DBP v. Confessor, 161 SCRA 307 (1988)

DBP v. Confessor,  161 SCRA 307 (1988)

Petition for review on certiorari

GANCAYCO, J.

FACTS:

·         On February 10, 1940 spouses Patricio Confesor and Jovita Villafuerte obtained an agricultural loan from DBP, in the sum of P2,000, as evidenced by a promissory note, whereby they bound themselves jointly and severally to pay the account in ten (10) equal yearly amortizations.

·         After ten years, the debt remained unpaid. Confessor, now a Congressman, executed a second promissory note acknowledging the loan and promising to pay the same before June 15, 1961.

·         Still not having paid the obligation on the specified date, the DBP filed a complaint against the spouses for the payment of the loan.

ISSUE:

·         W/N prescription had barred the complaint.

HELD:

·         No. Prescription was renounced when Confessor signed the second promissory note.

·         The right to prescription may be waived or renounced. Prescription is deemed to have been tacitly renounced when the renunciation results from acts which imply the abandonment of the right acquired.

·         The Court ruled that when a debt is already barred by prescription, it cannot be enforced by the creditor. But a new contract recognizing and assuming the prescribed debt would be valid and enforceable.

·         The statutory limitation bars the remedy but does not discharge the debt. A new express promise to pay a debt barred ... will take the case from the operation of the statute of limitations as this proceeds upon the ground that as a statutory limitation merely bars the remedy and does not discharge the debt, there is something more than a mere moral obligation to support a promise, to wit a – pre-existing debt which is a sufficient consideration for the new the new promise; upon this sufficient consideration constitutes, in fact, a new cause of action.