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Pentacapital Investment Corporation vs. Makilito B. Mahinay

Pentacapital Investment Corporation filed a complaint against Makilito Mahinay for unpaid loans evidenced by two promissory notes. Mahinay claimed the notes were subject to a condition that did not occur and that he did not receive the loan proceeds. The Court held that under the Civil Code, it is presumed that consideration exists for a contract unless proven otherwise. The presumptions that private transactions are fair and regular and that ordinary business course was followed also apply. Mahinay failed to rebut these presumptions with sufficient evidence, so he was found liable to pay the promissory notes.

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Louie Marrero Dadat
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211 views1 page

Pentacapital Investment Corporation vs. Makilito B. Mahinay

Pentacapital Investment Corporation filed a complaint against Makilito Mahinay for unpaid loans evidenced by two promissory notes. Mahinay claimed the notes were subject to a condition that did not occur and that he did not receive the loan proceeds. The Court held that under the Civil Code, it is presumed that consideration exists for a contract unless proven otherwise. The presumptions that private transactions are fair and regular and that ordinary business course was followed also apply. Mahinay failed to rebut these presumptions with sufficient evidence, so he was found liable to pay the promissory notes.

Uploaded by

Louie Marrero Dadat
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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PENTACAPITAL INVESTMENT CORPORATION vs. MAKILITO B.

MAHINAY
G.R. No. 171736 July 5, 2010

PENTACAPITAL INVESTMENT CORPORATION vs. MAKILITO B. MAHINAY


G.R. No. 181482 July 5, 2010

NACHURA, J.:

FACTS: Petitioner filed a complaint for a sum of money against respondent Makilito
Mahinay based on two separate loans obtained by the latter, these loans were evidenced by
two promissory notes. Respondent claimed that the promissory notes on which its
complaint was based were subject to a condition that did not occur, while admitting that he
indeed signed the promissory notes, he insisted that he never took out a loan and that the
notes were not intended to be evidences of indebtedness, that he did not receive the
proceeds of the loan.

ISSUE: Is the Mahinay liable to pay the promissory notes?

HELD: To ascertain whether or not respondent is bound by the promissory notes, it must
be established that all the elements of a contract of loan are present. In this case, under
Article 1354 of the Civil Code, it is presumed that consideration exists and is lawful unless
the debtor proves the contrary.

Moreover, under Section 3, Rule 131 of the Rules of Court, the following are disputable
presumptions: (1) private transactions have been fair and regular; (2) the ordinary course
of business has been followed; and (3) there was sufficient consideration for a contract.

A presumption may operate against an adversary who has not introduced proof to rebut it.
The effect of a legal presumption upon a burden of proof is to create the necessity of
presenting evidence to meet the legal presumption or the prima facie case created thereby,
and which, if no proof to the contrary is presented and offered, will prevail. The burden of
proof remains where it is, but by the presumption, the one who has that burden is relieved
for the time being from introducing evidence in support of the averment, because the
presumption stands in the place of evidence unless rebutted.

In the present case, we find that the presumption that a contract has sufficient
consideration cannot be overthrown by the bare, uncorroborated and self-serving
assertion of respondent that it has no consideration. The alleged lack of consideration must
be shown by preponderance of evidence.

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