Blade Intl Marketing Corp. et. al. vs CA & Metropolitan Bank

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Blade Intl Marketing Corp. et. al. vs CA & Metropolitan Bank
G.R. No. 131013
December 14, 2001

Facts:

The case under consideration is a petition to annul the decision of the Court of Appeals that ordered petitioners Blade International Marketing Corporation, et. al, to pay, jointly and severally, the total amount of their obligation to respondent Metropolitan Bank and Trust Company, including interest, penalty charge and attorney's fees.

The complaint consisted of eight (8) causes of actions involving the delivery, shipment of merchandise, and tools. Private Respondent alleged, that it paid the suppliers by way of letters of credit against bills of exchange and that said merchandise or shipment were delivered in trust and/or accepted by the petitioner/s under the conditions of the trust receipt which required the said petitioner/s as entrustee/s to hold the goods, merchandise, documents and/or instrument as well as the proceeds for the payment of petitioner/s obligations acceptances, indebtedness and liabilities and that without justifiable reason, they allegedly failed and refused to account for and turn over to the private respondent the proceeds of sale of the above mentioned goods or merchandise.

On 20 November 1987, petitioners filed a "Joint Answer with Counterclaim," and That defendant corporation thru its authorized officers applied for and in its own behalf for several commercial letters of credit with the plaintiff in blank form; and defendants further denied the material and ultimate facts of the eight (8) causes of actions in the complaint and interposed Special and Affirmative Defenses.

By way of "Special and Affirmative Defenses," defendants also maintained, that individual defendants Evan J. Borbon, Marcial Geronimo and Edgar J. Borbon never signed the letters of credit and related documents in their personal capacities nor agreed to be bound thereon in anyway or as sureties or as entrustees to the plaintiff, since they merely acted for and in behalf of defendant corporation in the execution of the documents in question and therefore not liable thereon in their personal capacities.

Defendant by way of counterclaim further maintained that the suit was premature and filed maliciously and in bad faith by making it appear that the defendant corporation and individual defendants committed breaches of trust which are non-existent.

Issue:

Whether the petitioners Evan J. Borbon, Edgar J. Borbon, and Marcial Geronimo are personally liable jointly and severally with Blade International for fulfillment of its obligations under the letters of credit opened with Metrobank?

Held:

The instant motion for reconsideration is hereby DENIED for lack of merit. So ordered.

The petitioners were liable solidarily.

In this case, petitioners admit that they signed the letters of credit and related documents pertaining to the transactions with Metrobank. However, petitioners claimed that they signed the forms in blank. The documents show that the petitioners agreed to jointly and severally undertake payment of the obligations and also consented to each and all of the stipulated conditions on the documents. "An experienced businessman who signs important legal papers cannot disclaim the consequent liabilities therefore after being a signatory thereon."

Thus, the Court of Appeals was correct in finding that petitioners contractually agreed to hold themselves personally solidarily liable with the corporation in the fulfillment of its obligations to Metrobank.

The first judgment was that, the trial court dismissed the complaint of plaintiff Metropolitan Bank and Trust Company against defendants Blade International Marketing Corporation, Evan J. Borbon, Edgar J. Borbon and Marcial Geronimo, as well as the counter claim of the latter against the former, without pronouncement as to costs.
On 24 February 1992, the private respondent not satisfied with the said Decision filed a "Notice of Appeal" before the Honorable Court of Appeals, upon the 'ground that said decision is contrary to the evidence adduced by the parties and to the applicable laws and jurisprudence.

On 13 June 1997, the Honorable Court of Appeals (Third Division) rendered a Decision, which reversed and set-aside the assailed decision and a new one was entered, copy of which was received by the petitioners thru counsel on 20 June 1997, the dispositive portion of which are as follows:"WHEREFORE, finding reversible error in the assailed decision, the same is hereby REVERSED and SET ASIDE and a new one is ENTERED finding the appellees liable, jointly and severally, with each other and ordering them to pay the appellant the sum of P2,118,841.20 representing the total amount of the obligation as of May 31, 1997, inclusive of 18% interest and 2% penalty charge until their obligation is fully paid, and the payment of P50,000.00 as attorney's fees. No pronouncement as to costs. So ordered.

On 04 July 1997, petitioners filed a "Motion for Reconsideration" thereof, and the Honorable Court of Appeals DENIED the same in its Resolution dated 24 October 1997, copy of which was received on 30 October 1997.