Wise & Co. v. Dionisio P. Tanglao

Summary

This 1936 Supreme Court case involved Wise & Co.'s attempt to collect P296.53 from Tanglao as an alleged surety for David's debt. David, a former agent of Wise & Co., owed P640 and had given Tanglao a power of attorney to mortgage property and act as guarantor. However, the compromise agreement only mortgaged Tanglao's property without expressly making him a surety. The Supreme Court reversed the trial court, holding that suretyship must be express and cannot be presumed. Additionally, even if suretyship existed, the creditor must first exhaust remedies against the principal debtor before pursuing the surety, as mandated by Article 1830 of the Civil Code. The case established important precedents regarding the express nature of suretyship contracts and the exhaustion of remedies principle in surety law.