TERESITA I. BUENAVENTURA, petitioner, vs.

METROPOLITAN BANK AND

TRUST COMPANY, respondent.
G.R. No. 167082, August 3, 2016
First Division
Bersamin, J.

Nature: In this appeal, the petitioner seeks the reversal of the decision
promulgated on April 23, 2004, whereby the Court of Appeals affirmed with
modification the judgment rendered on July 11, 2002 by the Regional Trial Court,
Branch 61, in Makati City. Also being appealed is the resolution promulgated on
February 9, 2005, whereby the CA denied her motion for reconsideration.

Facts: On January 20, 1997 and April 17, 1997, Teresita Buenaventura executed
Promissory Note Nos. 232663 and 232711, respectively, each in the amount of
P1,500,000.00 and payable to Metropolitan Bank and Trust Company. PN No.
232663 was to mature on July 1, 1997, with interest and credit evaluation and
supervision fee at the rate of 17.532% per annum, while PN No. 232711 was to
mature on April 7, 1998, with interest and CESF at the rate of 14.239% per
annum. Both PNs provide for penalty of 18% per annum on the unpaid principal
from date of default until full payment of the obligation. Despite demands, there
remained unpaid on PN Nos. 232663 and 232711 the amounts of P2,061,208.08
and P1,492,236.37, respectively, as of July 15, 1998, inclusive of interest and
penalty. Consequently, appellee filed an action against appellant for recovery of
said amounts, interest, penalty and attorney's fees before the Regional Trial
Court of Makati City (Branch 61). In answer, appellant averred that in 1997, she
received from her nephew, Rene Imperial, three postdated checks drawn against
appellee as partial payments for the purchase of her properties; that she
rediscounted the subject checks with appellee, for which she was required to
execute the PNs to secure payment thereof; and that she is a mere guarantor
and cannot be compelled to pay unless and until appellee shall have exhausted
all the properties of Imperial. The RTC ruled in favor of MBTC and ordered
Teresita to pay P3.5M plus interest and penalties. CA affirmed with modifications
as to the interest and penalty.

Issue: Whether or not Teresita shall be held liable for the promissory notes she
executed

Held: The Court affirmed the decision promulgated on April 23, 2004 with
modifications.

Teresita is liable for the amount in the promissory notes. A guaranty is not
presumed; it must be expressed (Art. 2055, New Civil Code). The PNs provide, in
clear language, that appellant is primarily liable thereunder. On the other hand,
said PNs do not state that Imperial, who is not even privy thereto, is the one
primarily liable and that appellant is merely a guarantor. Parenthetically, the
disclosure statement (Exh. "D") executed by appellant states that PN No. 232711
is "secured by postdated checks". In other words, it does not appear that the PNs
were executed as guaranty for the payment of the subject checks.

Moreover, the maturity date (July 1, 1997) of PN No. 232663 is ahead of the
dates (January 5, 1998 and March 31, 1998) of the subject checks. In other
words, appellant, as "guarantor," was supposed to make good her
"guaranty," i.e., PNs in question, even before the "principal" obligations, i.e.,
subject checks, became due. It is also noted that the rediscounting of the subject
checks (in January 1997) occurred months ahead of the execution of PN No.
232711 (on April 17, 1997) even as the PNs were supposedly a precondition to
said rediscounting. Stated differently, appellant is primarily liable under the
subject checks. She is a principal debtor and not a guarantor. Consequently, the
benefit of excussion may not be interposed as a defense in an action to enforce
appellant's warranty as indorser of the subject checks.