FACTS:
On
February 10, 1940, spouses Patricio Confesor and Jovita Villafuerte obtained an
agricultural loan from Agricultural and Industrial Bank, now Development Bank
of the Philippines, in the sum of P2,000, as evidenced by a promissory note of
said date whereby they bound themselves jointly and severally to pay the amount
in ten equal yearly amortizations.
As
the obligation remained unpaid even after the lapse if the ten-year period,
Confesor, who was then a member of the Congress of the Philippines, executed a
second promissory note on April 11, 1961, expressly acknowledging the said loan
and promising to pay the same on or before June 15, 1961.
The
spouses still failed to pay the obligation on the specified date. As
a result, the DBP filed a complaint on September 11, 1970 in the City Court of
Iloilo City. The city court ordered payment from spouses. The CFI of Iloilo
reversed the decision. Hence, this petition.
ISSUE:
Whether or not a promissory which was executed in consideration of a previous
promissory note which has already been barred by prescription is valid.
HELD:
Yes, the second promissory note is valid because the said promissory note is
not a mere acknowledgement of the debt that has prescribed already. Rather, it
is a new promise to pay the debt. A new promise is a new cause of action.
Although a debt barred by prescription is enforceable, a new contract
recognizing and assuming the prescribed debt would be valid and enforceable.
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