GR 117728; (June, 1996) (Digest)
G.R. No. 117728 June 26, 1996
SERVICEWIDE SPECIALISTS, INC., petitioner, vs. COURT OF APPEALS, SPOUSES EDUARDO and FELISA TOLOSA, BINAN MOTOR SALES CORPORATION, and EDUARDO GARCIA, respondents.
FACTS
Petitioner Servicewide Specialists, Inc. filed a complaint for replevin and/or sum of money against spouses Eduardo and Felisa Tolosa. Servicewide alleged it acquired the rights to a promissory note and chattel mortgage over an Isuzu jeepney originally executed by the Tolosas in favor of Amante Motor Works, which was subsequently assigned through Filinvest entities. The Tolosas defaulted on their installments. The spouses, in their answer, claimed they dealt with Binan Motor Sales Corporation and its president, Eduardo Garcia, who arranged the financing and later executed a “Deed of Sale with Assumption of Mortgage” for the vehicle. During proceedings, a third party, Lourdes Bartina, intervened, claiming prior ownership of the same jeepney purchased from Binan Motors, leading the trial court to order the vehicle’s release to her. The trial court later declared the Tolosas in default regarding Servicewide’s principal complaint.
ISSUE
The core issue is whether the Court of Appeals erred in affirming the trial court’s decision which, while holding the Tolosa spouses liable for the unpaid balance, absolved respondent Eduardo Garcia from solidary liability.
RULING
The Supreme Court denied the petition and affirmed the Court of Appeals. The legal logic rests on the nature of the obligation and the evidence presented. Servicewide’s cause of action was based on the promissory note and chattel mortgage executed solely by the Tolosa spouses. There was no evidence that Eduardo Garcia ever assumed the obligation as a solidary co-debtor. The “Deed of Sale with Assumption of Mortgage” executed between the Tolosas and Garcia was a separate transaction to which Servicewide was not a party; it did not constitute a novation that would make Garcia solidarily liable to Servicewide. An assumption of mortgage, without the creditor’s consent, does not release the original debtor nor automatically bind the assuming party to the creditor. Liability remains with the original obligor. The Court of Appeals correctly ruled that Garcia’s liability, if any, is only to the Tolosas based on their separate agreement, not to Servicewide. Consequently, the Tolosa spouses were correctly held solely liable for the unpaid debt to Servicewide.