This case has been cited 7 times or more.
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2014-02-24 |
BERSAMIN, J. |
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| The Court has declared that a contract where there is no mutuality between the parties partakes of the nature of a contract of adhesion,[33] and any obscurity will be construed against the party who prepared the contract, the latter being presumed the stronger party to the agreement, and who caused the obscurity.[34] PNB should then suffer the consequences of its failure to specifically indicate the rates of interest in the credit agreement. We spoke clearly on this in Philippine Savings Bank v. Castillo,[35] to wit:The unilateral determination and imposition of the increased rates is violative of the principle of mutuality of contracts under Article 1308 of the Civil Code, which provides that '[t]he contract must bind both contracting parties; its validity or compliance cannot be left to the will of one of them.' A perusal of the Promissory Note will readily show that the increase or decrease of interest rates hinges solely on the discretion of petitioner. It does not require the conformity of the maker before a new interest rate could be enforced. Any contract which appears to be heavily weighed in favor of one of the parties so as to lead to an unconscionable result, thus partaking of the nature of a contract of adhesion, is void. Any stipulation regarding the validity or compliance of the contract left solely to the will of one of the parties is likewise invalid. (Emphasis supplied) | |||||
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2013-03-13 |
MENDOZA, J. |
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| Because there is no ambiguity in the terms of the Loan Documents, NLC must honor the conditions of the omnibus credit line granted to it and its co-borrowers by respondent PNB. The Court has repeatedly emphasized that "a contract duly executed is the law between the parties and they are obliged to comply fully and not selectively with its terms."[39] Petitioner NLC, as a solidary debtor, can be made to answer for the promissory notes executed by KIC and PCC, in accordance with the Loan Documents, unless it can prove otherwise. Hence, the Court agrees with the RTC when it justifiably ruled that NLC could not escape liability for the reason that it simply acted as a third-party mortgagor and did not profit from the loan. | |||||
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2012-06-18 |
BERSAMIN, J. |
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| The Court is confounded by Marcos' dismissal of his own express written ratification of Antonio's act. Being himself a lawyer, Marcos was aware of the import and consequences of the letter of acknowledgment. The Court cannot agree with his insistence that the letter was worthless due to its being a contract of adhesion. The letter was not a contract, to begin with, because it was only a unilateral act of his. Secondly, his insistence was fallacious and insincere because he knew as a lawyer that even assuming that the letter could be treated as a contract of adhesion it was nonetheless effective and binding like any other contract. The Court has consistently held that a contract of adhesion was not prohibited for that reason. In Pilipino Telephone Corporation v. Tecson, [32] for instance, the Court said that contracts of adhesion were valid but might be occasionally struck down only if there was a showing that the dominant bargaining party left the weaker party without any choice as to be "completely deprived of an opportunity to bargain effectively." That exception did not apply here, for, verily, Marcos, being a lawyer, could not have been the weaker party. As the tenor of the of acknowledgment indicated, he was fully aware of the meaning and sense of every written word or phrase, as well as of the legal effect of his confirmation thereby of his agent's act. It is axiomatic that a man's act, conduct and declaration, wherever made, if voluntary, are admissible against him,[33] for the reason that it is fair to presume that they correspond with the truth, and it is his fault if they do not.[34] | |||||
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2007-11-23 |
NACHURA, J. |
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| The subject trust receipts, being contracts of adhesion, are not per se invalid and inefficacious. But should there be ambiguities therein, such ambiguities are to be strictly construed against Metrobank, the party that prepared them.[40] | |||||
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2007-03-05 |
CHICO-NAZARIO, J. |
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| Contracts of adhesion wherein one party imposes a ready-made form of contract on the other are not entirely prohibited. The one who adheres to the contract is in reality free to reject it entirely; if he adheres, he gives his consent.[34] A contract of adhesion is just as binding as ordinary contracts. It is true that this Court had, on occasion, struck down such contracts as being assailable when the weaker party is left with no choice by the dominant bargaining party and is thus completely deprived of the opportunity to bargain effectively. Nevertheless, contracts of adhesion are not prohibited even as the courts remain careful in scrutinizing the factual circumstances underlying each case to determine the respective claims of contending parties on their efficacy.[35] | |||||
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2005-02-17 |
QUISUMBING, J. |
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| Petitioners likewise insist that their defense tendered a genuine issue when they claimed that the loan documents constituted a contract of adhesion. Significantly, both the trial and appellate courts have already passed upon this contention and properly ruled that it was not a factual issue for trial. We agree with their ruling that there is no need of trial to resolve this particular line of defense. All that is needed is a careful perusal of the loan documents. As held by the Court of Appeals, petitioners failed to show any ambiguity in the loan documents. The rule is that, should there be ambiguities in a contract of adhesion, such ambiguities are to be construed against the party that prepared it. However, if the stipulations are clear and leave no doubt on the intention of the parties, the literal meaning of its stipulations must be held controlling.[21] | |||||
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2004-12-16 |
AZCUNA, J. |
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| A contract of adhesion is defined as one where one of the parties imposes a ready-made form of contract which the other party may accept or reject, but which the latter cannot modify. One party prepares the stipulation in the contract, while the other party merely affixes his signature or his "adhesion" thereto, giving no room for negotiation and depriving the latter of the opportunity to bargain on equal footing. These types of contracts have nonetheless been declared as binding as ordinary contracts, the reason being that the party who adheres to the contract is free to reject it entirely.[15] Thus, such agreement is not per se inefficacious. Corollarily, should there be any ambiguity in a contract of adhesion, such ambiguity is to be construed against the party who prepared it. If, however, the stipulations are not obscure, but are clear and leave no doubt on the intention of the parties, the literal meaning of its stipulations must be held controlling.[16] To reiterate, contracts of adhesion are not prohibited even as the courts remain careful in scrutinizing the factual circumstances and the situation of the parties concerned in the case to determine the respective claims of contending parties on their efficacy and enforceability.[17] When petitioner purchased the subject properties in Makati, the deed restrictions were made an addendum or supplement to the two deeds of absolute sale. The deed restrictions were pre-printed and duly annotated on the titles corresponding to the parcels of land purchased and petitioner, through its duly authorized representative, affixed its signature thereto. The stipulations were plain and unambiguous which leave no room for interpretation. As such, petitioner was presumed to have full knowledge and to have acted with due care or, at the very least, to have been aware of the terms and conditions of the contract and that it had actually assented to the stipulations as there was never any objection interposed prior to the actual purchase of the subject property. | |||||