GR 131013; (December, 2001) (Digest)
G.R. No. 131013 December 14, 2001
Blade International Marketing Corporation, Evan J. Borbon, Edgar J. Borbon, and Marcial Geronimo, petitioners, vs. Court of Appeals and Metropolitan Bank & Trust Company, respondents.
FACTS
Metropolitan Bank and Trust Company (Metrobank) filed a complaint for sum of money with a prayer for a writ of preliminary attachment against Blade International Marketing Corporation and its officers, Evan J. Borbon, Edgar J. Borbon, and Marcial Geronimo. Metrobank alleged it extended credit via letters of credit for the importation of merchandise, secured by trust receipts. The bank claimed the petitioners, as entrustees, failed to account for and turn over the proceeds from the sale of the goods, thereby breaching the trust receipt agreements.
The petitioners, in their joint answer, argued they were not personally liable. They contended the individual officers signed the letters of credit and related documents merely in their corporate capacities and that the documents were signed in blank. The trial court dismissed both the complaint and the petitioners’ counterclaim. On appeal, the Court of Appeals reversed the trial court, holding the petitioners jointly and severally liable for the obligation, inclusive of interest, penalty, and attorney’s fees.
ISSUE
Whether the individual petitioners, Evan J. Borbon, Edgar J. Borbon, and Marcial Geronimo, are personally and solidarily liable with the corporation for the obligations arising from the letters of credit and trust receipts.
RULING
The Supreme Court affirmed the decision of the Court of Appeals, holding the individual petitioners solidarily liable. The Court ruled that by signing the letters of credit and related documents, the petitioners contractually agreed to the stipulated conditions, which included a joint and several undertaking for payment. The defense that they signed in blank or only in their corporate capacity was unavailing. The Court emphasized that experienced businessmen who sign important legal documents cannot later disclaim liability arising therefrom. The signatures bound them personally to the solidary obligation as clearly stipulated in the instruments they executed. Therefore, they were correctly held jointly and severally liable with the corporation for the total amount due to Metrobank.