Professional Documents
Culture Documents
TOPIC: DACION EN PAGO In its answer, PAC, while admitting the material allegations of the
Filinvest Credit Corporation’s complaint, avers that Filinvest Credit
Facts: Corporation has no cause of action against it since its obligation towards the
Filinvest Credit Corporation was extinguished when in compliance with the
The Philippine Acetylene Co., Inc. purchased from one Alexander Filinvest Credit Corporation's demand letter, it returned the mortgaged
Lim, as evidenced by a Deed of Sale, a motor vehicle described as Chevorlet, property to the Filinvest Credit Corporation, and that assuming arguendo
1969 model, paying a down payment and the balance payable at 34 monthly that the return of the property did not extinguish its obligation, it was
installments. As security for the payment of said promissory note, PAC nonetheless justified in refusing payment since the Filinvest Credit
executed a chattel mortgage over the same motor vehicle in favor of said Corporation is not entitled to recover the same due to the breach of warranty
Alexander Lim.-Subsequently, Alexander Lim assigned to the Filinvest committed by the original vendor-assignor Alexander Lim.
Finance Corporation all his rights, title, and interests in the promissory note
and chattel mortgage by virtue of a Deed of Assignment. LC: Ordered PAC to pay the outstanding unpaid obligation and to accept the
delivery of the motor vehicle subject of the chattel mortgage.
Thereafter, the Filinvest Finance Corporation, as a consequence of
its merger with the Credit and Development Corporation assigned to the new Issue:
corporation, Filinvest Credit Corporation, all its rights, title, and interests on
the aforesaid promissory note and chattel mortgage, which, in effect, the Whether or not the return the return of the mortgaged property by
payment of the unpaid balance owed by PAC to Alexander Lim was financed the mortgagor to the mortgagee constituted dacion en pago or Dation in
by Filinvest Credit Corporation such that Lim became fully paid. PAC failed payment.
to comply with the terms and conditions set forth in the promissory note and
chattel mortgage since it had defaulted in the payment of nine successive
installments. Filinvest Credit Corporation then sent a demand letter whereby
its counsel demanded "that you (appellant) remit the aforesaid amount in Held:
full in addition to stipulated interest and charges or return the mortgaged
property to my client at its office at 2133 Taft Avenue, Malate, Manila within The mere return of the mortgaged motor vehicle by the mortgagor,
five (5) days from date of this letter during office hours. " PAC, to the mortgagee, Filinvest Credit Corporation, does not constitute
dation in payment or dacion en pago in the absence, express or implied of
Replying thereto, PAC, thru its assistant general- manager, wrote the true intention of the parties.
back advising Filinvest Credit Corporation of its decision to "return the
mortgaged property, which return shall be in full satisfaction of its Dacion en pago, according to Manresa, is the transmission of the
indebtedness pursuant to Article 1484 of the New Civil Code." Accordingly, ownership of a thing by the debtor to the creditor as an accepted equivalent
the mortgaged vehicle was returned Filinvest Credit Corporation to the of the performance of obligation. In dacion en pago, as a special mode of
together with the document "Voluntary Surrender with Special Power of payment, the debtor offers another thing to the creditor who accepts it as
Attorney To Sell" executed by PAC. Filinvest Credit Corporation wrote a equivalent of payment of an outstanding debt. The undertaking really
letter to PAC informing the latter that Filinvest Credit Corporation cannot partakes in one sense of the nature of sale, that is, the creditor is really
sell the motor vehicle as there were unpaid taxes on the said vehicle. On the buying the thing or property of the debtor, payment for which is to be
last portion of the said letter, Filinvest Credit Corporation requested the PAC charged against the debtor's debt. As such, the essential elements of a
to update its account by paying the installments in arrears and accruing contract of sale, namely, consent, object certain, and cause or consideration
interest. Filinvest Credit Corporation, in a letter, offered to deliver back the must be present. In its modern concept, what actually takes place in dacion
motor vehicle to the PAC but the latter refused to accept it, so Filinvest en pago is an objective novation of the obligation where the thing offered as
an accepted equivalent of the performance of an obligation is considered as
the object of the contract of sale, while the debt is considered as the purchase Guillermo Maulawin is a farmer businessman engaged in buying and selling
price. copra and corn. On July 10, 1997, Tan Shuy extended a loan of P420K to
Guillermo. In consideration thereof, Guillermo obligated himself to pay the
In any case, common consent is an essential prerequisite, be it sale loan and to sell lucad or copra to petitioner. Below is a reproduction of the
or innovation to have the effect of totally extinguishing the debt or contract:
obligation.-The evidence on the record fails to show that the mortgagee, the
herein appellee, consented, or at least intended, that the mere delivery to,
and acceptance by him, of the mortgaged motor vehicle be construed as No 2567 Lopez, Quezon July
actual payment, more specifically dation in payment or dacion en pago. 10, 1997
The fact that the mortgaged motor vehicle was delivered to him
does not necessarily mean that ownership thereof, as juridically Tinanggap ko kay G. TAN SHUY ang halagang
contemplated by dacion en pago, was transferred from appellant to appellee. ……………………………………………………………. (P420,000.00) salaping Filipino.
In the absence of clear consent of appellee to the proferred special mode of Inaako ko na isusulit sa kanya ang aking LUCAD at babayaran ko ang nasabing
payment, there can be no transfer of ownership of the mortgaged motor halaga. Kung hindi ako makasulit ng LUCAD o makabayad bago sumapit ang
vehicle from appellant to appellee. If at all, only transfer of possession of the ……………………., 19 …… maaari niya akong ibigay sa may kapangyarihan. Kung ang
mortgaged motor vehicle took place, for it is quite possible that appellee, as pagsisingilan ay makakarating sa Juzgado ay sinasagutan ko ang lahat ng
mortgagee, merely wanted to secure possession to forestall the loss, kaniyang gugol.
destruction, fraudulent transfer of the vehicle to third persons, or its being
rendered valueless if left in the hands of the appellant. [Sgd. by respondent]
………………………………
Tan Shuy v. Sps. Maulawin (F2012) …….
Topic: Dacion En Pago P………………………................
Lagda
Doctrine: Dation in payment extinguishes the obligation to the extent of
the value of the thing delivered, either as agreed upon by the parties or as
may be proved, unless the parties by agreement – express or implied, or by The transactions between Tan Shuy and Guillermo were coursed through
their silence – consider the thing as equivalent to the obligation, in which Tan Shuy’s daughter Elena. She served as cashier in the business of Tan
case the obligation is totally extinguished. Shuy, who primarily prepared and issued the pesada. When she’s absent,
Vicente would issue the pesada.
Facts: Tan Shuy is engaged in the business of buying copra and corn in the
4th district of Quezon Province. According to his son, Vicente Tan, whenever Vicente also helped Tan Shuy in buying copra and granting loans to
they would buy copra or corn from crop sellers, they would prepare and issue customers [copra sellers]. According to him, part of their agreement with
a pesada1 in their favor. When a pesada contained the annotation “pd” on Guillermo was that they would put the annotation “sulong” on the pesada
the total amount of the purchase price, it meant that the crop delivered had when partial payment on the loan had been made. But despite repeated
already been paid for by Tan Shuy. demands, Guillermo remitted only P23k in August 1998 and P5.5k in
October 1998, or atotal of P28.5K. Claiming that Maulawin had an
outstanding balance of P391.5K and convinced that he no longer had any
intention to pay, Ran Shuy went to the Lupon Tagapamayapa. Failing to
1
A pesada is a document containing details of the transaction, including reach a settlement, he filed acomplaint before the RTC.
the date of sale, the weight of the crop delivered, the trucking cost, and
Maulawin’s Arguments:
the net price of the crop
1. Loan had already been paid in full. Supreme Court Ruling:
2. He continuously delivered and sold copra to petitioner from April Pursuant to Art. 1232 of the Civil Code, an obligation is extinguished by
1998 to April 1999. An oral arrangement that the net proceeds payment or performance. There is payment when there is delivery of money
thereof shall be applied as installment payments for the loan was or performance of an obligation. Art. 1245 provides for a special mode of
made. His deliveries amounted to P420,537.68 worth of copra. payment known as dation in payment.
3. To bolster his claim, he presented copies of pesadas issued by Elena Dation in payment extinguishes the obligation to the extent of the value of
and Vicente. The pesadas did not contain the notation "pd," which the thing delivered, either as agreed upon by the parties or as may be proved,
meant that actual payment of the net proceeds from copra unless the parties by agreement – express or implied, or by their silence –
deliveries was not given to him, but was instead applied as consider the thing as equivalent to the obligation, in which case the
loanpayment. obligation is totally extinguished. In this regard, the RTC made the following
findings:
4. Tan Shuy filed a complaint because he got angry when Maulawin
sold copra to other copra buyers. a) Pesadas from April 1998 to April 1999shows that Guillermo only
gets the payments for trucking while the total amount which
RTC: The net proceeds from Guillermo's copra deliveries -represented represent the total purchase price for the copras that he delivered to
in the pesadas, which did not bear the notation "pd" should be applied as the plaintiff were all given to Elena Tan Shuy as installments for the
installment payments for the loan. It Gave credence to the pesadas, as their loan he owed to plaintiff. Such claim was bolstered by the testimony
due execution and authenticity was established by Elena and Vicente. But the of Apolinario Cariño which affirmed that he also sold copras to the
RTC did not credit the net proceeds from 12 pesadas, as they were deliveries plaintiff Tan Shuy. Guillermo also said that he incurred
for corn and not copra. Guillermo testified that it was the net proceeds from indebtedness to Tan Shuy and whenever he delivered copras the
the copra deliveries to be applied as installment payment for the loan. Thus, amount of the copras sold were applied as payments to his loan.
P41,585.25, which corresponded to the net proceeds from corn deliveries,
should be deducted from the amount of P420,537.68claimed by Guillermo to The CA fully subscribed to the findings of the RTC. The subsequent
be the total value of his copra deliveries. There exists, therefore, a balance of arrangement between Tan Shuy and Guillermo can thus be considered as
P41,047.57 in Guillermo’s loan. one in the nature of dation in payment. There was partial payment every
time Guillermo delivered copra to Tan Shuy, whenever he chose not to
CA: Affrirmed RTC collect the net proceeds of his copra deliveries, and instead applied the
collectible as installment payments for his loan from Tan Shuy.
Issue: WON the delivery of copra amounted to installment payments for the
loan obtained by Guillermo from Tan Shuy.
Held: YES.
Guillermo undertook two separate obligations: 1) Pay for the loan in cash;
and 2) Sell lucad or copra. Since the written agreement did not specifically
provide for the application of the net proceeds from the deliveries for the
loan, Tan Shuy argues that he cannot be compelled to accept copra as
payment for the loan. The pesadas did not specifically indicate that the net Reparations Commission v Universal Deep Sea Fishing (1978)
proceeds from the copra deliver is were to be used as installment payments Application of Payment
for the loan. Guillermo’s copra deliveries were duly paid in cash. The
pesadas were in fact documentary receipts for those payments.
Doctrine: The rules contained in Articles 1252 to 1254 of judgment, Civil The Supreme Court found the terms of the contracts clear and left no doubt
Code apply to a person owing several debts of judgment, same kind to a as to the intent of the contracting parties that the first installment due 24
single creditor. They cannot be made applicable to a person whose months after delivery was different from the first ten (10) equal yearly
obligation as a mere surety is both contingent and singular, which in this installment of the balance of the purchase price (which are not designated as
case is the full and faithful compliance with the terms of the contract of "first", "second", "third", etc., installments).
conditional purchase and sale of reparations goods.
The obligation included the payment, not only of the first installment in the
Facts: amount of P53,643.00, but also of the ten (10) equal yearly installments of
P56,597.20 per annum. The amount of P10,000.00 was, indeed, deducted
The Reparations Commission awarded six (6) trawl boats to from judgment, amount of P53,643.00, but then judgment, first of judgment,
the Universal Deep-Sea Fishing Corporation which were delivered ten (10) equal yearly installments had also accrued, hence, no error was
two at a time, each delivery being covered by a Contract of committed in holding judgment, surety company to judgment, full extent of
Conditional Purchase and Sale providing for identical schedules of its undertaking.
payments.
The rules contained in Articles 1252 to 1254 of judgment, Civil Code apply to
a person owing several debts of judgment, same kind to a single creditor.
The first installment representing 10% of the total cost was to
They cannot be made applicable to a person whose obligation as a mere
be paid 24 months after delivery and the balance of the total cost
surety is both contingent and singular, which in this case is the full and
to be paid in ten (10) equal installments, which, in the schedule
faithful compliance with the terms of the contract of conditional purchase
were numbered as "1", "2", "3", etc., the first of which was due one and sale of reparations goods.
year after the first installment.
ISSUE The lease over the Fairview wet market is the most onerous to the petitioner
in the case at bar.
Whether the petitioner was truly in arrears in the payment of rentals on the
subject property at the time of the filing of the complaint for ejectment. Petition granted.
As found by the lower court there was a letter sent by respondent to Marquez v Elisan Credit
herein petitioner, dated November 19, 1991, which states that
petitioner’s security deposit for the Quirino lot, be applied as partial Facts:
payment for his account under the subject lot as well as to the real Marquez obtained from Elisan Credit Corporation a loan payable in weekly
estate taxes on the Quirino lot. Petitioner interposed no objection, installments and subject to annual interest with monthly penalties and
attorney’s in case of nonpayment. A chattel mortgage was also executed loan. The chattel mortgage was already extinguished because being merely
stipulating that “the motor vehicle shall stand as a security for all other an accessory in nature, it cannot exist independently of the principal
obligations of every kind already incurred or which hereafter may be obligation.
incurred”. The payment of that loan was acknowledged by both parties.
Subsequently, Marquez obtained another loan evidenced by a promissory
note with the same terms and conditions as the first loan. When the second Meat Packing Corporation of the Philippines (MPCP) v
loan matured, there still remained an unpaid balance. Marquez requested Sandiganbayan
the creditor to pay the unpaid balance by daily installments until the loan is
paid; the creditor agreed. Thus, several months after the maturity of the Tender of payment and consignation
loan, Marquez had already paid a total amount which is greater than the
amount of the principal. Facts:
Despite such, the creditor filed a complaint for foreclosure of the CM on the
ground that Marquez allegedly failed to pay the principal of the second MPCP is a corporation wholly owned by the GSIS. It is the owner of 3 parcels
loan despite demand. It was also prayed that the unpaid balance plus of land, as well as the meat processing and packing plant thereon. MPCP and
accrued penalties and interestsbe paid because, allegedly, Marquez’ failure the Philippine Integrated Meat Corporation (PIMECO) entered into an
to pay upon maturity triggered the imposition of monthly penalties and Agreement whereby MPCP leased to PIMECO, under a lease-purchase
attorney’s fees. arrangement, its property. The Agreement contained rescission clauses.
Marquez, citing Art 1176 and 1235 of the Civil Code, insists that his daily
payments should be deemed to have been credited against the principal, as On March 17, 1986, the PCGG sequestered all the assets, properties and
the official receipts issued by the creditor were silent with respect to the records of PIMECO. The sequestration included the meat packing plant and
payment of interest and penalties. the lease-purchase agreement. MPCP gave notice to PIMECO of the
Issue 1: W/N the creditor waived the payment of the interest rescission of the lease-purchase agreement on the ground, among others, of
No. The fact that the official receipts did not indicate whether the payments non-payment of rentals of more than P2,000,000 for the year 1986. GSIS
were made for the principal or the interest does not prove that the creditor asked the PCGG to exclude the meat packing plant from the sequestered
waived the interest. There is no presumption of waiver of interest without assets of PIMECO, inasmuch as the same is owned by MPCP. PCGG denied
any evidence showing that the creditor accepted the daily instruments as the request. MPCP sought the turnover to it of the meat packing plant on the
payments for the principal. ground that the lease-purchase agreement had already been rescinded.
Issue 2: W/N the daily payments made by the debtor be applied to the PCGG acceded to this request.
interest
Yes. Notwithstanding the fact it was not indicated in the receipts whether Meanwhile, PCGG instituted with the Sandiganbayan a complaint for
the payments were applied to the principal or the interest, such failure reconveyance, reversion, accounting, restitution and damages, entitled,
should not be taken against the creditor. Under Article 1253 of the Civil "Republic vs Peter Sabido, et al." The complaint alleged that Sabido
Code, if the debt produces interest, payment of the principal shall not be obtained, under favored and very liberal terms, huge loans from the GSIS in
deemed to have been made until the interests have been covered. Thus, the favor of PIMECO, was beneficially held and controlled by defendants Sabido
creditor in this case has a right to credit the payments to the interest first. et al.
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Issue 3: W/N an order for foreclosure is proper Sabido filed an Urgent Manifestation and Motion, alleging that, according to
No. Foreclosure in this case is without legal and factual basis because the newspaper accounts, PCGG had already turned over the management and
chattel mortgage was already extinguished when the obligation under the operation of PIMECO to the GSIS/MPCP. Thus, he prayed that the transfer
first loan was duly paid. of the management, control and possession of PIMECO to GSIS be declared
A CM can only cover obligations existing at the time the mortgage is null and void ab initio for having been done without the approval of the
constituted. For a CM to cover debts yet to be contracted, a fresh chattel Sandiganbayan. Sandiganbayan received a letter from members of the
mortgage may be executed or the old contract be amended conformably to PIMECO Labor Union, praying for the maintenance of the status quo to
the form prescribed by the CM Law. Here, since there was no showing that a enable PIMECO to continue its business operations and to ensure their
new agreement was executed, the security can no longer apply to the second continuity of work and security of tenure. Sandiganbayan issued a TRO
commanding the PCGG to cease and desist from enforcing the contemplated Hence, MPCP brought this petition for certiorari, mandamus and
turnover to MPCP. Sandiganbayan, finding that the PCGG committed grave prohibition, arguing in fine that the PCGG is in estoppel because it has
abuse of authority, power and discretion in unilaterally terminating the already admitted that the lease-purchase agreement between MPCP and
lease-purchase agreement of PIMECO with MPCP and in turning over its PIMECO has been rescinded.
management, control and operation to the latter, ordered the issuance of a
writ of preliminary injunction. PCGG filed a Motion for Reconsideration, Issue:
which the Sandiganbayan granted. Thereafter, the Sandiganbayan declared
the turn-over of the meat packing plant to GSIS null and void. Whether or not the lease-purchase agreement between MPCP and PIMECO
has been validly rescinded, making the Sandiganbayan’s approval of the
PIMECO filed with the Sandiganbayan a petition entitled, “PIMECO vs consignation by PCGG as payment for back rentals or accrued amortizations
MPCP and PCGG," captioned as for "Declaratory Relief and Other Similar on the meat packing plant, after the MPCP refused the tender of payment of
Remedies.” PIMECO alleged that from 1981 to 1985, PIMECO has been the same, improper.
regularly paying the annual rentals; and that prior to its sequestration in
January 1986, PIMECO was able to pay MPCP P846,269.70. However, after Ruling:
its sequestration, the PCGG Management Team that took over the plant
became erratic and irregular in its payments of the annual rentals to MPCP, No. Consignation is the act of depositing the thing due with the court or
thus presenting the danger that PIMECO may be declared in default in the judicial authorities whenever the creditor cannot accept or refuses to accept
payment of rentals equivalent to 3 annual installments and causing the payment, and it generally requires a prior tender of payment. It should be
cancellation of the lease-purchase agreement. Hence, PIMECO prayed for a distinguished from tender of payment. Tender is the antecedent of
declaration that it is no longer bound by the provisions of the rescission consignation, that is, an act preparatory to the consignation, which is the
clause of the lease-purchase agreement. principal, and from which are derived the immediate consequences which
the debtor desires or seeks to obtain. Tender of payment may be
In the meantime, PCGG tendered to MPCP 2 checks (total of P5,000,000), extrajudicial, while consignation is necessarily judicial, and the priority of
representing partial payment of accrued rentals on the meat packing plant, the first is the attempt to make a private settlement before proceeding to the
which MPCP refused to accept on the theory that the lease-purchase solemnities of consignation. Tender and consignation, where validly made,
agreement had been rescinded. Thus, the PCGG filed an Urgent Motion produces the effect of payment and extinguishes the obligation.
praying that the Sandiganbayan order MPCP to accept the tendered amount.
MPCP alleged that its lease-purchase agreement with PIMECO has been If the creditor to whom tender of payment has been made refuses without
rescinded; and that PIMECO was in arrears in the payment of rentals in the just cause to accept it, the debtor shall be released from responsibility by the
amount of P12,378,171.06, which is more than the equivalent of 3 cumulative consignation of the thing or sum due.
rentals at the annual rate of P3,346,269.70.
Consignation alone shall produce the same effect in the following cases:
The Sandiganbayan held that the tender of payment has been validly made.
To rule otherwise would be unfair and unjust to PIMECO considering that (1) When the creditor is absent or unknown, or does not appear at the
during the time the PCGG had possession and control of the sequestered place of payment;
assets and records, PIMECO was not in the position to take steps necessary
for the preservation and conservation of those assets and records. (2) When he is incapacitated to receive the payment at the time it is
due;
Meanwhile, Sandiganbayan dismissed the petition for declaratory relief, it
appearing that while the unpaid rentals as of January 27, 1991 have reached (3) When, without just cause, he refuses to give a receipt;
P7,530,036.21, PCGG’s tender of payment and consignation of
P5,000,000.00 averted the accumulation of the unpaid rentals to 3 yearly (4) When two or more persons claim the same right to collect;
rentals-installments. Consequently, the petition for declaratory relief has
become moot and academic. (5) When the title of the obligation has been lost.
which, of course, include the meat packing complex and the land of which it
stands, stipulated in the MOA, cannot be legally enforced. Needless to say,
There was prior tender by PCGG of the amount of P5,000,000.00 for the commissioners should be the first to abide by the PCGG’s resolutions.
payment of the rentals in arrears. MPCP’s refusal to accept the same, on the
ground merely that its lease-purchase agreement with PIMECO had been Under the terms of the lease-purchase agreement, the amount of arrears in
rescinded, was unjustified. From January 29, 1986 to January 30, 1990, rentals or amortizations must be equivalent to the cumulative sum of three
PIMECO paid, and GSIS/MPCP received, several amounts due under the annual installments, in order to warrant the rescission of the contract.
lease-purchase agreement, such as annual amortizations or rentals, Therefore, it must be shown that PIMECO failed to pay the aggregate
advances, insurance, and taxes, in total sum of P15,921,205.83. Surely, the amount of at least P10,038,809.10 before the lease-purchase agreement can
acceptance by MPCP and GSIS of such payments for rentals and be deemed automatically cancelled. Assuming in the extreme that, as alleged
amortizations negates any rescission of the lease-purchase agreement. by MPCP, the arrears at the time of tender on January 30, 1991 amounted to
P12,578,171.00,40 the tender and consignation of the sum of
In support of its contention that the lease-purchase agreement has been P5,000,000.00, which had the effect of payment, reduced the back rentals to
rescinded, MPCP makes reference to the resolutions of the PCGG turning only P7,578,171.00, an amount less than the equivalent of three annual
over to the GSIS the meat packing complex and the land on which it is installments. Thus, with the Sandiganbayan’s approval of the consignation
situated. MPCP argues that PCGG was estopped from taking a contrary and directive for MPCP to accept the tendered payment, the lease-purchase
position. A closer perusal of the resolutions, however, readily shows that the agreement could not be said to have been rescinded.
turn-over was explicitly made dependent on certain conditions precedent,
among which was the approval by the Sandiganbayan and the execution of a ALLANDALE SPORTSLINE INC. v. THE GOOD DEVELOPMENT
MOA between PCGG and MPCP. A MOA was in fact executed on April 28, CORP
1989, although the same suffers from formal and substantial infirmities.
However, no approval was sought from the Sandiganbayan. On the contrary, CONSIGNATION
the Sandiganbayan, in its Resolution declaring the turn-over null and void,
refused to honor the PCGG resolutions, reasoning thus: Allandale Sportsline Inc (ASI) obtained a loan of P204,000 from The Good
Development Corp (GDC) under a Promissory Note signed by Melbarose
First, what was approved by the PCGG in its resolutions of September 20, Sasot (Pres) and Allandale Sasot (VP) of ASI, with Theresa
1988, and January 24, 1989, is the transfer of the "meat packing complex Manipon, as one of the three co-makers.
including the land located at Barrio Ugong, Pasig, Metro Manila," and not
"the management and operation of PIMECO." It is, however, the latter that The promissory note provides that the loan is payable in daily equal
the Memorandum of Agreement, executed on April 28, 1989, pursuant to the installments of P2,000 with interest as 26.002% per annum.
said resolutions, transferred to the GSIS.
In case of default in the payment of any installment, the
Second, the second resolution made the turnover of the "meat packing entire balance of the obligation shall become immediately
complex including the land located at Barrio Ugong, Pasig Metro Manila," due and demandable, and subject to liquidated penalty
"upon compliance with these conditions, to be implemented by the [PCGG] charge equivalent to 2% of the principal
Operations and Legal Departments: . . . (b) approval by the Sandiganbayan . .
." Until now, however, no motion has been presented to secure that approval, To provide additional security, ASI and Melbarose executed a Deed
and none can be expected because the same Memorandum of Agreement of Mortgage in favor of GDC acceding that: should the
changed the requirement of approval to "(t)he Sandiganbayan shall be Mortgagors fail to comply with any of the terms of the
advised of this Agreement." Even the advice stipulated has never been given promissory note and this mortgage contract, the
by the PCGG. Mortgagee shall automatically have the absolute right
without need of prior notice or demand to forthwith
Since the MOA was executed by one PCGG commissioner only, the same judicially or extrajudicially forclose this mortgage xxx
cannot validly amend the resolutions passed by the PCGG itself.
Consequently, the turnover of the management and operation of PIMECO,
The properties subject of the mortgage are itemized in an inventory o That they repeatedly tendered payment, but GDC
attached to the deed: rejected their efforts for no valid reason
o List A- all the merchandise and stocks in trade found in o That the unreasonable refusal to accept such
the commercial establishment owned by ASI and payment relieved them of their loan obligation
Melbarose, valued at P100,000
Manipon led a separate Answer in which she did not deny the
o List B- all the furniture, fixtures, appliances, equipment authenticity of her signature on the Promissory Note, but argued
and other personal property found in said business that she did not knowingly or voluntarily sign the instrument as a
establishment, P3,500 co-maker, for at that time she was under the impression that the
instrument she was signing was her own loan application with GDC
o List C- one Toyota Corona, valued at P40,000; one Totoya
Corolla, P35,000 GDC disclosed that after it obtained possession of the properties
subject of the writs of replevin, it caused the auction sale of some of
GD demanded that Melbarose pay the unpaid account of P179,000, them and realized proceeds amounting to P78,750.00 (No
or surrender the mortgaged chattels within 5 days from notice certificate of sale, but as testified by respondent’s witness,
Leonila Buenviaje)
No payment was made, RTC filed a complaint for Replevin
and/or Sum of Money with Damages against ASI, GDC presented a Statement of Account, which indicated that
Melbarose, Manipon, Florante Edrino and John Doe. the total outstanding balance of the loan obligation of ASI and
Melbarose was reduced to P191,111.82 after the proceeds of the
o Replevin- ordering the seizure of the above described auction sale conducted on June 19, 1992 in the amount of
chattels or personal propert with all accessories and P78,750.00 was deducted from the earlier balance of P266,126.17
directing their transfer to Plaintiff for the purposes of
foreclosure and or transfer to satisfy the obligation in favor RTC, in favor of GDC
of the plaintiff
ASI, Sasot and Manipon appealed to CA, DENIED; Motion for
RTC issued a Writ of Replivin, by virtue thereof, the Sheriff seized Recon, denied
and delivered to the GDC one unit of Toyota Corona and two
appliances SC: Petitioners contend that they were relieved of their obligation to
pay GDC when they made several attempts to tender payment but
Dec. 2, 1991, GDC filed an Amended Complaint to include in its respondent refused to accept them without any valid reason.
application for replevin the items under List A. RTC issued an Alias
Writ of Replevin, items seized and delivered to GDC July 3, 1991- first tender of payment, Sasot sent GDC a PCIB check
postdated Oct 31, 1991 of P171,000. Check rejected because the
Second Writ of Replevin was also issued over the Toyota Corolla, amount was insufficient for as July 4, 1991, the balance of the
but records do not indicate that the Sheriff made a return on the principal loand was P175,000, not P171,000, and its maturity was
writ Sept. 13, not Oct. 31
ASI and Melbarose filed their Answer with Counterclaim, Oct. 15, 1997- tendered payment of P171,000 in cash, respondent
contending that their loan obligation was only P200,000, and after refused due to insufficiency. Statement of Account was sent to
deducting the P18,000 which amount was retained by GDC as petitioner indicating that the total balance due was P228,071.61
advance payment, and P29,000 representing payments made from
June 4, 1991 to July 8, 1991, their unpaid obligation was only
P171,000.
On October 29, 1991, petitioners tendered cash payment of Their tender of payment not having been followed by a valid
P174,986.96, 338 8 but respondent still refused to accept it for consignation, it produced no effect whatsoever, least of all the
insufficiency of the amount. extinguishment of the loan obligation.
ISSUE: WHETHER OR NOT TENDER OF PAYMENT AND Therefore, the first issue of the validity or invalidity of their
RESPONDENT’S REFUSAL DISCHARGED PETITIONERS FROM tender of payment is completely moot and academic, for
THEIR OBLIGATION either way the discussion will go, it will lead to no other
conclusion but that, without an accompanying valid
HELD: NO consignation, the tender of payment did not result in the
payment and extinguishment of the loan obligation. The
Tender of payment, without more, produces no effect; Court cannot take cognizance of such a purely hypothetical issue.
rather, tender of payment must be followed by a valid
consignation in order to produce the effect of payment Disclaimer: following issues, irrelevant to Oblicon pero ilagay at idiscuss
and extinguish an obligation ko na rin briefly kahit di ko naiintindihan HAHAHHHA WAG NIYO NA
ITO BASAHIN
Mere preparatory act to consignation. It is the manifestation of a
desire by the debtor to comply with or pay an obligation. If refused FIRST ISSUE: Whether the parol evidence rule applies on the promissory
without just cause, the tender of payment will discharge the debtor note in question when the co-makers thereon are total strangers to another
of the obligation to pay but only after a valid consignation of the
sum due shall have been made with the proper court HELD: Lack of basis. Manipon did not join in the petition.
Consignation is the deposit of the proper amount with a The finding of the RTC, as affirmed by the CA, that she was a co-
judicial authority, before whom the debtor must establish maker of Promissory Note and a real party-in-interest is already
compliance with the following mandatory requirements: final and conclusive. Petitioners cannot now question this finding
by raising the defense that Manipon signed the promissory note
(1) there was a debt due; without knowledge of the nature of her liability under the
instrument.
(2) the consignation of the obligation had been made because the creditor to
whom tender of payment was made refused to accept it, or because he was Such defense is personal to Manipon and cannot be invoked by
absent or incapacitated, or because several persons claim to be entitled to petitioners, unless it is shown that their interests are so interwoven
receive the amount due, or because the title to the obligation has been lost; with and dependent on Manipon's as to be inseparable.
(3) previous notice of the consignation had been given to the person SECOND ISSUE: Was there a legal basis for RTC to grant respondent the
interested in the performance of the obligation; relief of collecting the amount of P269,611.82 plus legal interest until full
amount is paid, when respondents already covered P78,750
(4) the amount due was placed at the disposal of the court; and
As emphasized at the outset, the reliefs respondent prayed for in its
(5) after the consignation had been made, the person interested was notified Complaint and Amended Complaint are in the alternative: delivery
thereof. Failure to prove any of these requirements is enough ground to of the mortgaged properties preparatory to foreclosure or payment
render a consignation ineffective. of the unpaid loan
Petitioners did not allege or prove that after their tender NO, by causing the auction sale of the mortgaged properties,
of payment was refused by respondents, they attempted respondent effectively adopted and pursued the remedy of extra-
or pursued consignation of the payment with the proper judicial foreclosure, using the writ of replevin as a tool to get hold of
court. the mortgaged properties. One effect of respondent's election of the
remedy of extra-judicial foreclosure is its waiver of the remedy of Sps. Cacyurin v AFPMB (2013)
collection of the unpaid loan G.R. No. 171298, April 15, 2013
However, another effect of its election of the remedy of extra- Topic: Tender of Payment and consignation
judicial foreclosure is that whatever deciency remains after applying
the proceeds of the auction sale to the total loan obligation may still
be recovered by respondent Doctrine: Besides, as earlier stated, Article 1256 authorizes consignation
alone, without need of prior tender of payment, where the ground for
THIRD ISSUE, DI PA RIN RELEVANT: Whether respondent instituted consignation is that the creditor is unknown, or does not appear at the
the proper action for deficiency amount or raised or its claim at the pre-trial place of payment; or is incapacitated to receive the payment at the time it
is due; or when, without just cause, he refuses to give a receipt; or when
two or more persons claim the same right to collect; or when the title of the
The Complaint and Amended Complaint reveals that
obligation has been lost.
respondent did not allege any deciency account. Nor did it
raise the matter in its PreTrial Brief. This is only to be
expected because the auction sale of the properties was apparently Facts:
conducted long after it led its Complaint/Amended Complaint and
Pre-trial Brief Petitioner Oscar Cacayorin filed an application with AFPMBAI to
purchase a piece of property which the latter owned in Puerto Princesa City,
However, the Court notes that evidence on the deficiency amount through a loan facility.
was duly presented by respondent and examined by petitioners
(thru the testimonies and documentary evidences presented in On July 4, 1994, Oscar and his wife and the Rural Bank of San Teodoro
court) executed a Loan and Mortgage Agreement with the former as borrowers and
the Rural Bank as lender, under the auspices of Pag-IBIG or Home
The properties of petitioners which were seized by virtue of the Development Mutual Fund’s Home Financing Program.
Writs of Replevin were extra-judicially foreclosed and sold at public
auction by respondent in the exercise of its absolute right under the The Rural Bank issued an August 22, 1994 letter of guaranty6
contract entered into by the parties, without need of prior notice or informing AFPMBAI that the proceeds of petitioners’ approved loan in the
demand to forthwith judicially or extra-judicially foreclose this amount of P77,418.00 shall be released to AFPMBAI after title to the
mortgage and proceed against all or any of the mortgaged rights, property is transferred in petitioners’ name and after the registration and
interests and properties for the full satisfaction of the mortgagors' annotation of the parties’ mortgage agreement.
entire obligation to the mortgagee.
AFPMBAI executed in petitioners’ favor a Deed of Absolute Sale, and a new
Under the Deed of Mortgage, it is provided that in case of title was issued in their name, with the corresponding annotation of their
default, petitioners shall be liable for liquidated collection mortgage agreement with the Rural Bank.
charge in the amount equivalent to 25% of said
outstanding obligation. Unfortunately, the Pag-IBIG loan facility did not push through and
the Rural Bank closed and was placed under receivership by the Philippine
Deposit Insurance Corporation (PDIC). Meanwhile, AFPMBAI somehow was
able to take possession of petitioners’ loan documents and the title, while
petitioners were unable to pay the loan/consideration for the property.
(a) P200,000.00 upon signing x x x the Contract To Sell, Del Carmen v Sabordo (2014)
G.R. No. 181723, Aug. 11, 2014
(b) P300,000.00 payable on or before April 30, 1993,
Consignation
(c) P330,000.00 payable on or before July 31, 1993,
(d) P417,000.00 payable to the New Capitol Estate, for 15 years at Doctrine: It is settled that compliance with the requisites of a valid
[P6,867.12] a month consignation is mandatory. Failure to comply strictly with any of the
requisites will render the consignation void. One of these requisites is a
x x x In the event the VENDEE fails to pay the second installment on time, valid prior tender of payment.
[t]he VENDEE will pay starting May 1, 1993 a 2% interest on the
P300,000.00 monthly. Likewise, in the event the VENDEE fails to pay the Facts:
amount of P630,000.00 on the stipulated time, this CONTRACT TO SELL
shall likewise be deemed cancelled and rescinded and x x x 5% of the total Subsequently, the Suico spouses and their business partners failed to pay
contract price [of] P1,250,000.00 shall be deemed forfeited in favor of the their loan obligations forcing DBP to foreclose the mortgage. After the Suico
VENDOR. Unpaid monthly amortization shall likewise be deducted from the spouses and their partners failed to redeem the foreclosed properties, DBP
initial down payment in favor of the VENDOR.” consolidated its ownership over the same.
After execution of the contract, Bonrostro took possession of the property. Nonetheless, DBP later allowed the Suico spouses and Reginald and Beatriz
However, except for P200,000.00 downpayment, she failed to pay Flores (Flores spouses), as substitutes for Juliana Del Rosario, to repurchase
subsequent amortization. Luna then filed before the RTC a Complaint for the subject lots by way of a conditional sale for the sum of P240,571.00.
Rescission of Contract and Damages. This is a petition for review on
certiorari assailing the decision of CA affirming with modification the The Suico and Flores spouses were able to pay the downpayment and the
decision of RTC in favor herein respondents. first monthly amortization, but no monthly installments were made
thereafter. Threatened with the cancellation of the conditional sale, the Suico
Issue: Whether or not delay in the payment of installment is a substantial and Flores spouses sold their rights over the said properties to herein
breach of obligation as to warrant its rescission. respondents Restituto and Mima Sabordo, subject to the condition that the
latter shall pay the balance of the sale price. Subsequently, respondents were
Ruling: No, in a contract to sell, payment of the price is a positive able to repurchase the foreclosed properties of the Suico and Flores spouses.
suspensive condition. Failure of which is not a breach of contract warranting
rescission under Article 1191 of the Civil Code, but rather just an event that Respondents Restituto Sabordo (Restituto) filed with the then Court of First
prevents the supposed seller from being bound to convey title to the Instance of Negros Occidental an original action for declaratory relief with
supposed buyer. The contract to sell entered by the parties refers to real damages and prayer for a writ of preliminary injunction raising the issue of
property on installment basis, in which Art. 1191 cannot apply since they are whether or not the Suico spouses have the right to recover from respondents
governed by the Maceda Law. However, there being no breach, Bonrostro is Lots 506 and 514. The court ruled that the petioners can exercise their option
still not excused from being made liable for interest on the installments due to purchase or redeem the subject lots from respondents by paying the sum
from the date of default until fully paid. Tender of payment, a manifestation of P127,500.00.
by the debtor of a desire to comply with or pay an obligation, asserted by
Bonrostro for the accrual of interest to be suspended is not a valid defense In the meantime, Toribio Suico (Toribio) died leaving his widow, Eufrocina,
because for a tender of payment to take effect it must be accompanied by the and several others, including herein petitioner, as legal heirs. Later, they
means of payment and debtor must take immediate step to make a discovered that respondents mortgaged Lots 506 and 514 with Republic
Planters Bank (RPB) as security for a loan which, subsequently, became the consignation void. One of these requisites is a valid prior tender of
delinquent. payment.
Thereafter, claiming that they are ready with the payment of P127,500.00, Under Article 1256, the only instances where prior tender of payment is
but alleging that they cannot determine as to whom such payment shall be excused are: (1) when the creditor is absent or unknown, or does not appear
made, petitioner and her co-heirs filed a Complaint with the RTC of San at the place of payment; (2) when the creditor is incapacitated to receive the
Carlos City, Negros Occidental seeking to compel herein respondents and payment at the time it is due; (3) when, without just cause, the creditor
RPB to interplead and litigate between themselves their respective interests refuses to give a receipt; (4) when two or more persons claim the same right
on the abovementioned sum of money. The Complaint also prayed that to collect; and (5) when the title of the obligation has been lost. None of these
respondents be directed to substitute Lots 506 and 514 with other real estate instances are present in the instant case. Hence, the fact that the subject lots
properties as collateral for their outstanding obligation with RPB and that are in danger of being foreclosed does not excuse petitioner and her co-heirs
the latter be ordered to accept the substitute collateral and release the from tendering payment to respondents, as directed by the court.
mortgage on Lots 506 and 514. Upon filing of their complaint, the
heirs of Toribio deposited the amount of P127,500.00 with the
RTC of San Carlos City, Branch 59.
Ruling:
The petition lacks merit. In the instant case, petitioner and her co-heirs,
upon making the deposit with the RTC, did not ask the trial court that
respondents be notified to receive the amount that they have deposited. In
fact, there was no tender of payment. Instead, what petitioner and her co-
heirs prayed for is that respondents and RPB be directed to interplead with
one another to determine their alleged espective rights over the consigned
amount; that respondents be likewise directed to substitute the subject lots
with other real properties as collateral for their loan with RPB and that RPB
be also directed to accept the substitute real properties as collateral for the
said loan. Nonetheless, the trial court correctly ruled that interpleader is not
the proper remedy because RPB did not make any claim whatsoever over the
amount consigned by petitioner and her co-heirs with the court.