UNITED ALLOY v. UCPB

UNITED ALLOY PHILIPINES CORPORATION, SPOUSES DAVID C. CHUA and LUTEN CHUA, Petitioners vs. UNITED COCONUT PLANTERS BANK, Respondent.

G.R. No. 175949

January 30, 2017

Facts:

On December 18, 2000, herein petitioner corporation, United Alloy Philippines Corporation (UNIALLOY) applied for and was granted a credit accommodation by herein respondent United Coconut Planters Bank. (UCPB) in the amount of PhP50,000,000.00, as evidenced by a Credit Agreement. Part of UNIALLOY's obligation under the Credit Agreement was secured by a Surety Agreement, dated December 18, 2000, executed by UNIALLOY Chairman, Jakob Van Der Sluis (Van Der Sluis), UNIALLOY President, David Chua and his spouse, Luten Chua (Spouses Chua), and one Yang Kim Eng (Yang). Six (6) Promissory Notes, were later executed by UNIALLOY in UCPB's favor. In addition, as part of the consideration for the credit accommodation, UNIALLOY and UCPB also entered into a "lease-purchase" contract wherein the former assured the latter that it will purchase several real properties which UCPB co-owns with the Development Bank of the Philippines.

 UNIALLOY failed to pay its loan obligations. As a result, UCPB filed against UNIALLOY, the spouses Chua, Yang and Van Der Sluis an action for Sum of Money with Prayer for Preliminary Attachment. UNIALLOY filed against UCPB, UCPB Vice-President Robert Chua and Van Der Sluis claiming that it holds office and conducts its business operations in Tagoloan, Misamis Oriental. UNIALLOY contended that Van Der Sluis, in cahoots with UCPB Vice-President Robert Chua, committed fraud, manipulation and misrepresentation to obtain the subject loan for their own benefit. UNIALLOY prayed, among others, that three (3) of the six (6) Promissory Notes it executed be annulled or reformed or that it be released from liability thereon.

UNIALLOY filed with the RTC of Makati an omnibus motion praying for the suspension of the proceedings of the collection case in the said court on the ground of pendency of the certiorari petition it filed with this Court. However, the RTC denied UNIALLOY's motion in its Order dated August 19, 2002. On September 21, 2006, the CA rendered its assailed judgment denying UNIALLOY's appeal and affirming the questioned RTC Decision.

Issue/s:

1. Whether or not the trial court erred and/or committed grave abuse of discretion amounting to lack or in excess of jurisdiction in rendering the assailed questioned decision when there is a pending civil action before the regional trial court of Cagayan de oro, branch 40, involving the same parties and subject matter which case, is now pending and assailed by the plaintiff-appellee via petition before the honorable supreme court.

Ruling:

The honorable court of appeals committed a serious, reversible error if not grave abuse of discretion, in denying petitioners' urgent motion for reconsideration without stating clearly and distinctly the factual and legal basis thereof. Considering that the promissory notes subject of G.R. No. 179257 are among the promissory notes which are also involved in the present case, petitioner contends that a judgment by this Court in G.R. No. 179257 that reverses the Decision of the RTC of Cagayan de Oro City, which in effect would declare the nullity of the subject promissory notes, may conflict with the Decision of this Court in the present petition, which involves the collection of the sum being represented in the same promissory notes.