Professional Documents
Culture Documents
Marketing
v
CA
HELD
The
spouses
Marcial
See
and
Lilian
Tan
constituted
three
real
estate
There
was
no
novation.
mortgages
over
their
property
in
Paco
Manila
in
favor
of
and
for
the
following
amounts:
There
was
no
change
in
the
OBJECT
of
the
prior
obligation
(Objective
novation):
1.
Ylang-Ylang
Merchandising
Company
(partnership
b/w
Rodriguez
The
1
million
loaN
still
represented
the
3
loans
obtained.
and
Tan)
=>
for
250,000
It
merely
restructured
and
renewed
the
3
previous
loans
to
make
2.
Ajax
Marketing
Company
(formerly
Ylang-Ylang
Merchandising
the
loan
current
and
merely
consolidated
such
loan.
Company,
changed
name
but
not
its
composition)
=>
for
150,000
3.
Ajax
Marketing
and
Development
Corporation
(from
partnership
There
was
no
change
or
substitution
in
the
part
of
the
debtors
to
corporation)
for
600,000
upon
the
consolidation
of
the
loans
in
the
promissory
note
(Subjective
novation):
All
3
loans
were
obtained
from
Metrobank.
The
fact
that
the
petitioners
changed
from
a
partnership
to
a
The
3
loans
w/
an
aggregate
amount
of
1M
were
restructured
and
corporation
without
evidence
that
they
were
expressly
released
consolidated
into
1
loan.
from
their
obligation
did
not
make
petitioner
AJAX
(w/
it
new
Ajax
Marketing
and
Development
Co.
executed
a
promissory
note.
corporate
personality)
a
3rd
person
or
the
new
debtor.
It
had
these
words
typewritten:
"secured
by
REM"
and
"9.Collateral.
AJAX
only
became
a
co-debtor.
This
is
wholly/partly
secured
by:(x)
real
estate"
The
property
was
extra-judicially
foreclosed
in
favor
of
Metrobank
Doctrine:
for
the
1M
promissory
note.
Novation
is
juridical
action
with
a
dual
function.
It
extinguishes
an
obligation
&
creates
a
new
one
in
lieu
of
the
old
one.
Petitioners
contend:
Novation
is
never
presumed
and
will
not
be
allowed
unless
there
A
novation
occurred
when
their
3
loans
which
were
all
secured
by
was
an
express
agreement
or
the
new
obligation
is
incompatible
the
same
property,
were
consolidated
into
a
single
loan
of
1M
with
the
old
one.
under
the
promissory
note,
thereby
extinguishing
their
monetary
OLD
DEBTOR
should
be
released
expressly
from
an
obligation
and
obligation
and
releasing
the
mortgaged
property
from
liability.
the
3rd
person
or
new
debtor
assumed
his
place.
There
is
no
novation
if
the
old
debtor
would
not
be
released.
The
ISSUE:
W/N
there
was
indeed
a
novation
in
this
case?
new
debtor
would
only
become
a
co-debtor
or
surety.