Beruflich Dokumente
Kultur Dokumente
FACTS
- Rule 68, Sec. 2 - Judgment on foreclosure for payment or sale.
Adelina obtained a loan in the amount of 1.5m from Renato which is payable within o Mortgaged property may be charged not only for the mortgaged
1 year at 18% interest per annum which is secured by a REM over a parcel of land debt or obligation but also for the interest, other charges and costs
in Cubao. approved by the court.
- Subsequently, Adeline obtained additional land from Renato in the aggregate o Thus to discharge the REM, Adelina must pay the total amount due,
amount of 1.25m broken down as 150k, 150k, 500k, 200k and 250k at different which is the principal loan of 1.5m, the stipulated interest of 18%,
times. the stipulated interest due of 12%, cost of suit.. etc.
Adelina made payments but failed to settle their outstanding loan obligation. o Failure to pay such would would lead to a public auction for
- Renato filed a complaint for foreclosure of mortgage with the RTC. They claimed satisfaction of the judgment.
that Adelines indebtedness amounted to almost 7m, inclusive of the 18% NOTES
interest compounded monthly. Interest issue: W/N Adelina must pay Renato legal interest of 12% per annum on the
Adelina contended that their original obligation of 1.5m is what is secured by the stipulated interest of 18% per annum, computed from the filing of the complaint until
REM at 18% per annum and that there was no agreement that the same will be fully paid. -YES
compounded monthly. - Article 2212. Interest due shall earn legal interest from the time it is judicially
RTC ruled in favor of Renato. demanded, although the obligation may be silent upon this point.
CA partially granted the petition.
- It held that by express intention of the parties, the REM secured the original
loan and subsequent loans of 150k and 500k obtained which is the 2nd and 3rd
additional loan evidenced by acknowledgement receipts.
- However, in regard to the 1st, 4th and 5th loans, the parties never intended that
the subsequent loans be secured by the REM.
- It also held that to discharge the REM, payment of only the principal and the
stipulated interest is sufficient because the mortgage contract does not contain a
stipulation that the legal interest on the stipulated interest due, attorneys fee,
and cost of suit must be paid first before the same may be discharged.
ISSUE/S
1. W/N the subsequent loans were covered by the REM - NO
2. W/N payment of the principal and stipulated interest is sufficient to discharge
the REM - NO
DISPOSITION
WHEREFORE, THE DECISION OF THE COURT OF APPEALS DATED FEBRUARY
11, 1977 IS HEREBY MODIFIED, AND
NO COSTS. SO ORDERED.
Page 3 of 17
Paderes v. CA (Short title) ISSUE/S
GR # 147074 | 463 SCRA 504 | July 15, 2009 1. W/N the extrajudicial foreclosure and writ of possession is valid
Petition: Petition for Review on Certiorari
Petitioner: Spouses RODRIGO PADERES and SONIA PADERES RULING & RATIO
Respondent: CA, Hon. CARLOTA P. VALENZUELA, in her capacity as the YES
Liquidator of Banco - SPS PADERES and SPS BERGARDO purchased their properties from
MICC in good faith is of no moment. The purchases took place after
GR # 147075 | 463 SCRA 504 | July 15, 2009 MICCs mortgage to Banco Filipino had been registered in accordance
Petition: Petition for Review on Certiorari with Article 212520 of the Civil Code and the provisions of P.D. 1529
Petitioner: Spouses ISABELO BERGARDO and JUANA HERMINIA BERGARDO (PROPERTY REGISTRY DECREE).
Respondent: CA, Hon. CARLOTA P. VALENZUELA, in her capacity as the - a real right or lien in favor of Banco Filipino had already been established,
Liquidator of Banco subsisting over the properties until the discharge of the principal obligation,
whoever the possessor(s) of the land might be.
DOCTRINE - In PNB v. Mallorca, the court held that:
o Sale or transfer cannot affect or release the mortgage. A purchaser
FACTS is necessarily bound to acknowledge and respect the
- September 14, 1982, Manila International Construction Corporation (MICC) encumbrance
executed a real estate mortgage over 21 parcels of landincluding the o a recorded real estate mortgage is a right in rem, a lien on the
improvements in favor of Banco Filipino Savings and Mortgage Bank (Banco property whoever its owner may be.
Filipino)to secure a loan of P1,885,000.00. - PETITIONERS ARE NOT ENTITILED TO REDEEM
o It was registered and annotated at Registry of Deeds. o The debtor has 1 year to redeem but the petitioner failed to do so.
- MICC sold 1 house and lot to SPS PADERES and 1 house and lot to SPS. - THE HOUSES ARE COVERED IN THE MORTGAGE
BERGARDO. o Being improvements on the subject properties constructed by
o However, the sale was not registered. mortgagor MICC, there is no question that they were also covered
- MICC failed to settle its obligation. Thus, BANCO FILIPINO filed a petition by MICCs real estate mortgage following the terms ofits contract
for extra-judicial foreclosure of MICCs mortgage. with Banco Filipino and Article 2127
o BANCO FILIPINO was the highest bidder. Thus, a certificate of sale - THE RIGHT OF THE APPLICANT TO ASK FOR THE ISSUANCE OF A
was issued and registered with Registry of Deeds. WRIT OF POSSESSION OF THE LAND NEVER PRESCRIBES
o No redemption of foreclosed mortgage had been made. DISPOSITION
- CALOTA VALENZUELA, as liquidator of BANCO FILIPINO, obtained a Writ WHEREFORE, the petition is hereby DENIED.
of Possession of the foreclosed properties. Thus, a notice was addressed to
MICC and/or All persons claiming rights under them to voluntarily vacate
the premises.
- Instead of vacating, SPS. PADERES and SPS. BERGARDO filed a petition
to CA, assailing the validity of Writ of Possession.
o CA dismissed the petition
Hence, this petition.
PETITIONERS Contention:
- Having purchased their properties in good faith from MICC, their right is
superior to that of Banco Filipino.
- Still entitled to redeem the properties
- Their respective houses should not have been included in the auction sale
Page 4 of 17
Philippine Bank of Communications v. CA Upon application of Spouses, a TRO enjoining sheriffs from transferring the
GR # 118552 | February 5, 1996 title of the lot in favor of defendant Limchio and the latter, from taking
Petition: Petition for Review on Certiorari possession of the lot.
Petitioner: Philippine Bank of Communications Hence, what is left for the Court to ascertain is the true and correct account
Respondent: Court of Appeals and the Spouses Alejandro and Amparo Casafranca of Po as of the auction sale (that pertaining to Limchio as winning bidder)
New Civil Code Art. 2127 after which, the determination of the residue would follow.
PROMISSORY NOTE (provide for penalties)
DOCTRINE o For value received, I/we jointly and severally, promise to pay the
A mortgage must sufficiently describe the debt sought to be secured, which Philippine Bank of Communications, at its office in the City of Cebu,
description must not be such as to mislead or deceive, and an obligation is not Philippines the sum of THREE HUNDRED THOUSAND PESOS
secured by a mortgage unless it comes fairly within the terms of the mortgage (P300,000.00), Philippine Currency, together with interest thereon
at the rate of TWELVE % per annum until paid, which interest rate
FACTS the Bank may at any time without notice, raise within the limits
Spouses Casafranca used to be owners of a lot allowed by law, and I/we also agree to pay, jointly and solidarily
They sold the lot to Carlos Po who paid part of the agreed price. After 12% per annum penalty charge, by way of liquidated damages
securing title in his name, mortgaged the lot to the Philippine Bank of should this note be unpaid or is not renewed on due date.
Communications (PBCom) to secure a loan of P 330,000. xxx
In a civil action that ensued between Spouses and Po, the spouses obtained Should it become necessary to collect this note through an
a favorable judgment against Po. attorney-at-law. I/we hereby expressly agree to pay, jointly and
Later, in an auction sale to satisfy Pos judgment obligation, Spouses severally, ten per cent (10%) of the total amount due on this note as
acquired the aforesaid lot and a Certificate of Sale was executed in their attorneys fees which in no case shall be less than P100.00
favor. exclusive of all costs and fees allowed by law stipulated in the
Meanwhile, PBCom applied for extrajudicial foreclosure of the mortgage contract of real estate mortgage if any there be.
executed by Po, and in the succeeding auction sale, it acquired the lot in a MORTGAGE CONTRACT (does not provide for penalties)
winning bid of P1,006,540.66. The corresponding Certificate of Sale was o The mortgage contract explicitly provides for interest of 12% per
then executed in its favor. annum or at such other higher rate or rates as may be fixed by the
It appears further that Amparo Casafranca who had stepped into the shoes MORTGAGEE from time to time, and shall be payable at the end of
of the mortgagor Po by virtue of the auction sale in her favor offered to every month or otherwise, as the MORTGAGEE may elect and, if
redeem the property from PBCom by tendering to its manager a check in the not so paid, shall be added to, and become part of, the principal
amount of P500,000 which in her estimate would be sufficient to settle the and shall earn interest at the same rate as the principal
account of Po. PBCom did not accept the check as it insisted that any such To recapitulate, the principal loan obtained by Carlos Po (now succeeded by
redemption should be at the price it acquired the lot in the auction sale. Spouses) was P330,000. Interest thereon for the first year at 12% per
Spouses, in reaction, filed against PBCom a civil case for nullification of the annum was retained or deducted from the proceeds of the loan. Compound
foreclosure and auction sale. interests earned at the same rate reached P77,660. And then the rate of
Court set aside the extrajudicial foreclosure and auction sale and declared interest was raised to 14% per annum, as authorized in the mortgage
that the obligation secured by the mortgage executed by Po was only contract. At such rate, compound interests for said period would be in the
P330,000 plus stipulated interest and charges. sum of P343,805. Adding both interest earnings to the principal obligation,
PBCom advised the spouses to pay the sum of P884,281.38 purportedly the total account would then be P751,465. Additionally, the mortgage
representing Pos principal account of P330,000, interest and charges contract provides for attorneys fee[s] equivalent to 10% of the amounts due.
thereon, attorneys fees and realty taxes which it paid for the lot. Hence, the sum of P75,146.50 in the concept of attorneys fee[s] would raise
Spouses however did not agree with said Statement of Account and since the account to P826,611.50. Finally, the amount of P83,028.18 representing
the account remained unpaid, PBCom again applied for extrajudicial realty taxes paid by PBCom for the lot, inclusive of interest, which must be
foreclosure of mortgage during which it was sold to Natalie Limchio. reimbursed, will bring the grand total of the account to 909,639.68.
Spouses commenced the present action to nullify the auction sale in favor of The publication and other expenses incurred in the foreclosure and auction
Limchio. Spouses further alleged that PBCom refused to turn over the sale [to] the tune of P707 should be deducted from the amount of
correct amount of residue after paying off the mortgage and costs of the P1,184,000 which Natalie Limchio paid for the lot, leaving net proceeds of
sale. P1,183,293. Subtracting therefrom the total account due to PBCom, the
residue would be P273,653.32, which must be delivered to plaintiffs.
Trial Court ruled in favor of Spouses for the sum of P273, 653.32.
Page 5 of 17
Both parties appealed. PBCom questioned the lower courts failure to include
in its computation the penalty stipulated in the promissory notes
CA affirmed trial courts decision in toto.
PBCom insists that the penalties in the promissory note are covered (Nota
Bene: thereby effectively increasing the grand total of the account of Po
effectively decreasing the residue that it must pay the Spouses)
ISSUE/S
Whether, in the foreclosure of a real estate mortgage, the penalties
stipulated in two promissory notes secured by the mortgage may be charged
against the mortgagors as part of the sums secured, although the mortgage
contract does not mention the said penalties - NO
What applied here is the general rule that an action to foreclose a mortgage
must be limited to the account mentioned in the mortgage.
Construing the silence (as to the penalty with regard to the Mortgage
Contract) against PBCom, it can be fairly concluded that PBCom did not
intend to include the penalties on the promissory notes in the secured
amount. This explains the finding by the trial court, as affirmed by the Court
of Appeals, that penalties and charges not due for want of stipulation in the
mortgage contract
DISPOSITION
WHEREFORE, finding no reversible error on the part of respondent Court of Appeals,
its challenged decision of 29 April 1994 in CAG. R. CV No. 38332 is hereby
AFFIRMED in toto.
Costs against the petitioner.
Page 6 of 17
Prudential Bank v. Alviar (Short title) - Prudential Bank averred that the payment of P2,000,000.00 was not a
GR # 150197 | July 28, 2005 payment made by the spouses Alviar, but by G.B. Alviar Realty and
Petition: Petition for review on certiorari under Rule 45 of the Rules of Court Development Inc., which has a separate loan with the bank secured by a
Petitioner: Prudential Bank separate mortgage.
Respondent: Don A. Alviar and Georgia B. Alviar - RTC: Dismissed the complaint and ordered the Sheriff to proceed with the
extra-judicial foreclosure but upon reconsideration, issued an order setting
FACTS aside its earlier decision and awarded attorneys fees to respondents.
- Spouses Don A. Alviar and Georgia B. Alviar, are the owners of a parcel of - RTC found that only the P250,000.00 loan is secured by the mortgage on
land in San Juan covered by Transfer Certificate of Title (TCT) No. 438157 the land covered by TCT No. 438157. On the other hand, the P382,680.83
- They executed a deed of real estate mortgage in favor of Prudential Bank to loan is secured by the foreign currency deposit account of Don A. Alviar,
secure the payment of a loan worth P250,000.00 and executed a while the P545,000.00 obligation was an unsecured loan, being a mere
promissory note (1st), PN BD#75/C-252, covering the said loan and conversion of the temporary overdraft.
1
includes a dragnet clause . - The blanket mortgage clause relied upon by the bank applies only to future
- Don Alviar subsequently executed another promissory note (2nd), PN loans obtained by the mortgagors, and not by parties other than the said
BD#76/C-345 for P2,640,000.00, secured by a hold-out on the mortgagors mortgagors, such as Donalco Trading, Inc.
foreign currency savings account with the bank. - CA: Affirmed the Order of the trial court but deleted the award of attorneys
- Spouses Alviar then executed for Donalco Trading, Inc., another fees. It ruled that while a continuing loan or credit accommodation based on
promissory note (3rd) PN BD#76/C-430 covering P545,000.000. The loan only one security or mortgage is a common practice in financial and
is secured by Clean-Phase out which means that the temporary overdraft commercial institutions, such agreement must be clear and unequivocal.
incurred by Donalco Trading, Inc. with Prudential Bak is to be converted into - In the instant case, the parties executed different promissory notes agreeing
an ordinary loan in compliance with a Central Bank circular. to a particular security for each loan. Thus, the appellate court ruled that the
- Prudential Bank then wrote Donalco Trading, Inc., informing the latter of its extrajudicial foreclosure sale of the property for the three loans is improper.
approval of a straight loan of P545,000.00, the proceeds of which shall be - The Court of Appeals, however, found that respondents have not yet paid
used to liquidate the outstanding loan of P545,000.00 temporary overdraft. the P250,000.00 covered by PN BD#75/C-252 (1st) since the payment of
- Spouses Alviar then paid Prudential Bank P2,000,000.00, to be applied to P2,000,000.00 adverted to by respondents was issued for the obligations of
the obligations of G.B. Alviar Realty and Development, Inc. and for the G.B. Alviar Realty and Development, Inc.
release of the real estate mortgage. (separate loan)
- Prudential Bank moved for the extrajudicial foreclosure of the mortgage on ISSUE/S
the property covered by TCT No. 438157 (1st PN). Per the bank's 1. W/N the blanket mortgage clause or the dragnet clause is valid
computation, respondents had the total obligation of P1,608,256.68,
covering the three (3) promissory notes, to wit: PN BD#75/C-252 for RULING & RATIO
P250,000.00, PN BD#76/C-345 for P382,680.83, and PN BD#76/C-340 for 2. YES (but not applicable to full extent in this case)
P545,000.00, plus assessed past due interests and penalty charges. - A blanket mortgage clause, also known as a dragnet clause, is one which is
- Spouses Alviar filed a complaint for damages with a prayer for the issuance specifically phrased to subsume all debts of past or future origins. Such
of a writ of preliminary injunction with RTC Pasig, claiming that they have clauses are carefully scrutinized and strictly construed.
paid their principal loan secured by the mortgaged property, and thus the - The parties intended the real estate mortgage to secure not only the
mortgage should not be foreclosed. P250,000.00 loan from the petitioner, but also future credit facilities and
advancements that may be obtained by the respondents. The terms of the
above provision being clear and unambiguous, there is neither need nor
-
1
"That for and in consideration of certain loans, overdraft and other credit accommodations
excuse to construe it otherwise.
obtained from the Mortgagee by the Mortgagor and/or ________________ hereinafter referred to, - The subsequent loans obtained by the spouses Alviar were secured by other
irrespective of number, as DEBTOR, and to secure the payment of the same and those that may securities.
hereafter be obtained, the principal or all of which is hereby fixed at Two Hundred Fifty Thousand - Under American jurisprudence, two schools of thought have emerged on this
(P250,000.00) Pesos, Philippine Currency, as well as those that the Mortgagee may extend to the
Mortgagor and/or DEBTOR, including interest and expenses or any other obligation owing to the
question. One school advocates that a dragnet clause so worded as to be
Mortgagee, whether direct or indirect, principal or secondary as appears in the accounts, books broad enough to cover all other debts in addition to the one specifically
and records of the Mortgagee, the Mortgagor does hereby transfer and convey by way of mortgage secured will be construed to cover a different debt, although such other debt
unto the Mortgagee, its successors or assigns, the parcels of land which are described in the list
is secured by another mortgage.
inserted on the back of this document, and/or appended hereto, together with all the buildings and
improvements now existing or which may hereafter be erected or constructed thereon, of which the - The contrary thinking maintains that a mortgage with such a clause will not
Mortgagor declares that he/it is the absolute owner free from all liens and encumbrances" secure a note that expresses on its face that it is otherwise secured as to its
entirety, at least to anything other than a deficiency after exhausting the
Page 7 of 17
security specified therein, such deficiency being an indebtedness within the loan, and for any deficiency after subsequent securities has been exhausted,
meaning of the mortgage, in the absence of a special contract excluding it subject of course to defenses which are available to the spouses.
from the arrangement.
- The latter school represents the better position. The parties having
conformed to the blanket mortgage clause or dragnet clause, it is reasonable
to conclude that they also agreed to an implied understanding that DISPOSITION
subsequent loans need not be secured by other securities, as the WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-
subsequent loans will be secured by the first mortgage. In other words, the G.R. CV No. 59543 is AFFIRMED.
sufficiency of the first security is a corollary component of the dragnet Costs against petitioner.
clause. SO ORDERED.
- But of course, there is no prohibition, as in the mortgage contract in issue,
against contractually requiring other securities for the subsequent loans.
Thus, when the mortgagor takes another loan for which another security was
given it could not be inferred that such loan was made in reliance solely on
the original security with the dragnet clause, but rather, on the new security
given. This is the reliance on the security test.
- Hence, based on the reliance on the security test, an inquiry whether the
second loan was made in reliance on the original security containing a
dragnet clause must be made.
- It has been held that in the absence of clear, supportive evidence of a
contrary intention, a mortgage containing a dragnet clause will not be
extended to cover future advances unless the document evidencing the
subsequent advance refers to the mortgage as providing security therefor.
- It was therefore improper for petitioner in this case to seek foreclosure of the
mortgaged property because of non-payment of all the three promissory
notes. While the existence and validity of the dragnet clause cannot be
denied, there is a need to respect the existence of the other security given.
- The foreclosure of the mortgaged property should only be for the
P250,000.00 loan covered by PN BD#75/C-252, and for any amount not
covered by the security for the subsequent promissory note.
- While the dragnet clause subsists, the security specifically executed for
subsequent loans must first be exhausted before the mortgaged property
can be resorted to.
- One other crucial point is that the mortgage contract, as well as the
promissory notes subject of this case, is a contract of adhesion.
- The real estate mortgage in issue appears in a standard form, drafted and
prepared solely by the bank, and which, according to jurisprudence must be
strictly construed against the party responsible for its preparation.
- If the parties intended that the blanket mortgage clause shall cover
subsequent advancement secured by separate securities, then the same
should have been indicated in the mortgage contract.
- Even the promissory notes in issue were made on standard forms prepared
by the, and as such are likewise contracts of adhesion. Being of such nature,
the same should be interpreted strictly against the bank.
- The bank however, is not without recourse. Both the Court of Appeals and
the trial court found that respondents have not yet paid the P250,000.00, and
gave no credence to their claim that they paid the said amount when they
paid petitioner P2,000,000.00. Thus, the mortgaged property could still be
properly subjected to foreclosure proceedings for the unpaid P250,000.00
Page 8 of 17
Castro, Jr. v. Court of Appeals - All improvements subsequently introduced or owned by the mortgagor on the
250 SCRA 661 encumbered property are deemed to form part of the mortgage but not if
Petitioner: Luis Castro, Jr., Marissa Castro, Ramon Castro, Mary Ann Castro, the accessions were introduced by a third-party or in this case, a lessee.
Catherine Castro and Antonio Castro. o A contract of mortgage be it real or personal, needs an
Respondents: Court of Appeals and Union Bank of the Philippines indispensable element thereof of ownership by the mortgagor of
the property mortgaged.
DOCTRINE - It is to say, that a foreclosure would be ineffective unless the
Improvement subsequently introduced to the encumbered property are considered to mortgagor has title to the property to be foreclosed.
form part of the mortgage only if so owned by the mortgagor. Such is NOT in the case
at bar.
FACTS
Cabanatuan City College obtained a loan from Bancom. In order to secure such,
Cabanatuan mortgaged to Bancom 2 parcels of land within the school site.
- While the mortgage was subsisting, Cabanatuan leased to Castro a 10000 sqm.
portion of the encumbered property where the latter eventually build a
residential house. Bancom was duly advised by Cabanatuan on the matter.
Cabanatuan defaulted and Bancom extrajudicially foreclosed on the mortgaged
property. It was then up for public auction where Bancom was the only bidder.
Bancom filed with the RTC for an ex-parte Writ of Possession not only over the land
and school buildings but also the residential house constructed by Castro, which
was subsequently issued.
Castro while refusing to leave, averred that being the owners of the residential
house could not be ousted simply on the basis of a writ of possession.
RTC ruled in favor of Bancom pursuant to Article 2127.
2. CA affirmed the decision.
ISSUE/S
W/N improvements made by a lessee on an mortgaged property forms part of the
accessions and improvements recited in Article 2127 NO
PROVISIONS
Article 2127. - The mortgage extends to the natural accessions, to the improvements,
growing fruits, and the rents or income not yet received when the obligation becomes
due, and to the amount of the indemnity granted or owing to the proprietor from the
insurers of the property mortgaged, or in virtue of expropriation for public use, with the
declarations, amplifications and limitations established by law, whether the estate
remains in the possession of the mortgagor, or it passes into the hands of a third
person.
Page 9 of 17
PNB vs Sps Maranon the Clerk of Court be released in their favor for having been adjudged as the
GR # 189316 | June 1, 2013 real owner of the subject lot. RTC GRANTED
Petition: petition for review on certiorari1 under Rule 45 of the Rules of Court - Spouses Maraon again filed with the RTC an Urgent Ex-Parte Motion for
Petitioner: PHILIPPINE NATIONAL BANK Withdrawal of Deposited Rentals praying that the P30,000.00 rental fees
Respondent: SPOUSES BERNARD and CRESENCIA MARANON paid to PNB by Tolete on December 12, 1999 be released in their favor. The
said lease payments were for the five (5)-month period from August 1999 to
DOCTRINE December 1999 at the monthly lease rate of P6,000.00. RTC GRANTED
reasoning that since they are the proper owners, they are entitled to the
FACTS fruits.
- Spouses Montealegre had a 152-square meter parcel of land located at - PNB moved for reconsideration, averring that as declared by the RTC in its
Bacolod erected with a building leased by various tenants that was used as Decision dated June 2, 2006, its mortgage lien should be carried over to the
a security for a loan they had with PNB. new title reconveying the lot to Spouses Maraon.
- Spouses Montealegre failed to pay, PNB initiated foreclosure proceedings - PNB further argued that with the expiration of the redemption period on
on the mortgaged properties, including the subject lot. In the auction sale, February 4, 1993, or one (1) year from the registration of the certificate of
PNB emerged as the highest bidder. It was issued the corresponding sale, PNB is now the owner of the subject lot hence, entitled to its fruits.
Certificate of Sale dated December 17, 19917 which was subsequently - RTC: directing PNB to release to Spouses Maraon the P30,000.00 rental
registered on February 4, 1992. payments considering that they were adjudged to have retained ownership
- Before the expiration of the redemption period, Spouses Maraon filed over the property
before the RTC a complaint for Annulment of Title, Reconveyance and o Denied MR
Damages against Spouses Montealegre, PNB, the Register of Deeds of - PNB sought recourse with the CA via a petition for certiorari and mandamus
Bacolod City and the Ex-Officio Provincial Sheriff of Negros Occidental. - CA: denied the petition and affirmed the RTCs judgment
- In its Answer, PNB averred that it is a mortgagee in good faith and for value o not being parties to the mortgage transaction between PNB and
and that its mortgage lien on the property was registered thus valid and Spouses Montealegre, Spouses Maraon cannot be deprived of the
binding against the whole world. fruits of the subject lot as the same will amount to deprivation of
- While the trial proceedings were ongoing, Paterio Tolete (Tolete), one of the property without due process of law.
tenants of the building erected on the subject lot deposited his rental o PNB is not a mortgagee in good faith because as a financial
payments with the Clerk of Court of Bacolod City which, as of October 24, institution imbued with public interest, it should have looked beyond
2002, amounted to P144,000.00. the certificate of title presented by Spouses Montealegre and
- RTC: in favor of the Sps Maranon conducted an inspection on the circumstances surrounding the
o based on the expert testimony of Colonel Rodolfo Castillo, Head of transfer to Spouses Montealegre
the Forensic Technology Section of Bacolod City Philippine
National Police, that the signatures of Spouses Maraon in the Hence, this petition.
Deed of Sale presented by Spouses Montealegre before the RTC Decision dated June 2, 2006 lapsed into finality when it was
Register of Deeds to cause the cancellation of TCT No. T-129577 not appealed or submitted for reconsideration. As such, all
were forged. Hence, the RTC concluded the sale to be null and void conclusions therein are immutable and can no longer be modified
and as such it did not transfer any right or title in law. by any court even by the RTC that rendered the same. The CA
o PNB was adjudged to be a mortgagee in good faith whose lien on however erroneously altered the RTC Decision by reversing the
the subject lot must be respected pronouncement that PNB is a mortgagee-in-good-faith.
o The defendant Emilie Montealegre is ordered to reconvey the title
over Lot No. 177-A-1, Bacolod Cadastre back to the plaintiffs PNB further asseverates that its mortgage lien was carried over to
Maraon herein respondents the new title issued to Spouses Maraon and thus it retained the
o The Real Estate Mortgage lien of the Philippine National Bank right to foreclose the subject lot upon non-payment of the secured
registered on the title of Lot No. 177-A-1 Bacolod Cadastre shall debt. PNB asserts that it is entitled to the rent because it became
stay and be respected the subject lots new owner when the redemption period expired
- No reconsideration or appeal was sought by either parties. without the property being redeemed.
- Spouses Maraon filed motions for release of the rental payments deposited
with the Clerk of Court and paid to PNB by Tolete. ISSUE/S
- Spouses Maraon filed an Urgent Motion for the Withdrawal of Deposited 2. W/N PNB is entitled to the rentals
Rentals praying that the P144,000.00 rental fees deposited by Tolete with
Page 10 of 17
RULING & RATIO the disputed rent. The foreclosure proceedings on August 16, 1991 caused
3. NO by PNB could not have, thus, included the building found on the subject lot
and the rent it yields. PNBs lien as a mortgagee in good faith pertains to the
- Rent is a civil fruit that belongs to the owner of the property producing it by subject lot alone because the rule that improvements shall follow the
right of accession. The rightful recipient of the disputed rent in this case principal in a mortgage under Article 2127 of the Civil Code does not apply
should thus be the owner of the subject lot at the time the rent accrued. It is under the premises. Accordingly, since the building was not foreclosed, it
beyond question that Spouses Maraon never lost ownership over the remains a property of Spouses Maraon; it is not affected by non-
subject lot. This is the precise consequence of the final and executory redemption and is excluded from any consolidation of title made by
judgment in Civil Case No. 7213 rendered by the RTC on June 3, 2006 PNB over the subject lot. Thus, PNBs claim for the rent paid by Tolete
whereby the title to the subject lot was reconveyed to them and the cloud has no basis.
thereon consisting of Emilies fraudulently obtained title was removed.
Ideally, the present dispute can be simply resolved on the basis of such - There is technically no juridical tie created by a valid mortgage contract
pronouncement. that binds PNB to the subject lot because its mortgagor was not the true
owner. But by virtue of the mortgagee in good faith principle, the law allows
- The protection afforded to PNB as a mortgagee in good faith refers to the PNB to enforce its lien. We cannot, however, extend such principle so as to
right to have its mortgage lien carried over and annotated on the new create a juridical tie between PNB and the improvements attached to the
certificate of title issued to Spouses Maraon as so adjudged by the RTC. subject lot despite clear and undeniable evidence showing that no such
Thereafter, to enforce such lien thru foreclosure proceedings in case of non- juridical tie exists.
payment of the secured debt, as PNB did so pursue. The principle, however,
is not the singular rule that governs real estate mortgages and foreclosures - Lastly, it is worthy to note that the effects of the foreclosure of the subject lot
attended by fraudulent transfers to the mortgagor. is in fact still contentious considering that as a purchaser in the public sale,
PNB was only substituted to and acquired the right, title, interest and claim of
- Rent, as an accessory follows the principal. In fact, when the principal the mortgagor to the property as of the time of the levy. There being
property is mortgaged, the mortgage shall include all natural or civil fruits already a final judgment reconveying the subject lot to Spouses
and improvements found thereon when the secured obligation becomes due Maraon and declaring as null and void Emilie's purported claim of
as provided in Article 2127 of the Civil Code, viz: ownership, the legal consequences of the foreclosure sale, expiration
of the redemption period and even the consolidation of the subject lot's
Art. 2127. The mortgage extends to the natural accessions, to the title in PNB's name shall be subjected to such final judgment.
improvements, growing fruits, and the rents or income not yet
received when the obligation becomes due, and to the amount of - Nonetheless, since the present recourse stemmed from a mere motion
the indemnity granted or owing to the proprietor from the insurers of claiming ownership of rent and not from a main action for annulment of
the property mortgaged, or in virtue of expropriation for public use, the foreclosure sale or of its succeeding incidents, the Court cannot
with the declarations, amplifications and limitations established by proceed to make a ruling on the bearing of the CA's Decision dated June 18,
law, whether the estate remains in the possession of the mortgagor, 2008 to PNB's standing as a purchaser in the public auction. Such matter
or it passes into the hands of a third person. will have to be threshed out in the proper forum.
- However, the rule is not without qualifications. In Castro, Jr. v. CA the Court
explained that Article 2127 is predicated on the presumption that the DISPOSITION
ownership of accessions and accessories also belongs to the mortgagor as
the owner of the principal. After all, it is an indispensable requisite of a valid WHEREFORE, foregoing considered, the petition is hereby DENIED. The Decision
real estate mortgage that the mortgagor be the absolute owner of the dated June 18, 2008 and Resolution dated August 10, 2009 of the Court of Appeals in
encumbered property CA-G.R. SP No. 02513 are AFFIRMED.
- Otherwise stated, absent an adverse claimant or any evidence to the
contrary, all accessories and accessions accruing or attached to the SO ORDERED.
mortgaged property are included in the mortgage contract and may thus also
be foreclosed together with the principal property in case of non-payment of
the debt secured.
DISPOSITION
IN VIEW THEREOF, the assailed 28 March 2008 Decision and 30 July 2008
Resolution of the Court of Appeals in CA-G.R. CV No. 87410 are hereby AFFIRMED.
Page 13 of 17
Litonjua v. L&R Corp ISSUE/S
GR # 130722 | December 9, 1999 May a mortgage contract provide that the mortgagor cannot sell the mortgaged
Petitioner: Sps. Reynaldo K. Litonjua and Erlinda P. Litonjua and Phil. White House property without first obtaining the consent of the mortgagee and that, otherwise, the
Auto Supply, Inc., sale made without the mortgagees consent shall be invalid - NO
Respondent: L & R Corporation, Vicente M. Coloyan In His Capacity as Acting
Registrar of The Register of Deeds Of Quezon City Thru Deputy Sheriff Roberto R. RULING & RATIO
Garcia 1. No.
New Civil Code, Art. 2130 Insofar as the validity of the questioned stipulation prohibiting the mortgagor from
selling his mortgaged property without the consent of the mortgagee is concerned,
DOCTRINE therefore, the ruling in the Tambunting case (Nota Bene: Stipulation prohibiting
Stipulation prohibiting the mortgagor from selling his mortgaged property without the subsequent mortgage or encumbrance is ALLOWED. What is prohibited is stipulation
consent of the mortgagee violates Article 2130 of the New Civil Code The sale made prohibiting sale or conveyance by mortgagor) is still the controlling law. Indeed, we
by the spouses Litonjua to PWHAS, notwithstanding the lack of prior written consent are fully in accord with the pronouncement therein that such a stipulation violates
of L & R Corporation, is valid. Article 2130 of the New Civil Code. Both the lower court and the Court of Appeals in
its Amended Decision rationalize that since paragraph 8 of the subject Deed of
FACTS Real Estate Mortgage contains no absolute prohibition against the sale of the property
Spouses Litonjua obtained loans from L&R Corp in the aggregate sum of mortgaged but only requires the mortgagor to obtain the prior written consent
P400,000. Loans were secured by a mortgage constituted by spouses upon of the mortgagee before any such sale, Article 2130 is not violated thereby. This
their two parcels of land and improvements thereon observation takes a narrow and technical view of the stipulation in question without
Spouses sold to Philippine White House Auto Supply, Inc. (PWHAS) the taking into consideration the end result of requiring such prior written consent.
parcels of land they had previously mortgaged to L&R Corp. True, the provision does not absolutely prohibit the mortgagor from selling his
Spouses having defaulted in the payment of their loans, L&R Corp initiated mortgaged property but what it does not outrightly prohibit, it nevertheless achieves.
extrajudicial foreclosure proceedings, the mortgaged properties were sold to For all intents and purposes, the stipulation practically gives the mortgagee the sole
L&R Corp as the only bidder. prerogative to prevent any sale of the mortgaged property to a third party. The
When L&R Corp presented its corresponding Certificate of Sale to QC mortgagee can simply withhold its consent and thereby, prevent the mortgagor from
Register of Deeds for registration, it learned for the first tie of the prior sale of selling the property. This creates an unconscionable advantage for the mortgagee
properties made by the Spouses to PWHAS upon seeing the inscription at and amounts to a virtual prohibition on the owner to sell his mortgaged property. In
the back of the Certificates of Title. Thus, it wrote a letter to the Register of other words, stipulations like those covered by paragraph 8 of the subject Deed of
Deeds of QC requesting for the cancellation of the annotation regarding the Real Estate Mortgage circumvent the law, specifically, Article 2130 of the New Civil
sale to PWHAS. Code. Being contrary to law, paragraph 8 of the subject Deed of Real Estate
L&R Corp invoked a provision in its mortgage contract with the spouses Mortgage is not binding upon the parties. Accordingly, the sale made by the spouses
stating that the mortgagees prior consent was necessary in case of Litonjua to PWHAS, notwithstanding the lack of prior written consent of L & R
subsequent encumbrance or alienation of the subject properties. It argued Corporation, is valid.
that since the sale to PWHAS was made without prior written consent, the
same should not have been registered and/or annotated. DISPOSITION
A complaint for Quieting of Title, Annulment of Title and Damages with WHEREFORE, the Decision appealed from is hereby AFFIRMED with modifications
preliminary injunction was filed by the spouses Litonjua and PWHAS against
L&R Corp CFI QC The lower court rendered its Decision dismissing the NOTES
Complaint upon its finding that the sale between the spouses Litonjua and 1. Issue as to right of first refusal
PWHAS was null and void and unenforceable against L & R Corporation and a. A stipulation on a right of first refusal is allowed. There is nothing
that the redemption made was also null and void. wrong in a stipulation granting the mortgagee the right of first
On appeal, the decision of the trial court was set aside by the Court of refusal over the mortgaged property in the event the mortgagor
Appeals in its Decision dated June 22, 1994,on the ground that the sale decides to sell the same. While the mortgagor has every right to sell
made to PWHAS as well as the redemption effected by the spouses Litonjua the mortgaged property without securing the consent of the
were valid. However, the same was subsequently reconsidered mortgagee, he has the obligation under a right of first refusal
Hence this petition. provision to notify the mortgagee of his intention to sell the property
and give him priority over other buyers. A sale made in violation of
the mortgagees contractual right of first refusal in rescissible.
Page 14 of 17
Caltex v. IAC and Herbert Manzana
Issue: Whether or not the mere filing of a collection suit for the recovery of the debt
secured by real estate mortgage constitutes waiver of the other remedy of
foreclosure.
Held: It is of no moment that the collection suit was filed ahead, what is determinative
is the fact that the foreclosure proceedings ended even before the decision in the
collection suit was rendered. As a matter of fact, CALTEX informed the trial court that
it had already consolidated its ownership over the property, in its reply to the
opposition of Manzana to the motion for execution pending appeal filed by it.
The collection suit filed before the trial court cannot be considered as a deficiency
judgment because a deficiency judgment has been defined as one for the balance of
the indebtedness after applying the proceeds of the sale of the mortgaged property to
such indebtedness and is necessarily filed after the foreclosure proceedings. It is
significant to note that the judgment rendered by the trial court was for the full amount
of the indebtedness and the case was filed prior to the foreclosure proceedings.
A suit for the recovery of the deficiency after the foreclosure of a mortgage is in the
nature of a mortgage action because its purpose is precisely to enforce the mortgage
contract; it is upon a written contract and upon an obligation of Manzana to pay the
deficiency which is created by law (see Development Bank of the Philippines v.
Tomeldan et al., G.R. No. 51269, November 17, 1980, 101 SCRA 171). Therefore,
since more than ten (10) years have elapsed from the time the right of action accrued,
CALTEX can no longer recover the deficiency from Manzana.
Page 17 of 17