G.R. No. L-10873; April 16, 1958
C.N. HODGES, plaintiff-appellee, vs. WILLIAM REPOSPOLO, ALEJANDRO REPOSPOLO and ANDRES A. ARENGA, defendants. ANDRES A. ARENGA, defendant-appellant.

FACTS

On October 29, 1947, William and Alejandro Repospolo purchased a Chevrolet truck from C.N. Hodges for P5,000, paying P1,500 down. The balance of P3,500 was payable in monthly installments with interest at 1% per month. The Repospolos executed a deed (Exhibit A) containing these terms and stipulating for an additional P500 as attorney’s fees and costs in case of default. William Repospolo constituted a chattel mortgage on the truck as security. By September 7, 1948, the outstanding balance was P1,810. On that date, William Repospolo sold the truck to Andres A. Arenga, Alfredo Suello, and Mauricio La-anan for P1,000. The buyers paid half in cash and executed a promissory note for the balance, secured by a real estate belonging to Arenga. The “Contract of Sale with Guaranty” (Exhibit 3) stipulated that the buyers (the “Party of the Second Part”) would assume full responsibility for the outstanding obligation to Hodges. The buyers and William Repospolo secured Hodges’s approval of the transaction. Arenga signed at the foot of the original contract (Exhibit A) between Hodges and the Repospolos, and his name replaced William Repospolo’s in Hodges’s book of accounts (Exhibit 2). Arenga later made payments to Hodges totaling P410, leaving a balance of P1,400 on the truck. Arenga also obtained goods from Hodges worth P887.49 on credit. Neither debt was paid. On March 8, 1950, Hodges filed an action against the Repospolos and Arenga to recover P1,400, P887.49, and P500 as attorney’s fees. The trial court held Arenga liable for all sums and dismissed the complaint against the Repospolos, ruling they were substituted as debtors with Hodges’s consent (expromision). Arenga appealed.

ISSUE

1. Whether the Court of First Instance had jurisdiction over the case.
2. Whether defendant-appellant Andres A. Arenga is liable for the amounts claimed.

RULING

1. On Jurisdiction: Yes, the Court of First Instance had jurisdiction. The court’s original jurisdiction covers cases where the demand, exclusive of interest, exceeds P2,000. The total demand from the three causes of action (P1,400 + P887.49 + P500 = over P2,000) determines jurisdiction, not the amount in each cause separately.
2. On Liability: Yes, Arenga is liable. By signing Exhibit A, Arenga personally assumed the obligations under the original contract, including the payment of attorney’s fees in case of default. Exhibit 3 made the buyers the “true and lawful owners” subject to Hodges’s rights as defined in Exhibit A. Arenga’s status as an ex-mayor made it inconceivable he signed without understanding its implications. Although his obligation under Exhibit 3 to William Repospolo was joint with Suello and La-anan, his direct agreement with Hodges by signing Exhibit A alone made him solely responsible to Hodges for the debt. The decision of the lower court is affirmed.