MA. LUISA A. PENADA, AS PETITIONER VS.

VIRGINIA
ZUNIGA VDA. DE VEGA, AS RESPONDENT
GR. NO. 233774, APRIL 10, 2019
SUMMARY OF THE FACTS
On June 10, 2005, the petitioner filed a complaint against the respondent for the payment of the
loan and interest or foreclosure of property of the loan of P500,000 which was borrowed by the
respondent on March 03, 2005. The said loan has an interest rate of 8% per month and is secured
by a real estate mortgage on a parcel of land with buildings and improvements. According to the
petitioner, the respondent failed to pay her loan despite demand. As of May 2005, the unpaid
accumulated interest amounted to P232,000.00.
The respondent denied the allegations and claimed that the said amount was the accumulated
amount of another obligation she earlier secured from the petitioner. The respondent also argued
that the interest rate agreed upon was excessive and unconscionable, thus illegal.
In the petitioner’s reply although the agreement was to charge an interest rate of 8% per month,
what was actually charged was just 4% per month. And according to the petitioner, the
P500,000.00 loan was a previously executed undated real estate mortgage (undated Agreement)
between the parties which secured the respondent's loan of P200,000.00 from her.
ISSUES
Was a demand letter sent by the petitioner to the respondent and was it received by the latter?
ISSUES RELATED TO OUR TOPIC
Those obliged to deliver something incur in delay from the time the obligee judicially or
extrajudicially demands. (Article 1169)
THE COURT’S RULING
For the demand letter, it was proved that it was not received by the respondent because the
petitioner failed to give the original evidence of the registry receipt or the registry card with the
demand letter. Therefore, the delay was not triggered by the extrajudicial demand, it was when
the petitioner judicially demanded on June 10, 2005.
According to the court, a mortgage creditor for non-payment can only pursue one remedy which
is either a personal action for debt or a real action to foreclose the mortgage. Both arise from the
same cause and the mortgage is a subsidiary to the payment of the loan. Hence, the court ruled
that P200,000.00 is what the respondent owed to the petitioner.
The court also ruled out that since the undated agreement and the 2003 Agreement's interest rate
was unconscionable, the rate of interest on the loan of the respondent should be 12% per annum
not from extrajudicial demand but from judicial demand until June 30, 2013. And 6% per annum
from July 1, 2013, until the finality of this decision. Then, 6% interest rate on the total amount
due from such date of finality until full payment thereof.
In conclusion, the respondent Zuniga vda. de Vega is liable to pay petitioner Ma. Luisa A.
Pineda the following amounts:
 The loan of P200,000.00 and P30,000.00 attorney fees.
 The interest rate on the loan of 12% per annum from judicial demand to June 30, 2013, and
6% per annum from July 13, 2013, until the finality of this Decision.
 And 6% interest rate on the total amount due from such date of finality until full payment
thereof.