G.R. No. 165662 - Selegna Management and Development Corp. vs. United Coconut Planters Bank

On September 19, 1995, petitioners Selegna Management and Development Corporation and spouses Angeles obtained a ₱70 million credit facility from UCPB, secured by real estate mortgages and promissory notes with monthly interest amortizations.
On March 29, 1998, petitioners executed a new promissory note for ₱103,909,710.82, due March 26, 1999, at 21.75 % per annum interest, payable by monthly amortizations, with an acceleration clause upon any default.

UCPB’s December 21, 1998 demand letter called for ₱14,959,525.10 in unpaid interest; a January 25, 1999 letter formally accelerated the entire principal (₱103,909,710.82) plus ₱17,351,478.55 in interest and charges, due January 29, 1999.
A final demand was sent on March 4, 1999; petitioners made a partial payment of ₱10,199,473.96 on March 25, 1999 but did not cure the default.

UCPB served a Notice of Extrajudicial Foreclosure on May 18, 1999. Petitioners’ request for a 60-day extension to update charges was denied on May 25, 1999.
Petitioners secured a series of TROs and a preliminary injunction from May to November 1999, later clarified in December 2000 to avoid an indefinite restraint.

On March 15, 2002, RTC Judge Dumayas reinstated the preliminary injunction, subject to an accounting of foreclosure proceeds.
The Court of Appeals granted UCPB’s certiorari petition, held that foreclosure should proceed despite accounting issues, and in its May 4, 2004 Amended Decision reversed the RTC order; its Resolution of October 12, 2004 denied reconsideration.

Petitioners filed a Rule 45 Petition for Review before the Supreme Court, challenging: (a) denial of due process, (b) misapplication of jurisprudence, and (c) finding of grave abuse of discretion by the RTC judge.
The principal questions are (1) whether petitioners are in default and (2) whether a preliminary injunction should bar the extrajudicial foreclosure.

Whether petitioners’ failure to pay monthly interest and accelerated principal rendered the debt demandable and liquidated, constituting default.
Whether the partial payment of ₱10 million forestalled the maturity of the obligation or waived UCPB’s right to foreclose.

Whether petitioners demonstrated a clear and unmistakable right to obtain a writ of preliminary injunction against extrajudicial foreclosure.
Whether allegations of lack of accounting and due process inadequately established grounds for injunctive relief.