Carolyn M. Garcia v. Rica Marie · G.R. 154878

Petitioner: Carolyn M. Garcia
Respondent: Rica Marie S. Thio
Citation: G.R. No. 154878
Court: Supreme Court
Division: First Division
Ponente: Corona, J.
Decided: March 16, 2007

Summary

Garcia sued Thio for repayment of two loans totaling US$100,000 and P500,000, claiming Thio instructed that the loan proceeds be made payable to third party Santiago. The RTC ruled for Garcia, but the CA reversed, finding no loan contracts existed since the crossed checks were payable to Santiago, not Thio. The Supreme Court reversed the CA, holding that delivery occurred when the checks were placed in Thio's control under an arrangement whereby she re-lent to Santiago. The Court found compelling evidence including Thio's payment of interest from her own funds, witness testimony about her profit scheme, and Santiago's insolvency petition listing Thio as creditor. However, the Court modified the interest award to legal interest rate (12% per annum) rather than the alleged stipulated monthly rates, as contractual interest must be in writing under Article 1956 of the Civil Code.

Statutes applied

Civil Code, Art. 1956

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By the Intellegal Editorial Board · March 16, 2007

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