Antonio R. Agra v. Philippine National Bank

Summary

This case involves sureties attempting to avoid liability under a surety agreement by invoking laches defense. PNB granted a P2.5 million loan to Fil-Eastern Wood Industries in 1967, with petitioners signing as sureties. When the company defaulted, PNB filed suit in 1976 after a seven-year delay. Petitioners argued they were coerced into signing and that laches barred collection. The Supreme Court denied their petition, ruling that laches cannot defeat a collection suit filed within the statutory prescriptive period. The Court emphasized that surety obligations are direct, primary, and absolute, and that petitioners failed to timely challenge their consent under Civil Code Article 1391. The decision reinforces that equity doctrines like laches cannot override clear statutory provisions, and that sureties remain liable regardless of whether they received benefits from the guaranteed obligation.