Case Summary (G.R. No. 208254)
Petitioner’s Allegations
The respondent secured a loan from the petitioner for P683,000.00 on June 11, 1993, using two parcels of land as collateral. The loan was allegedly fully paid by the respondent through several payments made between 1995 and 1999. The respondent only learned about the foreclosure proceedings in January 2003, when armed representatives of the petitioner entered the property, leading to their discovery of the foreclosure application.
Respondent's Defense
The respondent argued that the petitioner did not fulfill the necessary legal requirements for foreclosure, claiming that the sale was invalid because it was not registered with the Register of Deeds and that the original mortgaged areas differed from those on the land titles issued later. The respondent asserted that he was willing to pay any outstanding balance on the loan and sought to annul the foreclosure sale.
Petitioner's Counterarguments
The petitioner contended that the mortgage was valid and properly foreclosed, claiming that the respondent was not truthful about the payments and had not communicated with them for years. The petitioner also focused on the claim that the discrepancies in the parcel descriptions did not negate the validity of the foreclosure.
RTC Ruling
The Regional Trial Court (RTC) ruled in favor of the respondent, declaring the foreclosure auction sale null and void based on evidence presented regarding the mortgage enforcements. The RTC concluded that certain necessary legal procedures were lacking and the loan documents were distinguishable regarding their validity.
CA Ruling
The Court of Appeals (CA) affirmed the RTC ruling but later issued an amended decision addressing the validity of the promissory note dated September 15, 1999. This prompted the respondent to argue that the note should not be admitted into evidence due to allegations of material alteration.
Issues Presented
- Whether the CA erred in affirming the RTC decision declaring the auction sale void without proof of legal flaws or fraud.
- Whether the CA's ruling mistakenly deleted the obligation for the respondent to pay the loan balance.
- Whether CA erred by considering material alterations on the promissory note introduced for the first time on appeal.
Court Ruling on Petition
The Supreme Court found that the CA had erred in some respects, particularly concerning the evidentiary treatment of the promissory note. The Court held that the respondent, who had previously marked the note as an exhibit, c
...continue readingCase Syllabus (G.R. No. 208254)
Case Background
- Petitioner: Rural Bank of Candelaria (Zambales), Inc., represented by Antonio Manikan, Chairperson and President.
- Respondent: Romulo Banluta (Deceased), substituted by his children.
- Nature of Case: Petition for Review on Certiorari under Rule 45, seeking to reverse the Court of Appeals' Amended Decision and Resolution, which affirmed the Regional Trial Court's decision declaring the foreclosure sale null and void.
Facts of the Case
- Respondent Romulo Banluta and his wife obtained a loan of P683,000.00 from the petitioner bank on June 11, 1993, secured by a real estate mortgage.
- Following the death of his wife in 1996, respondent continued to make payments, claiming full payment of the loan.
- In January 2003, the respondent discovered that the bank had initiated foreclosure proceedings without notifying him, leading to the sale of the mortgaged properties.
- Respondent alleged discrepancies in the areas of the mortgaged properties compared to the tax declarations, and argued that he was willing to pay any remaining balance on the loan.
- The petitioner countered that the loan was renewed multiple times and that the respondent had not made full payments.
Regional Trial Court (RTC) Ruling
- The RTC found the auction sale conducted by the Provincial Sheriff to be null and void.
- It ordered the reconveyance of the properties to the respondent, while also requiring the respondent to pay the total sum of P4,228,955.98, which included the principal loan amount and compounded interest.
- The RTC ruled th