G.R. No. 129609 - Rodil Enterprises, Inc. vs. Court of Appeals

On May 19, 2006, Globe Asiatique Realty Holdings Corporation (“Globe Asiatique”) and Union Bank of the Philippines (“Union Bank”) entered into a Memorandum of Agreement (MOA).
Under the MOA, Union Bank agreed to purchase, from time to time, installment accounts receivables arising from Globe Asiatique’s sale of real estate units as evidenced by Contracts to Sell.

From October 30, 2006 to May 30, 2007, Globe Asiatique, represented by its President Delfin S. Lee and/or Vice-President Dexter L. Lee, executed 10 Deeds of Assignment (DAs) and 11 copies of Special Powers of Attorney (SPAs) in favor of Union Bank covering 10 condominium units at GA Tower 1, Condominium Project along EDSA, Mandaluyong City.
A common provision in the DAs provided that Globe Asiatique absolutely transferred, assigned, and conveyed to Union Bank, its successors, and assigns, all its rights, title, interests, and participation “on that parcel of land, and subsequent improvements thereon.”
The SPAs granted Union Bank the authority to:

Send a Notice of Cancellation to defaulting installment purchasers.
Execute, sign, and deliver the necessary Deed of Absolute Sale for the transfer of title to the subject land and improvements.
Restructure and/or convert the assigned Contract to Sell to a Real Estate Mortgage on behalf of Globe Asiatique.

On November 17, 2011, Globe Asiatique sent a letter requesting the reformation of the DAs and SPAs, alleging that some provisions did not conform to the real agreement between the parties.
Globe Asiatique filed a Complaint for reformation on September 27, 2012, claiming that:

There was a mutual mistake since the parties intended only the sale or assignment of rights, title, and interests over the receivables—not over the parcels of land themselves.
The DAs did not express the true intent of the parties as they were executed to secure a credit facility rather than for the sale of real property.

Globe Asiatique sought reformation of the documents and additional relief in the form of attorney’s fees and litigation expenses.

In its Answer dated November 16, 2012, Union Bank admitted to entering into the MOA and acknowledged the execution of the DAs and SPAs as part of the MOA’s implementation.
The bank denied that the documents failed to express the true intent or that mutual mistake existed.
As an affirmative defense, Union Bank asserted that:

The parties had, alongside the MOA, signed annexed forms (including the DAs, SPAs, and Notice of Assignment and Instruction to Pay) that served as supplementary agreements.
The Notice of Assignment and Instruction to Pay (NAIP) was the document signed for the assignment or purchase of receivables, not the DAs which were intended as collateral security.

Union Bank prayed for the dismissal of the complaint and for Globe Asiatique to pay costs and attorney’s fees.

Globe Asiatique filed a Motion for Summary Judgment on June 4, 2014, arguing there were no genuine issues regarding material facts based on the admissions by Union Bank.
Union Bank filed its Opposition on June 20, 2014, maintaining that genuine issues of fact existed between the parties.
The Regional Trial Court (RTC) rendered an Order on September 2, 2014, denying the Motion for Summary Judgment by noting that conflicting allegations required a full trial.
Globe Asiatique’s subsequent motion for reconsideration was also denied by the RTC on April 30, 2015.

Globe Asiatique elevated the case by filing a Petition for Certiorari before the Court of Appeals (CA) on July 31, 2015.
On July 13, 2016, the CA dismissed Globe Asiatique’s petition and affirmed the RTC’s orders, agreeing that there were genuine issues of fact requiring a trial.
A subsequent CA Resolution on January 5, 2017, denied Globe Asiatique’s motion for reconsideration, thus upholding the lower court decisions.

Whether the trial court committed grave abuse of discretion when it denied Globe Asiatique’s Motion for Summary Judgment.
Whether the execution of the Deeds of Assignment and Special Powers of Attorney reflected the true intent of the parties, or if a mutual mistake had occurred causing those documents to misrepresent the real agreement.
Whether the appellate court correctly assessed and ruled on the absence of grave abuse of discretion by the RTC in light of the conflicting factual allegations presented by the parties.