Facts:

• Lim Julian is the plaintiff and appellant.
• Defendants include Tiburcio Lutero, Asuncion Magalona, and Rafael Lutero.
• The case was filed on March 8, 1922, in the Court of First Instance of Iloilo.
• The action sought to foreclose a mortgage executed on April 15, 1920, by Tiburcio Lutero and Asuncion Magalona in favor of Lim Julian.
• The mortgage secured future advancements of P12,000, including interest, commissions, and damages.
• The mortgage was registered on June 16, 1920.
• Advancements were for cultivating and harvesting sugar plantations, including agricultural assets and livestock.
• As of June 27, 1921, the defendants allegedly owed P22,807.09, plus a P2,000 penalty for non-compliance.
• Defendants denied the allegations, claiming the mortgage was paid off and any remaining debt was an ordinary obligation.
• The "Hospital de San Pablo de Iloilo" intervened, claiming a prior unregistered mortgage on the same property executed on June 17, 1920.
• The trial court ruled in favor of the defendants, dismissing Lim Julian's complaint and prioritizing the hospital's mortgage.
• Lim Julian appealed the decision.

Issue:

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Ruling:

• The Supreme Court ruled that Lim Julian's mortgage had not been paid and should not be cancelled.
• The Court held that the hospital's mortgage could not take priority over Lim Julian's due to its lack of registration and timing.
• The Court determi...(Unlock)

Ratio:

• The Supreme Court found Lim Julian's mortgage valid and enforceable, as it was registered before the hospital's mortgage.
• The mortgage secured not only the principal amount of P12,000 but also any additional amounts due at maturity.
• The defendants had received advancements exceeding the original loan amount, maintaining the mortgage'...continue reading