Professional Documents
Culture Documents
byNatividad. It was further shown from the annotation at the back of the title that the
spouses San Pablo signed aDeed of Real Estate Mortgage over the subject property in favor
of Bank of Commerce, which they never did.The spouses San Pablo filed a Complaint seeking
for the Quieting of Title and Nullification of the SPA and the deedof real estate mortgage with
the prayer for damages against Santos and the Bank of Commerce before the MTC
of Mandaue. The spouses San Pablo claimed that their signatures on the SPA and the Deed
of Real Estate Mortgageallegedly executed to secure a loan with the Bank of Commerce
were forged. They claimed that while the loan withthe Direct Funders was obtained
with their consent and direct participation, they never authorized the subsequentloan
obligation with the Bank of Commerce.During the pendency of the case, the Bank of
Commerce, for non-payment of the loan, initiated the foreclosureproceedings on the
strength of the contested Deed of Real Estate Mortgage. During the auction sale, the Bank
of Commerce emerged as the highest bidder and thus a Certificate of Sale was issued under
its name. Accordingly,the spouses San Pablo amended their complaint to include the prayer for
annulment of the foreclosure sale.
Santos countered that the loan with the Bank of Commerce was deliberately resorted to
with theconsent, knowledge and direct participation of the spouses San Pablo in order to pay
off the obligation with DirectFunders. In fact, it was Prudencio who caused the preparation of
the SPA and together with Santos, they went tothe Bank of Commerce, Cebu City Branch to apply
for the loan.
Bank of Commerce filed an Answer with Compulsory Counterclaim, alleging that the spouses
San Pablo,represented by their attorney-in-fact, Santos, together with Intergems, obtained a
loan and denied the allegationadvanced by the spouses San Pablo that the SPA and the
Deed of Real Estate Mortgage were spurious. Since theloan already became due and demandable,
the Bank of Commerce sought the foreclosure of the subject property.
During the trial, Anastacio Barbarona, Jr., the Manager of the Bank of Commerce, Cebu City Branch, testified
thatthe spouses San Pablo personally signed the Deed of Real Estate Mortgage in his
presence. The testimony of adocument examiner and a handwriting expert, however, belied this claim.
The expert witness, after carefully examining the loan documents with the Bank of Commerce, attested
that the signatures of the spouses San Pablo on the SPA and the Deed of Real Estate Mortgage were forged.
The MTC rendered a Decision, dismissing the complaint for lack of merit. The MTC declared
that while it was proven that the signatures of the spouses San Pablo on the loan documents
were forged, the Bank of Commerce were nevertheless in good faith.
Aggrieved, the spouses San Pablo appealed the adverse decision to the RTC of Mandaue
City, which, in turn, affirmed the unfavorable ruling of the MTC. A Motion for Reconsideration
filed also by the spouses San Pablo which was denied by the RTC for lack of merit. The
spouses San Pablo elevated the matter before the Court of Appeals assailing the adverse decisions
of the MTC and RTC. The appellate court granted the petition filed by the spouses San Pablo
and reversed the decisions of the MTC and RTC. The appellate court ruled that since it was
duly proven that the signatures of the spouses San Pablo on the loan documents were
forged, then such spurious documents could never become a valid source of title. The
mortgage contract executed by Santos over the subject property in favor of Bank of
Commerce, without the authority of the Spouses San Pablo, was therefore unenforceable,
unless ratified.
ISSUES:
1.Whether or not the forged SPA and Special Power of Attorney could be a valid source of a right t o
foreclosure a property
2.Whether or not the awards of Damages, Attorneys Fees and Litigation Expenses are proper in the case at
bar
HELD:
1.
A mortgagee has a right to rely in good faith on the certificate of title of the mortgagor of
the property given as security, and in the absence of any sign that might arouse suspicion,
the mortgagee has no obligation to undertake further investigation. This doctrine presupposes, however, that the mortgagor who is not the rightful owner of the property, has
already succeeded in obtaining Torrents title over the property in his name and that after
obtaining the said title, he succeeds in mortgaging the property to another who relies on
what appears on the title. This, however, is not the situation in the case at bar since Santos
was not the registered owner for he merely represented himself to be the attorney-in-fact of
the spouses San Pablo. In cases where the mortgagee does not directly deal with the
registered owner of the real property, the law requires that a higher degree of prudence be
exercised by the mortgagee. The respondent, however ,is not an ordinary mortgagee. It is a
mortgagee-bank and unlike private individuals, it is expected to exercise greater care and
prudence in its dealings, including those involving registered lands. A banking institution is
expected to exercise due diligence before entering into a mortgage contract. The Bank
of Commerce clearly failed to observe the required degree of caution in ascertaining the
genuineness and extent of the authority of Santos mortgage the subject property. It should
not have simply relied on the face of the documents submitted. Therefore, the same is not a
valid source of the right for the foreclosure of the property.2.
The Court finds that the award for moral damages is proper is proper. The carelessness of
the Bank of Commerce caused injury to the spouses which calls for the imposition of moral
damages. The award of
exemplary damages is deemed to be proper by the Court for the Bank of Commerce was
remiss in this obligation to inquire into the veracity of Santos authority to mortgage the
subject property, causing damage to the Spouses. The award of attorneys fees and litigation
expenses are likewise valid since the spouses were compelled to litigate and thus incur
expenses in order to protect its rights over the subject property.
MANUEL T. DE GUIA, petitioner, vs. COURT OF APPEALS (Former Sixth Division) and
JOSE B. ABEJO, represented by his Attorney-in-Fact,Hermenegilda Abejo-Rivera,
respondents. 2003 Oct 8 1st Division G.R. No. 120864 CASE DOCTRINES
Co-owner may file an action against a co-owner; purpose Any co-owner may file an
action under Article 487 not only against a third person, but also against another
co-owner who takes exclusive possession and asserts exclusive ownership of the
property. In the latter case, however, the only purpose of the action is to obtain
recognition of the co-ownership. The plaintiff cannot seek exclusion of the
defendant from the property because as co-owner he has a right of possession. The
plaintiff cannot recover any material or determinate part of the property. Coownership; right of enjoyment The right of enjoyment by each co-owner is limited
by a similar right of the other co-owners. A coowner cannot devote common
property to his exclusive use to the prejudice of the co-ownership. Hence, if the
subject is a residential house, all the co-owners may live there with their respective
families to the extent possible. However, if one co-owner alone occupies the entire
house without opposition from the other coowners, and there is no lease
agreement, the other co-owners cannot demand the payment of rent. Conversely, if
there is an agreement to lease the house, the co-owners can demand rent from the
co-owner who dwells in the house.
FACTS: Petition for Review on Certiorari. Abejo instituted an action for recovery of
possession with damages against DEGUIA. Abejos contentions:
1. he is the owner of the undivided portion of a property used as a fishpond
registered Register of Deeds of Bulacan.
2. ownership over approximately 39,611 square meters out of the FISHPONDs total
area of 79,220 square meters.
3. DE GUIA continues to possess and use the FISHPOND without any contract and
without paying rent to ABEJOs damage and prejudice.
4. DE GUIA refuses to surrender ownership and possession of the FISHPOND despite
repeated demands to do so after DE GUIAs sublease contract over the FISHPOND
had expired.
5. asked the trial court to order DE GUIA to vacate an approximate area of 39,611
square meters as well as pay damages. In his Answer,
DE GUIA alleged:
1. the complaint does not state a cause of action and has prescribed.
2. the FISHPOND was originally owned by Maxima Termulo who died intestate with
Primitiva Lejano as her only heir.
3. ABEJO is not the owner of the entire FISHPOND but the heirs of Primitiva Lejano
who authorized him to possess the entire FISHPOND.
4. ABEJOs ownership of the undivided portion of the FISHPOND as void and
claimed ownership over an undivided half portion of the FISHPOND for himself.
5. DE GUIA sought payment of damages and reimbursement for the improvements
he introduced as a builder in good faith. RTC decision: in favor of Abejo. CA decision:
affirmed the RTC.
Issue 1: WON a co-owner may file an action for ejectment against a co-owner.
Ruling: Article 487 of the Civil Code provides, *as for the recovery of possession.
Article 487 includes forcible entry and unlawful detainer (accion interdictal),
recovery of possession (accion publiciana), and recovery of ownership (accion de
reivindicacion). The summary actions of forcible entry and unlawful detainer seek
the recovery of physical possession only. These actions are brought before
municipal trial courts within one year from dispossession. However, accion
publiciana, which is a plenary action for recovery of the right to possess, falls under
the jurisdiction of the proper regional trial court when the dispossession has lasted
for more than one year. Accion de reivindicacion, which seeks the recovery of
ownership, also falls under the jurisdiction of the proper regional trial court. Any coowner may file an action under Article 487 not only against a third person, but also
against another co-owner who takes exclusive possession and asserts exclusive
ownership of the property. In the latter case, however, the only purpose of the
action is to obtain recognition of the co-ownership.
The plaintiff cannot seek exclusion of the defendant from the property because as
co-owner he has a right of possession. The plaintiff cannot recover any material or
determinate part of the property. In Hermogena G. Engreso with Spouse Jose
Engreso v. Nestoria De La Cruz and Herminio De La Cruz, we reiterated the rule that
a co-owner cannot recover a material or determinate part of a common property
prior to partition as follows: It is a basic principle in civil law that before a property
owned in common is actually partitioned, all that the co-owner has is an ideal or
abstract quota or proportionate share in the entire property. A co-owner has no right
to demand a concrete, specific or determinate part of the thing owned in common
because until division is effected his right over the thing is represented only by an
ideal portion. As such, the only effect of an action brought by a co-owner against a
co-owner will be to obtain recognition of the co-ownership; the defendant cannot be
excluded from a specific portion of the property because as a co-owner he has a
right to possess and the plaintiff cannot recover any material or determinate part of
the property.
Thus, the courts a quo erred when they ordered the delivery of one-half () of the
building in favor of private respondent. xxxx Following the inherent and peculiar
features of co-ownership, while ABEJO and DE GUIA have equal shares in the
FISHPOND quantitatively speaking, they have the same right in a qualitative sense
as co-owners. Simply stated, ABEJO and DE GUIA are owners of the whole and over
the whole, they exercise the right of dominion. However, they are at the same time
individual owners of a portion, which is truly abstract because until there is
partition, such portion remains indeterminate or unidentified. As co-owners, ABEJO
and DE GUIA may jointly exercise the right of dominion over the entire FISHPOND
until they partition the FISHPOND by identifying or segregating their respective
portions.