Case Summary (G.R. No. 196510)
Background and Procedural History
Petitioners initiated Civil Case No. 05-28420 before the Regional Trial Court (RTC) of Iloilo City, seeking the nullity of a mortgage on a certain property located at Barangay Tacas, Jaro, Iloilo City (Lot No. 4272-B-2), and claiming damages. The mortgage, dated July 1, 1994, purportedly executed by Loreta Tabuada, was challenged on the ground that Loreta had died in 1990 and thus could not have validly mortgaged the property. The RTC rendered judgment in favor of the petitioners, declaring the mortgage null and void, ordering the respondents to pay moral damages, attorney’s fees, and costs. The Court of Appeals (CA), however, reversed the RTC’s decision and dismissed the case. The petitioners appealed to the Supreme Court.
Summons and Default Proceedings
Respondents were served summons in January 2005. Due to their failure to file timely answers, the petitioners moved for a declaration of default. Although some respondents attempted to file answers later, these were denied by the RTC, which issued an order of default against all respondents. The respondents’ motions to set aside the order of default were likewise denied.
Presentation of Evidence and Factual Findings at RTC
During the ex parte hearing before the RTC, Sofia Tabuada testified regarding her familial relationship to the deceased Loreta Tabuada, her inheritance of the Lot No. 4272-B-2 property, and the fraudulent mortgage executed by Eleanor Tabuada impersonating Loreta. Documentary evidence admitted included a death certificate of Loreta Tabuada, the Transfer Certificate of Title (TCT) for the property, the contested mortgage and promissory note documents, payment records, and a demand letter from Spouses Certeza.
The RTC found that the mortgage was null and void because Eleanor Tabuada, not being the owner or legally authorized, fraudulently mortgaged the property to the respondents. Furthermore, the RTC awarded moral damages for disrespect to the dead, attorney’s fees, and costs in favor of petitioners.
Court of Appeals’ Reversal
The CA reversed and set aside the RTC judgment, dismissing the case. It based its ruling largely on the insufficiency of proof regarding the petitioners’ legal relationship to the deceased property owner. The CA questioned the authenticity of the death certificate, citing discrepancies in the name of the deceased on the certificate (Loreta Yulo Tabuada) and the name on the land title (Loreta H. Tabuada), and noted the absence of documentary evidence conclusively establishing petitioner Sofia Tabuada’s relationship to the deceased.
Issues Presented to the Supreme Court
- Whether the CA erred in concluding that petitioners failed to establish a legal relationship to the deceased owner sufficient to challenge the mortgage.
- Whether the award of moral damages based on disrespect to the dead was legally proper.
Supreme Court’s Ruling
The Supreme Court reversed the CA’s decision and reinstated the RTC ruling with modification. Key findings are as follows:
1. Establishment of Legal Relationship by Preponderance of Evidence
The Court emphasized that evidence includes not only documentary but also testimonial and circumstantial evidence, all of which are admissible and relevant to establish facts. It rejected the CA’s exclusive reliance on documentary discrepancies and underscored that preponderance of evidence—the greater weight of evidence—must be considered. Sofia Tabuada’s unchallenged testimony about her relationship as daughter-in-law to Loreta Tabuada, the families’ residence on the property, and other circumstances collectively supported the conclusion that Loreta Yulo Tabuada on the death certificate and Loreta H. Tabuada, the registered titleholder, were the same person. Hence, the legal relationship and ownership were competently established.
2. Nullity of the Mortgage for Lack of Authority and Ownership
Under Article 2085 of the Civil Code, a valid mortgage requires, inter alia, that the mortgagor be the absolute owner or legally authorized to dispose of the property. Since Loreta Tabuada died in 1990 and Eleanor Tabuada mortgaged the property in 1994 without lawful authority, the mortgage was null and void. The respondents admitted Eleanor’s act of mortgaging the property, confirming the fraudulent basis.
3. Respondents’ Lack of Good Faith as Mortgagees
The Spouses Certeza claimed good faith, alleging ignorance of Loreta Tabuada’s death. The Court found this unconvincing because the petitioners resided on the mortgaged property and were known relatives of the respondents implicated. The Spouses Cert
...continue reading
Case Syllabus (G.R. No. 196510)
Background and Procedural History
- The petitioners, through Civil Case No. 05-28420, filed an action before the Regional Trial Court (RTC), Branch 28, Iloilo City, seeking to declare the nullity of a mortgage and to recover damages.
- The real estate mortgage in question involved a property identified as Lot No. 4272-B-2 in Barangay Tacas, Jaro, Iloilo City, registered in the name of Loreta Tabuada.
- Petitioners alleged that respondents, particularly Eleanor Tabuada, fraudulently mortgaged the property without legal authority, representing herself as the late Loreta Tabuada, who had died in 1990, four years prior to the mortgage's execution.
- The RTC ruled in favor of the petitioners on January 18, 2006, declaring the mortgage null and void and awarding damages.
- Respondents appealed to the Court of Appeals (CA), which reversed the RTC decision and dismissed the complaint on September 30, 2009.
- The petitioners filed a motion for reconsideration, which the CA denied on March 7, 2011.
- The case was elevated to the Supreme Court via a petition for review on certiorari.
Factual Findings and Evidence Presented
- The petitioners are relatives by blood or affinity of the late registered titleholder, Loreta Tabuada.
- Sofia Tabuada testified she was the daughter-in-law of Loreta Tabuada and that her family had actual possession and residence on the mortgaged property.
- Evidence submitted included:
- The death certificate of Loreta Yulo Tabuada indicating her death on April 16, 1990.
- The Transfer Certificate of Title (TCT) No. T-82868 in the name of Loreta Tabuada.
- A promissory note and mortgage of real rights dated in 1994, purportedly executed by Loreta Tabuada.
- Payment records and a demand letter from the Spouses Certeza.
- Respondents Eleanor Tabuada and Julieta Trabuco admitted to mortgaging the property to the Spouses Certeza.
- Summons were personally or substitutedly served on respondents, and they failed to timely file an answer, resulting in their declaration of default by the RTC.
- Notably, the death of the registered owner, Loreta Tabuada, preceded the mortgage's alleged execution, undermining the validity of the mortgage.
Issues Presented
- Whether the Court of Appeals erred in reversing the RTC judgment given the ample evidence establishing the legal relationship between petitioner Sofia Tabuada and the late Loreta Tabuada.
- Whether the award of moral damages by the RTC, based on disrespect to the dead, was legally proper.
Legal Principles and Rules Applied
- Competent proof of a legal relationship is not confined to documentary evidence alone; testimonial and object evidence may be admitted, evaluated under the prepo