Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

Before this Court is a petition for Motion for Reconsideration filed by petitioner on the ruling of the Court hich affir!ed the Decision of the lo er Court dated "uly #$% &'()% finding the creditor barred by prescription in his atte!pt to collect on a pro!issory note e*ecuted !ore than fifteen years earlier ith the debtor sued pro!ising to pay either upon receipt by hi! of his share fro! a certain estate or upon de!and% the basis for the action being the latter alternati+e, -rgu!ents rolled into se+eral contentions but the !ain issue on the basis for this petition as a .uestion hether the Court in affir!ing the Decision of the lo er court erred in considering /literal0 interpretation on the phrase /upon de!and0, Petitioners posit that /upon de!and0 hinges respondent1s ability to pay fro! receipt of cash pay!ent fro! the Estate of the late Don Carlos Palanca, 2hey contended that the obligation is of a nature of a conditional suspensi+e condition .uoting -rticle &&)&, 2hey argued that respondent should pay the! as pro+ided for in -rticle &&3' that /obligations arising fro! contracts ha+e the force of la bet een the contracting parties and should be co!plied ith in good faith0, 2he court is not persuaded, On the petitioner1s contention that the obligation is one of a conditional suspensi+e obligation it is note orthy to lay do n the ele!ents of a conditional obligation, - conditional obligation is one hich is sub4ect to a condition, Condition has been defined by Esriche as /e+ery future and uncertain e+ent upon hich an obligation or pro+ision is !ade to depend,0 5uturity and uncertainty !ust concur as characteristics of the e+ent, 2olentino% in his boo6 cited that an e+ent hich is not uncertain but !ust necessarily happen cannot be a condition7 the obligation ill be considered as one ith a ter!% thus% respondent1s share fro! Estate of the late Don Carlos Palanca is so!ething that ould possibly happen in the future and therefore could not be a condition, On the contention citing -rticle &&)# of the Ci+il Code that pro+ides8 hen the fulfill!ent of the condition depends upon the sole ill of the debtor% the conditional obligation shall be +oid and -rticle &&)9% hich pro+ides that / hen the debtor binds hi!self to pay hen his !eans per!it hi! to do so% the obligation shall be dee!ed to be one ith a period% sub4ect to the pro+isions of article &&':0 hich re.uire for the court to fi* the duration citing Patente +ersus O!ega in relation to article &&)#, 2he court does not see !erit to ta6e the argu!ent, 2he ruling in Patente +ersus O!ega cannot be applied to the present case because in the first place the contract is +alid ith both parties in agree!ent to hat as stipulated in the pro!issory note% indicating as ell the phrases% /;by either of the undersigned of cash pay!ent fro! the Estate of the late Don Carlos Palanca or upon demand<% hich gi+es either option, Basic in statutory construction% the dis4uncti+e /or0 gi+es an option hich course of action to ta6e, 2he is4uncti+e /or0 !eans that only one of the listed re.uire!ents need be satisfied, 2he defense of the petitioner relying on their pre!ise that /upon de!and0 is a suspensi+e condition on the first option hich is /either of the undersigned of cash pay!ent fro! the Estate of the late Don Carlos Palanca0 is untenable, =here the language of the pro!issory note is clear% it should be gi+en its plain !eaning, In the instant case% the first option of cash pay!ent fro! the Estate of the late Don Carlos Palanca as not underta6en and the basis for the action being the latter alternati+e,

Petitioners also stressed that in interpreting the statute% the spirit of the la is gi+en recognition and should be applied in the present case, In the contractual syste! of our Ci+il Code it follo s that of the Spanish Ci+il Code of &))' of upholding the spirit and intent of the parties o+er for!alities8 hence% in general% contracts are +alid and binding fro! their perfection regardless of for! hether they be oral or ritten, 2his is plain fro! -rticles &>&3 and &>3( of the present Ci+il Code, 2hus% the first cited pro+ision prescribes8 -R2, &>&3, Contracts are perfected by mere consent% and fro! that !o!ent the parties are bound not only to the fulfill!ent of hat has been e*pressly stipulated but also to all the conse.uences hich% according to their nature% !ay be in 6eeping ith good faith% usage and la , Concordantly% the first part of -rticle &>3( of the Code Pro+ides8 -R2, &>3(, Contracts shall be obligatory in whatever form they may have been entered into% pro+ided all the essential re.uisites for their +alidity are present; 2hese essential re.uisites !entioned are nor!ally ?&@ consent ?#@ proper sub4ect !atter% and ?>@ consideration or causa for the obligation assu!ed ?-rticle &>&)@, > So that once the three ele!ents e*ist% the contract is generally +alid and obligatory% regardless of the for!% oral or ritten% in hich they are couched, In the case at bar% in as !uch as it as the intention of the petitioner% e+idenced by the ter!s of the said notes% to grant the respondent a period ithin hich to pay the debts% the long !ore than fifteen years of /sleep0 and a6ing up to file this action to collect /on the basis of the phrase /upon de!and0 is untenable, It as clear that !ore Athan fifteen years has already transpired, 2he obligation being due and de!andable% it ould appear that the filing of the suit after fifteen years as !uch too late, 2he action% therefore% of the creditor has definitely prescribedA on the basis of -rticles &&:'% &&&> and &&$$, In ruling for the present case% e apply the first paragraph of -rticle &&:' of the Ci+il Code8 -rt, &&:', E+ery obligation hose perfor!ance does not depend upon a future or uncertain e+ent% or upon a past e+ent un6no n to the parties% is demandable at once * * *, ?E!phasis supplied,@ =e affir! the findings of the Court and the lo er court that there is no date of pay!ent indicated in the Pro!issory Notes, 2hey are correct in ruling that since the Pro!issory Notes do not contain a period% creditor has the right to de!and i!!ediate pay!ent, -rticle &&:' of the Ci+il Code applies, Bo e+er% after the long lapse of ti!e% i,e, after fifteen long years% the action of the creditor prescribed as pro+ided for in -rticle &&&> and &&$$, =BERE5ORE% the petition is denied and the Court decision is affir!ed, Costs against Ceorge Pay,

SO ORDERED.

Chandrina Subrian Divinagracia Associate Justice

=E CONCDR8

Please see concurring opinion8

CERTIFICATION Pursuant to Section &>% -rticle VIII of the Constitution% it is hereby certified that the conclusions in the abo+e Resolution had been reached in consultation before the case as assigned to the riter of the opinion of the Court,

Chief "ustice