GR L 11059; (March, 1960) (Digest)
G.R. No. L-11059; March 25, 1960
ADRIAN FONG, plaintiff-appellee, vs. EMILIO M. JAVIER, defendant-appellant.
FACTS
During the Japanese occupation, defendant-appellant Emilio M. Javier received a loan from plaintiff-appellee Adrian Fong. Javier signed a promissory note promising to pay Fong the sum of P12,000.00 “in legal currency within six months from and after the formal declaration of peace between Japan and the United States.” By December 1953, when Fong filed his complaint, the note had become due. Javier had only paid a total of P5,850.00 on account of the loan. Javier objected to the Court of Appeals’ decision ordering him to pay the unpaid balance, contending that since the loan was given in Japanese war notes, he should only be required to pay its equivalent value according to the Ballantyne schedule, which he claimed would amount to only P600.00 in genuine Philippine currency.
ISSUE
1. Whether the Ballantyne schedule should be applied to determine the repayment amount of a loan contracted in Japanese war notes, where the promissory note expressly stipulates payment in legal currency after the declaration of peace.
2. Whether the plaintiff is liable for moral damages for filing the collection suit.
RULING
1. On the application of the Ballantyne schedule: The Supreme Court affirmed the refusal of the Court of Appeals to apply the Ballantyne schedule. The Court found this refusal fully justified in view of the express tenor of the promissory note and pursuant to the ruling in Roño vs. Gomez (83 Phil. 890). Following that and other subsequent decisions, the Court held that where debtors, expressly or impliedly, promise to pay in Philippine currency peso for peso, they are bound by that stipulation. The parties to a loan contract could properly make such an agreement.
2. On the claim for moral damages: The Supreme Court sustained the Court of Appeals’ denial of the claim for moral damages. The appellate court had declined to award damages, considering that the plaintiff’s demand for payment was well-founded since the promissory note was due and unpaid. A creditor may not be blamed for any embarrassment the debtor suffers from a legitimate collection suit, in the absence of legally reprehensible or unnecessarily aggravating conduct. The Court deferred to the lower court’s factual finding that the plaintiff had committed no such acts.
Judgment affirmed. No costs.