Belo vs. PNB

Facts:

1. Eduarda Belo owned an agricultural land from which she leased a portion to Sps. Marcos and Sps. Eslabon.

2. Respondent Sps. Eslabon later obtained a loan from PNB secured by real estate mortgages; 4 residential houses and the agri land of Belo.

3. Consent of Belo was acquired as evidenced by the SPA.

4. Failing to pay the loan, the properties were foreclosed, including that of Belo who is merely an accommodation mortgagor.

5. Belo later sold her redemption right to Petitioner who tendered payment for the redemption of the agri land for P 484,482.96. This was however rejected by PNB, arguing that the redemption price is P 2,779,978.72, representing the entire amount due to PNB, should the debtor-mortgagor wish to redeem the property.

Issue: Redemption price.

Held

1. The mortgage is valid as Eduarda Belos consent was properly obtained. As such, Belo became an accommodation mortgagor in the sense the she signed the SPA to authorize Sps. Eslabon to mortgage her property without receiving any of the proceeds.

The redemption price should be in accordance with Sec. 6 of Act No. 3135 and Sec. 25 of P.D. No. 694. The latter provision should be interpreted according to its constricted meaning. That the debtor-mortgagor is the one required to pay all the claims of the bank against him while as regards the debtor who is merely an accommodation mortgagor, she should be allowed to redeem the property by paying only the bid price. To hold otherwise would make the accommodation mortgagor a debtor-mortgagor.

DBP v Licuanan

Facts

Licuanans were granted a piggery loan and 5 other loans, secured by a REM, evidenced by promissory notes DBP then sent a letter informing Licuanan that they breached the conditions of the mortgage, as such the mortgaged properties were to be sold by the sheriff -> filed for an extrajudicial foreclosure of mortgage, which DBP was the highest bidder.

The certificate of sale was registered and after a year DBP consolidated its ownership

After more than a year DBP wrote to respondents informing them that the now acquired bank assets would be disposed of by public auction, by oral bidding. But there were no bidders.

Later of that same year DBP sent another letter informing Licuanan that could reacquire the land through a negotiated sale for cash or installment.

The licuanans sent a letter that they wanted to repurchase the properties

However 3 days later they executed a conditional sale to Peralta.

DBP held that the maturity dates indicate a demand for payment of the promissory notes TC found that there was no demand present

CA affirmed

Issue

Whether or not there was a demand for payment of the loans was made before the mortgage was foreclosed

Held:

There was no valid demand present. Well-settled is the rule that since a cause of action requires, as essential elements, not only a legal right of the plaintiff and a correlative duty of the defendant but also "an act or omission of the defendant in violation of said legal right," the cause of action does not accrue until the party obligated refuses, expressly or impliedly, to comply with its duty.

Unless demand is proven, one cannot be held in default. DBPs cause of action did not accrue on the maturity dates stated in the promissory notes. It is only when demand to pay is made and subsequently refused that respondents can be considered in default and petitioner obtains the right to file an action to collect the debt or foreclose the mortgage.The maturity dates only indicate when payment can be demanded. It is the refusal to pay after demand that gives the creditor a cause of action against the debtor.

Since demand was never made by DBP, the foreclosure was premature and therefore null and void.The licuanas were interested in purchasing the property, this did not hold them in estoppel that mortgage was validly foreclosed, by reason that the essence of redemption that such property would be redeemed back to the Licuanans.

GSIS v. CA 266 SRA 187

FACTS

1.) Private Respondent PVHI (Sulo ng Nayon Inc.) obtained a loan of 22 M from GSIS for the construction of a hotel as security PVHI hypothecated the hotel and its contents. GSIS granted PVHI two additional load accommodations of 8 M and 6.5 M.

2.) PVHI was only able to pay 98 M, thus GSIS finally instituted foreclosure proceedings (Real Estate, Chattel)

3.) Hotel was finally sold at public auction with GSIS as highest bidder

4.) GSIS filed with RTC of Pasay for a writ of possession. RTC granted. CA affirmed.

5.) PVHI filed a petition to set aside foreclosure sale (in accordance with Section 8 Act 3135), but RTC Judge Sayo dismissed on the ground of lack of jurisdiction

6.) Since the case was dismissed, they were compelled to file a petition for Certiorari

Issue: Whether or not RTC Judge Sayo erred in dismissing the petition to set aside foreclosure sale YES

Held

- SC remanded the case back to RTC

- SC found nothing objectionable in such recourse

- Pursuant to Section 8, 3135, the recourse for a party aggrieved by foreclosure is to have the sale set aside.

Maglaque v Planters Development Bank

Facts:

Maglaque and Payawal were the owners of a 464 sq m land and the residential house constructed therein.

1974, Maglaque obtained a 2k loan from Bulacan Development Bank (know known as planters) payable in 2 installments in the year 1974 and 1975, with a 12% interest per annum and secured the loan with the rem on the house and lot. Which the bank accepted.

In 1976 Payawal died (wife)

In 1977 Maglaque paid the 2k, which the bank accepted

1979 Maglaque died

1978 the REM was foreclosed for non payment of the full loan

1980, lapse of the redemption period, Planters consolidated its title

Afterwards the Maglaque heir filed an annulment of sale and reconveyance of title. The bank sold the lot to Beltran.

Issue:

Whether or not REM was validly foreclosed

Held:

Yes. A secured creditor holding a REM has 3 options upon the death of the debtor:

1. To waive the mortgage and claim the entire debt from the estate of the mortgagors as an ordinary claim;

2. Foreclose the mortgage judicially and prove any deficiency as an ordinary claim and;

3. Rely on the mortgage exclusively, foreclosing the same at any time before it is barred by prescription, without right to file a claim for any deficiency.

Here the bank availed of the 3rd option which was to exclusively foreclose the mortgage since Maglaque did not pay the whole amount, which included the 12% interest.

Philippine Savings Bank v. Geronimo GR 170241

Facts

1.) Respondent Spouses Dionisio and Cardidad Geronimo obtained a loan from Petitioner Philippine Savings Bank in the amount of 3 M secured by a REM on respindents land in Talipapa, Caloocan City.

2.) Respondents defaulted, prompting Petitioner bank to initiate extrajudicial foreclosure of REM

3.) At the auction sale, mortgaged property was sold to petitioner bank (highest bidder)

4.) Respondents filed with Trial Court for annulment of the extrajudicial foreclosure on the ground of the non-compliance f the Bank with the Publication required pursuant to the Law

5.) RTC dismissed the case; ruled in favor of the bank, sustained the validity of EJF on the ff grounds: a.) there was compliance with public requirement, b.) Spouses and Caridad failed to prove petitioners alleged non-compliance, c.) reliance on the positive testimony of Deputy Sheriff that there was publication of notice of Sale in a newspaper of general circulation.

6.) CA reversed the ruling of Trial Court; ruled in favor of the Spouses, declared the EJF void on the ff grounds: a.) there was no sufficient proof that Ang Pinoy is a newspaper of general circulation in Caloocan, non compliance with the requisite of publication of the notice of Sale

Issue: Whether or not the extrajudicial foreclosure is void for the non-compliance with the requisite publication of the notice of Sale--- Yes

Held

-EJF and sale are void; Petition denied; CA ruling affirmed

-SC: Phil Savings Bank failed to establish its compliance with the publication required under Section 3 Act 3135

-Ang Pinoy is a newspaper of general circulation in Manila, not in Caloocan where property is situated

-Sheriff presented its incompetent to prove that the notice of sale was actually published in a newspaper. His testimony that during the auction sale, mortgage bank presented affidavit of publication does not prove compliance with the requisite publication.

-Affidavit of Publication was excluded by the TC for being heaesay, and such was not contended by the petitioner bank

Spouses Fernando v. Phil Veterans Bank

G.R. 168524

Facts: Respondent Phil Veterans Bank (Veterans) granted petitioner spouses Fernando and Edralin a loan worth 270k. As security, petitioner executed a REM over a property in Paranaque. Edralins defaulted. Foreclosure proceeding and sale were held. Veterans emerged as highest bidder. Certificate of title was awarded to them. Edralins failed to redeem the property within 1 year. Veterans acquired absolute ownership of said property. Veterans filed a writ of possession. RTC dismissed the application. CA reversed.

Issue: Whether or not the sale executed constitutes Pactum Comisorium

Held: SC affirmed CA ruling. Petition is denied. Petitioners argument that the deed of sale executed by Veterans in its own favor during the consolidation of title which constitutes Pactum Comisorium which is prohibited by law---- is without merit. Veterans did not, upon the petitioners default, automatically acquire or appropriate the mortgaged property for itself. Veterans went through all the stages of extrajudicial foreclosure.