A CONTRACT IS PERFECTED UPON THE MEETING OF THE MINDS OF THE TWO PARTIES

It is perfected by mere consent, that is, from the moment that there is a meeting of the offer and
acceptance upon the thing and the cause that constitute the contract. Loan is a reciprocal obligation,
as it arises from the same cause where one party is the creditor and the other the debtor. The
obligation of one party in a reciprocal obligation is dependent upon the obligation of the other, and the
performance should ideally be simultaneous. (Spouses Ong vs. BPI Family Savings Bank, Inc.,
G.R. No. 208638, January 24, 2018)

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A CONTRACT IS PERFECTED UPON THE MEETING OF THE MINDS OF THE TWO PARTIES

Spouses Ong vs. BPI Family Savings Bank, Inc.

G.R. No. 208638, January 24, 2018
Reyes, Jr., J.

FACTS:
Petitioners Spouses Ong filed a petition for review under Rule 45 assailing the Decision and
Resolution of the CA, which reversed the Decision of the RTC granting petitioner’s claim for damages
from respondent BPI Family Savings Bank, Inc. due to the latter’s failure to completely deliver the
proceeds of the loan.

Petitioners are engaged in a printing business and pursuant to an expansion plan, they obtained from
respondent an omnibus loan consisting of a term loan and a credit line amounting to ₱15,000,000 and
₱5,000,000, respectively. However, with respect to the credit line, respondent was only able to release
the amount of ₱3,000,000 and refused to deliver the remaining balance of ₱2,000,000. Petitioners
thus stopped paying the loan amortizations because of incomplete delivery of the credit line.

Petitioners filed an action for damages against respondent claiming that the latter’s failure to
completely deliver the proceeds of the loan injured the expansion project of their business. However,
respondent disclaimed liability arguing that there was no perfected contract of loan with respect to the
credit line, hence no delay can be attributed thereto to warrant payment of damages. Further,
respondent argued that petitioners are the ones in default when they failed to pay the remaining
balance of the loan.

ISSUE:
Was there a perfected loan contract to render respondent in delay in the performance of its obligation?

HELD:
Yes, there was a perfected loan contract to render respondent in delay in the performance of its
obligation.
As a rule, a contract is perfected upon the meeting of the minds of the two parties. It is perfected by
mere consent, that is, from the moment that there is a meeting of the offer and acceptance upon the
thing and the cause that constitute the contract. Loan is a reciprocal obligation, as it arises from the
same cause where one party is the creditor and the other the debtor. The obligation of one party in a
reciprocal obligation is dependent upon the obligation of the other, and the performance should ideally
be simultaneous. This means that in a loan, the creditor should release the full loan amount and the
debtor repays it when it becomes due and demandable.

In this case, there is no iota of doubt that when respondent approved and released the ₱3,000,000 out
of the original ₱5,000,000 credit facility, the contract was perfected. As such, respondent did not only
incur delay in releasing the pre-agreed credit line of ₱5,000,000.00 but likewise violated the terms of
its agreement with petitioners when it deliberately failed to release the amount of ₱2,000,000. The
default attributed to petitioners when they stopped paying their amortizations on the term loan cannot
be sustained because BSA had already reneged on its obligation to release the amount previously
agreed upon, i.e., the ₱5,000,000 covered by the credit line.
Therefore, there was already a perfected loan contract when respondent delivered a portion of the
credit line to petitioners and the former’s failure to deliver the remaining balance of the loan renders it
in delay in the performance of its obligation.