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GLORIA OCAMPO AND TERESITA TAN VS.

LANDBANK OF THE PHILIPPINES, URDANETA, PANGASINAN BRANCH AND EX-OFFICIO PROVINCIAL SHERIFF OF PANGASINAN GR No. 164968, July 3, 2009 Facts: This is an instant petition for review on Certiorari assailing the decision of CA (favoring Landbank). In 1991, Ocampo and her daughter, Tan obtained from the Landbank a PhP10M quedan loan upon issuance of promissory notes (PNs) which was released to them by: Amount Release Date Maturity Date Remarks PhP3.996M 01/31/1991 07/30/1991 2 PNs PhP6M 04/05/1991 10/02/1991 3 PNs Quedan Rural Credit Guarantee Corporation (Quedancor) guaranteed to pay Landbank their loan but only up to 80% of the outstanding loan plus interests at the time of maturity. Pursuant thereto, Ocampo and Tan delivered to Landbank quedans and executed a Deed of Assignment covering 41,690 cavans of palay (equivalent to PhP9.996M – 100% of the loan) in favor of Quedancor. Ocampo and Tan constituted a Real Estate Mortgage (REM) over 2 parcels of unregistered land owned by Ocampo to secure the remaining 20%. Such encumbrance was annotated in the land title when Ocampo filed for the lands’ registration. When Ocampo failed to pay the 3 remaining PNs on Oct. 2, 1991, Lanbank filed the following:  Claim for guarantee payment with Quedancor;  Criminal case of estafa against Ocampo for disposing stocks of palay covered by the quedans;  Extrajudicial foreclosure of REM (re: 20% of loan) The Ex-Officio Provincial Sheriff issued a notice of Extrajudicial Sale (Public Auction). RTC issued TRO on the public auction and favored Ocampo and Tan when they filed a Complaint for Declaration of Nullity and Damages with Application of a Writ of Preliminary Injunction against Landbank and the Sheriff on the basis on forgery regarding the REM on the 20% of the loan. Upon Landbank’s appeal, the CA granted its petition and reversed the RTC’s decision. Hence, this petition. Issues: 1. WON the Deed of Real Estate Mortgage was void? 2. Assuming it was valid, WON the loan was already extinguished? Held: 1. NO. The Deed of REM was valid. There is no forgery. Ocampo and Tan failed to present any evidence to disprove the genuineness or authenticity of their signatures. In fact, Ocampo admitted in her direct examination that such signature was hers, although she claimed that she was made to sign a blank form (printed form with blanks yet to be filled up). Moreover, the bank personnel who were also signatories to the deed confirmed their appearances despite her testimony that
Special Commercial Laws

she cannot say for certain if she appeared before the notary public. It is well-settled that a document acknowledged before a notary public is a public document that enjoys the presumption of regularity. It is a prima facie evidence of the truth of the facts stated therein and a conclusive presumption of its existence and due execution. The real issue is fraud and not forgery. Ocampo claimed that she was led to believe by Landbank that the form she signed was to process her PhP5M loan application and not to secure the subject 20% of the loan. However, Ocampo was unable to establish clearly and precisely how Landbank committed the alleged fraud. She failed to lay down the deception through insidious words or machinations or misrepresentations made by Landbank so that she signed the blank form. Granting for the sake of argument that there was fraud, such contract was merely voidable where an action should have been instituted within 4 yours from discovery, i.e. when the REM was registered with the Register of Deeds. 2. NO. The loan was not yet extinguished. Ocampo claimed that she already paid the quedan loan when she executed the Deed of Assignment in favor of Quedancor. The loan was between Ocampo and Landbank. Yet, she did not include Landbank as party to the Deed of Assignment despite evidence on record showing her indebtedness to Landbank (e.g. registration/annotation of REM). Ocampo hastily executed the Deed of Assignment and conveyed some of her properties to Quedancor without prior notice to Landbank. Dacion en pago is the delivery and transmission of ownership of a thing by the debtor to the creditor as an accepted equivalent of the performance of an obligation. As properly ruled by the CA, the required consent is absent in this case. Landbank had no participation much less consented to the execution of the Deed of Assignment. Hence, no extinguishment of loan can be had. Even if the Deed of Assignment has the effect of valid payment, the extinguishment is only up to the extent of 80% of the quedan loan. Thus, it leaves a balance of 20% which can be fully satisfied by the foreclosure of the REM. Petition denied.

Ocampo is a businesswoman. She is expected to be acquainted with the banking procedures as regards to loan applications. She ought to have read the terms and conditions of the document shat she was signing, especially so when, as claimed by her, there were still blank spaces at that time when she affixed her signature thereon. The law furnishes no protection to the inferior simply because he is inferior any more than it protects the strong because he is strong... The foolish may lose all they have to the wise; but that does not mean that the law will give it back to them again... /slrb