The Court of First Instance of Cebu rendered a judgment ordering Shell Refining Company and Michael Incorporated to pay Pacita F. Reformina and the heirs of Francisco Reformina for damages resulting from a fire on their boat. On appeal, the trial court's judgment was modified ordering the defendants to pay compensatory and moral damages. When the plaintiffs attempted to execute the decision, a dispute arose over the applicable interest rate, with the plaintiffs claiming 12% and the defendants insisting on the statutory 6% rate. The Supreme Court held that the 6% statutory rate under Article 2209 of the Civil Code applied because the case involved damages, not a loan or forbearance.
The Court of First Instance of Cebu rendered a judgment ordering Shell Refining Company and Michael Incorporated to pay Pacita F. Reformina and the heirs of Francisco Reformina for damages resulting from a fire on their boat. On appeal, the trial court's judgment was modified ordering the defendants to pay compensatory and moral damages. When the plaintiffs attempted to execute the decision, a dispute arose over the applicable interest rate, with the plaintiffs claiming 12% and the defendants insisting on the statutory 6% rate. The Supreme Court held that the 6% statutory rate under Article 2209 of the Civil Code applied because the case involved damages, not a loan or forbearance.
The Court of First Instance of Cebu rendered a judgment ordering Shell Refining Company and Michael Incorporated to pay Pacita F. Reformina and the heirs of Francisco Reformina for damages resulting from a fire on their boat. On appeal, the trial court's judgment was modified ordering the defendants to pay compensatory and moral damages. When the plaintiffs attempted to execute the decision, a dispute arose over the applicable interest rate, with the plaintiffs claiming 12% and the defendants insisting on the statutory 6% rate. The Supreme Court held that the 6% statutory rate under Article 2209 of the Civil Code applied because the case involved damages, not a loan or forbearance.
The Court of First Instance of Cebu rendered a judgment ordering Shell Refining Company and Michael Incorporated to pay Pacita F. Reformina and the heirs of Francisco Reformina for damages resulting from a fire on their boat. On appeal, the trial court's judgment was modified ordering the defendants to pay compensatory and moral damages. When the plaintiffs attempted to execute the decision, a dispute arose over the applicable interest rate, with the plaintiffs claiming 12% and the defendants insisting on the statutory 6% rate. The Supreme Court held that the 6% statutory rate under Article 2209 of the Civil Code applied because the case involved damages, not a loan or forbearance.
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Pacita F.
Reformina and Heirs of Francisco
Reformina vs The Honorable Valeriano P. Tomol, Jr, as Judge of theCourt of First Instance, Barch XI, Cebu City, Shell Refining Company (Phils.), Inc., and Michael, Incorporated G.R. No. L-59096 FACTS: On June 7, 1972, the Court of First Instance of Cebu, rendered a judgment as follows: WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and third party defendants and against the defendants and third party plaintiffs as follows: Ordering defendants and third party plaintiffs Shell and Michael, Incorporated to pay jointly and severally the following persons: (g) Plaintiffs Pacita F. Reformina and Francisco Reformina the sum of P131,084.00 which is the value of the boat F B Pacita Ill together with its accessories, fishing gear and equipment minus P80,000.00 which is the value of the insurance recovered and the amount of P10,000.00 a month as the estimated monthly loss suffered by them as a result of the fire of May 6, 1969 up to the time they are actually paid or already the total sum of P370,000.00 as of June 4, 1972 with legal interest from the filing of the complaint until paid and to pay attorney's fees of P5,000.00 with costs against defendants and third party plaintiffs. On appeal, the trial courts judgment was modified as follows: WHEREFORE. the judgment appealed from is modified such that defendants-appellants Shell Refining Co. (Phils.), Inc. and Michael, Incorporated are hereby ordered to pay ... The two (2) defendants- appellants are also directed to pay P100,000.00 with legal interests from the filing of the complaint until paid as compensatory and moral damages and P41,000.00 compensation for the value of the lost boat with legal interest from the filing of the complaint until fully paid to Pacita F.
Reformina and the heirs of Francisco Reformina. The liability of
the two defendants for an the awards is solidary. The decision, having become final, was remanded to the lower court for execution. Petitioners claim that the legal interest to be executed should be at the rate of 12% per annum invoking in support Central Bank of the Philippines Circular No. 416. Private respondents on the other hand, insist that legal interest be at the rate of 6% per annum pursuant to Article 2209 of the New Civil Code in relation to Articles 2210 and 2211 thereof. The petition is devoid of merit and dismissed. ISSUE: Whether or not the legal interest should be at 6%. HELD: In the case at bar, the decision herein sought to be executed is one rendered in an Action for Damages for injury to persons and loss of property and does not involve any loan, much less forbearances of any money, goods or credits. As correctly argued by the private respondents, the law applicable to the said case is Article 2209 of the New Civil Code which reads Art. 2209. If the obligation consists in the payment of a sum of money, and the debtor incurs in delay, the indemnity for damages, there being no stipulation to the contrary, shall be the payment of interest agreed upon, and in the absence of stipulation, the legal interest which is six percent per annum.
G.R. No. 153852 October 24, 2012 Spouses Humberto P. Delossantos and Carmencita M. Delos Santos, Petitioners, Metropolitan Bank and Trust Company, Respondent
