G.R. No. 171982 ; August 18, 2010
DEVELOPMENT BANK OF THE PHILIPPINES, Petitioner, vs. TRADERS ROYAL BANK and PRIVATIZATION AND MANAGEMENT OFFICE (vice ASSET PRIVATIZATION TRUST), Respondents.

FACTS

In 1980, Phil-Asia Food Industries Corporation obtained a loan from Traders Royal Bank via letters of credit for importing machinery. Development Bank of the Philippines issued a guaranty to TRB covering this importation. After partial payments, a balance remained. TRB filed a collection suit against Phil-Asia and DBP, later impleading the Asset Privatization Trust. DBP contested liability, arguing its guaranty was limited to imports from a specific supplier, Archer Daniels Midland, and that the actual importation from Emi Disc Corporation was without its consent. DBP and Phil-Asia also claimed overpayment, asserting total payments exceeded the loan principal.
The trial court held DBP and Phil-Asia jointly and severally liable for the unpaid balance. The Court of Appeals affirmed with modifications, adjusting the interest rate and ordering Phil-Asia to indemnify DBP. The appellate court found DBP had impliedly ratified the change of supplier through its payments and that the evidence did not support the overpayment claim, recalculating the outstanding balance.

ISSUE

The core issues were whether DBP’s guaranty covered the actual importation, whether the loan had been overpaid, and whether the Privatization and Management Office assumed liability.

RULING

The Supreme Court denied the petition, affirming the Court of Appeals. The Court emphasized that the petition raised questions of fact, which are not reviewable under Rule 45. The jurisdiction of the Supreme Court in such petitions is limited to reviewing errors of law; factual findings of the Court of Appeals, especially when they affirm the trial court, are generally conclusive and binding.
The legal logic rests on the principle of finality of factual determinations. The Court found no reason to deviate from the appellate court’s conclusions, as the petitioner failed to demonstrate that the case fell under any recognized exception to the rule barring re-evaluation of facts. These exceptions include findings grounded on speculation, grave abuse of discretion, or conclusions unsupported by evidence. The Court upheld the finding that DBP, by its conduct, ratified the change of supplier and was thus liable under its guaranty. It also sustained the computation of the unpaid balance and the finding that the Privatization and Management Office did not assume the obligation, as no evidence was presented to prove such transfer.