ii But the 2 nd group varied on the commencement of the running of legal

Ii but the 2 nd group varied on the commencement of

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ii. But, the 2 nd group varied on the commencement of the running of legal interest 11
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they should pay the 19M damages with present legal interest of 12% from the date of the filing of the complaint. ISSUES: 1. WON eastern shipping is jointly and severally liable for the damages YES 2. WON the legal interest on an award for loss or damage should be computed at the time the complaint is filed. NO, should be from final judgment 3. WON the rate of legal interest is 12% and not 6% - 6% amount due from the date of the lower court decision (not from the filing). And 12% upon the finality of this decision. certainty of demand – runs from the time judgment is made III. Quantifiable damage must be established by a certain date, because in order for interest to exist, there must be a principal that the interest can be tacked on iii. Non-payment of award that is awarded by final judgment is considered a loan or forbearance which would set the interest at 12%* I. Now 6% by virtue BSP-MB Cirucular (effective 2013). ** The SC did not apply such guidelines in the case at bar and jumped directly to the disposition portion. I assume 6% is to be used because the case at bar is a case for damages not arising from a loan or forbearance of credit. It should be computed from the from the finality of decision of the lower court. But by virtue of Ratio 12c, after the finality of this decision such interest shall be 12% because it will be treated as if it is a forebearance of credit. 3. So, SC suggested the following guidelines for start and end date of computation of interest: a. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money : i. Interest due is what is written which will earn the legal interest from the time it is judicially demanded ii. If there is no stipulation, the interest rate is 12% per annum which is computed from default or judicial or extrajudicial demand b. Obligation is NOT a loan or forbearance of money i. Interest for the amount of damages is upon the discretion of the court at the rate of 6% per annum ii. No interest shall be given on unliquidated claims or damages until the demand is established with certaintly c. When the demand is established with: i. Reasonable certainty, interest begins to run from the time of judicial or extrajudicial demand ii. Without reasonable certainty – interest to run from the date of judgment (so, based on the amount finally adjuged.) d. When the judgment of the court awarding a sum of money becomes final and executory , the rate of legal interest, whether the case falls under paragraph A or paragraph B, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit. Eastern Assurance v CA 1. Tan insured his building for P250k in case of fire with Eastern Assurance and Surety Corporation (EASCO) 2. When the building was destroyed by fire, Tan claimed indemnity but EASCO refused. So, Tan filed a complaint for breach of contract against EASCO.
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