Summary of Cases in PLEDGE, CHATTEL MORTGAGE, REAL MORTGAGE, & ANTICHRESIS
Feati Bank v. CA
Manila Banking v. Teodoro Teodoro SUMMARY: Defendants, together with AnastacioTeodoro, AnastacioTeodoro, Sr., jointly and severally, executed in favor of plaintiff a promissory note for the sum of P1,!". Defendants failed to pay the said amount inspite of repeated demands and the o#ligation as of Septem#er $, 1%&% stood at P 1',1$(.11. 1',1$(.11. The defendants executed in f avor of plaintiff two P)S f or P*, and P1,. They made partial payments #ut none were paid, leaving an unpaid #alance of P*,%$!.(! as of Septem#er $, 1%&% including. +t appears that the Son executed in favor of plaintiff a Deed of Assignment of eceiva#les -A from the /mergency /mployment Administration in the sum of P!!,&$'.. The Deed of Assignment provided that it was for and in consideration of certain credits, loans, overdrafts and other credit accommodations extended to defendants as security for the payment of said sum and the interest thereon, and that defendants do here#y remise, release and 0uitclaim all its rights, title, and interest in and to the accounts receiva#les. urther, title to the A is to remain in the assignee. Plaintiff extended loans to defendants on the #asis and #y reason of certain contracts entered into #y the defunct /m ergency /mployment Administration -//A with defendants for the fa#rication of fishing #oats, and that the Philippine isheries 2ommission succeeded the //A after its a#olition3 that non4payment of the notes was due to the failure of the 2ommission to pay defendants after the latter had complied with their contractual o#ligations3 and that the President of the 5an6 too6 steps to collect from the 2ommission, #ut no collection was effected. The action was instituted against the defendants for the collection of sum on the P)s. The trial court rendered judgment adverse to the defendants. SC in SC in favor of 752. The A had no effect of payment of the loans made #y teodoros. DOCTRINE: Assignment of credit is an agreement #y virtue of which the owner of a credit, 6nown as the assignor, #y a legal cause, such as sale, dation in payment, exchange or donation, and without the need of the consent of the de#tor, transfers his credit and its accessory rights to another, 6nown as the assignee, who ac0uires the power to enforce it to the same extent as the assignor could have enforced it against the de#tor. +n case of dou#t as to whether a transaction is a pledge or a dation in payment, the presumption is in favor of pledge, the latter #eing the lesser transmission of rights and interests An assignment to guarantee an o#ligation is in effect a mortgage and not an a#solute conveyance of title which confers ownership on the assignee •
•
Duran v. IAC SUMMARY: 2irce SUMMARY: 2irce Duran owned two pieces of land. 8hile she was a#road, a deed of sale over the properties was executed in favor of e Duran, 2irce9s mother. e su#se0uently mortgaged the same properties to /rlinda Tiangco, who, #y the failure of e to redeem the properties, eventually ac0uired them. 2irce, after finding out a#out the mortgage, claims that her signatures on the Deed of Sale were forged, thus such sale in favor of her mother should #e void. E!D: The E!D: The court ruled that even assuming that the signatures on the deeds of sale were a forgery, and the sale would #e regarded as void, the Deed of 7ortgage is valid , with respect to the mortgagee, Tiangco. 8hile it is essential that the mortgagor #e the a#solute owner of the property mortgaged, and while as #etween the daughter and the m other, it was the daughter who still owned the lots, insofar as innocent third persons are concerned the owner was already the mother -e Duran inasmuch as she had already #ecome the registered owner, the T2T under e9s name #eing #inding as to third persons. DOCTRINE: The fraudulent and forged document of sale may #ecome the root of a valid title if the certificate has already #een transferred from the name of the true owner to the name indicated #y the forger /very person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way o#lige him to go #ehind the certificate to determine the condition of the property. :ood faith is a possessor;s #elief that the person from whom he received the thing was the owner of the same and could convey his title •
•
•
Rural Bank o" Caloo#an v. CA SUMMARY: 2astro < a (4yr. old widow with a limited education < applied for a loan with the 5an6, for the purpose of o#taining money to invest in the #usiness of the sps. =alencia. -According to the findings affirmed #y the S2 the sps. =alencia misrepresented 2astro9s age and financial standing to try to o#tain the 5an69s consent < the #an6 eventually granted the application and extended a loan to 2astro. The sps. =alencia =alencia also applied to #e granted a loan #y the 5an6, which was granted and to which 2astro signed as co4m a6er. As As security for 5>T? loans, 2astro mortgaged her house and lot in favor of the #an6. -According to the findings affirmed # y the S2 the sps. =alencia =alencia too6 advantage of 2astro9s old age and limited education to fraudulently o#tain her consent to sign #oth the promissory note covering their loan and the mortgage contract which secured not only 2astro9s loan #ut also t hat of the sps. =alencia9s. =alencia9s. The #an6 extrajudicially foreclosed the mortgage and the property was sold at a pu#lic auction. Su#se0uently, 2astro filed an action es sentially praying that the sps. =alencia9s =alencia9s promissory note #e declared as invalid as regards 2astro, that the mortgage contract #e declared as invalid insofar as it exceeded 2astro9s own loan, and that the extrajudicial foreclosure and sale #e annulled. The 2+ decided in favor of 2astro. The 2A affirmed the 2+9s decision in toto. Thus, the 5an6 and Desiderio filed a petition for review on certiorari with the S2. The S2 affirmed the decision of the 2A. The fraud perpetrated #y the sps. =alencia on 2astro, and the misrepresentations it made to the 5an6 resulted in mutual mista6e on the part of 2astro and the 5an6 < to the extent that it resulted in the vitiation of #oth parties9 consent. The loan ta6en #y the sps. =alancia is thus invalid as to 2astro, who had signed as co4ma6er3 and, the mortgage contract is invalid in so far as it covered the amount in excess of 2astro9s own loan. DOCTRINE: The validity of a contract of mortgage is dependent upon compliance with all the re0uisites of a valid contract.
Re$e% v. Sierra CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
1
SUMMARY:5asilia SUMMARY:5asilia 5eltran inherited a land from her parents which she used to secure a loan she #orrowed from =icente eyes Sr. eyes filed an application for registration of title to a land in i@al which he inherited from his father. This was opposed #y the Director of land, Santos and the Sierras. 2+ ruled in favor of eyes. S2 reversed 2+. +t held that the document evidencing the transaction #etween eyes Sr. entitled /xhi#it D was actually a mortgage contract as evidenced #y the word utangB. ?ence, ownership of the land remains with the oppositors. eyes may not claim ownership of the land despite failure of the mortgagor to pay. DOCTRINE:The DOCTRINE:The intention of the parties at the time of the execution of the contract must prevail. The fact that the real transaction #etween the parties was a #orrowing and lending, will, whenever, or however, it may appear, show that a deed, a#solute on its face was intended as a security for money3 and whenever it can #e ascertained to #e a security for money, it is only a mortgage, however artfully it may #e disguised.
Olea v. CA SUMMARY: +n 1%!(, the spouses Pacardos executed a deed of Sale 2on Pacto de etro over Cot (%( of the Passi2adastre for P %' in favor of 7aura Pala#rica. +t was stipulated that Cot (%( could #e repurchased after three years -on "( anuary 1%' from the date of execution of the deed for the same amount. +f repurchased, the sale would #ecome null and void3 otherwise, the same would vest complete and a#solute title on the vendee. After the execution of the s ale, the Pacardos remained in possession of the land and cultivated the same. The Pacardos failed to repurchase the lot #ut annually delivered 1E$ of the produce to Pala#rica. +n 1%(*, Pala#rica sold the lot to her daughter, >lea. +n 1%*%, >lea filed a 2omplaint against against /lena -widow of the Pacardos9 son, iloteo, r. and the Palencias for recovery of possession wit h damages for the latter9s refusal to deliver 1E$ of the produce. The Trial 2ourt dismissed the case, which was affirmed #y the 2A3 hence, the instant Petition to the S2. Applying )22 1&", the S2 held that the t ransaction involved an e0uita#le mortgage, not a pacto de retro sale. 7oreover, the S2 held that >lea cannot rely on the stipulation providing that complete and a#solute title shall #e vested on the vendee should the vendors fail to redeem the property on the specified date #ecause such provision is void for #eing pactum commissorium. Therefore, ownership never passed to >lea, who was merely a mortgagee. Thus, there is no legal #asis for >lea to recover possession of the property. DOCTRINE: The contract of sale with right to repurchase shall #e presumed to #e an e0uita#le mortgage in any of the following casesF -a when the price of the sale is unusually inade0uate3 -# when the vendor remains in possession as lessee or otherwise3 -c when upon or after the expiration of the right to repurchase another instrument extending the period of redemption or granting a new period is executed3 -d when the purchaser retains for himself a part of the purchase price3 -e when the vendor #inds himself to pay the taxes on the thing sold3 and, -f in any other case where it may #e fairly inferred that the real intention of the parties is that the transaction shall secure the payment of a de#t or the performance of any other o#ligation. -)22 1&" 5eing remedial in nature, Art. 1&" may #e applied retroactively to cases prior to the effectivity of the )22. A contract should #e construed as a mortgage or a loan instead of a pacto de retro sale when its terms are am#iguous or the circumstances surrounding its execution or its performance are incompati#le or inconsistent with the theory that it is a sale. 8here in a contract of sale with pacto de retro the vendor remains in physical possession of the land sold as lessee or otherwise, the contract should #e considered an e0uita#le mortgage. The same presumption applies when the vendee was given the right to appropriate the fruits thereof in lieu of receiving interest o on the loan. 8here the contract contains a stipulation that upon payment #y the vendor of the purchase price within a certain period the document shall #ecome null and void and have no legal force or effect, the purported sale should #e considered a mortgage contract. The presence of even one of the circumstances enumerated )22 1&" is sufficient to declare a contract of sale with right to repurchase an e0uita#le mortgage. +n case of dou#t, a contract purporting to #e a sale with right to repurchase shall #e construed as an e0uita#le mortgage. -)22 1&$ A stipulation providing that complete and a#solute title shall #e vested on the vendee should the vendors fail to redeem the property on the specified date is void for #eing pactum commissorium which ena#les the mortgagee to ac0uire ownership of the mortgaged property without need of foreclosure. •
• •
•
•
•
• •
Da$rit v. E&er%on SUMMARY: Dayrit and " others too6 out a P1', loan from 7o#il, which was secured #y a real estate mortgage on some of Dayrit;s realty. They also entered into an agreement to #uy certain 7o#il products. The loan was revealed to have #een used to pay another mortgage de#t owed #y Dayrit. Dayrit et al. were only a#le to pay one installment, so 7o#il demanded payment. Dayrit ac6nowldged the de#t #ut nevertheless the case went to court and a judgment was rendered declaring Dayrit et al. jointly lia#le and authori@ing the foreclosure of the lots in case Dayrit et al. failed to pay. 7o#il moved to execute the decision #ut Dayrit as6ed that he #e allowed to tneder his 1E$ share of the de#t so that the mortgage on his lots may #e released. 2+ denied Dayrit;s motion, so he appealed to the 2A. 2A upheld the 2+, hence this recourse to the S2, which sustained the two lower courts. +t held that the petition for certiorari was filed out of time as provided in >2 !'G1 and this fact alone is enough to merit dismissal. )evertheless S2 ruled on the merits, holding that the judgment was clear in stating that the mortgage was to #e foreclosed in the event that Dayrit et al. are una#le to pay their o#ligation. The mortgage cannot #e released upon payment #y Dayrit of his 1E$ share #ecause mortgages li6e the one in the 2A5 are generally indivisi#le and are intended to secure the whole de#t and not just ali0uot parts thereof. DOCTRINE: A DOCTRINE: A mortgage directly and immediately su#jects the property upon which it is imposed, the same #eing indivisi#le even though the de#t may #e divided, and such indivisi#ility li6ewise #eing unaffected #y the fact that the de#tors are not solidarily lia#le. 8hen several things are pledged or mortgaged, each thing for a determinate portion of the de#t, the pledges or mortgages are considered separate from each other. 5ut when the several things are given to secure the same de#t in its entiret y, all of them are lia#le for the de#t, and the creditor does not have to divide his action #y distri#uting the de#t among the various things pledged or mortgaged. /ven when only a part of the de#t remains unpaid, all the things are still lia#le for such #alance. #alance. ?ence, a mortgage voluntarily constituted #y the de#tor on on two or more parcels of land is one and indivisi#le, and the mortgagee has the right to have either or #oth parcels, jointly or singly, sold to satisfy his claim. +n case the mortgaged properties are a house and lot, it can not #e claimed that the lot and the house should #e sold separately and not together -Tolentino.
CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
2
!o'e( v. CA SUMMARY: Cope@ SUMMARY: Cope@ loaned Php ", from Prudential 5an6. ?e executed a surety #ond with Philamgen -as his surety and #ound themselves jointly and severally lia#le to Prudential 5an6. Cope@ executed a Deed of Assignment of his !, shares of 5aguio 7ilitary +nstitution to Philamgen as indemnity. Cope@ failed to pay Prudential 5an6 and Philamgen paid Prudential 5an6 as surety of Cope@. ?ence, Philamgen filed a suit of collection against Cope@. The S2 held and ruled that the transaction entered into #y and #etween Cope@ and Philamgen under the Stoc6 Assignment Separate rom 2ertificate in relation to the Surety 5ond )o. 1!1&! and the +ndemnity Agreement, all executed and dated une ", 1%'%, #on%titute% a 'ledge o" t)e *+,+++ %)are% o" %to#k #y %to#k #y the Cope@ in favor of the Philamgen, and not a dacion en pago. pago. +t is also the S29s ruling that upon the facts esta#lished, there was no novation of the o#ligation #y su#stitution of de#tor. DOCTRINEF DOCTRINEF The character of the transaction #etween the parties is to #e determined #y their intention, regardless of what language was used or what the form of the transfer was. +f it was intended to secure the payment of money, it must #e construed as a pledge3 #ut if there was some other intention, it is not a pledge. ?owever, even though a transfer, if regarded #y itself, appears to have #een a#solute, its o#ject and character might still #e 0ualified and explained #y a contemporaneous writing declaring it to have #een a deposit of the property as collateral security. A transfer of property #y the de#tor to a creditor, even if sufficient on its face to ma6e an a#solute conveyance, should #e treated as a pledge if the de#t continues in existence and is not discharged #y the transfer, and that accordingly, the use of the terms ordinarily importing conveyance, of a#solute ownership will not #e given that effect in such a transaction if they are also commonly used in pledges and mortgages and therefore do not un0ualifiedly indicate a transfer of a#solute ownership, in the a#sence of clear and unam#iguous language or other circumstances excluding an intent to pledge •
•
Yuliong%iu v. -NB Fa%t Fa#t%: Plaintiff Fa#t%: Plaintiff o#tained a loan from P)5. To guarantee guarantee its payment, it pledged vessels to the latt er. 8hen plaintiff failed to pay, P)5 too6 possession of the vessels and executed a deed of sale in its favor. Plaintiff argues that the contract was a chattel mortgage. The 2ourt disagreed. Plaintiff also contends that constructive delivery was insufficient to ma6e the pledge effective. The 2ourt ruled otherwise. Delivery depends on the peculiar nature of the things in 0uestion. Since P)5 was, pursuant to the terms of pledge contract, in full control of the vessels thru the plaintiff, the former could actually ta6e actual possession at any time during the life of the pledge to ma6e more effective its security.
S'% Ya' v. S'% D$ SUMMARY: Tiram#ulo spouses mortgaged their lands to Dumaguete ural #an6. 8hile the mortgage was still effective, Tiram#ulos sold the lots to Sps Dy without the consent and 6nowledge of the #an6. Tiram#ulo defaulted so D5+ extrajudicially foreclosed the mortgage, and D5+ #ecame the highest #idder on 7arch $1, 1%*". The certificate of sale was registered une "!,1%*$. D5+ sold lots 1, $ and & to Sps Dy, #ut lot $ was not included in those lands foreclosed. Sps Dy was granted a motion for writ of possession. >ne month #efore 1 year redemption period -7ay 1%*!, Sps Dy tried to redeem the lots #ut Haps did not want to accept, saying that the redemption price should #e at the price of the auction sale -P"1&,!.%$ and not the loan as tendered #y the Dys -!,I1, interest. Dy again consigned with the court in the amount of roughly *, to add to the redemption and include lot $. S2 ruled in favor of Sps Dy, saying that the redemption was well within the period, and that piecemeal redemption was allowed, and that the value should #e prorated. DOCTRINE: As held in Natino v. IAC , the tender of the redemption money may #e made to the purchaser of the land or to the sheriff. +f made to the sheriff, it is his duty to accept the tender and execute the certificate of redemption. The re0uisites for a valid redemption areF -1 the redemption must #e made within twelve -1" months from the time of the registration of the sale in the >ffice of the egister of Deeds3 -" payment payment of the purchase price of the property property involved, involved, plus 1J interest interest per month thereon in addition, addition, up to the time of redemption, together with the amount of any assessments or taxes which the purchaser may have paid thereon after the purchase, also with 1J interest on such last named amount3 and -$ written notice of the redemption redemption must #e served served on the officer officer who made the sale and a duplicate filed with the egister of Deeds of the province. The sale #y the mortgagor of mortgaged property to a third person notwithstanding the lac6 of written consent #y the mortgagee is valid, and the third person has the right to redeem the foreclosed property •
•
•
DB- v. CA SUMMARY: Private respondent Cydia 2u#a is a grantee of a fishpond lease agreement from the :overnment. She later o#tained a loan from D5P in the amounts of P1%, , P1%, , and P%*, ( under the terms stated in the three promissory notes. As a security for the said loan 2u#a executed a two Deed of Assignment of her Ceasehold ights. Then she failed to pay her loan when it #ecame due in accordance with the terms of the promissory notes. D5P in turn appropriated the leasehold rights of 2u#a over the fishpond, without foreclosure proceedings, whether judicial or extrajudicial. After appropriating the said leasehold rights D5P executed a Deed of 2onditional Sale of the Ceasehold ights in favor of respondent 2u#a over the same fishpond, to which 2u#a agreed. espondent 2u#a failed to pay the amorti@ations stipulated in the Deed of 2onditional Sale, however she was a#le enter with D5P a temporary arrangement with D5P for the Deferment )otarial escission of Deed of 2onditional Sale. ?owever, a )otice of escission thru )otarial Act was sent the D5P to 2u#a, then it too6 possession of the fishpond in 0uestion. After it too6 possession of the said fishpond, D5P disposed the property in favor of Agripina 2aperal through a deed of conditional sale. Then a new fishpond lease agreement was awarded #y the :overnment t o 2aperal. Cydia 2u#a filed an action with the egional Trial 2ourt of Pangasinan for the declaration declaration of nullity of D5P9s appropriation of of her leaseholds over the su#ject fishpond, for the annulment of the Deed of 2onditional Sale executed in her favor #y D5P, the annulment of D5P9s sale of the fishpond t o 2aperal, and the restoration of her rights over the said fishpond and for damages. The T2 ruled in favor of 2u#a, declaring that D5P9s ta6ing possession and ownership of the su#ject property without foreclosure was violative of Art. "** of the 2ivil 2ode, and that condition )o.1" of the Assignment of the Ceasehold ights was void for #eing a clear case of pactum of pactum commissorium. 5oth commissorium. 5oth 2u#a and D5P elevated the case to the 2A, with 2u#a see6ing an increase in the amount of damages, while D5P 0uestioned the findings of fact and law of t he T2. The 2A reversed the ruling of the T2 with regards to the validity of the acts of D5P. S2 reversed 2A decision and modified T2 decision. S2 ruled that thetwo Deed of Assignment Assignment executed #y 2u#a in favor of D5P would operate as a mortgage or some other contract CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
3
DOCTRINE: +n People’s Bank & Trust Co. vs. Odom, Odom, this 2ourt had the occasion to rule that an assignment to guarantee an o#ligation is in effect a mortgage.
Manila Suret$ v. ela$o ela$o SUMMARY: 7anila Surety executed a #ond for t he dissolution of a writ of attachment against =elayo. To secure payment to 7anila Surety, =elayo in turn pledged four pieces of jewelry to the Surety 2ompany with power to sell the same in case the surety paid or #ecome o#ligated to pay any amount of money in connection with said #ond. udgment was executed against =elayo #ut was unsatisfied, forcing 7anila surety to pay the #ond #ut which it failed to recover from =elayo. 7anila Surety caused the pledged jewelry to #e s old, reali@ing a net product of P"$'. only. =elayo =elayo was una#le to pay t he #alance. =elayo countered with a claim that the sale of the pledged jewelry extinguished any further lia#ility on his part under Article "11' of the 1%' 2ivil 2ode. S2 heldF =elayo9s lia#ility to 7anila Surety is extinguished. Article "11', in its last portion, clearly esta#lishes that the extinction of the principal o#ligation supervenes #y operation of imperative law that the parties cannot overrideF If the price of the sale is less neither shall the creditor !e entitled to recover the deficienc" not#ithstanding an" stipulation to the contrar". 5y electing to sell the articles pledged, instead of suing on t he principal o#ligation, the creditor has waived any other remedy, and must a#ide #y the results of the sale. )o deficiency is recovera#le. DOCTRINE: The accessory character is of the essence of pledge and mortgage. As stated in Article "*' of the 1%' 2ivil 2ode, an essential re0uisite of these contracts is that they #e constituted to secure the fulfillment of a principal o#ligation
Ong v. Ro/an !ending SUMMARY: SUMMARY: The sps. >ng o#tained a series of loans from o#an3 all the loans were secured #y a real estate mortgage on the sps. >ng9s parcel of land in Tarlac 2ity. Su#se0uently, Su#se0uently, the sps. >ng and o#an entered into t wo agreementsF a memorandum of agreement -7>A and a Dacian in Payment Agreement -DPA. Knder the DPA, DPA, the sps. >ng were to assign the properties m ortgaged to o#an in settlement of their total o#ligation3 under the 7>A, on the other hand, the sps. >ng committed to pay t he amount of the loan wE in 1 year < else, t he DPA would #e enforced. Su#se0uently, the sps. >ng filed a complaint principally praying that the 7>A and the DPA #e #e declared void for #eing pactum #eing pactum commisorum. commisorum. The trial court dismissed the complaint on the ground that there was no pactum no pactum commisorum. commisorum. This was affirmed #y the 2A. The S2 reversed and set aside the decision of the 2A. The S2 found that the 7>A and the DPA constituted pactum constituted pactum commissorium. The 7>A and the DPA contained no provisions for foreclosure proceedings nor redemption. Knder the 7>A, the failure of the sps. >ng to pay their de#t wEin 1 year gave o#an the right to enforce the DPA, transferring to it the ownership of the properties. o#an in effect automatically ac0uires ownership of the properties upon the failure of the sps. >ng to pay their de#t wEin the stipulated period. DOCTRINE: -)oteF the case is under Pledge in the Sylla#us. Pactum commissorum ena#les the mortgagee to ac0uire ownership of the mortgaged property wEo the need of any foreclosure proceedings < such a situation is prohi#ited under Art. "** -)22. The following are the elements of pactum of pactum commissoriumF commissoriumF 1. There is is a property property mortgaged mortgaged #y way of security security for the payment payment of the principa principall o#ligation3 o#ligation3 and, and, ". There should should #e a stipulation stipulation for the the automatic automatic appropriatio appropriation n #y the creditor creditor of the thing mortgaged mortgaged in case case of non4payment non4payment of the principal o#ligation wEin the stipulated period.
Medida v. CA SUMMARY: The spouses Dolino o#tained a loan of P$, from 2ity Savings 5an6 secured #y a lot in the 2e#u 2ity 2adastre. The loan #ecame due and demanda#le #ut the spouses still failed to pay. So the 5an6 caused the extrajudicial foreclosure of the m ortgage. +t was the highest #idder in the pu#lic auction s ale conducted. After 1 year, the spouses still failed to redeem the land. The #an6 then caused the issuance of a new T2T in their name. The spouses Dolino filed a case for the annulment of the sale at pu#lic auction as well as the corresponding certificate of sale and T2T issued. The 2+ ruled in favor of the spouses. +t upheld the /7, #ut annulled the / foreclosure sale #ecause of the failure to comply with the notice re0uirements in Act )o. $1$', as amended. The 2A modified the 2+ decision #y declaring void and ineffective the /7. S2 reinstated the 2+ decision. The case relied upon #y the 2A does not apply to present case which involves a mortgage, not a sale, to the #an6. DOCTRINE: A DOCTRINE: A redemptioner is defined as a creditor having a lien #y attachment, judgment or mortgage on mortgage on the property sold, or on some part thereof, su!se$uent
I%aguirre v. de !ara SUMMARY: elicitas de Cara o#tained several loans from P)5. 8hen she encountered financial difficulties, she turned to +saguirre for assistance. elicitas and +saguirre executed a Deed of Sale and Special 2ession of ights and +nterestsB over a "' s0m lot, which was part of pending a 7iscellaneous Sales Application, covering 1 s0m, with the 5ureau of Cands. % years after the execution of the Deed, +saguirre filed a sales application over the "' s0m property. ?is application was granted and an >2T was issued in his name. 7eanwhile, elicitas9 pending application over the 1 s0m lot -which included the "' s0m sold to +saguirre was also approved. Due to the overlapping of titles, +saguirre filed an Action for Luieting of Title and Damages with T2 Davao. The T2 ruled in f avor of +saguirre. >n appeal, the 2A reversed the ruling and held that there was only an e0uita#le mortgage, not a sale. The 2A was affirmed #y the S2. elicitas then moved for the issuance of a 8rit of Possession #efore the T2, which was granted. >n appeal, the 2A affirmed the issuance of the 8rit3 hence, the instant appeal to the S2. The S2 held that elicitas was entitled to the 8rit since a simple mortgage does not give the mortgagee a right to the possession of the property unless the mortgage should contain some special provision to that effect. DOCTRINE: The only right granted #y law in favor of the mortgagee is to demand the execution and the recording of the document in which the mortgage is formali@ed. -)22 "1"' As a general rule, the mortgagor retains possession of the mortgaged property since a mortgage is merely a lien and title to the property does not pass to the mortgagee. /ven though a mortgagee does not have possession of the property, there is no impairment of his security since the mortgage directly and immediately su#jects the property upon which it is imposed, whoever the possessor may #e, to the fulfillment of the o#ligation for whose security it was constituted. -)22 "1"& •
•
•
CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
4
•
•
+f the de#tor is una#le to pay his de#t, the mortgage creditor may institute an action to foreclose the mortgage, whether judicially or extrajudicially, where#y the mortgaged property will then #e sold at a pu#lic auction and the proceeds therefrom given to the creditor to the extent necessary to discharge the mortgage loan. A simple mortgage does not give the mortgagee a right to the possession of the property unless the mortgage should contain some special provision to that effect.
Canla% v. CA SUMMARY: >smundo 2anlas and 7aMosca entered into a #usiness venture. To raise funds, >smundo, through a SPA, authori@ed 7aMosca to mortgage two parcels of land owned #y >smundo and his spouse Angelina. Cater, >smundo sold the two lots to 7aMosca for P*', < P$', of which was to #e >smundo9s investment in their #usiness. 7aMosca failed to pay P!&, of the remaining P', #alance. Cater, 7aMosca used impostors to secure two mortgages -one of which was with AS5 over the 2anlases9 lots. 7aMosca failed to pay the loan he too6 out with AS5, so AS5 foreclosed on the property. The 2anlases found out that their lots were #eing foreclosed and as6ed the courts to stop such. T2 declared the mortgage to AS5 null and void. 2A reversed and held that >smundo was estopped from assailing the mortgage deed. S2 reversed the 2A and ruled that the mortgage is null and void #ecause it was executed #y impostors who pretended to #e the 2anlases, in violation of the rule that a mortgage may #e constituted only #y the owner of the property. AS5 was held lia#le for not exercising the re0uisite diligence in ascertaining the identity of the impostors who came to them pretending to #e the 2anlases. Knder the last clear chance, even if >smundo was negligent in letting 7aMosca mortgage his properties, the #an6 must still suffer the loss. DOCTRINE: A DOCTRINE: A contract of mortgage must #e constituted only #y the a#solute owner on the property mortgaged. A mortgage const ituted #y an impostor is void. The degree of diligence re0uired of #an6s is more than a good father of a family, in 6eeping with their responsi#ility to exercise the necessary care and prudence in dealing with registered or titled property. The #usiness of a #an6 is affected with pu#lic interest, holding in trust the money of the depositors, which #an6 deposits the #an6 should guard against loss due to negligence or #ad faith, #y reason of which the #an6 would #e denied the protective mantle of the land registration law, accorded only to purchases or mortgagees for value and in good faith. 8here #oth parties are negligent #ut the negligent act of one is apprecia#ly later in point of time than that of the other, or where it is impossi#le to determine whose fault or negligence #rought a#out the occurrence of the incident, the one who had the last clear opportunity to avoid the impending harm #ut failed to do so, is chargea#le with the conse0uences arising therefrom
-NB v. Cor'u( SUMMARY: 2orpu@ SUMMARY: 2orpu@ delivered to a rural #an6 her T2T over a piece of land as security against any lia#ility she might incur against her employer. The rural #an6 eventually cancelled its lien on the T2T, she having incurred no lia#ility I she moved to the KS. ?owever, without 2orpu@9s 6nowledge and consent, the rural #an69s m anager turned over 2orpu@9s title to Alano, 2amacho, and 2allejo, and the three made it appear that 2orpu@ sold her land to one 7ary 5ondoc. 7ary 5ondoc allegedly sold the property to the Sps. Palaganas, who later on also sold it in favor of Sps. Songcuan. The Sps. Songcuan then used this property -evidenced #y the title issued in their name as security for a loan they too6 from P)5. 5efore granting the loan, P)5 had the title verified and t he property inspected. 2orpu@ filed a case against them. The T2 and 2A ruled in her favor and annulled the layers of deeds of sale of land I reinstated 2orpu@9s title. S2 agreed with the T2 and 2A. +n the course of its verification, petitioner P)5 was informed of the previous T2Ts covering the su#ject property. And And the P)5 has not categorically contested this finding. +t is evident from the faces of those titles that the ownership of the land changed from 2orpu@ to 5ondoc, from 5ondoc to the Palaganases, and from the Palaganases to the Songcuans in less than three months and mortgaged to P)5 within four months of the last transfer. T)e a/ove in"or&ation in turn %)ould )ave driven t)e -NB to look at t)e deed% o" %ale involved. DOCTRINE: As DOCTRINE: As a rule, the 2ourt would not expect a mortgagee to conduct an exhaustive investigation of the history of the mortgagor9s title #efore he extends a loan. 5ut petitioner P)5 is not an ordinary mortgagee3 it is a #an6. 5an6s are expected to #e more cautious than ordinary individuals in dealing with lands, even registered ones, since the #usiness of #an6s is im#ued with pu#lic interest.
S'%. Certe(a v. -SB Fa%t Fa#t%0Do#trine: Petitioners Fa#t%0Do#trine: Petitioners contend that the auction sale conducted #y virtue of the extrajudicial foreclosure of the mortgage should #e declared null and void for failure to comply with the two4#idder rule. Court ruled that it is no# no longer re$uired to have at least t#o !idders in an e%traudicial foreclosure of mortgage.
Nagtalon v. UC-B SUMMARY: K2P5 was a mortgagee of )agtalons, who defaulted. 5ecause of this, the /7 was foreclosed and K2P5 ended up #eing the highest #idder. K2P5 filed an ex parte motion for writ of possession, which )agtalon opposed. S2 held that the writ should issue, saying that the general rule is that the writ of possession is a ministerial duty of the court. DOCTRINES: :eneral ule for issuance of 8rit of PossessionF Any 0uestion regarding the validity of the mortgage or its foreclosure is not a legal ground for refusing the issuance of a writ of executionEwrit of possession, since its issuance is a ministerial function. /xceptionsF 1. :ross inade0ua inade0uacy cy of purchase purchase priceFinjusti priceFinjustice ce could result result in issuing issuing a writ of possession possession under the the given factual factual scenario scenario and thus the issuance of the writ must #e deferred. ". Third party party claiming claiming right adverse adverse to de#torEmortg de#torEmortgagorF agorF where where such third party party claim and possessio possession n exist, the trial trial court should should conduct a hearing to determine the nature of the adverse possession. •
•
CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
5
$.
ailure ailure to pay the surplus surplus proceeds proceeds of the sale to mortgagorF mortgagorF e0uita#l e0uita#le e consideratio considerations ns demands demands the deferment deferment of the issuance issuance of the writ as it would #e highly unfair and ini0uitous for t he mortgagor, who as a redemptioner might choose to redeem the foreclosed property, to pay the e0uivalent amount of the #id clearly in excess of t he total mortgage de#t.
Star T1o v. -a'er Cit$ SUMMARY: rom SUMMARY: rom 1%%41%%1, Paper 2ity applied for and was granted four -! loans and credit accommodations #y-252, now su#stituted #y Star Two -SP=4A72, -SP=4A72, +nc #y virtue of epu#licAct )o. %1*". The loans were secured #y four -! Deeds of 2ontinuing 2hattel 7ortgages on its machineries and e0uipment found inside its paper plants. ?owever, 252 eventually executed a unilateral 2ancellation of Deedof 2ontining 2hattel 7ortgage. +n 1%%", 252, as the trustee #an6, together with 7etro#an6 and Knion 5an6,entered into a 7ortgage Trust +ndenture -7T+, with Paper 2ity. +n the said 7T+, Paper 2ity ac0uired additionalloans secured #y five -' Deed of eal /stat e 7ortgage, plus real and personal properties in an annex to the 7T+,which covered the machineries and e0uipment of Paper 2ity. The 7T+ was later on amended and supplementedthree -$ times, wherein the loan was increased and included the same mortgages with an additional #uilding andother improvements inthe plant site. Paper 2ity was a#le to comply with the loans #ut only until 1%%( due to aneconomic crisis. 252 filed a petition for extra4judicial foreclosure against the real estate executed #y Paper 2ityincluding all the improvements #ecause of payment default. The property was foreclosed and su#jected to pu#lic auction. The three #an6s and the highest #idder were issued a 2ertificate of Sale. Paper 2ity filed a complaintalleging that the sale was null and void due to lac6 of prior notice. During the pendency of the complaint, Paper 2ity filed a motion to remove machinery out of the foreclosed land and #uilding, that the same were not included inthe foreclosure of the real estate mortgage. The trial court denied the m otion, ruling that the machineries ande0uipment were included. Thereafter, Paper 2ity;s 7otion for econsideration, the trial court granted the same andjustified the reversal #y finding that the machineries and e0uipment are chattels #y agreement thru the four Deeds of 2ontinuing 2hattel 7ortgages3 and that the deed of cancellation executed #y 252 of said mortgage was not valid#ecause it was one unilaterally. The 2A affirmed the orders of the trial c ourt #ecause itrelied on the plain language of the 7T+;s stating that nowhere from any of the 7T+s executed #y the parties can wefind the alleged NexpressN agreement adverted to #y petitioner. S2 reversed and ruled that these were real properties su#ject to real estate mortgage
2olden1a$ Mer#)andi%ing v. E3uita/le -CI SUMMARY: Petitioner executed a /7 in favor of respondent over its real property in =alen@uela to secure a "7 loan granted #y respondent. Kpon failure to settle the loan, respondent extrajudicially foreclosed the /7. The sale was registered on e#ruary 1&, "1. Petitioner offered to redeem the property through a letter dated 7arch *, "1 #ut was told that this was no longer possi#le since the sale had #een registered. Petitioner filed this suit alleging that it is the one4year period of redemption under Act )o. $1$' which should apply and not the shorter redemption period provided in A *(%1. urthermore, it alleged t hat applying Section !( of A *(%1 to the real estate mortgage executed in 1%*' would result in the impairment of o#ligation of contracts and violation of the e0ual protection clause under the 2onstitution, thus 0uestioning its constitutionality. 5oth T2 and 2A dismissed the case. SC: edemption SC: edemption no longer possi#le. Section !( did not divest juridical persons of the right to redeem their foreclosed properties #ut only modified the time for the exercise of such right #y reducing the one4year period originally provided in Act )o. $1$'. The new redemption period c ommences from the date of foreclosure sale, and expires upon registration of the certificate of sale or three months after foreclosure, whichever is earlier. There is li6ewise no retroactive application of the new redemption period #ecause Section !( exempts from its operation those properties foreclosed prior to its effectivity and whose owners shall retain their redemption rights under Act )o. $1$'. DOCTRINE: On t)e #on%titutionalit$ o" Se#tion *4. Section !( of .A. *(%1 does not violate the constitutional proscription against impairment of the o#ligation of contract. There is an impairment if a su#se0uent law changes the terms of a contract #etween the parties, imposes new conditions, dispenses with those agreed upon or withdraws remedies for the enforcement of the rights of the parties. Section !( did not divest juridical persons of the right to redeem their foreclosed properties #ut only modified the time for the exercise of such right #y reducing the one4year period originally provided in Act )o. $1$'. Section !( also does not infringe t he e0ual protection clause. /0ual protection permits of reasona#le classification as long as it is germane to the purpose of the law, concerns all mem#ers of the class, and applies e0ually to present and future conditions. The legislature clearly intended to shorten the period of redemption for juridical persons whose properties were foreclosed and sold in accordance with the provisions of Act )o. $1$'. The difference in the treatment of juridical persons and natural persons was #ased on the nature of the properties foreclosed < whether these are used as residence, for which the more li#eral one4year redemption period is retained, or used for industrial or commercial purposes, in which case a shorter term is deemed necessary to reduce the period of uncertainty in the ownership of property and ena#le mortgagee4#an6s to dispose sooner of these ac0uired assets.
A#&e S)oe v. CA SUMMARY: A SUMMARY: A chattel mortgage in favor of P5P was executed in #ehalf of Acme Acme < this mortgage secured a corporate loan of P$7. The chattel mortgage contained a clause that there was an intention for the chattel mortgage to cover not just the existing o#ligation #ut also o#ligations yet to #e contractedEincurred. /ventually, P5P was a#le to pay the P$7 loan. +n the years that followed, P5P extended several other loans t o Acme, which Acme was a#le to settle promptly. ?owever, ?owever, due to financial constraints, Acme was una#le to pay #ac6 a P17 loan that P5P had extended to it. See6ing to enforce the chattel mortgage, P5P applied for an extrajudicial foreclosure with the Sheriff of 2aloocan 2ity. Thus, Acme filed an action for injunction, with damages and a prayer for the issuance of a writ of preliminary injunction, #efore the T2 of 2aloocan 2ity. The T2 decided in favor of P5P and ordered that t he foreclosure push through. The 2A affirmed the decision of t he T2 in toto. Thus, Acme filed a petition for review with the S2. The S2 set aside the decision of the 2A. The S2 held that the full payment of the P$7 loan had automatically rendered the chattel mortgage paid or terminated. Thus, the chattel mortgage could not have covered the P17 loan which Acme had #een una#le to pay and for which the foreclosure had #een sought. DOCTRINE: A DOCTRINE: A chattel mortgage 7KST comply su#stantially with the form prescri#ed #y the 2hattel 7ortgage Caw itself. >ne of the re0uisites is the execution of an affidavit in good faith Osec. ' < the parties to a contract 7KST execute an oath, -the mortgage is made for the purpose of securing the o#ligation specified in the conditions thereof, and for no other purpose, and that the same is a just and valid o#ligation, and one not entered into for the purpose of fraud.B Thus, the de#t referred to in the law is a 2K/)T o#ligation < )>T one that is merely contemplated. +n accordance with Sec. $ of the 2hattel 7ortgage Caw, the payment of the o#ligation automatically renders the chattel mortgage void or terminated.A chattel mortgage can only cover o#ligations existing at the time the mortgage is constituted < upon payment of the existing o#ligations covered, there no longer is any chattel mortgage that can cover new loans thereafter concluded. CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
6
Tu&alad v. i#en#io SUMMARY: =icencio and Simeon executed a chattel m ortgage over their house in 7anila in f avor of the Tumalads to guarantee a loan of P!,*. 5ecause they defaulted, the mortgage was extrajudicially foreclosed. The house was sold to the Tumalads, as the highest #idder, in a pu#lic auction sale. The Tumalads then commenced a civ il case for /jectment against =icencio and Simeon. The 7un2ourt and the 2+ ruled in favor of the Tumalads. The S2 reversed the 2+ and dismissed the case. 8hile the su#ject of the chattel mortgage is a house, which is a real property, =icencio and Simeon are estopped from claiming that the house can not #e considered as the su#ject of the chattel mortgage. The 2ourt also too6 into account the fact that such house was on a rented lot. ?owever, =icencio and Simeon should not #e made to pay rentals. Since =icencio and Simeon were occupying the house at the time of the auction sale, they are entitled to remain in possession during the period of redemption or within one year from and after "( 7arch 1%'&, the date of the auction sale, and to collect the rents or profits during the said period. The period of redemption had not yet expired when action was instituted in the court of origin. Also, the Tumalads did not choose to ta6e possession under Section (, Act )o. $1$', as amended, which is the law selected #y the parties to govern the extrajudicial foreclosure of the chattel mortgage. Since the Tumalads9 right to possess was not yet #orn at the filing of the complaint, there could #e no violation or #reach thereof. DOCTRINE: +f a house #elonging to a person stands on a rented land #elonging to another person, it may #e mortgaged as a personal property as so stipulated in the document of mortgage. The principle is predicated on statements #y the owner declaring his house to #e a chattel, a conduct that may conceiva#ly estop him from su#se0uently claiming otherwise. Section ( of the same Act allows the purchaser of the property to o#tain from the court the possession during the period of redemptionF #ut the same provision expressly re0uires the filing of a petition with the proper 2ourt of irst +nstance and the furnishing of a #ond. +t is only upon filing of the proper motion and the approval of the corresponding #ond that the order for a writ of possession issues as a matter of course. 5efore the expiration of the 14year period within which the judgment4de#tor or m ortgagor may redeem the property, the purchaser thereof is not entitled, as a matter of right, to possession of the same.
Makati !ea%ing v. 5earever SUMMARY: 8earever Textile Textile 7ills, +nc. -8T7+ discounted and assigned several receiva#les with 7a6ati Ceasing and inance 2 orporation -7C2 under a eceiva#le Purchase Agreement in order to o#tain f inancial accommodations from the latter. To secure this, 8T7+ executed a 2hattel 7ortgage over certain raw materials inventory as well as a machinery descri#ed as an Artos Aero Dryer Stentering ange -dryer. 8T7+ defaulted so 7C2 filed a Petition for /xtrajudicial oreclosure. The Sheriff was una#le to enter 8T7+9s premises so 7C2 filed a 2omplaint for udicial oreclosure with 2+ i@al. The 2+ issued a 8rit of Sei@ure and the sheriff was a#le to sei@e the main drive motor of the dryer. 8T7+ then filed a Petition for 2eriorari and Prohi#ition with the 2A, which set aside the 2+9s >rders. The 2A held that the dryer cannot #e su#ject of a chatt el mortgage as it was real property. ?ence, the instant Petition. The S2 held t hat even if the dryer is real property, parties to a contract may #y agreement treat as personal property that which #y nature would #e real property, as long as no interest of third parties would #e prejudiced there#y. The S2 found the characteri@ation of the s u#ject machinery as chattel #y the private 8T7+ is indicative of intention and impresses upon the property the character determined #y the parties. Thus, 8T7+ is estopped from claiming that the dryer is real property. DOCTRINE: +f a house of strong materials, may #e considered as personal property for purposes of executing a chattel mortgage thereon as long as the parties to the contract so agree and no innocent third party will #e prejudiced there#y, there is a#solutely no reason why a machinery, which is mova#le in its nature and #ecomes immo#ili@ed only #y destination or purpose, may not #e li6ewise treated as such. -Tumalad doctrine o >ne who has so agreed is estopped from denying the existence of the chattel mortgage. The parties to a contract may #y agreement treat as personal property that which #y nature would #e real property, as long as no interest of third parties would #e prejudiced there#y. •
•
D$ v. CA SUMMARY: 8ilfredo #ought a truc6 and a tractor using money loaned from Ci#ra. To secure the loan, he mortgaged the truc6 and the tractor to Ci#ra. 8ilfredo9s #rother Perfecto wanted the tractor so he #ought it from 8ilfredo and assumed the mortgage de#t. ?owever, Ci#ra refused to release release the tractor without without full payment payment of 8ilfredo9s 8ilfredo9s de#t -including -including the price of the truc6, truc6, so Perfecto Perfecto convinced his sister to #uy the truc6. Perfecto tendered a chec6 for the full payment of 8ilfredo9s de#t to Ci#ra, #ut Ci#ra refused to release the tractor to Perfecto pending clearance of the chec6. ?owever, #efore the chec6 can #e cleared, a sheriff levied upon the tractor to satisfy 8ilfredo9s judgment de#t against :/CA2. :/CA2 was a#le to #uy the tractor on auction and later sell it to its stoc6holder :on@ales. Perfecto filed an action for replevin against :/CA2. T2 ruled in his favor, 2A reversed T2. >n appeal to the S2, T2 was upheld and the tractor was awarded to Perfecto. S2 held that under the )22, 8ilfredo as owner4mortgagor remained entitled to sell the tractor su#ject only to the consent of the mortgagee Ci#ra, which was o#tained. o#tained. The sale to Perfecto is therefore therefore valid, a#sent proof that Ci#ra had already foreclosed foreclosed on the mortgage. mortgage. The non4clearan non4clearance ce of the chec6 did not affect the consummation of the sale, since the chec6 payment pertained to 8ilfredo9s de#t and not to the purchase price of the tractor and truc6. DOCTRINE: The chattel mortgagor continues to #e the owner of the property, and therefore, has the power to alienate the same3 however, he is o#liged under pain of penal lia#ility, to secure the writ ten consent of the mortgagee. Thus, the instruments of mortgage are #inding, while they su#sist, not only upon the parties executing them #ut also upon those who later, #y purchase or otherwise, ac0uire the properties referred to therein. The a#sence of the written consent of the mortgagee to the sale of the mortgaged property in favor of a third person, does not affect the validity of the sale #ut only the criminal lia#ility of the mortgagor and the #inding effect of such sale on the mortgagee under the Deed of 2hattel 7ortgage. A third person who purchases the mortgaged property automatically steps into the shoes of the original mortgagor.
CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
7
-AMECA v. CA SUMMARY: PA7/2A SUMMARY: PA7/2A loaned P"mil from D5P and executed a promissory note, secured #y its inventory of furniture and e0uipment. A month #efore the mortgage contract, its supposed mar6et value was P".'mil. They defaulted so D5P extrajudicially foreclosed on the chattels. D5P was the only #idder so it was a#le to #uy it for around P$"",. Then for the deficiency, it filed a complaint against PA7/2A and and its solidary de#tors -Teveses -Teveses and Pulido according to the promissory note it signed. T2 ordered PA7/2A to pay the #alance t o D5P3 2A affirmed. PA7/2A PA7/2A went to the S2, arguing that the pu#lic auction was tainted with fraud, and that Art. 1!*! and "11' must #e applied in the transaction #y analogy. The S2 disagreed, saying that the 2hattel 7 ortgage Caw runs inconsistent with those of pledge under Art. "11'. "11'. 8hereas, in pledge, the sale of the thing pledged extinguishes the entire principal o#ligation, suc h that the pledgor may no longer recover proceeds of the sale in excess of the amount of the principal o#ligation, Section 1! of the 2hattel 7ortgage Caw expressly entitles the mortgagor to the #alance of the proceeds, upon satisfaction of the principal o#ligation and costs. DOCTRINE: Since DOCTRINE: Since the 2hattel 7ortgage Caw #ars the creditor4mortgagee from retaining the excess of the sale proceeds there is a corollary o#ligation on the part of the de#tor4mortgagee to pay the deficiency in case of a reduction in the price at pu#lic auction. 8hile it is true that section $ of Act )o. 1'* provides that Na chattel mortgage is a conditional saleN, it further provides that it Nis a conditional sale of personal property as security for the payment of a de#t, or for the performance of some other o#ligation specified therein.N The chattels included in the chattel mortgage are only given as security and not as a payment of the de#t, in case of a failure of payment.
Diego v. Fernando Fa%t Fa#t%: ernando Fa#t%: ernando executed a deed of mortgage in favor of Diego to secure a loan of P",. After which, Diego too6 possession of the properties. ernando however failed to pay even after several demands, thus Diego moved to foreclose the mortgage. ernando opposed contending that the contract was one of antichresis and as Diego has #een reaping the fruits of the property, it is actually the latter who owes him. The 2ourt ruled that it is a contract of mortgage. )onetheless, Diego must account for the fruits he received while in possession of the properties and deduct such from the de#t owing him. Do#trine: +t Do#trine: +t is not an essential re0uisite of a mortgage that possession of the mortgaged premises #e retained #y the mortagagor. To To #e antichresis, it must #e expressly agreed #etween creditor and de#tor t hat the former, having #een given possession of the properties given as security, is to apply their fruits to the payment of the interest, if owing, and thereafter to the principal of his credit, so that if a contract of loan with security does not stipulate the payment of interest #ut provides for the delivery to the creditor #y the de#tor of the property given as security, in order that the latter may gather its fruits, without stating that said fruits are to #e applied to the payment of interest, if any, and afterwards that of the principal, the contract is a mortgage and not antichresis.
2ar#ia v. illar Su&&ar$: :alas mortgaged her L2 lot to =illar. Su#se0uently, Su#se0uently, she mortgaged the same lot to :arcia. 5oth were annotated on the T2T. Then, Then, :alas sold the lot to =illar, free from all liens and encum#rancesB. :arcia then filed an action for mandamus #ut su#se0uently filed an action to foreclose the property. The S2 held that the foreclosure was not proper since there was no violation of the second m ortgage. Also, the mortgagor is allowed to sell the property #ut the loan will still #e su#sisting and enforcea#le against the mortgagor. Do#trine%: A mortgage is a real right, which follows the property, even even after su#se0uent transfers #y the mortgagor. A registered mortgage lien is considered insepara#le from the property inasmuch as it is a right in rem.B The sale or transfer of the mortgaged property cannot affect or release the mortgage3 thus the purchaser or transferee is necessarily #ound to ac6nowledge and respect the encum#rance. •
•
CREDIT: Case Summaries |
Pledge to Antichresis |
kb |
8
