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  • 137 - Cu-Unjieng e Hijos vs. Mabalacat Sugar Co., 54 Phil 976, 4 October 1930

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    Bibi Jumpol
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    This case involved a lawsuit filed by Cu Unjieng e Hijos to recover over P163,000 owed by the Mabalacat Sugar Company along with foreclosing on a mortgage used to secure the debt. While Cu Unjieng agreed to extend the payment deadline, the Sugar Company failed to make interim payments as required. The Sugar Company argued the extension negated the original contract's clause allowing acceleration of the debt for nonpayment. However, the Supreme Court ruled the extension was voluntary and without consideration for the creditor, so the creditor was justified in treating the debt as accelerated due to the debtor's failure to comply with the extension terms.

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    This case involved a lawsuit filed by Cu Unjieng e Hijos to recover over P163,000 owed by the Mabalacat Sugar Company along with foreclosing on a mortgage used to secure the debt. While Cu Unjieng agreed to extend the payment deadline, the Sugar Company failed to make interim payments as required. The Sugar Company argued the extension negated the original contract's clause allowing acceleration of the debt for nonpayment. However, the Supreme Court ruled the extension was voluntary and without consideration for the creditor, so the creditor was justified in treating the debt as accelerated due to the debtor's failure to comply with the extension terms.

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    200 views1 page

    137 - Cu-Unjieng e Hijos vs. Mabalacat Sugar Co., 54 Phil 976, 4 October 1930

    Uploaded by

    Bibi Jumpol
    This case involved a lawsuit filed by Cu Unjieng e Hijos to recover over P163,000 owed by the Mabalacat Sugar Company along with foreclosing on a mortgage used to secure the debt. While Cu Unjieng agreed to extend the payment deadline, the Sugar Company failed to make interim payments as required. The Sugar Company argued the extension negated the original contract's clause allowing acceleration of the debt for nonpayment. However, the Supreme Court ruled the extension was voluntary and without consideration for the creditor, so the creditor was justified in treating the debt as accelerated due to the debtor's failure to comply with the extension terms.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    Title Cu-Unjieng e Hijos vs. Mabalacat Sugar Co.

    , 54 Phil 976, 4 October 1930


    Ponente Street, J.:
    Doctrine
    Facts  This action was instituted in the Court of First Instance of Pampanga by Cu Unjieng e
    Hijos, for the purpose of recovering from the Mabalacat Sugar Company an
    indebtedness amounting to more than P163,00, with interest,and to foreclose a
    mortgage given by the debtor to secure the same, as well as to recover stipulated
    attorney's fee and the sum of P1,206, paid by the plaintiff for insurance upon the
    mortgaged property, with incidental relief.
     In the complaint Siuliong & Co., Inc., was joined as defendant, as a surety of the
    Mabalacat Sugar Company, and as having a third mortgage on the mortgaged
    property. The Philippine National Bank was also joined by reason of its interest as
    second mortgagee of the land covered by the mortgage to the plaintiff
     The mortgage executed by the Mabalacat Sugar Company contains, a provision to the
    effect that non-compliance on the part of the mortgage debtor with any of the
    obligations assumed in virtue of this contract will cause the entire debt to become due
    and give occasion for the foreclosure of the mortgage.
     The debtor party failed to comply with the obligation, imposed upon it in the
    mortgage, to pay the mortgage debt in the stipulated installments at the time
    specified in the contract. It results that the creditor was justified in treating the entire
    mortgage debt as having been accelerated by such failure of the debtor in paying the
    installments.
     Cu Unjieng e Hijos, agreed to extend the time for payment of the mortgage
    indebtedness until June 30, 1929, with certain interim payments to be made upon
    specified dates prior to the contemplated final liquidation of the whole indebtedness.
    But the debtor party failed to make the interim payments

    : Petitioner Respondent
     

    Lower Courts .
    Appellate Court
    Issue whether the action was prematurely stated since notwithstanding extension of time of
    payment

    Is SC Ruling Yes. Notwithstanding the failure of the debtor to comply with the terms of this extension,
    it is insisted for the appellant that this agreement for the extension of the time of
    payment had the effect of abrogating the stipulation of the original contract with respect
    to the acceleration of the maturity of the debt by non-compliance with the terms of the
    mortgage.

    As the trial court pointed out, this contention is untenable. The agreement to extend
    the time of payment was voluntary and without consideration so far as the
    creditor is concerned; and the failure of the debtor to comply with the terms of
    the extension justified the creditor in treating it as of no effect.

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