G.R. No. 203133 - YULIM INTERNATIONAL COMPANY LTD., JAMES YU, JONATHAN YU, AND ALMERICK TIENG LIM, VS. INTERNATIONAL EXCHANGE BANK (NOW UNION BANK OF THE PHILIPPINES).D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE , in view of the foregoing considerations, the Court finds the individual defendants James Yu, Jonathan Yu and Almerick Tieng Lim, not liable to the plaintiff, iBank, hence the complaint against them is hereby DISMISSED for insufficiency of evidence, without pronouncement as to cost. This court, however, finds defendant corporation Yulim International Company Ltd. liable; and it hereby orders defendant corporation to pay plaintiff the sum of P4,246,310.00 with interest at 16.50% per annum from February 28, 2002 until fully paid plus cost of suit. The counterclaims of defendants against plaintiff iBank are hereby DISMISSED for insufficiency of evidence. SO ORDERED . [15] Thus, the RTC ordered Yulim alone to pay iBank the amount of P4,246,310.00, plus interest at 16.50% per annum from February 28, 2002 until fully paid, plus costs of suit, and dismissed the complaint against petitioners James, Jonathan and Almerick, stating that there was no iota of evidence that the loan proceeds benefited their families. [16] The petitioners moved for reconsideration on January 12, 2010; [17] iBank on January 19, 2010 likewise filed a motion for partial reconsideration. [18] In its Joint Order [19] dated March 8, 2010, the RTC denied both motions. Ruling of the CA On March 23, 2010, Yulim filed a Notice of Partial Appeal, followed on March 30, 2010 by iBank with a Notice of Appeal. Yulim interposed the following as errors of the court a quo : THE LOWER COURT ERRED IN ORDERING [YULIM] TO PAY [iBANK] THE AMOUNT OF P4,246,310.00 WITH INTEREST AT 16.5% PER ANNUM FROM FEBRUARY 28, 2002 UNTIL FULLY PAID. THE LOWER COURT ERRED IN NOT ORDERING [iBANK] TO PAY ATTORNEYS FEES, MORAL DAMAGES AND EXEMPLARY DAMAGES. [20] For its part, iBank raised the following as errors of the RTC: THE TRIAL COURT ERRED IN NOT HOLDING INDIVIDUAL [PETITIONERS JAMES, JONATHAN AND ALMERICK] SOLIDARILY LIABLE WITH [YULIM] ON THE BASIS OF THE CONTINUING SURETYSHIP AGREEMENT EXECUTED BY THEM. THE TRIAL COURT ERRED IN NOT HOLDING ALL THE [PETITIONERS] LIABLE FOR PENALTY CHARGES UNDER THE CREDIT AGREEMENT AND PROMISSORY NOTES SUED UPON. THE TRIAL COURT ERRED IN NOT HOLDING [THE PETITIONERS] LIABLE TO [iBANK] FOR ATTORNEYS FEES AND INDIVIDUAL [PETITIONERS] JOINTLY AND SEVERALLY LIABLE WITH [YULIM] FOR COSTS OF SUIT INCURRED BY [iBANK] IN ORDER TO PROTECT ITS RIGHTS. [21] Chiefly, the factual issue on appeal to the CA, raised by petitioners James, Jonathan and Almerick, was whether Yulims loans have in fact been extinguished with the execution of a Deed of Assignment of their condominium unit in favor of iBank, while the corollary legal issue, raised by iBank, was whether they should be held solidarily liable with Yulim for its loans and other obligations to iBank. The CA ruled that the petitioners failed to prove that they have already paid Yulims consolidated loan obligations totaling P4,246,310.00, for which it issued to iBank PN No. SADDK001014188 for the said amount. It held that the