GR L 22552; (January, 1969) (Digest)
G.R. No. L-22552 January 30, 1969
THE COMMISSIONER OF IMMIGRATION, plaintiff-appellant, vs. ASIAN SURETY & INSURANCE COMPANY, INC., defendant-appellee.
FACTS
Defendant-appellee Asian Surety & Insurance Company, Inc. executed a bond in the sum of P7,000 to guarantee that Cua Giok Ke, a Chinese citizen admitted temporarily as a non-immigrant student, would actually depart from the Philippines on or before April 7, 1958, or within such period as the Commissioner of Immigration or his authorized representative may properly allow. The Bureau of Immigration extended several times the temporary stay of Cua Giok Ke after April 7, 1958 without notifying the bonding company. On June 13, 1961, deportation proceedings were instituted, and the Commissioner declared the bond confiscated for violation of its terms, as Cua Giok Ke did not leave after the expiration of his last authorized stay. Upon receipt of the confiscation letter, the surety company caused Cua Giok Ke’s surrender on June 16, 1961, and requested the lifting of the confiscation order, which was denied. The lower court dismissed the complaint for recovery on the bond, holding it inequitable to penalize the surety for an omission due to the plaintiff’s fault in not notifying it of the extensions.
ISSUE
Whether the defendant-appellee surety company is liable on its bond despite the extensions of stay granted by the Commissioner of Immigration without the surety’s knowledge or consent.
RULING
Yes. The Supreme Court reversed the lower court’s decision and held the surety company liable. The obligation under the bond was contractual and the law between the parties. The bond’s terms explicitly allowed the Commissioner to extend the stay at his discretion. The surety’s admission of a failure to comply with the bond’s terms was fatal to its claim for exemption. The plea for equitable relief was unavailing, as the surety was not entirely without fault; it could have made appropriate inquiries about the alien’s status. The rule of strictissimi juris favoring sureties does not apply to compensated corporate sureties, which are in fact insurers and their contracts are to be construed against them. Policy considerations also require holding bonding companies liable to address the problem of overstaying aliens. The case was remanded to determine the liability of third-party defendants.