear and leave no doubt as to the intention of the contracting parties, the literal sense of its wording shall be followed (art. 1281 of the Civil Code).

    There is certainly nothing in the clause referred to of the surety bond, Exhibit B, nor in the others which it contains, that is contrary to law, morals or public order. The acts provided therein by reason of which the contract of suretyship was executed could have taken place within the stipulated period of twelve months. Hence, the parties fiscal that period exactly at twelve months, limiting thereby the obligation of the appellee to answer for the payment to the appellant of the aforesaid sum of P7,500 to not more than the stipulated period. The clauses of a contract of suretyship, as has been said on more than one occasion, determine the degree of liability of the surety (Government of the Philippine Islands v. Herrero, 38 Phil., 410), which must not be extended by mere implications beyond the clear turns of the contract. The surety must only be bound with manner and to the extent, and under the circumstances which are set forth or which may be inferred from the contract of suretyship (La Insular v. Machuca Go-Tauco and Nubla Co-Siong, 39 Phil., 567; Solon v. Solon, 38 Off. Gaz., 2015).

    Furthermore, as it was and is known that the appellee is a corporation created and organized exclusively to engage in the business of giving bonds upon a fixed premium or interest, which is of course limited to the rate determined by law, it must necessarily subsist on the income it derives through said means. From this it follows that it did not bind itself, which appellant knows, to answer to any one beyond the one year period of the contract. To bind it for a longer time, he should have renewed the contract, Exhibit B; and appellant neither asked for a novation nor paid the necessary premium to extend it for one, two or three more years.

    Accordingly, the first error attributed to the lower court has no merit, and as the second error is no more than a consequence of the first, consideration thereof is unnecessary.

    The judgment appealed from being in accordance with law in view of the foregoing considerations, it is affirmed in its entirety, with costs against the appellant. So ordered.

    Avanceña, C.J., Villa-Real, Imperial, Laurel, Concepcion, and Moran, JJ., concur.

    G.R. No. 45213   May 24, 1939 - H. P. L. JOLLYE v. EMETERIO BARCELON<br /><br />068 Phil 164


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