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Insurance Case Digest: Verendia v CA G.R. No. 75605 January 22, 1993

G.R. No. 75605 January 22, 1993
Lessons Applicable: Exception to Ambiguous Provisions Interpreted Against Insurer (Insurance)

  • Rafael (Rex) Verendia's residential building was insured with Fidelity and Surety Insurance Company, Country Bankers Insurance and Development Insurance with Monte de Piedad & Savings Bank as beneficiary
  • December 28, 1980 early morning: the building was completely destroyed by fire
  • Fidelity refused the claim stating that there was a misrepresentation since the lessee was not Roberto Garcia but Marcelo Garcia 
  • trial court: favored Fidelity
  • CA: reversed
ISSUE: W/N there was false declaration which would forfeit his benefits under Section 13 of the policy

  • Section 13 thereof which is expressed in terms that are clear and unambiguous, that all benefits under the policy shall be forfeited "If the claim be in any respect fraudulent, or if any false declaration be made or used in support thereof, or if any fraudulent means or devises are used by the Insured or anyone acting in his behalf to obtain any benefit under the policy"
  • Robert Garcia then executed an affidavit before the National Intelligence and Security Authority (NISA) to the effect that he was not the lessee of Verendia's house and that his signature on the contract of lease was a complete forgery.
  • Worse yet, by presenting a false lease contract, Verendia, reprehensibly disregarded the principle that insurance contracts are uberrimae fidae and demand the most abundant good faith