GR L 4476; (April, 1953) (Digest)
G.R. No. L-4476 April 20, 1953
SAMUEL J. WILSON, plaintiff-appellee, vs. B. H. BERKENKOTTER, defendant-appellant.
FACTS
In 1938, plaintiff Samuel J. Wilson, defendant B.H. Berkenkotter, and Paul A. Gulick jointly and severally signed a promissory note for P90,000 in favor of the Chartered Bank of India, Australia and China, payable on demand with interest. They agreed among themselves to pay the obligation in equal shares of P30,000 each. During the Japanese occupation, the Bank of Taiwan, as liquidator of enemy banks, demanded payment of the loan. Defendant Berkenkotter paid the entire obligation, amounting to P112,591.22 in Japanese military notes, in November 1944. After liberation, Berkenkotter demanded payment from his co-debtors for their shares. Gulick paid P18,902. Wilson refused to pay P37,530.40 in Philippine currency and instead tendered P625.51, which he claimed was the equivalent value (under the Ballantyne schedule) of his share (P37,530.40) in military notes at the time of payment in November 1944. Berkenkotter refused the tender, and Wilson consigned the amount with the court.
ISSUE
Whether the Ballantyne schedule of values is applicable in determining the amount plaintiff Wilson must reimburse defendant Berkenkotter for the share of the solidary obligation paid by the latter during the Japanese occupation.
RULING
Yes, the Ballantyne schedule is applicable. The Supreme Court affirmed the trial court’s decision, ordering Berkenkotter to accept the consigned amount of P625.51 as full payment. The Court held that the obligation of Wilson to reimburse Berkenkotter was not created in 1938 upon the signing of the promissory note but was a new obligation created in November 1944 when Berkenkotter paid the entire debt to the bank. This new obligation was created and payable during the Japanese occupation. Therefore, the Ballantyne schedule, which provides for the revaluation of obligations payable during the occupation based on the relative value of Japanese military notes to Philippine currency at the time of payment, governs. The Court rejected Berkenkotter’s claim for reimbursement in full Philippine currency and his claim for collection expenses, as the consignation was proper.