In the Matter of the Intestate Estate of Justo Palanca

Gr L-29900, June 28, 1974

[Per J. Fernando, Second Division]

This case is about a promissory note whereby the late Justo Palanca promised to pay George Pay
the amount of Php 26, 900.00 with 12% per annum. George Pay asking the administratrix
Segundina Chua Vda. de Palanca to pay the obligation. That once said property is brought under
administration, George Pay, as creditor, can file his claim against the administratrix. However It
then stated that there was a refusal on the part of Segundina Chua Vda. de Palanca to be
appointed as administratrix, and the rights of the creditor had already prescribed. George pay
claims that he does not insist on this provision but only claiming on his right under the
promissory note, which then stated “upon demand”

What have we learned about the topic?

Article 1179 of the Civil Code states that "Every obligation whose performance does not depend
upon a future or uncertain event, or upon a past event unknown to the parties, is demandable at
once."

And according to Article 1144 of the Civil code provides: "The following actions must be
brought within ten years from the time the right of action accrues:(1) Upon a written contract; (2)
Upon an obligation created by law;(3) Upon a judgment."

What does the case teach us?

The issue whether the creditor is barred by prescription.

Yes, Article 1179 of the Civil Code which provdes that every obligation whose performacnce
does not depend upon a future or uncertain event is demandable at once. Here George Pay’s
attempt to collect on a promissory note in the amount of P26, 900.00 with 12% per annum which
had attached the word “upon demand” to it asking the surviving spouse of the late Justo Palanca,
Segundina Chua vda. de Palanca, who was appointed as administratrix for payment even though
the latter refused to be administratrix. From the manner in which the promissory note was
executed, as expressed therein, "upon demand" is already being due and demandable. In relation
to article 1144 of the Civil Code which provides that the action must be brought within ten years
upon a written contract. What is undeniable is that more than fifteen years after the execution of
the promissory note that this petition was filed. The defense interposed was prescription. The
obligation being due and demandable, it would appear that the filing of the suit after fifteen years
was much too late. For again, according to the Civil Code, the prescriptive period for a written
contract is that of ten years. Therefore he can no longer demand payment of the said the debt due
to prescription.