USA COLLEGE OF LAW

PRACTICAL EXERCISES FOR REMEDIAL LAW REVIEW I

PART I (PLEADINGS). Divide yourselves into two (2) groups. Each group should be
divided into four (4) sub groups. The first group should answer the Set A problem
while the second group should answer the Set B problem.
THE CASE
Jorge Gonzales (Gonzales) was a client of Exor Bank (Bank) for 15 years.
In October 2010, the Bank granted a credit line to Gonzales through the execution
of a Credit-On-Hand Loan Agreement (COHLA), in which the aggregate amount of
the accounts of Gonzales with the Bank served as collateral for and his availment
limit under the credit line. Gonzales drew from said credit line through the issuance
of check. At the same time, Gonzales had a Foreign Currency Deposit (FCD) of USD
8,715.72 with the Bank.
On October 30, 2013, Gonzales and his wife obtained a loan for PhP 500,000.
Subsequently, on December 26, 2013 and January 3, 2015, the spouses Robilio and
Gonzales obtained two additional loans from the Bank in the amounts of PhP
1,000,000 and PhP 300,000, respectively. These three loans amounting to PhP
1,800,000 were covered by three promissory notes. To secure the loans, a real
estate mortgage (REM) over a parcel of land covered by Transfer Certificate of Title
(TCT) No. 38012 was executed by Gonzales and the spouses Robilio. Notably, the
promissory notes specified, among others, the solidary liability of Gonzales and the
spouses Robilio for the payment of the loans. However, it was the spouses Robilio
who received the loan proceeds of PhP 1,800,000. The three (3) Promissory Notes
read:
I
PROMISSORY NOTE
For value received, we, Jorge Gonzales, Filipino, of legal age and with address
at Makati City, Jointly and solidarily with Spouses Bob and Carmen Robilio, Filipinos, of
legal age and with address at Makati City hereby promise to pay Exon Bank, or Order,
with address at Makati City, the total amount of FIVE HUNDRED THOUSAND PESOS
ONLY (P 500,000.00) Philippine Currency, on or before October 12, 2018 plus interest of
2 % per month which shall be payable on the first day of each month. Failure to pay
monthly interest shall render the entire obligation immediately due and demandable
without need of demand
We hereby waive presentment of payment and notice of dishonor.
Iloilo City, Philippines, October 30, 2013.
Signed
Gonzales

Signed
Bob Robilio Carmen Robilio

II
PROMISSORY NOTE
For value received, we, Jorge Gonzales, Filipino, of legal age and with address
at Makati City, Jointly and solidarily with Spouses Bob and Carmen Robilio, Filipinos, of
legal age and with address at Makati City hereby promise to pay Exon Bank, or Order,
with address at Makati City, the total amount of ONE MILLION PESOS ONLY (P
1,000,000.00) Philippine Currency, on or before October 12, 2018 plus interest of 2 % per
month which shall be payable on the first day of each month. Failure to pay monthly
interest shall render the entire obligation immediately due and demandable without need
of demand
We hereby waive presentment of payment and notice of dishonor.
Iloilo City, Philippines, October 30, 2013.
Signed
Gonzales

Signed
Bob Robilio Carmen Robilio

III
PROMISSORY NOTE
For value received, we, Jorge Gonzales, Filipino, of legal age and with address
at Makati City, Jointly and solidarily with Spouses Bob and Carmen Robilio, Filipinos, of
legal age and with address at Makati City hereby promise to pay Exon Bank, or Order,
with address at Makati City, the total amount of THREE HUNDRED THOUSAND PESOS
ONLY (P 300,000.00) Philippine Currency, on or before October 12, 2018 plus interest of
2 % per month which shall be payable on the first day of each month. Failure to pay
monthly interest shall render the entire obligation immediately due and demandable
without need of demand
We hereby waive presentment of payment and notice of dishonor.
Iloilo City, Philippines, October 30, 2013.
Signed
Gonzales

Signed
Bob Robilio Carmen Robilio

The monthly interest dues of the loans were paid by the spouses Robilio through the
automatic debiting of their account with the Bank. But the spouses Robilio, from the
month of July 2015, defaulted in the payment of the periodic interest dues from
their Bank account which apparently was not maintained with enough deposits. The
Bank allegedly called the attention of Gonzales regarding the defaults and the
subsequent accumulating periodic interest dues which were left still left unpaid.
In the meantime, Gonzales issued a check dated September 30, 2015 in favor of
Rene Hison (Hison) for PhP 250,000 drawn against the credit line (COHLA). However,
on October 13, 2015, upon presentment for payment by Hison of said check, it was
dishonored by Exor Bank due to the termination by Exor Bank of the credit line
under COHLA on October 1, 2015 for the unpaid periodic interest dues from the
loans of Gonzales and the spouses Rubilio. The Bank likewise froze the FCD account
of Gonzales.
Consequently, Gonzales had a falling out with Hison due to the dishonor of the
check. They had a heated argument in the premises of the Philippine Columbian
Association (PCA) where they are both members, which caused great
embarrassment and humiliation to Gonzales. Thereafter, on November 5, 2015,
Hison sent a demand letter to Gonzales for the PhP 250,000. And on December 3,
2015, the counsel of Hison sent a second demand letter to Gonzales with the threat
of legal action. With his FCD account that the Bank froze, Gonzales needed money
to pay the PhP 250,000 he owed to Hison.

On January 28, 2016, Gonzales, through counsel, wrote the Bank insisting that the
check he issued had been fully funded, and demanded the return of the proceeds of
his FCD as well as damages for the unjust dishonor of the check. The Bank replied
on March 22, 2016 and stood its ground in freezing Gonzales accounts due to the
outstanding dues of the loans. On May 26, 2016, Gonzales reiterated his demand,
reminding the Bank that it knew well that the actual borrowers were the spouses
Robilio and he never benefited from the proceeds of the loans, which were serviced
by the Bank account of the spouses Robilio.
The banks refusal to heed his demands made Gonzales decide to file a case for
damages with the RTC, on account of the alleged unjust dishonor of the check
issued in favor of Hison.
SET A. PROBLEM
Group 1. Prepare a Complaint for Gonzales against the Bank (You should be able to
identify Gonzales Cause[s] of Action).
Group 2. Prepare an Answer for the Bank with Counterclaim
Prepare a (motion and) pleading to Implead the Rubilios
Group 3. As counsel for the Rubilios prepare an Answer to the TP Complaint.

Group 4. As counsel for Hison prepare the necessary motion and pleading to
intervene in the case
For All: - Prepare other pleadings necessary to join the issues
- Draft a Summons
- What is/are the basis for the filing fees? Explain
SET B. PROBLEM
Group 1. Prepare a Complaint for Hison against Gonzales and the Bank
Group 2. Prepare an Answer for Gonzales and another (motion and pleading to
implead the Rubilios)
Group 3. Prepare an Answer for the Bank
Group 4. Prepare a Third Party Answer for the Rubilios
For All: - Prepare Counterclaims and other pleadings necessary to join the issues.
- What is/are the basis for the filing fees? Explain.
- Draft a Summons.
Additional problems.
1.

What are the different kinds of pleadings? Define and state their functions.

2.

What is a negative pregnant? Give an example.

3.

Define Ultimate Facts

4.

What is Joinder of Issues

5.

Is a Third Party Defendant an original party? How does the trial court acquire
jurisdiction over a Third Party Defendant?