REPUBLIC OF THE PHILIPPNES )

City of Bacolod ) S.c.

X ------------------------------------ X

JUDICIAL AFFIDAVIT

I, DIANA OUANO-LERIO, of legal age, Filipino and a

resident of Mandaue City, Cebu, Philippines, after having
been sworn in accordance with law, hereby depose and state
that:

I am submitting this Judicial Affidavit in relation to the

case entitled RICARDO M. MASONGSONG & EVANGELINE G.
MASONGSONG VS. SAN MIGUEL FOODS, INC., before RTC,
Branch 48, Bacolod City, and pursuant to A.M. No. 12-8-8-
SC (Judicial Affidavit Rule) of the Supreme Court.

The name of the lawyer who conducted or supervised

my examination is Atty. Pacifico M. Maghari III, with office
address located at 590 Ylac St., Villamonte, Bacolod City.
Such examination was conducted at the San Miguel Foods,
Inc. Bacolod Branch on ________________.

The purpose of my testimony is to prove that the

plaintiff Ricardo Masongsong was conducting business with
Pompeyo Saturinas in securing credit from the defendant
San Miguel Foods Inc. subject matter of the pending case
before RTC, Branch 48, Bacolod City. Pompeyo Saturinas is
the person who incurring credit from the defendant San
Miguel Foods Inc. via the business front named Ace
Distributor but which was done with the knowledge and
consent of the plaintiff Masongsong. This testimony is
likewise offered to prove that the filing of the action for
foreclosure by the defendant San Miguel Foods Inc. (SMFI)
is with factual and legal bases based on the available
records and documents of the defendant at hand.

I answered the questions asked herein fully conscious

that I do so under oath and that I may face criminal liability
for false testimony or perjury, to wit:

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Q1: Ms. Witness, what is your name and other personal
circumstances in relation to the present case?

A1: My name is DIANA-OUANO LERIO, of legal age, Filipino,

married and a resident of Mandaue City, Cebu.

Q2: Do you know the plaintiff Ricardo Masongsong?

A2: Yes, sir.

Q3: How did you come to know him?

A3: Mr. Ricardo Masongsong started dealing business with

San Miguel Food Inc. (SMFI for brevity) in 1990 as dealer for
B-Meg Feeds products. He was appointed as distributor for
poultry products in 1994 for the cities of Bacolod and Iloilo
under the trade name of RM Integrated Sales and
Complimentary Distributorship or RMIS for brevity.

Q4: What is your relation to the defendant SMFI?

A4: I work for SMFI as a Finance Head where the plaintiff

also worked for.

Q5: What events have transpired that led into this case?

A5: Ricardo Masongsong operating under the trade name

RM Integrated Sales and Complimentary Distributorship
(RMIS for brevity) had an approved Credit Line with SMFI
fully secured by Real Estate Mortgage (REM) of parcels of
lands under TCT No. T-160141 and T-139246, respectively.
The Credit Line Agreement is renewable yearly at the
discretion of the creditor/corporation despite the expiry date
April 30, 1998.

Q6:Do you have any evidence to support that?

A6: Yes, sir. (showing a copy of the Credit Line Agreement)

Q7: I am now attaching a copy of the Credit Line Agreement

as Exhibit “1” of your judicial affidavit.

What happened thereafter?

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A7: The plaintiff incurred debts with SMFI since the Credit
Line Agreement still subsisted or continued after April 30,
1998. Thus, demand letters were served against the plaintiff
to settle his incurred indebtedness with the defendant SMFI.

Q8: Despite the sequence of events you mentioned, what is

the reason why the plaintiff filed a case against SMFI?

A8: SMFI filed an Extra Judicial Foreclosure against the

plaintiff’s mortgaged properties for failure to pay his credit
purchases availed through Pompeyo Saturinas. However, Mr.
Masongsong alleges that he has never made use of such
credit purchases and that it was Mr. Saturinas using the
business name of Ace Distributors that purchased volumes
of dressed chicken charged under his credit line account
without his knowledge and consent but which in fact is
contrary to SMFI’s investigation.

Q9: Do you have evidence to support any of the statements

you have mentioned?

A9: Yes, sir I have here a Credit Endorsement clearly

showing that Mr. Masongsong has knowledge and consent of
the purchases of Pompeyo Saturinas. (showing a copy of the
Credit Endorsement)

Q10: I am now attaching a copy of the Credit Endorsement

as Exhibit “2” of your judicial affidavit, respectively. You
have mentioned a business name Ace Distributor. Who is the
owner of such business, if you know?

A10: Yes sir. I know that the owner of said business is

Pompeyo Saturinas.

Q11: How do you know this information?

A11: Pompeyo Saturinas was a former Supervisor/Sales

Manager of SMFI. The Credit Endorsement is the proof that
the business coverage was not only in Bacolod City but also
extended to Iloilo City. It also further shows that Pompeyo
Saturinas through Ace Distributor transacted business with
SMFI with the knowledge and consent Mr. Ricardo
Masongsong Integrated Services and Complimentary
Distributorship or RMIS owned by Mr. Ricardo Masongsong.

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Q12: What else did SMFI do from then on?

A12: As the Finance Head of SMFI-Vismin, I was asked to

conduct an investigation on the matter and on his
(Masongsong) accounts.

Q13: What did you find in your investigation?

A13: I found during the investigation and examination of

accounts an acknowledgment that Mr. Ricardo Masongsong
consented and entered into an agreement with Mr. Pompeyo
Saturinas of Ace Distributor for the later to use his credit line
in Iloilo to purchase dressed chicken from San Miguel Foods,
Inc. Further, Mr. Ricardo Masongsong confirmed that for
every purchase of dressed chicken made by Ace Distributor
through the credit line of RMIS, Mr. Masongsong gets a 3%
share out of the 5% Distributor’s Fee granted by SMFI to its
Distributors. Also in our investigation, Mr. Ricardo
Masongsong authorized his representatives based in Iloilo to
receive deliveries of dressed chicken from San Miguel Foods,
Inc. ordered by Ace Distributor. These delivieries amounted
to TWO MILLION NINE HUNDERED EIGHTY-EIGHT
THOUSAND, FIVE HUNDERED TWEL FIVE PESOS and
THIRTY-FOUR CENTAVOS (Php 2,988,512.34) as of July 31,
2002 and remained unpaid as of today.

Q14: Do you have evidence to support that?

A14: Yes, sir. I have here with me a copy of the Minutes of

Meeting where the matters mentioned in the minutes were
confirmed by Ricardo Masongsong in which he has affixed
his signature during the meeting dated August 4, 2000.
(showing the minuets of meeting dated August 4, 2000)

Q15: I am now attaching a copy of the Minutes of Meeting

dated August 4, 2000 as Exhibit “3” of your judicial
affidavit. What other circumstances came to your knowledge
during your investigation?

A15: I also learned that there is an affiliation between the

plaintiff Ricardo Masongsong and Pompeyo Saturinas,
director of Ace Distributor. They had an agreement that Ace
Distributor can withdraw SMFI Poultry Products from Iloilo
Sale Office under the account of plaintiff RMIS Iloilo.

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Q16: Can you present any evidence to support that
statement?

A16: Yes, sir I have here an Authorization Certificate signed

by Mr. Ricardo Masongsong authorizing his representatives
based in Iloilo to receive stocks from San Miguel Foods, Inc.
(showing a copy of the Authorization Certificate).

Q17: I am now attaching a copy of the Authorization

Certificate as Exhibit “4” of your judicial affidavit. What
other evidences do you have?

A17: Based on the investigation report gathered and other

available documents presented, Mr. Ricardo Masongsong
acknowledged, consented and authorized Ace Distributor
owned by Pompeyo Saturinas to purchase SMFI Poultry
Products under the credit line of RMIS in Iloilo. Nothing else
to add, Sir.

AFFIANT FURTHER SAYETH NAUGHT.

PLAINTIFF RESERVES THE RIGHT TO RE-DIRECT

AS ALLOWED BY THE RULES.

IN WITNESS WHEREOF, I have hereunto affixed my

signature this ___ day of March, 2014 at the City of Bacolod,
Philippines.

DIANA OUANO-LERIO
Witness

JURAT

SUBSCRIBED AND SWORN to before me this _____

day of March, 2014, by the Affiant whom I have identified
through competent evidence of identity who exhibited her
Government ID No. _________ issued at _____________
on ____________, with her signature and picture appearing
thereon.

Notary Public

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Doc. No. ___
Page No. ___
Book No. ___
Series of 2014.

ATTESTATION

I, ATTY. PACIFICO MAGHARI III, under oath,

depose and state that:

I am the legal counsel who conducted the foregoing

examination of Petitioner/Witness DIANA OUANO-LERIO
as contained in this Judicial Affidavit;

I faithfully recorded or caused to be recorded the

questions asked of the said Petitioner/Witness and the
answers he gave thereto; and that no other person assisted
him in his declaration neither was he coached with answers.

IN WITNESS WHEREOF, I have hereunto affixed my

signature this ____ day of March, 2014, at the City of
Bacolod, Philippines.

PACIFICO M. MAGHARI, III

Affiant
PTR No. 5430608 B. C. Jan. 2, 2014
IBP No. 929226 B. C.Dec. 19, 2013
MCLE Compliance No. IV-0022024/9.24.13
SC ROLL NO. 44869

SUBSCRIBED AND SWORN to before me this ____

day of March, 2014, by the Affiant who exhibited to me his
IBP ID bearing his Roll No. 44869 with his signature affixed
thereon and likewise his picture appearing thereon.

Notary Public
Doc. No. ___
Page No. ___
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Book No. ___
Series of 2014.

COPY FURNISHED:
ATTY. VICENTE SABORNAY
Counsel for the Plaintiff-Spouses Masongsong
2/F Manuela Bldg.
San Juan Street, Bacolod City

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