Monday, July 12, 2021

Spouses Marcelian and Alice Tapayan v. Martinez

PRINCIPLES: 

Courts are not precluded to accept in evidence a mere photocopy presented as a documentary evidence, when no objection was raised when it was formally offered;

A clear and convincing evidence is necessary to rebut the conclusive presumption of the due execution of a Deed acknowledged before a notary public.


PARTIES:

Petitioners - Spouses Marcelian and Alice Tapayan

Respondent - Ponceda Martinez 


FACTS 

Respondent is the registered owner of a parcel of land named as Pingol Property in Ozamis City. Two (2) mortgages were contracted over her property:

1. PNB mortgage – P100K in the name of Respondent

2. DBP mortgage – P1M renewable credit line in the name of Petitioners

As agreed, a portion of the DBP loan was utilized to settle the remaining balance of PNB loan amounting to P65,320.55. Subsequently, a Deed of Undertaking among the parties was made.

Based on the Undertaking, the Petitioners shall execute a second mortgage in favor of the Respondent over their Carangan Property in Ozamis City. Moreover, should the Petitioners fail pay the DBP loan and the property of the Respondent is foreclosed and is not redeemed by the Petitioners within 1 year redemption period or in case the loan shall be paid by the Respondent just to save her property from being foreclosed, the Petitioners shall acknowledge as his indebtedness the amount due to the DBP upon foreclosure or the amount paid by the Respondent in paying the loan, but in either case shall be deducted therefrom the amount of P65,320.55 plus interests and fees paid by the Petitioners to the PNB in favor of the Respondent’s remaining balance. 

The DBP loan was not paid when it fell due. 

The Respondent filed a complaint for Specific Performance with Damages against Petitioners compelling them to constitute a mortgage over their house and lot, the Carangan Property.

The Petitioners claimed that the Undertaking is a falsity. The DBP loan were used as a capital for the construction business of petitioner and Respondent’s son in a Joint Venture. 

Petitioners’ allegations:

1. The copy of the Deed of Undertaking was inadmissible as proof of its contents.

2. The Deed of Undertaking was a falsity.

3. The petitioners are accommodation borrowers; hence they are not liable but the alleged Joint Venture.

4. Should the petitioners execute a mortgage of their Carangan Property, it should be deducted from the amount they paid to PNB mortgage in favor of Respondent. 

RTC Decision:

The RTC decided in favor of Respondent and ordered the Petitioner-spouses to execute a mortgage over their Carangan property in favor of the respondent, unless they reimburse the respondent for the total amount of P1,180,200.10 paid by her to the DBP for the redemption of the mortgage plus P20K attorney’s fees. 

The RTC noted that the Undertaking was acknowledged before Atty. Emmanuel Chiong who enjoys the presumption of having performed his duties regularly. Therefore, the alleged falsity must be rejected as it is valid and binding. 

CA Decision:

Affirmed the decision of the RTC.


ISSUES:

Whether or not CA erred in affirming the RTC Decision to execute a mortgage over their Carangan Property in favor of the respondent. 


RULING

I. The Deed of Undertaking was admissible as proof of its contents

The objection of the petitioners over the admission of the Undertaking should not be granted. 

Under the law, a proper and timely objection over the documentary evidence presented is necessary; otherwise, it is deemed waived.

Although Best Evidence Rule requires that the original documents must be produced whenever its contents are the subject of inquiry, Courts are not precluded to accept in evidence a mere photocopy of a document when no objection was raised when it was formally offered. Offer is made after all the witnesses of the party making the offer have testified, specifying the purpose for which the evidence is being offered. It is only at this time, and not at any other, that objection to the documentary evidence may be made. 

In this case, the Petitioners failed to object to the admission of the plain copy of the Deed of Undertaking at the time it was formally offered in evidence before the RTC, in fact, they only raised this objection for the first time before the CA. 

Therefore, the Deed of Undertaking was admissible.


II. The Deed of Undertaking was genuine and was duly executed.

The contention of the petitioners that the Deed was a falsity is without merit. 

Under the law, 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. To overcome this presumption, there must be presented evidence that is clear and convincing.

In this case, the petitioners' denials without clear and convincing evidence to support their claim of fraud and falsity were not sufficient to overthrow the above-mentioned presumption. They have not even supported their claim that their signatures thereon were forged.

Therefore, the authenticity, due execution and the truth of the facts stated in the "Bilihan ng Lupa" are upheld.


III. The petitioners were not accommodation borrowers. 

The allegation of the petitioners that they are accommodation borrowers who applied for the DBP Loan for and on behalf of the Joint Venturers, who should assume the liability, based on the Joint Affidavit of the Joint Venturers should be denied. 

The statements in the Joint Venture were only corroborated by the petitioner’s self-serving declarations and the Court finds no other evidence on record to support the existence of the alleged joint venture, and the verbal agreement of the Joint Venturers in respect of the DBP Loan. 

In this case, Petitioners paid the interest on the DBP Loan, insurance premiums, and other incidental fees without seeking reimbursement from the alleged Joint Venturers, establishing Petitioners’ benefit. 

Therefore, Petitioners must bear the liability and comply the obligations imposed by the Deed of Undertaking. 


IV. The amount paid to PNB must be deducted from Petitioners’ total liability in accordance with the provisions of the Deed (the only issue which the SC deviated from the lower courts’ decision).

The Court ordered the petitioners to execute a mortgage over their Carangan Property and such mortgage should only be made to secure the amount of P1,114,879.55 – the amount paid by the Respondent to DBP to avert the foreclosure of the DBP Mortgage. 

Contrary to the P1,180,200.10 amount directed by the lower courts, the SC reasoned that the P65,320.55 should be deducted from Petitioners' total liability, representing the reimbursement they paid to PNB as the remaining balance of the Respondent over the first mortgage. 


No comments:

Post a Comment

Second Placer Rule vs. Rule of Succession; Three Classifications of Domicile; Requisites of Domicile by Choice

TOPICS: Second Placer Rule has no legal basis, thus, the Rule on Succession shall govern when a permanent vacancy is created after the winni...