Case Digest (G.R. No. 175816)
Facts:
- The case involves BPI Family Savings Bank, Inc. (Petitioner) and spouses Ma. Arlyn T. Avenido and Pacifico A. Avenido (Respondents).
- On April 25, 1996, the spouses entered into a Mortgage Loan Agreement with BPI Family for a loan of ₱12,000,000.00, secured by a real estate mortgage on a property in Bais City (Transfer Certificate of Title No. T-1216).
- The spouses defaulted on their loan payments, leading BPI Family to initiate extrajudicial foreclosure proceedings under Act No. 3135.
- A public auction occurred on March 8, 1999, where BPI Family was the highest bidder at ₱12,142,616.00.
- This bid amount was applied as partial payment against the total loan obligation of ₱12,917,381.43, resulting in a deficiency of ₱794,765.43.
- On September 20, 2000, BPI Family filed a Complaint for Collection of Deficiency of Mortgage Obligation with Damages against the spouses in the Regional Trial Court (RTC) of Cebu City (Civil Case No. CEB-25629).
- The spouses argued they had paid a substantial amount and that the foreclosure sale price exceeded their outstanding obligation, seeking dismissal of the complaint and claiming damages.
- The RTC dismissed BPI Family's complaint on November 13, 2002, ruling that the bank was not entitled to a deficiency judgment.
- BPI Family appealed, but the Court of Appeals affirmed the RTC's decision on March 31, 2006, and denied BPI Family's motion for reconsideration on November 16, 2006.
Issue:
- (Unlock)
Ruling:
- The Supreme Court ruled that BPI Family is entitled to collect a deficiency mortgage obligation of ₱455,836.80 from the spouses Avenido, plus legal interest.
- The Court determined that the deficiency should be calculated based on the winning b...(Unlock)
Ratio:
- The Supreme Court highlighted that under Philippine law, particularly Act No. 3135, a mortgagee can recover any deficiency when the sale proceeds from the foreclosed property do not cover the debt.
- The Court clarified that the lower courts' view of the winning bid price as "nominal...continue reading
Case Digest (G.R. No. 175816)
Facts:
The case involves BPI Family Savings Bank, Inc. (Petitioner) and spouses Ma. Arlyn T. Avenido and Pacifico A. Avenido (Respondents). The events leading to the case began on April 25, 1996, when the spouses Avenido entered into a Mortgage Loan Agreement with BPI Family, securing a loan of ₱2,000,000.00 with a real estate mortgage on a property in Bais City, covered by Transfer Certificate of Title No. T-1216. The spouses defaulted on their loan payments, prompting BPI Family to initiate extrajudicial foreclosure proceedings under Act No. 3135. The public auction took place on March 8, 1999, where BPI Family emerged as the highest bidder with a bid of ₱2,142,616.00. This amount was applied as partial payment against the total loan obligation, which had accrued to ₱2,917,381.43, leaving a deficiency of ₱794,765.43.
On September 20, 2000, BPI Family filed a Complaint for Collection of Deficiency of Mortgage Obligation with Damages against the spouses Avenido in the Regional Trial Court (RTC) of Cebu City, which was docketed as Civil Case No. CEB-25629. The spouses Avenido countered that they had already paid a substantial amount towards their loan and that the foreclosure sale price exceeded their outstanding obligation. They sought the dismissal of the complaint and claimed damages. The RTC ruled on November 13, 2002, dismissing B...