Facts:

The case of Bank of the Philippine Islands vs. Carlos Leobrera arose from two consolidated petitions for review, identified as G.R. No. 137147 and G.R. No. 137148, heard by the Supreme Court of the Philippines and decided on November 18, 2003. The events leading to this legal confrontation began when Carlos Leobrera, the respondent, filed a complaint against the Bank of the Philippine Islands, the petitioner. A lower court determined that the bank had committed errors, leading to the foreclosure of properties owned by Leobrera. The trial court and subsequently the Court of Appeals initially granted him awards for actual damages, moral damages, and attorney's fees. However, the trial court and the Court of Appeals' decisions were contested by both parties, prompting them to file motions for reconsideration regarding the amounts awarded. Notably, the petitioner sought the reduction of the moral damages and clarification on the nature of the reconveyance of properties, whil

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Facts:

Background of the Case (G.R. No. 137147)

• The case involves petitioner Bank of the Philippine Islands (BPI) and respondent Carlos Leobrera, along with the Court of Appeals.
• Initially, the Supreme Court rendered a decision on January 29, 2002, which affirmed the decisions of the Court of Appeals and the trial court. That decision modified the lower court’s awards by reducing the award of actual damages to ₱200,000.00 and the attorney’s fees to ₱50,000.00.
• Subsequent to that decision, both parties filed respective motions for reconsideration:
• Petitioner BPI filed a Motion for Partial Reconsideration/Clarification.
• Respondent Leobrera also filed a Motion for Reconsideration.

Petitioner’s Arguments in Its Motion for Partial Reconsideration/Clarification (G.R. No. 137147)

• Petitioner objected to the lower courts’ “exorbitant” award of moral damages amounting to ₱1,000,000.00, contending that such award had not been considered in a similar decision in G.R. No. 137148.
• Petitioner also sought clarification regarding the order to reconvey the foreclosed properties to respondent Leobrera, requesting that it be stated these properties remain subject to the real estate mortgage executed by the respondent.

Respondent’s Arguments in His Motion for Reconsideration (G.R. No. 137147)

• Respondent contended that the Supreme Court erred in reducing the award of actual damages from ₱1,000,000.00 (as determined by the Court of Appeals) to ₱200,000.00.
• He further argued that the reduction of the attorney’s fees from ₱100,000.00 (as awarded by the Court of Appeals) to ₱50,000.00 was also erroneous.
• The motion emphasized that for the recovery of actual damages, the amount expended must be shown with a reasonable degree of certainty and substantiated by competent proof.

Factual Findings and Evidence on Damages (G.R. No. 137147)

• The trial court and the Court of Appeals had found that petitioner BPI was guilty of gross negligence and bad faith in its dealings with respondent Leobrera.
• The evidentiary basis for the award of actual damages was scrutinized, and it was noted that the actual loss demonstrated was the sum of a $1,763.50 letter of credit and a remittance of $8,350.94, totaling $10,114.44.
• The conversion of this foreign currency amount to its peso equivalent was to be computed at the prevailing exchange rate at the time of payment, pursuant to established jurisprudence involving similar financial transactions.

Background of the Related Case (G.R. No. 137148)

• In the decision rendered on January 30, 2002, the Court affirmed the lower courts’ decision with modifications:
• Defendant was ordered to pay actual damages of ₱98,975.00.
• Attorney’s fees were fixed at ₱30,000.00.
• All awards for moral and exemplary damages were deleted.
• Only respondent Leobrera filed a Motion for Reconsideration in this case.
• In his motion, he challenged the reduction of actual damages from ₱1,300,000.00 to ₱98,975.00.
• He disputed the deletion of interest on actual damages.
• He contested the reduction of attorney’s fees and costs from ₱200,000.00 to ₱30,000.00.
• He argued that the deletion of the award for moral and exemplary damages was a serious error.
• The trial court and the Court of Appeals had, however, substantiated the damages claimed by respondent through extensive reliance on his testimony and supporting evidence.

Issue:

Whether the Supreme Court erred in modifying (i.e., reducing) the awards given by the lower courts:

• Specifically, whether reducing the actual damages from ₱1,000,000.00 to ₱200,000.00 in G.R. No. 137147 was appropriate.
• Whether reducing the attorney’s fees from ₱100,000.00 to ₱50,000.00 was justified.

Whether the petitioner’s challenge to the moral damages award (of ₱1,000,000.00) should have been entertained, given the similar case in G.R. No. 137148:

• The petitioner argued that the moral damages being excessive in the lower courts’ ruling should be deleted in line with the decision in the related case.
• Whether the factual bases for the moral damages in both cases are similar or sufficiently distinct.
• Whether the order to reconvey the foreclosed properties should come with a clarification that these properties continue to be subject to the real estate mortgage executed by respondent Leobrera.
• Whether allowing a party to change its legal theory on appeal (introducing new issues not raised before the lower courts) violates principles of due process and fair play.
• Whether the evidentiary support for the award of actual damages as provided by respondent, particularly the substantiation of expenses amounting to $10,114.44, is sufficient to warrant its conversion to peso based on the prevailing exchange rate.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)