Myline Cordial

Sps. Evangelista vs. Mercator Finance Corporation
G.R. No. 148864, August 21, 2003

FACTS:
On February 16, 1982, the petitioners Spouses Evangelista executed a mortgage in favor of defendant Mercator Finance Corporation (MFC) for and in consideration of certain loans and/or other forms of credit accommodation obtained from the mortgagee-defendant MFC to secure the payment of the same and those others that the mortgagee might extend to the mortgagor, Embassy Farms Inc. Petitioners, in their capacities and as officers of Embassy Farms Inc. signed the promissory note and the subsequent Continuing Suretyship Agreement executed to guarantee the indebtedness of Embassy Farms, and the succeeding promissory notes restructuring the loan. Due to their failure to pay the obligation,  the properties were foreclosed and sold. After 10 years, however, petitioners filed a complaint for annulment of titles of the properties sold.

ISSUE:
If there is an ambiguity in the wording of a promissory note, how should it be interpreted?

RULING:
A reading of the promissory note in question will show that there is no ambiguity even if the petitioners insist that it does not convey their true intent in executing the document. Assuming that there is an ambiguity, Section 17 of the Negotiable Instruments Law states: Where the language of the instrument is ambiguous or there are omissions therein, the following rules of construction apply:  x x x
(g) where an instrument containing the word “I promise to pay” is signed by two or more persons, they are deemed to be jointly and severally liable thereon.