G.R. No. L-31935 - Ng vs. Republic

Complainant Domingo R. Marcelo filed a verified letter-complaint on May 19, 1988, charging respondent Atty. Adriano S. Javier, Sr. with professional misconduct in connection with a real estate mortgage transaction.
The complaint was filed pursuant to Rule 139-B of the Rules of Court and routed to the IBP Commission on Bar Discipline for investigation.

On November 13, 1984, complainant mortgaged his unregistered lot (1,045 square meters at Cambaog, Bustos, Bulacan) to Sy Hun Tek as security for a loan.
The alleged loan amount was P80,000.00, due on November 15, 1985, with legal interest.
The deed of mortgage was prepared and notarized by respondent, who acted as the family lawyer for the mortgagee.
Of the P80,000.00 amount, complainant received only P50,000.00; from this, deductions were made: P2,500.00 was applied as the first installment and an additional P5,000.00 was taken for expenses related to titling the property, leaving a net amount of P42,500.00 received by him.

Complainant never received a copy of the mortgage deed and only learned its contents later when he obtained a certified true xerox copy from the Records Management and Archives Office.
Upon falling two months behind on installments, respondent visited complainant’s home while he was sick and had him sign documents which respondent claimed were merely to acknowledge his debt obligation.
The documents later turned out to serve as a dacion en pago (dation in payment) for settling the mortgage, shifting the rights over the property.

Shortly after the signing of those documents, complainant discovered that the mortgaged property had been foreclosed and sold to Enrico Perez without proper public auction or notice.
Complainant attempted to redeem the property by contacting Perez and seeking respondent’s assistance, but both avenues proved futile.
Respondent, in his verified answer, denied preparing the mortgage deed (asserting he merely acknowledged the parties’ signatures) and contested that complainant owed P80,000.00 plus titling expenses.
Respondent claimed the transaction resulted in a valid dacion en pago settlement, affirming that the sale to Perez was lawful and that there were no procedures for foreclosure since the mortgage had already been settled.

The record included cash vouchers, affidavits, and witness testimonies (including that of Sy Hun Kiong and an employee of Security Bank) which detailed the disbursement of funds.
Evidence showed that instead of receiving the full P80,000.00, complainant obtained a net amount of P42,500.00.
Testimonies corroborated that complainant was not fully informed about the mortgage’s terms nor was he given copies of the documents he signed.

Whether the actual amount of the loan was P50,000.00 (net of deductions resulting in P42,500.00 received) or the full contractual amount of P80,000.00.
Determining if the mortgage schedule reflected the deduction of P2,500.00 and P5,000.00, explaining the net received amount.

Whether complainant was properly informed about the full contents, obligations, and terms of the mortgage deed.
Whether a copy of the mortgage deed was furnished to complainant at the time of execution.

Whether complainant was adequately apprised by respondent that the document he signed was a dacion en pago.
Whether necessary copies of the dacion en pago were provided to complainant after its notarization.
Whether the signing of a blank long bond paper, later used as the dacion en pago, was done knowingly and with full disclosure.