G.R. No. 214939 - BPI Family Savings Bank, Inc. vs. Spouses Soriano

Spouses Jacinto Servo Soriano and Rosita Fernandez Soriano owned two parcels of land in Chapis Village, Baguio City.
One parcel measured 1,492 square meters with a fair market value of ₱626,640.00, covered by TCT No. 85840 (formerly T-14467).
The other parcel measured approximately 1,021 square meters with a fair market value of ₱428,820.00, covered by TCT No. 87113 (formerly T-14466).

On April 21, 2004, Rey Viado executed an Affidavit of Loss purportedly by the spouses, forging their signatures, which was annotated on TCT Nos. T-14466 and T-14467.
Viado further caused the execution of a forged Special Power of Attorney using the spouses' signatures to petition the Baguio City RTC for re-issuance of Owner's Duplicate Copies of the two TCTs, which the court granted.
The RTC declared the original Owner's Duplicate Copies lost, nullified their effect, and ordered issuance of new titles.

Viado and his associates used the reissued TCTs to secure loans from Maria Luzviminda Patimo and BPI Family Savings Bank, Inc. (BPI Family).
In Civil Case No. 6210-R, it was alleged that Jessica Jose, in confederation with Viado, executed a forged deed called "Acknowledgment of Trust," falsely showing that the spouses held the property in trust for Jose, who became registered owner by March 2005.
In Civil Case No. 6211-R, Vanessa P. Hufana secured a ₱2 million loan with BPI Family using the forged titles as collateral. The transfer of property to Hufana was based on forged documents, including a Special Power of Attorney and a Deed of Absolute Sale executed using forged signatures.
Gloria Soriano Cruz, attorney-in-fact of the spouses, discovered the fraudulent transfers when she attempted to pay realty taxes and found the properties transferred to third parties.

Defendants Jose and Hufana were declared in default after failing to file answers.
Viado admitted to filing the petition for reissuance of titles but denied causing the forged Special Power of Attorney.
BPI Family admitted dealing with Hufana in good faith, relying on the face of the title and notarized loan documents without further inquiry.
Patimo alleged due diligence by verifying the title with the Register of Deeds and conducting an ocular inspection before granting the loan.
The RTC ruled on July 19, 2011, finding the forgery and nullifying transfers while holding Patimo and BPI Family as mortgagees in good faith; however, it ordered Viado, Jose, and Hufana to pay damages to the spouses.
The spouses moved for reconsideration regarding dismissal against Patimo and BPI Family, which the RTC denied, leading to an appeal to the Court of Appeals (CA).

The CA partially reversed the RTC, finding Patimo a mortgagee in good faith but ruling BPI Family was not because it failed to exercise proper diligence.
The CA ordered cancellation of the mortgage and reinstatement of the original title in favor of the spouses and held BPI Family solidarily liable for damages.
BPI Family filed a motion for reconsideration, denied by the CA, leading to the present petition for review on certiorari.

Whether BPI Family Savings Bank, Inc. was a mortgagee in good faith when it accepted the forged title as collateral for the loan.
Whether BPI Family can be held solidarily liable with the other defendants for damages awarded to the spouses Soriano.
Whether the award of moral and exemplary damages against BPI Family was proper.