SUN LIFE OF CANADA (PHILIPPINES), INC. v. MA. DAISY S.

SIBYA,
et al.,
G.R. No. 211212, 08 June 2016, THIRD DIVISION, (Reyes, J.)

[Doctrine]

Atty. Jesus Sibya, Jr. (Atty. Jesus Jr.) applied for life insurance with Sun
Life of Canada (Philippines), Inc. (Sun Life). In his Application for
Insurance, he indicated that he had sought advice for kidney problems. Sun
Life approved the application on February 5, 2001. The policy indicated his
wife and two sons - Ma. Daisy S. Sibya (Ma. Daisy), Jesus Manuel S. Sibya
III, and Jaime Luis S. Sibya, - as beneficiaries and entitles them to a death
benefit of P1,000,000.00 should Atty. Jesus Jr. dies on or before February 5,
2021, or a sum of money if he is still living on the endowment date.

On May 11, 2001, Atty. Jesus Jr. died as a result of a gunshot wound in
San Joaquin, Iloilo. As such, Ma. Daisy filed a Claimant's Statement with
Sun Life to seek the death benefits indicated in his insurance policy.

Sun Life denied the claim on the ground that the details on Atty. Jesus
Jr.'s medical history were not disclosed in his application. Simultaneously,
Sun Life tendered a check representing the refund of the premiums paid by
Atty. Jesus Jr.

Despite repeated demands by Ma. Daisy et al, Sun Life refused to

heed the requests and instead filed a Complaint for Rescission of Atty. Jesus
Jr.'s insurance policy.

In contrary, Ma. Daisy et al claimed that Atty. Jesus Jr. did not commit
misrepresentation in his application for insurance. They averred that Atty.
Jesus Jr. was in good faith when he signed the insurance application and
even authorized Sun Life to inquire further into his medical history for
verification purposes.

ISSUE:

Is Sun Life of Canada obligated to release the life insurance proceeds

to Daisy S. Sibya – the widow of Jesus Sibya Jr.?
RULING:

Yes. The liability of Sun Life is classified as an obligation with a

period, for whose fulfillment a day certain has been fixed although it may
not be known when, shall be demandable only when that day comes. When
Atty. Jesus Jr. died on May 11, 2001 prior to February 5, 2021, the arrival of
the period effects the demandability of the obligation.

Moreover, the Court affirmed that Atty. Jesus Jr. did not commit any
material concealment and misrepresentation in his insurance application.
As provided in Section 48 of the Insurance Code, an insurer is given two (2)
years - from the effectivity of a life insurance contract and while the insured
is alive - to discover or prove that the policy is void ab initio or is rescindible
by reason of the fraudulent concealment or misrepresentation of the
insured or his agent. After the two-year period lapses, or when the insured
dies within the period, the insurer must make good on the policy, even
though the policy was obtained by fraud, concealment, or
misrepresentation. Sun Life had all the means of ascertaining the facts
allegedly concealed by the applicant, given there are disclosures, waiver
and authorization to investigate executed by Atty. Jesus Jr.. Sun Life failed to
clearly and satisfactorily establish the intent to defraud on the part of the
insured. Hence, Sun Life is liable to pay the life insurance proceeds to Ma.
Daisy et al.