Carolyn M.

Garcia
-vs-
Rica Marie S. Thio
GR No. 154878, 16 March 2007

FACTS
Respondent Thio received from petitioner Garcia two crossed checks
which amount to US$100,000 and US$500,000, respectively, payable to the
order of Marilou Santiago. According to petitioner, respondent failed to pay the
principal amounts of the loans when they fell due and so she filed a complaint
for sum of money and damages with the RTC. Respondent denied that she
contracted the two loans and countered that it was Marilou Satiago to whom
petitioner lent the money. She claimed she was merely asked y petitioner to
give the checks to Santiago. She issued the checks for P76,000 and P20,000
not as payment of interest but to accommodate petitioners request that
respondent use her own checks instead of Santiagos.

RTC ruled in favor of petitioner. CA reversed RTC and ruled that there
was no contract of loan between the parties.

ISSUE
(1) Whether or not there was a contract of loan between petitioner and
respondent.
(2) Who borrowed money from petitioner, the respondent or Marilou Santiago?

HELD
(1) The Court held in the affirmative. A loan is a real contract, not
consensual, and as such I perfected only upon the delivery of the object of the
contract. Upon delivery of the contract of loan (in this case the money
received by the debtor when the checks were encashed) the debtor acquires
ownership of such money or loan proceeds and is bound to pay the creditor
an equal amount. It is undisputed that the checks were delivered to
respondent.

(2) However, the checks were crossed and payable not to the
order of the respondent but to the order of a certain Marilou Santiago.
Delivery is the act by which the res or substance is thereof placed within the
actual or constructive possession or control of another. Although respondent
did not physically receive the proceeds of the checks, these instruments were
placed in her control and possession under an arrangement whereby she
actually re-lent the amount to Santiago.

Petition granted; judgment and resolution reversed and set aside.

Saura Import & Export Co., Inc.
-vs-
DBP
GR No. L-24968, 27 April 972
44 SCRA 445

FACTS
Saura applied to the Rehabilitation Finance Corporation (RFC), before its
conversion into DBP, for an industrial loan to be used for construction of
factory building, for payment of the balance of the purchase price of the jute
machinery and equipment and as additional working capital. In Resolution
No.145, the loan application was approved to be secured first by mortgage on
the factory buildings, the land site, and machinery and equipment to be
installed.

The mortgage was registered and documents for the promissory note were
executed. The cancellation of the mortgage was requested to make way for
the registration of a mortgage contract over the same property in favor of
Prudential Bank and Trust Co., the latter having issued Saura letter of credit
for the release of the jute machinery. As security, Saura execute a trust receipt
in favor of the Prudential. For failure of Saura to pay said obligation,
Prudential sued Saura.

After 9 years after the mortgage was cancelled, Saura sued RFc alleging
failure to comply with tits obligations to release the loan proceeds, thereby
prevented it from paying the obligation to Prudential Bank.

The trial court ruled in favor of Saura, ruling that there was a perfected
contract between the parties ad that the RFC was guilty of breach thereof.

ISSUE
Whether or not there was a perfected contract between the parties.

HELD
The Court held in the affirmative. Article 1934 provides: An accepted promise
to deliver something by way of commodatum or simple loan is binding upon
the parties, but the commodatum or simple loan itself shall not be perfected
until delivery of the object of the contract.

There was undoubtedly offer and acceptance in the case. When an

application for a loan of money was approved by resolution of the respondent
corporation and the responding mortgage was executed and registered, there
arises a perfected consensual contract.
BPI Investment Corporation
-vs-
CA
GR No. 133632, 15 February 2002
377 SCRA 117

FACTS
Frank Roa obtained a loan from Ayala Investment and Development
Corporation (AIDC), for the construction of his house. Said house and lot were
mortgaged to AIDC to secure the loan. Roa sold the properties to ALS and
Litonjua, the latter paid in cash and assumed the balance of Roas
indebtedness wit AIDC. AIDC was not willing to extend the old interest to
private respondents and proposed a grant of new loan of P500,000 with
higher interest to be applied to Roas debt, secured by the same property.
Private respondents executed a mortgage deed containing the stipulation.
The loan contract was signed on 31 March 1981 and was perfected on 13
September 1982, when the full loan was released to private respondents.

BPIIC, AIDCs predecessor, released to private respondents P7,146.87,

purporting to be what was left of their loan after full payment of Roas loan.
BPIIC filed for foreclosure proceedings on the ground that private respondents
failed to pay the mortgage indebtedness. Private respondents maintained that
they should not be made to pay amortization before the actual release of the
P500,000 loan. The suit was dismissed and affirmed by the CA.

ISSUE
Whether or not a contract of loan is a consensual contract.

HELD
The Court held in the negative. A loan contract is not a consensual contract
but a real contract. It is perfected only upon delivery of the object of the
contract. A contract o loan involves a reciprocal obligation, wherein the
obligation or promise of each party is the consideration for that of the other; it
is a basic principle in reciprocal obligations that neither party incurs in delay, if
the other does not comply or is not ready to comply is a proper manner with
what is incumbent upon him
Pantaleon v American Express

G.R. No. 174269, May 8 2009 [Credit Transaction]

FACTS:

After the Amsterdam incident that happened involving the delay of American
Express Card to approve his credit card purchases worth US$13,826.00 at
the Coster store, Pantaleon commenced a complaint for moral and exemplary
damages before the RTC against American Express. He said that he and his
family experienced inconvenience and humiliation due to the delays in credit
authorization. RTC rendered a decision in favor of Pantaleon. CA reversed the
award of damages in favor of Pantaleon, holding that AmEx had not breached
its obligations to Pantaleon, as the purchase at Coster deviated from
Pantaleon's established charge purchase pattern.

ISSUE:
1. Whether or not AmEx had committed a breach of its obligations to
Pantaleon.
2. Whether or not AmEx is liable for damages.

RULING:
1. Yes. The popular notion that credit card purchases are approved within
seconds, there really is no strict, legally determinative point of demarcation
on how long must it take for a credit card company to approve or disapprove a
customers purchase, much less one specifically contracted upon by the
parties. One hour appears to be patently unreasonable length of time to
approve or disapprove a credit card purchase.

The culpable failure of AmEx herein is not the failure to timely approve
petitioners purchase, but the more elemental failure to timely act on the
same, whether favorably or unfavorably. Even assuming that AmExs credit
authorizers did not have sufficient basis on hand to make a judgment, we see
no reason why it could not have promptly informed Pantaleon the reason for
the delay, and duly advised him that resolving the same could take some time.

2. Yes. The reason why Pantaleon is entitled to damages is not simply

because AmEx incurred delay, but because the delay, for which culpability lies
under Article 1170, led to the particular injuries under Article 2217 of the Civil
Code for which moral damages are remunerative. The somewhat unusual
attending circumstances to the purchase at Coster that there was a deadline
for the completion of that purchase by petitioner before any delay would
redound to the injury of his several traveling companions gave rise to the
moral shock, mental anguish, serious anxiety, wounded feelings and social
humiliation sustained by Pantaleon, as concluded by the RTC.
Facts:

Frank Roa obtained a loan with interest rate of 16 1/4%/annum from Ayala Investment and
Development Corporation (AIDC), the predecessor of BPI Investment Corp. (BPIIC), for the
construction of a house on his lot in New Alabang Village, Muntinlupa.
He mortgaged the house and lot to AIDC as security for the loan.
1980: Roa sold the house and lot to ALS Management & Development Corp. and Antonio
Litonjua for P850K who paid P350K in cash and assumed the P500K indebtness of ROA with
AIDC.
AIDC proposed to grant ALS and Litonjua a new loan for P500K with interested
rate of 20%/annum and service fee of 1%/annum on the outstanding balance payable within
10 years through equal monthly amortization of P9,996.58 and penalty interest of
21%/annum/day from the date the amortization becomes due and payable.
March 1981: ALS and Litonjua executed a mortgage deed containing the new stipulation
with the provision that the monthly amortization will commence on May 1, 1981
August 13, 1982: ALS and Litonjua paid BPIIC P190,601.35 reducing the P500K principal
loan to P457,204.90.
September 13, 1982: BPIIC released to ALS and Litonjua P7,146.87, purporting to be
what was left of their loan after full payment of Roas loan
June 1984: BPIIC instituted foreclosure proceedings against ALS and Litonjua on the
ground that they failed to pay the mortgage indebtedness which from May 1, 1981 to June 30,
1984 amounting to P475,585.31
August 13, 1984: Notice of sheriff's sale was published
February 28, 1985: ALS and Litonjua filed Civil Case No. 52093 against BPIIC alleging
that they are not in arrears and instead they made an overpayment as of June 30, 1984 since
the P500K loan was only released September 13, 1982 which marked the start of the
amortization and since only P464,351.77 was released applying legal compensation the
balance of P35,648.23 should be applied to the monthly amortizations
RTC: in favor of ALS and Litonjua and against BPIIC that the loan granted by BPI to ALS
and Litonjua was only in the principal sum of P464,351.77 and awarding moral damages,
exemplary damages and attorneys fees for the publication
CA: Affirmed reasoning that a simple loan is perfected upon delivery of the object of the
contract which is on September 13, 1982
ISSUE: W/N the contract of loan was perfected only on September 13, 1982 or the second release
of the loan?

HELD: YES. AFFIRMED WITH MODIFICATION as to the award of damages. The award of moral
and exemplary damages in favor of private respondents is DELETED, but the award to them of
attorneys fees in the amount of P50,000 is UPHELD. Additionally, petitioner is ORDERED to pay
private respondents P25,000 as nominal damages. Costs against petitioner.
obligation to pay commenced only on October 13, 1982, a month after the perfection of
the contract
contract of loan involves a reciprocal obligation, wherein the obligation or promise of each
party is the consideration for that of the other. It is a basic principle in reciprocal obligations
that neither party incurs in delay, if the other does not comply or is not ready to comply in a
proper manner with what is incumbent upon him. Consequently, petitioner could only demand
 for the payment of the monthly amortization after September 13, 1982 for it was only then
when it complied with its obligation under the loan contract.
BPIIC was negligent in relying merely on the entries found in the deed of mortgage,
without checking and correspondingly adjusting its records on the amount actually released
and the date when it was released. Such negligence resulted in damage for which an award
of nominal damages should be given
SSS where we awarded attorneys fees because private respondents were compelled to
litigate, we sustain the award of P50,000 in favor of private respondents as attorneys fees