This case has been cited 3 times or more.
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2010-12-15 |
CARPIO, J. |
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| The facts in the instant case are analogous to those in Cebu Contractors Consortium Co. v. Court of Appeals.[21] There, Cebu Contractors Consortium Co. (CCCC) approached Makati Leasing and Finance Corporation (MLFC) to obtain a loan. MLFC agreed to extend financial assistance to CCCC but, instead of a loan with collateral, MLFC induced CCCC to adopt a sale and leaseback scheme. Under the scheme, several of CCCC's equipment were made to appear as sold to MLFC and then leased back to CCCC, which in turn paid lease rentals to MLFC. The rentals were treated as installment payments to repurchase the equipment. | |||||
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2008-07-04 |
AUSTRIA-MARTINEZ, J. |
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| The Court recognizes that the business of financing companies has a legitimate and commendable purpose.[23] In earlier cases, it considered a financial lease or financing lease a legal contract,[24] though subject to the restrictions of the so-called Recto Law or Articles 1484 and 1485 of the Civil Code.[25] In previous cases, the Court adopted the statutory definition of a financial lease or financing lease, as:[A] mode of extending credit through a non-cancelable lease contract under which the lessor purchases or acquires, at the instance of the lessee, machinery, equipment, motor vehicles, appliances, business and office machines, and other movable or immovable property in consideration of the periodic payment by the lessee of a fixed amount of money sufficient to amortize at least seventy (70%) of the purchase price or acquisition cost, including any incidental expenses and a margin of profit over an obligatory period of not less than two (2) years during which the lessee has the right to hold and use the leased property, x x x but with no obligation or option on his part to purchase the leased property from the owner-lessor at the end of the lease contract. [26] Petitioner presented a lengthy discussion of the purported trend in other jurisdictions, which apparently tends to favor absolving financing companies from liability for the consequences of quasi-delictual acts or omissions involving financially leased property.[27] The petition adds that these developments have been legislated in our jurisdiction in Republic Act (R.A.) No. 8556,[28] which provides: | |||||
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2007-07-12 |
GARCIA, J. |
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| In Cebu Contractors Consortium Co. v. Court of Appeals,[12] the Court viewed and thus declared a financial lease agreement as having been simulated to disguise a simple loan with security, it appearing that the financing company purchased equipment already owned by a capital-strapped client, with the intention of leasing it back to the latter. | |||||