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G.R. No. 112160 (February 28 2000)
Facts: In August 1982, Osmundo S. Canlas, and Vicente Maosca, decided to venture
in business and to raise the capital needed therefor. Canlas executed a Special
Power of Attorney authorizing Maosca to mortgage two parcels of land situated in
BF Homes, Paranaque. Each lot has a semi-concrete residential house in the name
of the Canlas and his wife. Spouses Canlas agreed to sell the two lots to Maosca,
for and in consideration of PhP 850,000.00, P500,000.00 of which payable within
one week, and the balance of PhP 350,000.00 shall serve as serve as Canlas inves
tment in the business. Canlas delivered to Maosca the transfer certificates of ti
tle of the two lots sold. Maosca, on his part, issued two postdated checks in fav
orof Osmundo Canlas in the amounts of P40,000.00 and P460,000.00, respectively,
but it turned out that the check covering the bigger amount was not sufficiently
funded. In sum, the spouses Canlas received only PhP40,000.00, despite deliveri
ng the TCTs to the supposed vendee.
On September 1982, Maosca, with the use of the SPA previously issued by Canlas, w
as able to secure a P100,000.00 loan from a certain Atty. Manuel Magno by mortga
ging the same parcels of land, with the help of impostors who misrepresented the
mselves as the spouses Canlas. On September 29, 1982, Vicente Maoscam, using the
same parcels of land as security and through the involvement of the same imposto
rs who again introduced themselves as the Canlas spouses, applied and was approv
ed of another loan by Asian Savings Bank (ASB) in the amount of P500,000.00. Whe
n the loan was not paid, the bank, extra-judicially foreclosed the mortgage.
On January 1983, the spouses Canlas wrote a letter informing the bank that the e
xecution of subject mortgage over the two parcels of land was without their auth
ority. They requested that steps be taken to annul the questioned mortgage.
Issues: Is the mortgage with the bank valid? And if the answer is in the negativ
e, should the bank bear the loss?
A contract of mortgage must be constituted only by the absolute owner on the pro
perty mortgaged; a mortgage, constituted by an impostor is void. Considering tha
t it was established that the contract of mortgage was entered into and signed b
y impostors who misrepresented themselves as the spouses Canlas, the subject con
tract of mortgage is a complete nullity.
As to who shall bear the loss, The doctrine of last clear chance is applicable,
the respondent bank must suffer the resulting loss. In essence, the doctrine of
last clear chance is to the effect that where both parties are negligent but the
negligent act of one is appreciably later in point of time than that of the oth
er, or where it is impossible to determine whose fault or negligence brought abo
ut the occurrence of the incident, the one who had the last clear opportunity to
avoid the impending harm but failed to do so, is chargeable with the consequenc
es arising therefrom. The respondent bank did not observe the required diligence
in verifying the real identity of the couple who introduced themselves as the s
pouses Osmundo Canlas and Angelina Canlas. Not a single identification card was
presented by the impostor-loan applicants to show their true identity. And yet t
he bank approved the loan on sheer finding that the signatures affixed on a deed
of mortgage previously executed in favor of a certain Atty. Magno matched the s
ignatures in the residence certificates presented by the impostors. In fact the
deed of mortgage referred to did not bear the tax identification number of the s
pouses, as well as the Community Tax Certificate of Angelina Canlas.
Applying Art. 1173 It could be said that the degree of diligence required of ban
ks is more than that of a good father of a family in keeping with their responsi
bility to exercise the necessary care and prudence in dealing even on a register
ed or titled property. Under such principle, the bank would be denied the protec
tive mantle of the land registration law, accorded to purchasers or mortgagees f
or value and in good faith. Asian Savings Bank has to bear the loss.