Development Bank of the Philippines v. Court of Appeals

Summary

Juan B. Dans, 76, obtained a P300,000 loan from DBP in 1987, with DBP requiring mortgage redemption insurance coverage and collecting P1,476 premium. Dans died 19 days after applying for MRI. The DBP MRI Pool denied coverage due to the 60-year age limit. The Supreme Court held DBP liable as an insurance agent who exceeded authority by accepting an application from an ineligible applicant while concealing the age limitation. Though DBP MRI Pool was absolved due to no perfected insurance contract, DBP was ordered to refund the premium with interest and pay P50,000 moral damages for deceiving its client. The case establishes liability of agents who exceed authority without proper disclosure to third parties.