Ileana Macalinao was an APPROVED cardholder of BPI Mastercard She made some purchases through the use of the said credit card and defaulted in paying for said purchases purchases She su!se"uently recei#ed a demand letter from BPI as$ing for the payment of PhP %&%'(%)*& Terms and Conditions: The charges or balance balance thereof remaining unpaid unpaid after the payment payment due date indicated indicated on the monthly Statem Statement ent of Accou Accounts nts shall bear bear intere interest st at the rate of 3% per month month for BPI Expres Express s Credit Credit BPI !old "astercard and "astercard and an additional penalty fee e#ui$alent to another 3% of the amount due for e$ery month or a fraction of a months delay delay PROVIDED that if there occurs any change on the prevailing market rates !CC shall have the option to ad"ust the rate of interest and#or penalty fee due on the outstanding o$ligation %ith prior notice to the cardholder& The Cardholder here$y authori'es !CC to correspondingly increase the rate of such interest (in) the event of changes in the prevailing market rates and to charge additional service fees as may $e deemed necessary in order to maintain its service to the Cardholder&
Macalinao failed to settle her o!ligations' and thus BPI +led a complaint for collection collecti on of sum of money money CA Ruling: ,he amount of PhP %&%'(%)*& already incorporated the interest rates in the said amount ,hus' the said amount should not !e made m ade as !asis in computing the total o!ligation of petitioner Macalinao Macalinao ,he -A also held' howe#er' that the Me,- erred in modifying the amount of interest rate from 3% monthly to only 2% considering that etitioner Macalinao freely availed herself of the credit card facility o!ered "y resondent BPI to the general u"lic
#tatement of the Issue: Macal Macalina inao o claims claims that the interest interest rate and penalty penalty charg charge e of *. per month imposed imposed !y the -A is ini"uitous as the same translates translates to */. per annum or thrice thrice the legal rate of interest interest On the other hand' respondent BPI asserts that said interest rate and penalty charge are reasona!le as the same are !ased on the ,erms and -onditions 0o#erning the Issuance and 1se of the BPI -redit -ard #C Ruling 2e are of the opinion that the interest rate and penalty charge of *. per month should !e e"uita!ly reduced reduced to 3. per month or 3&. per annum Indeed' in the ,erms ,erms and -onditions 0o#erning the Issuance and 1se of the BPI -redit -ard' there was a stipulation on the *. interest rate But' we held in Chua vs& Timan4 Timan 4 &e need not unsettle the principle 'e had a(rmed in a plethora of cases that stipulated interest rates of 3% per month and higher are excessi$e ini#uitous unconscionable and exorbitant Such stipulations are $oid for being contrary to morals if not against the la' *hile C&!& Circular +o& ,-./ 01 %hich took e2ect on 3anuary 4 4,05 e2ectively removed the ceiling on interest rates for $oth secured nothing in the said circular could possibly be read as and unsecured loans regardless of maturity granting carte blanche authority to lenders to raise interest rates to le$els 'hich 'ould either ensla$e their borro'ers or lead to a hemorrhaging of their assets
#ince the stiulation on the interest rate is void$ it is as if there as no e&ress contract thereon. 'ence$ courts may reduce the interest rate as reason and e(uity demand 5%)6 ,he same is true with respect to the penalty charge Pertinently' Pertinently' Article %337 of the -i#il -ode states4 Art %337 ,he 8udge shall e"uita!ly reduce the penalty when the principal o!ligation has !een partly partly or irre irregul gular arly ly compli complied ed with with !y the de!tor de!tor E#en E#en if there there has has !een !een no
performance' the penalty may also !e reduced !y the courts if it is ini"uitous or unconsciona!le ,hus' under the circumstances' the -ourt +nds it e"uita!le to reduce the interest rate pegged !y the -A at %(. monthly to %. monthly and penalty charge +9ed !y the -A at %(. monthly to %. monthly or a total of 3. per month or 3&. per annum in line with the pre#ailing 8urisprudence and in accordance with Art %337 of the -i#il -ode
