Lapu Lapu Foundation vs CA

SECOND DIVISION

[G.R. No. 126006. January 29, 2004]

LAPU LA PULA LAPU PU FO FOUN UNDA DAT TIO ION, N, IN INC. C. an an  !L !LIA IA" " #. TAN,  petitioners, vs. COU COURT RT OF APP!A PP!AL" L" $"%& $"%&%n' %n'%%n' %%n'( ( D)& D)&)*) )*)on+ on+ an ALLI! LLI!D D AN-ING CORP. CORP.,, respondents D!CI"ION CALL!JO, "R., J . .

Befor Before e the the Court Court is the petit petitio ion n for for review review on certi certior orari ari filed filed by the Lapula Lapulapu pu Foundation Inc! and Elias "! #an see$in% to reverse and set aside the Decision  dated )une *+ ',,+ of the Court of -ppeals .C-/ in C-01!2! CV No! 34'+* orderin% the petitioners 5ointly and solidarily to pay the respondent -llied Ban$in% Corporation the a6oun a6ountt of 78,3 78,39+ 9++!+ +!+' ' plus plus intere interests sts and and other other char% char%es es!! Li$ew Li$ewise ise sou% sou%ht ht to be revers reversed ed and and set aside aside is the the appel appellat late e courts courts 2esol 2esoluti ution on date dated d -u%ust u%ust ', ', ',,+ ',,+ denyin% the petitioners 6otion for reconsideration! &'(

#he case ste66ed fro6 the followin% facts: So6eti6e So6eti6e in ',44 ',44 petitio petitioner ner Elias Elias "! #an then 7resident 7resident of the co0peti co0petition tioner  er  Lapulap Lapulapu u Founda Foundation tion Inc! Inc! obtaine obtained d four loans loans fro6 the respond respondent ent -llied -llied Ban$in% Ban$in% Corporation covered by four pro6issory notes in the a6ounts of 7';;;;; each! #he details of the pro6issory notes are as follows:

P/N No. Date of P/N Maturity Date Amount as of 1/23/79 BD No. 504 Nov. 7, 1977 e!. 5, 197" P123,377.7# BD No. #21 Nov. 2", 1977 Mar. 2", 197" P123,411.10 BD No. 71# De$. 12, 1977 A%r. 11, 11, 197" P122,322.21 BD No. "39 &an. 5, 197" May 5, 197" P120,455.54

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 -s of )anuary *3 ',4, the entire entire obli%ation a6ounted a6ounted to 7 8,39++!+' and despite de6ands 6ade on the6 by the respondent Ban$ the petitioners failed to pay the sa6e! #he respondent Ban$ was constrained to file with the 2e%ional #rial Court of Cebu City Branch '9 a co6plaint see$in% pay6ent by the petitioners 5ointly and solidarily of the su6 of 78,39++!+' representin% their loan obli%ation e
In its answer to the co6plaint the petitioner Foundation denied incurrin% indebtedness fro6 the respondent Ban$ alle%in% that the loans were obtained by petitioner #an in his personal capacity for his own use and benefit and on the stren%th of the personal infor6ation he furnished the respondent Ban$! #he petitioner  Foundation 6aintained that it never authori=ed petitioner #an to co0si%n in his capacity as its 7resident any pro6issory note and that the respondent Ban$ fully $new that the loans contracted were 6ade in petitioner #ans personal capacity and for his own use and that the petitioner Foundation never benefited directly or indirectly therefro6! #he petitioner Foundation then interposed a cross0clai6 a%ainst petitioner #an alle%in% that he havin% euired hi6 to affi< two si%natures on every pro6issory note assurin% hi6 that the loan docu6ents would be filled out in accordance with their a%ree6ent! ?owever after he si%ned and delivered the loan docu6ents to the respondent Ban$ these were filled out in a 6anner not in accord with their a%ree6ent such that the petitioner Foundation was included as party thereto! Further prior to its filin% of the co6plaint the respondent Ban$ 6ade no de6and on hi6!  -fter due trial the court a quo rendered 5ud%6ent the dispositive portion of which reads:

)*++-+, in vie of te foreoin evien$es 'si$(, aruments an $onsierations, tis $ourt ere!y fins te %re%oneran$e of evien$e in favor of te  %aintiff an ere!y reners ument as foos 1. euirin te efenants +ias 6. an an 8a%ua%u ounation, n$. 'te  %etitioners erein( to %ay ointy an soiariy to te %aintiff Aie Ban:in ;or%oration 'te res%onent erein( te amount of P493,5##.#1 as %rin$i%a o!iation for te four %romissory notes, in$uin a oter $ares in$ue in te same, it interest at 14< %er annum, $om%ute from &anuary 24, 1979, unti te same are fuy  %ai, %us 2< servi$e $ares an 1< monty %enaty $ares. 2. euirin te efenants +ias 6. an an 8a%ua%u ounation, n$., to %ay ointy an soiariy, attorneys fees in te euivaent amount of 25< of te tota amount ue from te efenants on te %romissory notes, in$uin a $ares=

3. euirin te efenants +ias 6. an an 8a%ua%u ounation, n$., to %ay ointy an soiariy itiation e>%enses of P1,000.00 %us $osts of te suit. '3(

On appeal the C- affir6ed with 6odification the 5ud%6ent of the court a quo by deletin% the award of attorneys fees in favor of the respondent Ban$ for bein% without basis! #he appellate court disbelieved petitioner #ans clai6 that the loans were his personal loans as the pro6issory notes evidencin% the6 showed upon their faces that these were obli%ations of the petitioner Foundation as contracted by petitioner #an hi6self in his official and personal character! -pplyin% the parol evidence rule the Cli$ewise re5ected petitioner #ans assertion that there was an unwritten a%ree6ent between hi6 and the respondent Ban$ that he would pay the loans fro6 the proceeds of his shares of stoc$s in the Lapulapu Industries Corp! Further the C- found that de6and had been 6ade by the respondent Ban$ on the petitioners prior to the filin% of the co6plaint a quo! It noted that the two letters of  de6and dated )anuary 3 ',4, and )anuary 3; ',4, as$in% settle6ent of the obli%ation were sent by the respondent Ban$! #hese were received by the petitioners as shown by the re%istry return cards  presented durin% trial in the court a quo! &8(

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Finally li$e the court a quo the C- applied the doctrine of piercin% the veil of  corporate entity in holdin% the petitioners 5ointly and solidarily liable! #he evidence showed that petitioner #an had represented hi6self as the 7resident of the petitioner  Foundation opened savin%s and current accounts in its behalf and si%ned the loan docu6ents for and in behalf of the latter! #he C- li$ewise found that the petitioner  Foundation had allowed petitioner #an to act as thou%h he had the authority to contract the loans in its behalf! On the other hand petitioner #an could not escape liability as he had used the petitioner Foundation for his benefit!  -%%rieved the petitioners now co6e to the Court alle%in% that: I! #?E CO@2# OF -77E-LS 12-VELA E22ED IN ?OLDIN1 #?-# #?E LO-NS S@B)EC# -##E2 OF #?E INS#-N# 7E#I#ION -2E -L2E-DA D@E -ND DE-ND-BLE DES7I#E -BSENCE OF 72IO2 DE-ND! II! #?E CO@2# OF -77E-LS 12-VELA E22ED IN -77LAIN1 #?E 7-2OL EVIDENCE 2@LE -ND #?E DOC#2INE OF 7IE2CIN1 #?E VEIL OF CO27O2-#E EN#I#A -S B-SIS FO2 -D)@D1IN1 )OIN# -ND SOLID-2A LI-BILI#A ON #?E 7-2# OF 7E#I#IONE2S ELI-S "! #-N -ND L-7@L-7@ FO@ND-#ION INC!&4(

#he petitioners assail the appellate courts findin% that the loans had beco6e due and de6andable in view of the two de6and letters sent to the6 by the respondent Ban$! #he petitioners insist that there was no prior de6and as they vi%orously deny receivin% those letters! -ccordin% to petitioner #an the si%natures on the re%istry return cards were not his! #he petitioners denial of receipt of the de6and letters was ri%htfully %iven scant consideration by the C- as it held:

+>i!its  an ? are to etters of eman, res%e$tivey ate &anuary 3, 1979 an &anuary 30, 1979, as:in settement of te o!iations $overe !y te %romissory notes. e first etter as ritten !y Ben io Pen ?en, @i$ePresient of te !an:, an aresse to 8a%ua%u ounation, n$., attention of Mr. +ias 6. an, Presient, ie te se$on as a fina eman ritten !y te a%%eees $ounse, aresse to  !ot efenantsa%%eants, an ivin tem five 5C ays from re$ei%t itin i$ to sette or ui$ia a$tion ou !e institute aainst tem. Bot etters ere uy re$eive !y te efenants, as son !y te reistry return $ars, mar:e as +>i!its 2 an ?1, res%e$tivey. e aeation of an tat e oes not :no o sine te sai reistry return re$ei%ts merits s$ant $onsieration, for tere is no soin tat te aresses tereon ere ron. *en$e, te is%uta!e %resum%tion tat a etter uy ire$te an maie as re$eive in te reuar $ourse of mai %er %ar. @, ?e$tion 3, ue 131 of te evise ues on +vien$eC sti os. '"(

#here is no dispute that the pro6issory notes had already 6atured! ?owever the petitioners insist that the loans had not beco6e due and de6andable as they deny receipt of the respondent Ban$s de6and letters! hen presented the re%istry return cards durin% the trial petitioner #an clai6ed that he did not reco%ni=e the si%natures thereon! #he petitioners alle%ation and denial are self0servin%! #hey cannot prevail over  the re%istry return cards which constitute docu6entary evidence and which en5oy the presu6ption that absent clear and convincin% evidence to the contrary these were re%ularly issued by the postal officials in the perfor6ance of their official duty and that they acted in %ood faith!  Further as the C- correctly opined 6ails are presu6ed to have been properly delivered and received by the addressee in the re%ular course of  the 6ail!  -s the C- noted there is no showin% that the addresses on the re%istry return cards were wron%! It is the petitioners burden to overco6e the presu6ptions by sufficient evidence and other than their barefaced denial the petitioners failed to support their clai6 that they did not receive the de6and letters therefore no prior  de6and was 6ade on the6 by the respondent Ban$! &,(

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?avin% established that the loans had beco6e due and de6andable the Court shall now resolve the issue of whether the C- correctly held the petitioners 5ointly and solidarily liable therefor! In disclai6in% any liability for the loans the petitioner Foundation 6aintains that these were contracted by petitioner #an in his personal capacity and that it did not benefit therefro6! On the other hand while ad6ittin% that the loans were his personal obli%ation petitioner #an avers that he had an unwritten a%ree6ent with the respondent Ban$ that these loans would be renewed on a year0to0year basis and paid fro6 the proceeds of his shares of stoc$ in the Lapulapu Industries Corp! #hese contentions are untenable! #he Court particularly finds as incredulous petitioner #ans alle%ation that he was 6ade to si%n blan$ loan docu6ents and that the phrase IN A OFFICI-L7E2SON-L C-7-CI#A was superi6posed by the respondent Ban$s e6ployee despite petitioner 

#ans protestation! #he Court is hard pressed to believe that a business6an of petitioner  #ans stature could have been so careless as to si%n blan$ loan docu6ents! In contrast as found by the C- the pro6issory notes  clearly showed upon their  faces that they are the obli%ation of the petitioner Foundation as contracted by petitioner #an in his official and personal capacity!  oreover the application for credit acco66odation  the si%nature cards of the two accounts in the na6e of petitioner  Foundation as well as New Current -ccount 2ecord all acco6panyin% the pro6issory notes were si%ned by petitioner #an for and in the na6e of the petitioner  Foundation!   #hese docu6entary evidence une>uivocally and cate%orically establish that the loans were solidarily contracted by the petitioner Foundation and petitioner #an! &''(

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 -s a corollary the parol evidence rule li$ewise constrains this Court to re5ect petitioner #ans clai6 re%ardin% the purported unwritten a%ree6ent between hi6 and the respondent Ban$ on the pay6ent of the obli%ation! Section , 2ule '3; of the of the 2evised 2ules of Court provides that &w(hen the ter6s of an a%ree6ent have been reduced to writin% it is to be considered as containin% all the ter6s a%reed upon and there can be between the parties and their successors0in0interest no evidence of such ter6s other than the contents of the written a%ree6ent! &'4(

In this case the pro6issory notes are the law between the petitioners and the respondent Ban$! #hese pro6issory notes contained 6aturity dates as follows: February 9 ',4 arch * ',4 -pril '' ',4 and ay 9 ',4 respectively! #hat these notes were to be paid on these dates is clear and e
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Finally the appellate court did not err in holdin% the petitioners 5ointly and solidarily liable as it applied the doctrine of piercin% the veil of corporate entity! #he petitioner  Foundation asserts that it has a personality separate and distinct fro6 that of its 7resident petitioner #an and that it cannot be held solidarily liable for the loans of the latter! #he Court a%rees with the C- that the petitioners cannot hide behind the corporate veil under the followin% circu6stances:

e evien$e sos tat an as !een re%resentin imsef as te Presient of 8a%ua%u ounation, n$. *e o%ene a savins a$$ount an a $urrent a$$ount in te names of te $or%oration, an sine te a%%i$ation form as e as te ne$essary s%e$imen sinature $ars +>i!its A, B an ;C ti$e, for imsef an for te

founation. *e su!mitte a notarie ?e$retarys ;ertifi$ate +>i!it EC from te $or%oration, attestin tat e as !een autorie, inter alia, to sin for an in !eaf of te 8a%ua%u ounation any an a $e$:s, rafts or oter orers it res%e$t to te !an:= to transa$t !usiness it te Ban:, neotiate oans, areements, o!iations,  %romissory notes an oter $ommer$ia o$uments= an to initiay o!tain a oan for P100,000.00 from any !an: +>i!its E1 an E2C. Fner tese $ir$umstan$es, te efenant $or%oration is ia!e for te transa$tions entere into !y an on its  !eaf. '20(

7er its Secretarys Certificate the petitioner Foundation had %iven its 7resident petitioner #an ostensible and apparent authority to inter alia  deal with the respondent Ban$! -ccordin%ly the petitioner Foundation is estopped fro6 >uestionin% petitioner  #ans authority to obtain the sub5ect loans fro6 the respondent Ban$! It is a fa6iliar  doctrine that if a corporation $nowin%ly per6its one of its officers or any other a%ent to act within the scope of an apparent authority it holds hi6 out to the public as possessin% the power to do those acts and thus the corporation will as a%ainst anyone who has in %ood faith dealt with it throu%h such a%ent be estopped fro6 denyin% the a%ents authority! &*'(

In fine there is no co%ent reason to deviate fro6 the C-s rulin% that the petitioners are 5ointly and solidarily liable for the loans contracted with the respondent Ban$! /!R!FOR! pre6ises considered the petition is DENIED and the Decision dated )une *+ ',,+ and 2esolution dated -u%ust ', ',,+ of the Court of -ppeals in C-01!2! CV No! 34'+* are -FFI2ED in toto ! "O ORD!R!D. Puno, (Chairman) Quisumbing, Austria-Martinez, and Tinga, JJ., concur .

 7enned by -ssociate )ustice Delilah Vidallon0a%tolis with -ssociate )ustices "uirino D! -bad Santos and -rte6io 1! #u>uero concurrin%!

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1old Line #ransit Inc! !! 2a6os, 3+3 SC2- *+* .*;;'/!

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 Section 3.V/ 2ule '3' of the 2evised 2ules of Court!

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Ibi !  #he provision reads in full:

Sec! ,! "!ien#e o$ %ritten agreements! hen the ter6s of an a%ree6ent have been reduced to writin% it is considered as containin% all the ter6s a%reed upon and there can be between the parties and their successors0in0interest no evidence of such ter6s other than the contents of the written a%ree6ent! ?owever a party 6ay present evidence to 6odify e
C En%ineerin% !! C- 3; SC2- ''+ .*;;*/!

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Rollo, p! 3'! .@nderscorin% ours!/

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Soler !! Court of -ppeals, 39 SC2- 94 .*;;'/!