SPOUSESANICETOANDTHELMACIRELOSv

s.SPOUSESWI
LLI
AM G.HERNANDEZ,
ANDROSEMARIEZAFEANDTHEHON.COURTOFAPPEALS

G.
R.No.146523,
June15,
2006

FACTS:

Herei
npetitioner
s,SpousesAnicetoandThel maCirel
os,werer egi
ster
edowner sofa
houseandl otatatNo.10KennedyDr iv
e,TandangSor a,QuezonCity.Whenpet it
ioner
ThelmaCirelos(Cirel
os)obt
ainedaloanf rom r
espondentWi l
li
am Hernandez( oneof
thepriv
ater espondents)
,intheamountofP450, 000.00,sheexecuted,assecur it
y
ther
efor
,a Deed ofRealEst ate Mortgage i
nf avorofHer nandez cover
ing t he
abovementi
onedpr operty
.

Petit
ionerCirel
osal l
egedt hattoimmediatelyreleasetheloan,Hernandezasked hert o
signabl ankbondpapercont aini
ngnothingbuthernamewhi chHer nandezsaidwil
lbe
conver t
ed into promi ssory note.Later,t he pet i
ti
onersr eceived a l et
ter f
rom
respondentsaski ngthem tov acatet
hepr opertybecauser espondentsalreadyownt he
same.Ci rel
osdiscoveredi ntheRegist
erofDeedst hattherewasalreadyaDeedofSal e
infav orofrespondent sannot atedatthebackoft het i
tl
eandt heblankpapershe
signedwasconv ert
edintoaDeedofAbsol uteSal e.

Hence,pet
it
ionersfil
edacompl aintforBreachofContract,AnnulmentofSaleand
DamagesbeforetheRTC,againstspousesWi l
li
am G.Her
nandezandRosemar i
eZafe.
Theypoint
edt hattheDeedwasv oidsinceitdidnothav etheconsentofAni cet
o,
husbandofThelmaCi rel
os,andtheReleaseofRealEstateMor tgageisfi
cti
ti
ousas
theyhav
enoty etpai
dtheirl
oan.

Int
heirr
eply
,therespondent
sclai
medt hatt
heexecut
ionoftheReleaseofRealEstat
e
Mort
gageandDeedofAbsol uteSal
ewasoutoft hefr
eewillandvoli
tionofpet
it
ioners
andthatThelmaCirel
oswasaut hor
izedbyherhusband,Anicet
o,t hroughaSpecial
PowerofAtt
orney(SPA)execut
edwaybackonJanuary27,1990.

TheRTCdeci
dedinfavorofthespousesHer
nandezandheldthattheDeedofAbsol ut
e
Sal
ewasnotfabr
icat
ed.Thedocumenti t
sel
fshowedincont
establ
eev idenceofwhatit
pur
port
stobeandwast est
if
iedunderoat
hbythelawyerwhonotarizedit.

Onappeal,theCAaf f
ir
medt hedecisi
onoftheRTCandheldthatt
hepetit
ioner
sf ai
led
todefeatthepresumpti
ont hatof
fici
aldut
yhasbeenregular
lyperf
ormed.Further,i
t
foundther
ewasnosuf fi
cientevi
dencetoshow def
ecti
nconsentorshow ani nt
ent
othert
hanacont r
actofsal
e.
I
SSUES:

(
1)WONCir
elos’
ssi
gnat
urei
ntheDeedofAbsol
uteSal
ewasobt
ainedt
hrough
f
raud

(
2)WONt
herewasconsentf
rom Cir
elos’
shusbandt
oal
lowher(
Thel
maCi
rel
o)
t
omor
tgageandsel
ltheproper
tyinquest
ion

(
3)WONt
hesal
ehadacauseorconsi
der
ati
on

(
4)WONt hesal
emustbeconsi
der
edonl
yasequi
tabl
emor
tgagei
nst
eadofan
absol
utesal
e

RULI
NG:

(
1)NO.Ci
rel
o'
ssi
gnat
urei
ntheDeedofAbsol
uteSal
ewasnotobt
ainedt
hroughf
raud.

TheDeedofAbsol uteSalebeingimpugnedbypetit
ioner
si sapubli
cdocumenthav ing
beennot ari
zedbyAtty.Campos.Asapubl icdocument,thedeedhasi nitsfavorthe
presumptionofregular
it
y,andcar r
iestheevi
denti
arywei ghtconfer
reduponi twith
respecttoitsdueexecuti
on.Torebutthesame,theremustbeev i
dencethatisclear
,
convinci
ngandmor ethanmerelypreponder
ant
.

Here,allpeti
ti
onerscoul
dof f
erbywayofev i
dencewasCir
elos’
sbaredeni
althatshe
signedthesubjectdeedofsaleandhercl aimthatwhatwasgivenhertosi
gnwasa
blankpieceofpaperwhi chHernandezlaterturnedi
ntosaiddeed.Suchdenialis
insuff
ici
enttoov er
comet heposit
iveval
ueoft hedeedofsal ewhi
chisanot ari
zed
document .

(
2)YES.Ci
rel
o'shusbandgav
econsentt
oal
lowhert
omor
tgageandsel
lthepr
oper
ty.

Asar uleinthesaleofconjugalpr
operti
es,theconsentofboththehusbandandthe
wif
eisr equi
redandtheabsenceoft heconsentofonerenderstheent
ir
esalenul
land
voi
di ncludi
ng t
he por
ti
on oft he conj
ugalpropert
yper t
aini
ng tothespousewho
cont
ractedthesal
e.

Here,theDeedofAbsol uteSaleinvol
vedapr opert
yr egist
eredinthenamesoft he
spousesanditwassignedonlybyThelmaCi rel
os,thewi f
e.TheDeeddoesnotactual l
y
contai
nanysignat
ureofAni cetoshowinghisconsent .Howev er
,inassert
ingt
hatt he
DeedwasexecutedbyCi rel
oswi t
ht heconsentofherhusband,r espondentsf
ormal l
y
off
eredanSPA,wi thpowert osellaswel lasmor t
gage,wasexecut edbyAni ceto
Cir
elosinf
avorofThelmaCi r
elosonJanuary27, 1990.
Att
y.Campoal lowedt onotari
zet heDeedbyv ir
tueoft heSPAshownt ohim wit
ht he
words"sel
l"
,"absolut
esal e"
,and"sal e"wit
hthei nit
ialsofAni
cetoCir
elo("ABC")
.Mor e
i
mpor t
antl
y,thesaidSPAwasannot at edandinscribedatthebackofthet i
tl
eonJul y
10,1990.Thati s,evenbef or
eCi rel
osst art
edt ransacti
ngwithHernandez.Hence,it
cannotbesaidthatAnicetoCirel
odi dnotgiveThel maCi r
elot
heauthor
ityorconsentto
mortgageorsellthepropert
yinquest ion.

(
3)YES.Thesal
ehadacauseorconsi
der
ati
on.

Thepar t
ieschangedtheiragr
eementfrom thatofloantoanabsol ut
esal ewhen
peti
ti
onerscoul
dnol ongerpaythei
robl
igati
on.TheP450,000.00loanwast heref
ore
convert
edtoapurchasepri
cewhenthepart
iesmodif
iedtheagreementbetweenthem.

(
4)NO.Thecont
racti
sanabsol
utesal
e,notanequi
tabl
emor
tgage.

TheCiv i
lCodepr ovi
desthattheessentialr
equi
sit
esofanequi t
ablemor tgageare:(1)
thepar t
iesenterintowhatappear stobeacont ractofsale;and( 2)theirint
enti
on,
however,istosecur eanexisti
ngdebtbywayofamor tgage.Further,Arti
cle1602of
theCodeenumer atesseverali
nstanceswhenacont r
acti
spr esumedt obeanequi t
able
mortgage.The pr esence ofeven justone ofthe ci
rcumst ancessetf ort
hi nthis
prov
isionsuffi
cestoconv er
tacontractt
oanequitablemortgage.Noconcur r
enceoran
over
whel mingnumberi sneeded.

I
nt hiscase,pet
it
ionersclaimt hattheagreementbet weenthem isoneofequitabl
e
mortgageforthr
eer easons,i.
e.,ther
ewasi nadequacyoft hepr
ice,t
heyremainedin
possessi
onoftheproperty,and,thei
rint
ent
ionwasonl ythatofmort
gageandnotsale.

TheCour thel
dthattherewasnoinadequacyoft hepriceissincethepeti
ti
oner
sdidnot
presentanypr oofthatthefai
rmarketv al
ueofther ealpropertyinthear
eaattheti
me
ofthet ransact
ionweremuchhi gherthant hesell
ingpriceoft heloti
nquesti
on.Mere
all
egationt hatthepr i
cepaidisi nadequate,wit
houtmor e,doesnotmakeacase
favorabletopetit
ioner
s.

Furt
her,thepetit
ioners'possessi
onoft hepropertyaft
erthedateoft heabsolut
esale
wasdef i
edbyt her espondentsasshownbyt hesev er
aldemandst heyhavemade
agai
nstthef or
mert ov acat
et hepremises,andthefactthatpet
it
ionerHernandezev
en
wrotealett
ertother espondentaskingformoretime.