Fidelity v. Isabelo G. Sanchez

Summary

The Supreme Court affirmed a lower court judgment requiring defendants to reimburse plaintiff surety company P784.17 plus interest and attorney's fees. Sanchez had served as selling agent for Radio Corporation under a P2,000 surety bond posted by plaintiff company, with co-defendants as additional sureties on an indemnity bond. When Sanchez failed to pay for P784.17 worth of merchandise received, the Radio Corporation demanded payment from the surety company, which paid on March 1, 1933. The Court rejected defendants' arguments that Radio Corporation should have been joined as party, that failure to file counterclaim constituted waiver, and that the payment was improper. Applying Civil Code provisions on suretyship, the Court held that the surety company was entitled to reimbursement from the principal and co-sureties after properly paying the principal's mature debt obligation.