Case Summary (A.M. No. 04-6-298-RTC)
Factual Background
The case centers around several parcels of land in Tagaytay City owned by the respondents. On April 3, 2000, the respondents executed a Special Power of Attorney (SPA) granting the petitioners authority to obtain a loan using the properties as collateral. The SPA contained provisions allowing the petitioners to secure loans and manage the mortgage and proceeds from such loans. However, without notifying the petitioners, the respondents revoked the SPA effective July 17, 2000.
Legal Proceedings
Following the revocation of the SPA, the petitioners learned of this development on July 31, 2000, when they received confirmation regarding the approval of their loan application of Php 25 million from the PVB. Subsequently, they demanded that the respondents annul the revocation but were unsuccessful. On September 8, 2000, the petitioners filed a complaint in the Regional Trial Court (RTC) to annul the revocation and enforce the provisions of the SPA, eventually amending the complaint to include a claim for ownership stake in the properties under the SPA.
Regional Trial Court Decision
The RTC ruled in favor of the petitioners, validating the SPA and declaring the revocation as illegal and unjust. The court found the respondents liable for damages resulting from their actions, and although the SPA was deemed valid, the court held that conditions had changed since its execution, preventing enforcement. The RTC awarded the petitioners significant damages and recognized their ownership over half of the subject properties.
Court of Appeals Ruling
On appeal, the Court of Appeals (CA) modified the RTC decision. While it upheld the revocation of the SPA as void, it denied the petitioners' claims to half ownership of the properties, arguing that such a division of property was implausible given the circumstances of petitioners’ relations with the respondents. The CA directed that the Php 500,000 paid to respondents by petitioner Ching be deducted from the loan amount, and ordered him to bear the expenses for the loan processing alone. The CA also ordered the return of the Php 500,000 but categorized it conditionally based on the loan approval, which petitioners challenged.
Petitioners' Arguments
The petitioners contended that the CA erred in making the reimbursement of the Php 500,000 conditional upon loan approval. They also claimed entitlement to half of the properties based on their agreement, supported by the assertion that they incurred expenses for the loan application under the impression that they would receive a share of the loan proceeds. Furthermore, the petitioners argued for the reinstatement of exemplary damages, asserting bad faith in the revocation.
Respondents' Arguments
The respondents maintained that the judgment in question was not conditional since they were required to return the Php 500,000, and they contested any claims that they agreed to give the petitioners half of their properties or reimburse them for the loan expenses. They emphasized that petitioner Ching had admitted in court about agreeing to pay all associated costs.
Resolution and Implications
The Supreme Court found that the SPA constituted a contract of agency coupled with an interest, which could not be revoked unilaterally. It held that th
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Case Background
- Petitioners: Albert M. Ching and Romeo J. Bautista.
- Respondents: Felix M. Bantolo, Antonio O. Adriano, and Eulogio Sta. Cruz, Jr. (substituted by his children).
- This case is a Petition for Review on Certiorari under Rule 45 of the Rules of Court.
- The petition challenges the Decision dated July 31, 2006, and the Resolution dated March 12, 2007, of the Court of Appeals (CA) in CA-G.R. CV No. 79886.
Factual Antecedents
- Respondents are owners of multiple land parcels in Tagaytay City, each holding Original Certificates of Title (OCT) to their respective properties.
- On April 3, 2000, respondents executed a Special Power of Attorney (SPA) granting petitioners authority to secure a loan against their properties.
- The SPA allowed petitioners to borrow money and mortgage the properties as collateral.
- Without notifying petitioners, respondents revoked the SPA on July 17, 2000.
- On July 18, 2000, the Philippine Veterans Bank approved a loan for petitioner Ching amounting to P25 million.
- Petitioners learned of the revocation of the SPA in August 2000 and demanded its annulment.
- A complaint was subsequently filed in the Regional Trial Court (RTC) for annulment of the revocation and enforcement of the SPA.
RTC Ruling
- The RTC ruled in favor of the petitioners on December 18, 2002, declaring the revocation of the SPA illegal.
- The court found the SPA valid but unenforceable due to changed circumstances and held respondents liable for damages.
- The RTC awarded petitioners ownership of one-half of the properties and ordered respondents to pay actual, moral, and exemplary damages.
Court of Appeals Ruling
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