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Case Summary of (Estate of Victor Sevilla v. Sevilla, G.R. No. L-17845 April 27, 1967), Papers of Law

A summary of a case of (Estate of Victor Sevilla v. Sevilla, G.R. No. L-17845 April 27, 1967)

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Uploaded on 10/30/2020

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Case Summary
(Estate of Victor Sevilla v. Sevilla, G.R. No. L-17845 April 27, 1967)
Negotiable Instrument Involved: Promissory Note
Petitioner: Simeon Sadaya
Respondent: Francisco Sevilla
Petitioned for: Intestate estate of Victor Sevilla as reimbursement
Case:
On March 28, 1949, a promissory note was executed jointly and severally by Victor Sevilla, Oscar Varona
and Simeon Sadaya in favor of the Bank of the Philippine Islands for the sum of Php 15,000.00 with
interest at 8℅ per annum, payable on demand. Victor Sevilla and Simeon Sadaya act as accomodation
parties for Varona while the latter received the whole amount.
On October 6, 1952, the bank collected from Sadaya the outstanding balance which totalled Php
5,416.12 and Varona failed to reimburse Sadaya despite of repeated demands. Sadaya filed a creditor's
claim to his co-guarantor. But Victor Sevilla died so Intestate estate proceedings were started in the
Court of First Instance of Rizal, Special Proceeding No. 1518. Francisco Sevilla was named administrator,
where he resisted the claim upon the averment that the deceased Victor Sevilla "did not receive any
amount as consideration for the promissory note," but signed it only "as surety for Oscar Varona".
On June 5, 1957, the trial court issued an order admitting the claim of Simeon Sadaya in the amount of
P5,746.12, and directing the administrator to pay the same from any available funds belonging to the
estate of the deceased Victor Sevilla.
The motion to reconsider having been overruled, the administrator appealed.The Court of Appeals, in a
decision promulgated on July, 15, 1960, voted to set aside the order appealed from and to disapprove
and disallow "appellee's claim of P5,746.12 against the intestate estate."
The case is now before this Court on certiorari to review the judgment of the Court of Appeals.
Sadaya's brief seeks reversal of the appellate court's decision and prays that his claim "in the amount of
50% of P5,746.12, or P2,873.06, against the intestate estate of the deceased Victor Sevilla," be
approved.
Underlying Principle:
On principle, a solidary accommodation maker — who made payment — has the right to contribution,
from his co-accommodation maker, in the absence of agreement to the contrary between them, and
subject to conditions imposed by law. This right springs from an implied promise between the
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Case Summary

(Estate of Victor Sevilla v. Sevilla, G.R. No. L-17845 April 27, 1967)

Negotiable Instrument Involved: Promissory Note Petitioner: Simeon Sadaya Respondent: Francisco Sevilla Petitioned for: Intestate estate of Victor Sevilla as reimbursement Case: On March 28, 1949, a promissory note was executed jointly and severally by Victor Sevilla, Oscar Varona and Simeon Sadaya in favor of the Bank of the Philippine Islands for the sum of Php 15,000.00 with interest at 8℅ per annum, payable on demand. Victor Sevilla and Simeon Sadaya act as accomodation parties for Varona while the latter received the whole amount. On October 6, 1952, the bank collected from Sadaya the outstanding balance which totalled Php 5,416.12 and Varona failed to reimburse Sadaya despite of repeated demands. Sadaya filed a creditor's claim to his co-guarantor. But Victor Sevilla died so Intestate estate proceedings were started in the Court of First Instance of Rizal, Special Proceeding No. 1518. Francisco Sevilla was named administrator, where he resisted the claim upon the averment that the deceased Victor Sevilla "did not receive any amount as consideration for the promissory note," but signed it only "as surety for Oscar Varona". On June 5, 1957, the trial court issued an order admitting the claim of Simeon Sadaya in the amount of P5,746.12, and directing the administrator to pay the same from any available funds belonging to the estate of the deceased Victor Sevilla. The motion to reconsider having been overruled, the administrator appealed.The Court of Appeals, in a decision promulgated on July, 15, 1960, voted to set aside the order appealed from and to disapprove and disallow "appellee's claim of P5,746.12 against the intestate estate." The case is now before this Court on certiorari to review the judgment of the Court of Appeals. Sadaya's brief seeks reversal of the appellate court's decision and prays that his claim "in the amount of 50% of P5,746.12, or P2,873.06, against the intestate estate of the deceased Victor Sevilla," be approved. Underlying Principle: On principle, a solidary accommodation maker — who made payment — has the right to contribution, from his co-accommodation maker, in the absence of agreement to the contrary between them, and subject to conditions imposed by law. This right springs from an implied promise between the

accommodation makers to share equally the burdens that may ensue from their having consented to stamp their signatures on the promissory note. Civil Code Application: By Article 18 of the Civil Code in matters not covered by the special laws, "their deficiency shall be supplied by the provisions of this Code". Nothing extant in the Negotiable Instruments Law would define the right of one accommodation maker to seek reimbursement from another. Perforce, we must go to the Civil Code. Because Sevilla and Sadaya, in themselves, are but co-guarantors of Varona, their case comes within the ambit of Article 2073 of the Civil Code which reads: ART. 2073. When there are two or more guarantors of the same debtor and for the same debt, the one among them who has paid may demand of each of the others the share which is proportionally owing from him. If any of the guarantors should be insolvent, his share shall be borne by the others, including the payer, in the same proportion. The provisions of this article shall not be applicable, unless the payment has been made in virtue of a judicial demand or unless the principal debtor is insolvent. As Mr. Justice Street puts it: "[T]hat article deals with the situation which arises when one surety has paid the debt to the creditor and is seeking contribution from his cosureties." Conclusion and decision of the Supreme Court:

  1. All of the foregoing postulate the following rules: (1) A joint and several accommodation maker of a negotiable promissory note may demand from the principal debtor reimbursement for the amount that he paid to the payee; and (2) a joint and several accommodation maker who pays on the said promissory note may directly demand reimbursement from his co-accommodation maker without first directing his action against the principal debtor provided that (a) he made the payment by virtue of a judicial demand, or (b) a principal debtor is insolvent. The Court of Appeals found that Sadaya's payment to the bank "was made voluntarily and without any judicial demand," and that "there is an absolute absence of evidence showing that Varona is insolvent". This combination of fact and lack of fact epitomizes the fatal distance between payment by Sadaya and Sadaya's right to demand of Sevilla "the share which is proportionately owing from him." For the reasons given, the judgment of the Court of Appeals under review is hereby affirmed. No costs. So ordered. By:Jecelyn Belegorio