SADAYAV.

SEVILLA

19SCRA924

FACTS:
March28,1949:VictorSevilla,OscarVaronaandSimeonSadayaexecuted,jointlyand
severally,infavoroftheBPI,oritsorder,apromissorynoteforP15,000.00withinterestat8%
perannum,payableondemand.
TheP15,000.00proceedswasreceivedbyOscarVaronaalone.
VictorSevillaandSimeonSadayasignedthepromissorynoteascomakersonlyasafavorto
OscarVarona.
June15,1950:outstandingbalanceisP4,850.00.Nopaymentthereaftermade.
Oct161952:bankcollectedfromSadayatotalofP5,416.12(w/int)
VaronafailedtoreimburseSadayadespiterepeateddemands.V
VictorSevilladiedFranciscoSevillawasnamedadministrator.
Sadayafiledacreditor'sclaimfortheabovesumofP5,746.12,plusattorneysfeesinthesumof
P1,500.00
TheadministratorresistedtheclaimupontheavermentthatthedeceasedVictorSevilla"didnot
receiveanyamountasconsiderationforthepromissorynote,"butsigneditonly"assuretyfor
OscarVarona
June5,1957:Trialcourtordertheadministratortopay
CAreversed.
ISSUE:W/NSadayacanclaimagainsttheestateofSevillaascoaccomodationpartywhen
Veronaasprincipaldebtorisnotyetinsolvent

HELD:NO.Affirmed
VaronaisboundbytheobligationtoreimburseSadaya
solidaryaccommodationmakerwhomadepaymenthastherighttocontribution,fromhis
coaccommodationmaker,intheabsenceofagreementtothecontrarybetweenthem,and
subjecttoconditionsimposedbylaw
requisitesbeforeoneaccommodationmakercanseekreimbursementfroma
coaccommodationmaker.
ART.2073.Whentherearetwoormoreguarantorsofthesamedebtorandforthesamedebt,
theoneamongthemwhohaspaidmaydemandofeachoftheothersthesharewhichis
proportionallyowingfromhim.
Ifanyoftheguarantorsshouldbeinsolvent,hisshareshallbebornebytheothers,includingthe
payer,inthesameproportion.
(1)Ajointandseveralaccommodationmakerofanegotiablepromissorynotemaydemand
fromtheprincipaldebtorreimbursementfortheamountthathepaidtothepayee
(2)ajointandseveralaccommodationmakerwhopaysonthesaidpromissorynotemay
directlydemandreimbursementfromhiscoaccommodationmakerwithoutfirstdirectinghis
actionagainsttheprincipaldebtorprovidedthat
(a)hemadethepaymentbyvirtueofajudicialdemand,ornojudicialdemandjustvoluntarily

(b)aprincipaldebtorisinsolvent.Varonaisnotinsolvent

second
issue

SADAYAV.SEVILLA

19SCRA924

FACTS:
Sadaya,SevillaandVaronasignedsolidarilyapromissorynoteinfavorofthebank.Varona
wastheonlyonewhoreceivedtheproceedsofthenote.SadayaandSevillabothsignedas
comakerstoaccommodateVarona.Thereafter,thebankcollectedfromSadaya.Varona
failedtoreimburse.

Consequently,Sevilladiedandintestateestateproceedingswereestablished.Sadaya
filedacreditorsclaimonhisestateforthepaymenthemadeonthenote.Theadministrator
resistedtheclaimonthegroundthatSevilladidn'treceiveanyproceedsoftheloan.The
trialcourtadmittedtheclaimofSadayathoughtiswasreversedbytheCA.

HELD:
SadayacouldhavesoughtreimbursementfromVarona,whichisrightandjustasthelatter
wastheonlyonewhoreceivedvalueforthenoteexecuted.Thereisanimpliedcontract
ofindemnitybetweenSadayaandVaronaupontheformerspaymentoftheobligationtothe
bank.

Surelyenough,theobligationsofVaronaandSevillatoSadayacannotbejointandseveral.
Forindeed,hadpaymentbeenmadebyVarona,Varonacouldn'thadreasontoseek
reimbursementfromeitherSadayaorSevilla.Afterall,theproceedsoftheloanwenttoVarona
alone.

Onprinciple,asolidaryaccommodationmakerwhomadepaymenthastherightto
contribution,fromhiscoaccomodationmaker,intheabsenceofagreementtothecontrary
betweenthem,subjecttoconditionsimposedbylaw.
Thisrightspringsfromanimplied
promisetoshareequallythe
burdensthaymayensuefromtheirhavingconsentedtostamptheirsignaturesonthe
promissorynote.

Thefollowingaretherules:
1.
Ajointandseveralaccommodationmakerofanegotiablepromissorynotemay

demandfromtheprincipaldebtorreimbursementfortheamountthathepaidtothepayee
2.
Ajointandseveralaccommodationmakerwhopaysonthesaidpromissorynote
maydirectlydemandreimbursementfromhiscoaccommodationmakerwithoutfirstdirecting
hisactionagainstthe
principaldebtorprovidedthat
a.
Hemadethepaymentbyvirtueofajudicialdemand
b.
Aprincipaldebtorisinsolvent.
ItwasnevershownthattherewasajudicialdemandonSadayatopaytheobligationandalso,
itwasneverproventhatVaronawasinsolvent.Thus,SadayacannotproceedagainstSevilla
forreimbursement

CRISOLOGOJOSEV.CAAccommodationParty
177SCRA594
FACTS:
ThepresidentofMoversEnterprises,toaccommodateitsclientsSpousesOng,issueda
checkinfavorofpetitionerCrisologoJose.
Thiswasinconsiderationofaquitclaimby
petitioneroveraparcelofland,whichtheGSISagreedtoselltospousesOng,withthe
understandingthatuponapprovalofthecompromiseagreement,thecheckwillbe
encashedaccordingly.
Asthecompromiseagreementwasn'tapprovedduringthe
expectedperiodoftime,theaforesaidcheckwasreplacedwithanotheroneforthesame
value. Upondepositthoughofthechecksbypetitioner,itwasdishonored.Thisprompted
thepetitionertofileacaseagainstAtty.BernaresandSantosforviolationofBP22.
Meanwhile,duringthepreliminaryinvestigation,Santostriedtotenderacashierscheck
forthevalueofthedishonoredcheckbutpetitionerrefusedtoacceptsuch.Thiswas
consignedbySantoswiththeclerkofcourtandheinstitutedchargesagainstpetitioner.The
trialcourtheldthatconsignationwasn'tapplicabletothecaseatbarbutwasreversedbythe
CA.

Issue:WONthecorporationcanbeheldliableasaccommodationparty?
HELD:No.
PetitioneraverredthatitisnotSantoswhoistheaccommodationpartytotheinstrumentbutthe
corporationitself.Butassumingarguendothatthecorporationistheaccommodationparty,
itcannotbeheldliabletothecheckissuedinfavorofpetitioner.
Theruleon
accommodationparty
doesn'tincludeorapplytocorporationswhichareaccommodationparties.Thisisbecausethe
issueorindorsementofanotherisultravires.Hence,onewhohastakentheinstrumentwith
knowledgeoftheaccommodationnaturethereofcannotrecoveragainstacorporation
whereitisonlyanaccommodationparty.Iftheformoftheinstrument,orthenatureofthe
transaction,issuchastochargetheindorseewiththeknowledgethattheissueor
indorsementoftheinstrumentbythecorporationisfortheaccommodationofanother,

hecannotrecoveragainstthecorporationthereon.

Bywayofexception,anofficeroragentofacorporationshallhavethepowerto
executeorindorseanegotiablepaperinthenameofthecorporationforthe
accommodationofathirdpartyonlyisspecificallyauthorizedtodoso.
Corollarily,
corporateofficershavenopowertoexecuteformereaccommodationanegotiable
instrumentofthecorporationfortheirindividualdebtsandtransactionsarisingfromor
inrelationtomattersinwhichthecorporationhasnolegitimateconcern.Sincesuch
accommodationpapercannotbeenforcedagainstthecorporation,thesignatories
thereofshallbepersonallyliabletherefore,aswellastheconsequencesarisingfromtheiracts
inconnectiontherewith.

StelcovsCA

StelcoMarketingvs.CA
GR96160,17June1992,210scra51
accommodationparty

FACTS:
StelcoMarketingCorporationsoldstructuralsteelbarstoRYLConstructionInc.RYLgave
Stelcossistercorporation,ArmstrongIndustries,aMetroBankcheckfromSteelweld
Corporation.ThecheckwasissuedbySteelweldsPresidenttoRomeoLim,PresidentofRYL,
bywayofaccommodation,asaguarantyandnotinpaymentofanobligation.WhenArmstrong
depositedthecheckatitsbank,itwasdishonoredbecauseitwasdrawnagainstinsufficient
funds.Whensodeposited,thecheckboretwoindorsements,i.e.RYLandArmstrong.
Subsequently,StelcofiledacivilcaseagainstRYLandSteelweldtorecoverthevalueofthe
steelproducts.

ISSUE:
WhetherSteelweldasanaccommodatingpartycanbeheldliablebyStelcoforthedishonored
check.

RULING:
SteelweldmaybeheldliablebutnotbyStelco.UnderSection29oftheNIL,SteelweldCorp.
canbeheldliableforhavingissuedthesubjectcheckfortheaccommodationofRomeoLim.
Anaccommodationpartyisonewhohassingedtheinstrumentasmaker,drawer,acceptor,or
indorser,withoutreceivingvaluedtherefor,andforthepurposeoflendinghisnametosome
otherperson.Suchapersonisliableontheinstrumenttoaholderforvalue,notwithstanding
suchholder,atthetimeoftakingtheinstrument,knewhimtobeonlyanaccommodationparty.
Stelcohowever,cannotbedeemedaholderofthecheckforvalueasitdoesnotmeettwo

essentialrequisitesprescribedbystatute,i.e.thatitdidnotbecometheholderofitbeforeit
wasoverdue,andwithoutnoticethatithadbeenpreviouslydishonored,andthatitdidnottake
thecheckingoodfaithandforvalue.

TravelOnvsCA

TravelOn,Inc.vsCourtofAppeals
G.R.No.L56169June26,1992
accommodationparty

FACTS:
PetitionerTravelOnInc.isatravelagencyfromwhichArturoMirandaprocuredticketson
behalfofairlinepassengersandderivedcommissionstherefrom.Mirandawassuedby
petitionertocollectonthesixpostdatedchecksheissuedwhichwerealldishonoredbythe
draweebanks.Miranda,however,claimedthathehadalreadyfullypaidandevenoverpaidhis
obligationsandthatrefundswereinfactduetohim.Hearguedthathehadissuedthe
postdatedchecksnotforthepurposeofencashmenttopayhisindebtednessbutforpurposes
ofaccommodation,ashehadinthepastaccordedsimilarfavorstopetitioner.Petitioner
howeverurgesthatthepostdatedchecksareperseevidenceofliabilityonthepartofprivate
respondentandfurtherarguesthatevenassumingthatthecheckswereforaccommodation,
privaterespondentisstillliablethereunderconsideringthatpetitionerisaholderforvalue.

ISSUE:
WhetherMirandaisliableonthepostdatedchecksheissuedevenassumingthatsaidchecks
wereissuedforaccommodationonly.

RULING:
Therewasnoaccommodationtransactioninthecaseatbar.Inaccommodationtransactions
recognizedbytheNegotiableInstrumentsLaw,anaccommodatingpartylendshiscredittothe
accommodatedparty,byissuingorindorsingacheckwhichisheldbyapayeeorindorseeasa
holderinduecourse,whogavefullvaluetherefortotheaccommodatedparty.Thelatter,in
otherwords,receivesorrealizesfullvaluewhichtheaccommodatedpartythenmustrepayto
theaccommodatingparty.Buttheaccommodatingpartyisboundonthechecktotheholderin
duecoursewhoisnecessarilyathirdpartyandisnottheaccommodatedparty.Inthecaseat
bar,TravelOnwaspayeeofallsix(6)checks,itpresentedthesechecksforpaymentatthe
draweebankbutthechecksbounced.TravelOnobviouslywasnotanaccommodatedpartyit
realizednovalueonthecheckswhichbounced.Mirandamustbeheldliableonthechecks
involvedaspetitionerisentitledtothebenefitofthestatutorypresumptionthatitwasaholderin
duecourseandthatthechecksweresupportedbyvaluableconsideration.

**InaccommodationtransactionsrecognizedbytheNegotiableInstrumentsLaw,an

accommodatingpartylendshiscredittotheaccommodatedparty,byissuingorindorsinga
checkwhichisheldbyapayeeorindorseeasaholderinduecourse,whogavefullvalue
therefortotheaccommodatedparty.Inthecaseatbar,TravelOnwasthepayeeofallsix(6)
checks,itpresentedthesechecksforpaymentatthedraweebankbutthechecksbounced.
TravelOnobviouslywasnotanaccommodatedpartyitrealizednovalueonthecheckswhich
bounced.

BPIvsCA

BPIvs.CourtofAppealsandNapiza
G.R.No.112392.February29,2000,326scra641
*accommodationparty
**liabilityofgeneralindorser

FACTS:
AcertainHenryChanownedaContinentalBankManagersCheckpayableto"cash"inthe
amountofTwoThousandFiveHundredDollars($2,500.00).Chanwenttotheofficeof
BenjaminNapizaandrequestedhimtodepositthecheckinhisdollaraccountbywayof
accommodationandforthepurposeofclearingthesame.Privaterespondentacceded,and
agreedtodelivertoChanasignedblankwithdrawalslip,withtheunderstandingthatassoonas
thecheckiscleared,bothofthemwouldgotothebanktowithdrawtheamountofthecheck
uponprivaterespondentspresentationtothebankofhispassbook.Napizathusendorsedthe
checkanddepositeditinaForeignCurrencyDepositUnit(FCDU)SavingsAccounthe
maintainedwithBPI.UsingtheblankwithdrawalslipgivenbyprivaterespondenttoChan,one
RubenGayon,Jr.wasabletowithdrawtheamountof$2,541.67fromNapiza'sFCDUaccount.
Itturnedoutthatsaidcheckdepositedbyprivaterespondentwasacounterfeitcheck.

*WhenBPIdemandedthereturnof$2,500.00,privaterespondentclaimedthathedepositedthe
check"forclearingpurposes"onlytoaccommodateChan.

**Petitionerclaimsthatprivaterespondent,havingaffixedhissignatureatthedorsalsideofthe
check,shouldbeliablefortheamountstatedthereininaccordancewiththeprovisionofthe
NegotiableInstrumentsLawontheliabilityofageneralindorser(Sec.66).

ISSUE:*
WhetherprivaterespondentisobligedtoreturnthemoneypaidoutbyBPIonacounterfeit
checkevenifhedepositedthecheck"forclearingpurposes"onlytoaccommodateChan.

ISSUE:**
WhetherornotrespondentNapizaisliableunderhiswarrantiesasageneralindorser.

RULING:
No.Ordinarilyprivaterespondentmaybeheldliableasanindorserofthecheckorevenasan
accommodationparty.However,petitionerBPI,inallowingthewithdrawalofprivate
respondentsdeposit,failedtoexercisethediligenceofagoodfatherofafamily.BPIviolated
itsownrulesbyallowingthewithdrawalofanamountthatisdefinitelyoverandabovethe
aggregateamountofprivaterespondentsdollardepositsthathadyettobecleared.The
proximatecauseoftheeventuallossoftheamountof$2,500.00onBPI'spartwasits
personnelsnegligenceinallowingsuchwithdrawalindisregardofitsownrulesandtheclearing
requirementinthebankingsystem.Insodoing,BPIassumedtheriskofincurringalosson
accountofaforgedorcounterfeitforeigncheckandhence,itshouldsuffertheresulting
damage.

AGROCONGLOMERATESV.SORIANO
348SCRA450

FACTS:
PetitionersoldtoWonderlandFoodIndustriestwoparcelsofland. Theystipulatedunder
aMemorandumofAgreementthatthetermsofpaymentwouldbeP1,000,000incash,
P2,000,000insharesofstock,andthebalancewouldbepayableinmonthly
installments. Thereafter,an
addendumwasexecutedbetweenthem,qualifyingthecashpayment.Insteadofcash
payment,thevendeeauthorizedthevendortoobtainaloanfromthefinancieronwhichthe
vendeebounditselftopayfor.ThisloanwastocoverforthepaymentofP1,000,000.This
addendumwasnotnotarized.

PetitionerSorianosignedasmakerthepromissorynotespayabletothebank.However,
thepetitionersfailedtopaytheobligationsastheyweredue.
Duringthattime,thebank
wasinfinancialdistressandthispromptedittoendorsethepromissorynotesforcollection.
Thebankgaveampletimetopetitionersthentosatisfytheirobligations.

Thetrialcourtheldinfavorofthebank.Itdidn'tfindmerittothecontentionthat
Wonderlandwastheonetobeheldliableforthepromissorynotes.

ISSUE:W/NAgroshouldbeliablebecausetherewasnoaccomodationorsurety
HELD:
Yes.First,therewasnocontractofsalethatmaterialized.
Theoriginalagreementwas
thatWonderlandwouldpaycashandpetitionerwoulddeliverpossessionofthe
farmlands.
Butthiswaschangedthroughanaddendum,thatpetitionerwouldinstead
securealoanandthesettlement
ofthesamewouldbeshoulderedbyWonderland.

Petitionersbecameliableasaccommodationparties.Theyhavetherightafterpayingthe
instrumenttoseekreimbursementfromthepartyaccommodated,sincetherelationbetween
themhasineffectbecameoneofprincipalandsurety.

Furthermore,asitturnedout,thecontractofsuretybetweenWoodlandandpetitioner
wasextinguishedbytherescissionofthecontractofsaleofthefarmland.Withtherescission,
therewasconfusioninthepersonsoftheprincipaldebtorandsurety. Theaddendum
thereonlikewiselostits
efficacy.