G.R. No. 154127, 8 December 2003


Petitioner Romeo Garcia and de Jesus borrowed P400,000.00 from respondent Dionisio Llamas. They executed a promissory note wherein they bound themselves jointly and severally to pay the loan with a 5% interest/month.

The loan has long been overdue and, despite repeated demands, petitioner and de Jesus have failed and refused to pay it. Which leads respondent to file a complaint. Petitioner averred that he assumed no liability under the promissory note because he signed it merely as an accommodation party for de Jesus; and, that he is relieved from any liability arising from the note since the loan had been paid by de Jesus thru a check; and that, the issuance of the check and respondents acceptance thereof novated the note.

Respondent asserted that the loan remained unpaid for because the check issued by de Jesus bounced. RTC rendered judgment in favor of respondent, ordering petitioner & de Jesus to pay jointly & severally. CA ruled that no novation, express or implied, had taken place.


Whether or Not there was a novation of the obligation.


No. There was no novation of obligation that took place.

The parties did not declare that the old obligation had been extinguished by the issuance and the acceptance of the check, or that the check would take the place of the note. There is no incompatibility between the promissory note and the check. The check had been issued only to answer for the obligation. On the one hand, the note evidences the loan obligation; and on the other, the check answers for it. Hence, the two can stand together.

Neither could the payment of interests, Such payment was already provided for in the promissory note and, like the check, was totally in accord with the terms and conditions thereof.

Petitioners argue that the obligation was novated by the substitution of debtors is without merit because petitioner has not shown that he was expressly released from the obligation, that a third person was substituted in his place, or that the joint and solidary obligation was canceled and substituted by the solitary undertaking of De Jesus. The law requires that the creditor expressly consents to the substitution of a new debtor.

 * Case digest by  Neah Hope L. Bato, LLB-1, Andres Bonifacio Law School, SY 2017-2018