GR 4444; (September, 1908) (Digest)
SALIH ADAD, plaintiff-appellee, vs. JAMES CRAIG TOW, GEO E. WOLF, and UN PAK LEUNG, defendants-appellants.
September 3, 1908
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FACTS:
In an initial action, plaintiff Salih Adad sued defendant James Craig Tow for possession of premises in Manila and damages. The Court of First Instance (CFI) ruled in favor of Adad on April 11, 1905, granting him possession and P108.89 in damages (which covered rent and damages only up to December 1, 1904).
Tow appealed this CFI judgment to the Supreme Court. On April 24, 1905, Tow, as principal, and George E. Wolf and Un Pak Leung, as sureties, executed a bond. The bond stated that they were bound for “all rents, damages and costs which are now due or may hereafter become due” by reason of Tow’s withholding possession. However, it also stipulated a condition: “should the defendant prosecute his appeal with effect and reversed the judgment… or in case of its confirmation or modification, pay any money on judgment, costs, rents, and damages assessed against him in said cause, then and in that case, this obligation to be null and void.”
Tow remained in possession of the premises until September 30, 1905.
The Supreme Court affirmed the original CFI judgment on April 30, 1906. Subsequently, Tow paid the full amount of the P108.89 judgment and all costs assessed in that original action on June 16, 1906.
On August 22, 1906, Adad commenced the present action against Tow, Wolf, and Un Pak Leung (Un Pak Leung was never served) to recover rents for Tow’s occupation of the premises from December 1904 to September 1905, which were not covered by the original P108.89 judgment. The CFI ruled in favor of Adad, ordering Tow and Wolf to pay P1,500 plus interest and costs. Tow and Wolf appealed to the Supreme Court.
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ISSUE:
1. Whether defendant Wolf, as a surety, is liable on the bond for rents accruing after the original P108.89 judgment was paid, given the specific conditions of the bond.
2. Whether defendant Tow is liable for the occupation of the premises from December 1904 to September 1905, either under the bond or independently, based on the allegations in the complaint.
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RULING:
1. For defendant Wolf (surety): The Supreme Court held that Wolf is not liable on the bond. The bond explicitly stated that the obligation would be null and void if Tow paid “any money on judgment, costs, rents, and damages assessed against him in said cause.” Tow had fulfilled this condition by paying the P108.89 judgment and all costs assessed in the original action. The Court clarified that the initial clause stating the parties were bound for “all rents, damages and costs which are now due or may hereafter become due” merely indicates the scope of the bond’s penalty, but the condition for its nullification determines the surety’s actual liability. Since Tow satisfied the condition by paying what was assessed in the previous case, the bond became void, thereby relieving the sureties (including Wolf) of further liability.
2. For defendant Tow: The Court found that the amended complaint failed to state a sufficient cause of action against Tow for the occupation of the premises from December 1904 to September 1905.
First, no action could be maintained against him on the bond because the complaint itself showed that the original judgment secured by the bond had been paid.
Second, regarding a separate claim for the value of the use of the premises, the complaint lacked specific allegations. There was no direct allegation that Tow was in possession during the specified period, nor was there any allegation of the value of the use of the premises during that time, or of any agreement by Tow to pay a specific sum.
Therefore, the CFI judgment was reversed. Defendant Wolf was acquitted. As to defendant Tow, the case was remanded to the CFI with instructions to sustain his demurrer to the amended complaint and to allow the plaintiff Adad to amend his complaint in accordance with the rules of court.