- Petitioner
- Socony-Vacuum Corporation (Formerly the Standard Oil Company of New York)
- Respondent
- Leon C. Miraflores
- Citation
- G.R. No. 45821
- Court
- Supreme Court En Banc
- Division
- En Banc
- Ponente
- Laurel, J.
- Decided
- April 12, 1939
Summary
Socony-Vacuum Corporation sued Chan To and Leon C. Miraflores to recover P1,357.04. Chan To was a selling agent who had defaulted on P2,565.93 before January 16, 1933. Miraflores executed a mortgage on that date to secure Chan To's obligations 'from January 16, 1933.' After this date, Chan To's remittances exceeded his new obligations, but the company applied part of the surplus to the pre-existing debt. The Supreme Court affirmed lower courts' rulings that Miraflores was not liable for the pre-1933 obligation because the mortgage contract specifically limited his liability to obligations incurred after January 16, 1933. The Court held that rules on application of payments apply between creditor and principal debtor, not between creditor and surety, and that suretyship contracts cannot be given retrospective effect beyond their specified terms.