Behn Meyer & Co. v. Gonzalez
REITERATIONFacts
The Antecedents: Plaintiff Behn, Meyer & Co. delivered candles and petroleum on consignment to Ira L. Davis, valued at P25,556.86. Davis failed to account for P3,097.23. Prior to the consignment, Francisco Gonzalez entered into a written contract with the plaintiff, becoming a guarantor for the payment of the value of effects received by Davis. This guaranty was evidenced by a joint and several bond for P5,000, signed by both Davis and Gonzalez. Procedural History: The plaintiff instituted an action upon the bond against both Davis and Gonzalez to recover the balance due from Davis. The Court of First Instance rendered judgment against both defendants. Only Francisco Gonzalez appealed. The Petition: The appellant, Gonzalez, contended that his obligation as guarantor was not proven because the written contract of guaranty, a joint and several bond, was lost and not formally introduced in evidence, nor was secondary evidence of its contents presented as required by section 335 of the Code of Civil Procedure. The plaintiff countered that the execution and delivery of the bond were admitted in an agreed statement of facts.
Issue(s)
Whether the admission in the agreed statement of facts regarding the execution and delivery of the bond is sufficient to prove the appellant's liability as guarantor. Whether the written contract of guaranty, as described in the agreed statement of facts, sufficiently shows the existence of a valid contract binding the appellant as guarantor.
Ruling
The Supreme Court affirmed the judgment of the lower court, holding that the appellant's liability as guarantor was sufficiently established. The Court ordered the appellant to pay the costs of the instance.
Ratio Decidendi
On the sufficiency of the admission in the agreed statement of facts: The Court held that the admission in the agreed statement of facts, stating that "the defendant, Ira L. Davis, delivered to the plaintiff a point and several bond, in the sum of P5,000, signed by Francisco Gonzalez and himself," dispensed with the necessity of formal proof of the execution and delivery of the bond. This admission, when construed in connection with the allegation in the complaint that Gonzalez had agreed in writing to guarantee Davis's account, was deemed sufficient to show the existence of the liability created by the bond. The Court reasoned that the acts of signing and delivering the bond necessarily import that it was in writing and that the parties intended to enter into contractual relations, with Gonzalez bound as guarantor. On whether the written contract sufficiently shows a valid contract: The Court found that while the agreed statement of facts was "dangerously vague and incomplete" regarding the specific terms and consideration of the contract, the admission, when read with the complaint, indicated that the bond was a written document formally sufficient under section 335(2) of the Code of Civil Procedure to bind Gonzalez for the debt of Davis. Furthermore, the Court invoked Article 1277 of the Civil Code, which presumes the existence of a licit cause until the contrary is proven, and section 334(35) of the Code of Civil Procedure, which presumes consideration from a written contract. The testimony of Davis also supported the execution of the guaranty for monies received by him as agent. Therefore, the existence of a valid contractual relationship and the appellant's liability as guarantor were sufficiently established.
Main Doctrine
An admission in an agreed statement of facts regarding the execution and delivery of a written contract of guaranty, coupled with the allegations in the complaint, is sufficient to establish the existence of the liability of the guarantor, even if the written document itself was not formally presented as evidence, provided that the law of the jurisdiction presumes the existence of a licit cause or consideration for such written contracts.