Arcadio v. Heirs of Quirino A. de Guzman

Summary

The Supreme Court affirmed the liability of spouses Carandang to repay P336,375 that Quirino de Guzman paid for their stock subscriptions in Mabuhay Broadcasting System. The Court rejected their defense of a pre-incorporation agreement, finding insufficient evidence to overcome the legal presumption that payment by a third person creates a debt obligation under Civil Code Articles 1236-1237. The case established important precedents on substitution of parties after death, co-ownership rights in debt collection, and conjugal partnership liability. The Court modified the lower court's joint and solidary liability ruling, clarifying that married couples sued for partnership obligations are liable as representatives of their conjugal partnership, with payment coming from conjugal property rather than personal assets.