Case Digest (G.R. No. 128669)
Facts:
Mamerta Vda. de Jayme, et al., G.R. No. 128669, October 04, 2002, the Supreme Court Second Division, Quisumbing, J., writing for the Court. Petitioners are Mamerta Vda. de Jayme (widow of Graciano Jayme) and the heirs of the Jayme family; respondents include the Court of Appeals, Cebu Asiancars, Inc. (Asiancars), its officers (including George Neri), and Metropolitan Bank and Trust Company (MBTC). The dispute arose from transactions involving Lot 2700 in Mandaue City, Cebu (TCT No. 8290), which the Jayme spouses had leased in 1973 to Asiancars for twenty years and which later became subject to mortgage and foreclosure.Chronology: In January 1973 the Jaymes leased one-half of Lot 2700 to Asiancars. The lease expressly provided that any building constructed on the leased portion would become the Jaymes' property upon termination or voluntary surrender. A Special Power of Attorney was executed in 1974 in favor of George Neri to use the lot as security for a P300,000 loan, which was later paid. In October–November 1977, Asiancars obtained a P6,000,000 loan from MBTC; the Jaymes executed a Deed of Real Estate Mortgage (REM) on the entire Lot 2700 dated November 21, 1977, to secure Asiancars' loan. Asiancars' officers executed a separate personal Undertaking (November 7, 1977) promising to compensate the Jaymes for any damages arising from the MBTC mortgage.
Asiancars later executed a dacion en pago by conveying the building on the leased premises to MBTC (December 18, 1980) as partial satisfaction of the indebtedness; MBTC conducted extrajudicial foreclosure and purchased the property at public auction on February 4, 1981, with the certificate of sale registered on February 23, 1981. Graciano Jayme died; in January 1982 the Jayme heirs filed a complaint for Annulment of Contract and Damages with prayer for preliminary injunction against Asiancars, its officers and MBTC.
The Regional Trial Court (RTC), Branch 15, in Civil Case No. CEB-21369 rendered judgment declaring the REM valid and binding, upheld the Undertaking as binding on its signatories, allowed the Jaymes to redeem the property for P2,942,448.66 within 90 days (else issue a certificate of sale to MBTC), and held the signatories to the Undertaking liable to reimburse the Jaymes; it awarded attorneys’ fees and costs. The Court of Appeals (CA), in CA-G.R. CV No. 46496, affirmed the RTC but modified the reliefs: it declared the REM and foreclosure valid, ruled the redemption period had expired on February 23, 1982, ordered issuance of a definite deed of sale to MBTC, declared the dacion en pago valid and MBTC owner of the building, and ordered MBTC to pay the plaintiffs for the use of the land and ordered Asiancars and its officers to pay substantial damages and costs. The CA denied petitioners’ motion for reconsideration.
Petitioners filed this Rule 45 petition assailing the CA decision; they argued, inter alia, that the REM was a sham “deed of guara...(Subscriber-Only)
Issues:
- Was the Deed of Real Estate Mortgage executed by the Jaymes annulable for vitiated consent (i.e., procured by fraud such that their signatures only bound them as guarantors and not as mortgagors)?
- Was the dacion en pago by Asiancars in favor of MBTC valid and binding despite the lease stipulation that ownership of the building would vest in the Jaymes u...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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