Case Digest (G.R. No. 243999) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Sps. Lito P. Tumon and Lydia G. Tumon v. Radiowealth Finance Company, Inc. (G.R. No. 243999, March 18, 2021), petitioners applied in or before September 2014 for a four-year loan of ₱2,811,456.00 to finance their tokwa business. After a ₱100,000.00 processing fee and interest of ₱1,311,456.00 were charged, they received only ₱1,500,000.00. The loan was secured by a real estate mortgage on their property covered by TCT No. 009-2010000083. Beginning November 30, 2014, petitioners paid monthly amortizations of ₱58,572.00, 87% of which went to interest, an arrangement they later claimed was unconscionable. They were not given copies of the finance statement, mortgage, or promissory note and only discovered the true cost of financing after making eleven payments totaling ₱644,292.00. Facing business losses in late 2015, petitioners fell into default. Radiowealth filed an Application for Extrajudicial Foreclosure on March 11, 2016, with auction set for April 26, 2016. Petitioners s Case Digest (G.R. No. 243999) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Loan Transaction and Allegations
- In or before September 2014, petitioners Sps. Lito and Lydia Tumon applied for a loan with Radiowealth Finance Co., Inc. (Radiowealth) to finance their tokwa business.
- Agreed loan amount: ₱2,811,456.00 payable over four years.
- Disbursed amount: ₱1,500,000.00 after ₱100,000.00 processing fee and ₱1,311,456.00 interest charged upfront.
- Security and repayment terms
- Real estate mortgage on petitioners’ property (TCT No. 009-2010000083).
- Monthly amortization: ₱58,572.00, of which ₱27,322.00 (87%) was interest.
- Alleged irregularities
- Unconscionable 87% monthly interest, alleged to be exorbitant and against law.
- Failure to furnish a finance statement, Real Estate Mortgage, and Promissory Note (Truth in Lending Act violation).
- Lack of informed consent concerning fees, interest rate, and loss of home.
- Default and Foreclosure Proceedings
- Petitioners’ default
- Business losses in late 2015 led to nonpayment from October 2015 onward.
- Eleven payments from November 2014 to September 2015 totaled ₱644,292.00.
- Extrajudicial foreclosure by Radiowealth
- Application filed March 11, 2016; outstanding balance as of April 2015: ₱2,044,338.10.
- Notice of foreclosure sale set for April 26, 2016.
- RTC injunctive relief
- Petitioners filed for TRO/WPI on April 11, 2016; TRO granted April 14, 2016.
- May 3, 2016: RTC denied WPI, finding clear right of Radiowealth to foreclose and petitioners’ obligation remained.
- June 10, 2016: RTC denied petitioners’ motion for reconsideration, citing risk of prejudgment of main case.
- Appeals and Supreme Court Petition
- CA Rule 65 petition
- Petitioners alleged grave abuse of discretion by RTC in denying WPI.
- March 16, 2018: CA dismissed petition for lack of merit—no clear right, risk of prejudging main case, no showing of irreparable injury.
- December 14, 2018: CA denied motion for reconsideration.
- Rule 45 petition to the Supreme Court
- Main issue: whether CA erred in upholding RTC’s denial of WPI for absence of grave abuse of discretion.
- Petitioners invoked A.M. No. 99-10-05-0 requisites: allegation of unconscionable interest, supporting evidence, payment of 12% p.a. (later 6% p.a.) legal interest.
- Radiowealth failed to comment; Court waived respondent’s comment.
Issues:
- Whether the Court of Appeals gravely abused its discretion in affirming the RTC’s denial of the writ of preliminary injunction in the extrajudicial foreclosure proceedings.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)