Case Digest (G.R. No. 101949)
Facts:
This case, titled G.R. No. 196323 and decided on February 8, 2021, involves the petitioner, Maybank Philippines Incorporated (formerly known as PNB-Republic Bank), against Remedios Sian-Limsiaco, the respondent. In 1979, Remedios acquired a sugar crop loan of P142,500.00 from Maybank, which she secured through a Real Estate Mortgage (REM) on two parcels of land. Subsequently, in 1982 and 1984, she obtained additional loans totaling P307,700.00 and P110,000.00 respectively, both secured by REMs on other properties. Maybank, however, never demanded payments nor initiated foreclosure proceedings on these mortgages over a span of 17 years. Consequently, on June 29, 2001, Remedios and her son, Roy Sian-Limsiaco, filed a petition in the Regional Trial Court (RTC) of Himamaylan, Negros Occidental, seeking to cancel the liens on the mortgaged properties based on the principles of prescription and the extinction of their loan obligations.
Maybank, having assigned its assets and liabilit
Case Digest (G.R. No. 101949)
Facts:
- Sugar Crop Loans and Mortgage Executions
- In 1979, respondent Remedios Sian-Limsiaco obtained a sugar crop loan of P142,500.00 from Maybank, payable within one year.
- Remedios executed a Special Power of Attorney (SPA) to mortgage two parcels:
- Lot 8 (TCT No. T-74488) owned by Sian Agricultural Corporation.
- In 1982, Remedios and her son Roy Sian-Limsiaco secured another sugar crop loan for P307,700.00.
- Through an SPA, Roy executed a Real Estate Mortgage (REM) on four parcels owned by Spouses Jerome Gonzales and Perla Sian-Gonzales:
- Lot 214 (TCT No. T-121539).
- In 1984, Remedios obtained a further sugar crop loan amounting to P110,000.00, again secured by a REM on Lot 8 of Sian Agricultural Corporation.
- Inaction on Loan Demand and Subsequent Petition
- Maybank never demanded payment nor initiated collection or foreclosure on the aforementioned sugar crop loans.
- After a lapse of 17 years, on June 29, 2001 (or thereafter), Remedios and Roy filed a petition before the Regional Trial Court (RTC), Branch 56 of Himamaylan, Negros Occidental, seeking cancellation of the annotated mortgage liens on the grounds of prescription and the extinction of the loan obligation.
- Maybank, having assigned its assets and liabilities (including the receivables) to Philippine National Bank (PNB) via a Deed of Assignment dated July 20, 1998, argued that PNB should be substituted as the respondent.
- The RTC required additional documents to justify the substitution; PNB failed to provide such evidence, resulting in the denial of its Motion for Substitution.
- Procedural Postings and Trial Court Ruling
- After the substitution issue, counsel for PNB filed a Motion to Dismiss on Demurrer to Evidence, which the RTC denied due to the failure to prove proper authorization to appear on Maybank’s behalf.
- Subsequently, the receivables were transferred to the Bangko Sentral ng Pilipinas (BSP).
- On June 24, 2003, the RTC issued an Order in respondent’s favor declaring the mortgage contracts unenforceable by virtue of prescription.
- The RTC directed the cancellation of the entries annotated on the titles of the respective mortgaged properties without the need for presentation of original duplicate titles.
- Appeal to the Court of Appeals and Subsequent Motions
- Maybank raised several issues on appeal with the Court of Appeals (CA):
- Whether the trial court erred in taking cognizance and granting the petition even though the case was not filed in the name of the real parties in interest.
- Whether Remedios had any valid cause of action against Maybank.
- Whether the registered owners of the mortgaged properties were bound by the RTC’s judgment despite not being made parties.
- On April 30, 2010, the CA denied Maybank’s appeal and affirmed the RTC’s Order in toto.
- Maybank filed a Motion for Reconsideration, which was denied by a Resolution on March 16, 2011.
- Eventually, Maybank elevated the matter to a Petition for Review on Certiorari before the Supreme Court.
Issues:
- Real Parties in Interest and Indispensable Parties
- Whether the trial court erred in granting the petition even though the case was not filed in the name of the real parties in interest (i.e., the registered owners of the mortgaged properties) and whether omitting the Bangko Sentral ng Pilipinas (BSP) as an indispensable party was a mistake.
- Cause of Action and Legal Capacity to Sue
- Whether the trial court erred in granting the petition on the basis that respondent, though not the registered owner, had no cause of action against petitioner and lacked proper legal capacity as an agent acting on behalf of the mortgagors-principals.
- Assignment and the Probative Value of Evidence
- Whether the Deed of Assignment (dated July 20, 1998) presented by Maybank, intended to justify the substitution of PNB (and subsequently BSP), held sufficient probative value to warrant its inclusion as an indispensable party in the suit.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)