sc.judiciary.gov.ph/jurisprudence/2012/november2012/200868.pdf
"x x x.
II.
Whether Alcaraz v. Court of Appeals, instead of Macalinao v. BPI, is applicable.
Ledda contends that the case of Alcaraz v. Court of Appeals,
instead of Macalinao v. Bank of the Philippine Islands which the Court of Appeals invoked, is applicable in the computation of the interest rate on the unpaid credit card obligation. Ledda claims that similar to Alcaraz, she was a “prescreened” client who did not sign any credit card application form or terms and conditions prior to the issuance of the credit card. Like Alcaraz, Ledda asserts that the provisions of the Terms and Conditions, particularly on the interests, penalties and other charges for non-payment of any outstanding obligation, are not binding on her as such Terms and Conditions were never
shown to her nor did she sign it.
We agree with Ledda. The ruling in Alcaraz v. Court of Appeals applies squarely to the present case. In Alcaraz, petitioner there, as a prescreened client of Equitable Credit Card Network, Inc., did not submit or sign any application form or document before the issuance of the credit card.
There is no evidence that petitioner Alcaraz was shown a copy of the terms and conditions before or after the issuance of the credit card in his name, much less that he has given his consent thereto.
In this case, BPI issued a pre-approved credit card to Ledda who, like Alcaraz, did not sign any credit card application form prior to the issuance of the credit card. Like the credit card issuer in Alcaraz, BPI, which has the burden to prove its affirmative allegations, failed to establish Ledda’s
agreement with the Terms and Conditions governing the use of the credit card. It must be noted that BPI did not present as evidence the Terms and Conditions which Ledda allegedly received and accepted.
Clearly, BPI failed to prove Ledda’s conformity and acceptance of the stipulations contained in the Terms and Conditions. Therefore, as the Court held in Alcaraz, the Terms and Conditions do not bind petitioner (Ledda in this
case) “without a clear showing that x x x petitioner was aware of and consented to the provisions of [such] document.”
On the other hand, Macalinao v. Bank of the Philippine Islands, which the Court of Appeals cited, involves a different set of facts. There, petitioner Macalinao did not challenge the existence of the Terms and Conditions Governing the Issuance and Use of the BPI Credit Card and her consent to its provisions, including the imposition of interests and other
charges on her unpaid BPI credit card obligation.
Macalinao simply questioned the legality of the stipulated interest rate and penalty charge, claiming that such charges are iniquitous. In fact, one of Macalinao’s assigned errors before this Court reads: “The reduction of interest rate, from
9.25% to 2%, should be upheld since the stipulated rate of interest was unconscionable and iniquitous, and thus illegal.”
Therefore, there is evidence that Macalinao was fully aware of the stipulations contained in the Terms and Conditions Governing the Issuance and Use of the Credit Card, unlike in this case where there is no evidence that Ledda was aware of or consented to the Terms and Conditions for the use of the credit card.
Since there is no dispute that Ledda received, accepted and used the BPI credit card issued to her and that she defaulted in the payment of the total amount arising from the use of such credit card, Ledda is liable to pay BPI P322,138.58 representing the principal amount of her unpaid credit card
obligation.
Relevantly, Ledda states in paragraph 28 of her petition that: “Assuming, arguendo, that respondent was able to establish a cause of action against petitioner, the same will only be limited Consistent with Alcaraz, Ledda must also pay interest on the total unpaid credit card amount at the rate of 12% per annum since her credit card obligation consists of a loan or forbearance of money.
In Eastern Shipping Lines, Inc. v. Court of Appeals, the Court explained:
1. When an obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially
demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.
We reject Ledda’s contention that, since there was no written agreement to pay a higher interest rate, the interest rate should only be 6%. Ledda erroneously invokes Article 2209 of the Civil Code.
Article 2209 refers to indemnity for damages and not interest on loan or forbearance of money, which is the case here. In Sunga-Chan v. Court of Appeals, the Court held:
Eastern Shipping Lines, Inc. synthesized the rules on the
imposition of interest, if proper, and the applicable rate, as follows: The 12% per annum rate under CB Circular No. 416 shall apply only to loans or forbearance of money, goods, or credits, as well as to judgments involving such loan or forbearance of money, goods, or credit, while the 6% per annum under Art. 2209 of the Civil Code applies “when the transaction involves the payment of indemnities in the concept of damage arising from the breach or a delay in the performance of obligations in general,” with the application of both rates reckoned “from the time the complaint was filed until the [adjudged] amount is fully paid.” In either instance, the reckoning period for the commencement of the running of the legal interest shall be subject to the condition “that the courts are vested with discretion, depending on the equities of each case, on the award of interest. (Emphasis supplied)
Art. 2209. If the obligation consists in the payment of a sum of money, and the debtor incurs in delay, the indemnity for damages, there being no stipulation to the contrary, shall be the payment of the interest agreed upon, and in the absence of stipulation, the legal interest, which is six per cent per annum. (Emphasis supplied)
In accordance with Eastern Shipping Lines, Inc., the 12% legal interest shall be reckoned from the date BPI extrajudicially demanded from Ledda the payment of her overdue credit card obligation. Thus, the 12% legal interest shall be computed from 2 October 2007, when Ledda, through
her niece Sally D. Ganceña, received BPI’s letter dated 26 September 2007 demanding the payment of the alleged overdue amount of P548,143.73.
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