Astro Electronics Corp. V. Phil. Export And Foreign Loan Guarantee Corp.

(2003)
G.R. No. 136729 September 23 ,2003
Lessons Applicable: Promissory notes and checks (Negotiable Instruments Law)

FACTS:

Astro was granted several loans by the Philippine Trust Company (Philtrust)
amounting P3M w/ interest and secured by 3 promissory notes:

December 14, 1981: P600,000.00

December 14, 1981: P400,000.00

August 27, 1981: P2,000,000.00

Roxas signed twice the promissory notes

as President of Astro

in his personal capacity

Roxas also signed a Continuing Surety ship Agreement in favor of Philtrust

Bank, as President of Astro and as surety

Philguarantee, with the consent of Astro, guaranteed in favor of Philtrust the

payment of 70% of Astros loan, subject to the condition that upon payment by
Philguanrantee, it shall be proportionally subrogated to the rights of Philtrust
against Astro

Upon Astros failure to pay, Philguarantee paid 70% of the guaranteed loan to
Philtrust.

Subsequently, Philguarantee filed against Astro and Roxas a complaint for

sum of money with the RTC

Roxas: alleged that he merely signed the same in blank and the
phrases in his personal capacity and in his official capacity were fraudulently
inserted without his knowledge
 RTC: favored Philguarantee holding Astro and Roxas jointly and severally
liable

if Roxas really intended to sign the instruments merely in his capacity

as President of Astro, then he should have signed only once

CA affirmed RTC

ISSUE: W/N Roxas should be jointly and severally liable with Astro

HELD: YES. CA affirmed

Under the Negotiable Instruments Law, persons who write their names on
the face of promissory notes are makers,promising that they will pay to the
order of the payee or any holder according to its tenor.

even without the phrase personal capacity, Roxas will still be

primarily liable as a joint and several debtor under the notes considering that his
intention to be liable as such is manifested by the fact that he affixed his
signature on each of the promissory notes twice which necessarily would imply
that he is undertaking the obligation in 2 different capacities, official and
personal.

3 promissory notes uniformly provide: FOR VALUE RECEIVED, I/We

jointly, severally and solidarily, promise to pay to PHILTRUST BANK or
order...

begins with I, We, or Either of us promise to pay, when signed by two

or more persons = solidarily liable

Subrogation is the transfer of all the rights of the creditor to a third person,
who substitutes him in all his rights

Philguarantee has all the right to proceed against petitioner, it is

subrogated to the rights of Philtrust to demand for and collect payment from
both Roxas and Astro since it already paid the value of 70% of roxas and Astro
Electronics Corp.s loan obligation
 Roxas acquiescence is not necessary for subrogation to take
place because the instant case is one of the legal subrogation that occurs by
operation of law, and without need of the debtors knowledge

Philguarantee, as guarantor, became the transferee of all

the rights of Philtrust as against Roxas and Astro because the guarantor who
pays is subrogated by virtue thereof to all the rights which the creditor had
against the debtor