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    PNB Vs Manila Oil Digest

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    Loi Villarin
    The Philippine National Bank sued Manila Oil Refining & By-Products Company to recover a 61,000 peso promissory note. The note contained a provision authorizing an attorney to confess judgment against Manila Oil if payment was not made. An attorney associated with PNB filed to confess judgment, but Manila Oil objected. The court found that provisions authorizing attorneys to confess judgment without allowing the debtor to be heard are not authorized or contemplated by Philippine law. While promissory notes are generally valid, this type of confession of judgment provision is otherwise illegal and enlarges the potential for fraud.

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    PNB Vs Manila Oil Digest

    Uploaded by

    Loi Villarin
    93 views1 page
    The Philippine National Bank sued Manila Oil Refining & By-Products Company to recover a 61,000 peso promissory note. The note contained a provision authorizing an attorney to confess judgment against Manila Oil if payment was not made. An attorney associated with PNB filed to confess judgment, but Manila Oil objected. The court found that provisions authorizing attorneys to confess judgment without allowing the debtor to be heard are not authorized or contemplated by Philippine law. While promissory notes are generally valid, this type of confession of judgment provision is otherwise illegal and enlarges the potential for fraud.

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    Case digest

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    PNB vs Manila Oil Digest

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    The Philippine National Bank sued Manila Oil Refining & By-Products Company to recover a 61,000 peso promissory note. The note contained a provision authorizing an attorney to confess judgment against Manila Oil if payment was not made. An attorney associated with PNB filed to confess judgment, but Manila Oil objected. The court found that provisions authorizing attorneys to confess judgment without allowing the debtor to be heard are not authorized or contemplated by Philippine law. While promissory notes are generally valid, this type of confession of judgment provision is otherwise illegal and enlarges the potential for fraud.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    93 views1 page

    PNB Vs Manila Oil Digest

    Uploaded by

    Loi Villarin
    The Philippine National Bank sued Manila Oil Refining & By-Products Company to recover a 61,000 peso promissory note. The note contained a provision authorizing an attorney to confess judgment against Manila Oil if payment was not made. An attorney associated with PNB filed to confess judgment, but Manila Oil objected. The court found that provisions authorizing attorneys to confess judgment without allowing the debtor to be heard are not authorized or contemplated by Philippine law. While promissory notes are generally valid, this type of confession of judgment provision is otherwise illegal and enlarges the potential for fraud.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    PHILIPPINE NATIONAL BANK vs.

    MANILA OIL REFINING & BY-PRODUCTS COMPANY, INC.


    G.R. No. L-18103
    June 8, 1922
    FACTS:
    This case concerns the validity of a provision in a Php61,000.00 promissory note
    whereby in case the same is not paid at maturity, the maker (Manila Oil) authorizes any attorney
    to appear and confess judgment thereon for the principal amount, with interest, costs, and
    attorney's fees, and waives all errors, rights to inquisition, and appeal, and all property
    exceptions.
    On May 8, 1920, the manager and the treasurer of the Manila Oil executed and delivered
    to the PNB the promissory note in question. When they defaulted, PNB brought action to the CFI
    of Manila to recover the Php61,000.00. They brought with them Atty. Elias Rector, an attorney
    associated with PNB, to enter in representation of Manila Oil. He filed a motion of confessing
    judgment. The defendant, however, in a sworn declaration, objected strongly to the unsolicited
    representation of attorney Recto. Later, attorney Antonio Gonzalez appeared for the defendant
    and filed a demurrer, and when this was overruled, presented an answer. The trial judge rendered
    judgment on the motion of attorney Recto in the terms of the complaint.
    ISSUE:
    Whether the promissory note in question is valid.
    HELD:
    No it is not. After hearing the opinion of experts, the Court arrived at this decision.
    Warrants of attorney to confess judgment are not authorized nor contemplated by our law.
    Provisions in notes authorizing attorneys to appear and confess judgments against makers should
    not be recognized in this jurisdiction by implication and should only be considered as valid when
    given express legislative sanction.
    Although the NIL mentions of the validity of the promissory note despite the presence of
    a provision of a confession of judgment, the Court points out the conclusion of the article: But
    nothing in this section shall validate any provision or stipulation otherwise illegal." If
    confessions of judgment were allowed, the debtor will be deprived of his right to be heard.
    Moreover, it is not the policy of the law to place a debtor in the absolute power of his creditor.
    The field for fraud is too far enlarged by such an instrument.

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