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Pedrosa CD 2.4

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17 views4 pages

Pedrosa CD 2.4

Uploaded by

flipher03
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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GR No.

190755; November 24, 2010

LAND BANK OF THE PHILIPPINES, petitioner,


vs
ALFREDO ONG, respondent.
Facts:

On March 18, 1996, spouses Johnson and Evangeline Sy secured


a loan from Land Bank Legazpi City in the amount of PhP 16
million. The loan was secured by three (3) residential lots, five (5)
cargo trucks, and a warehouse. Under the loan agreement, PhP 6
million of the loan would be short-term and would mature on
February 28, 1997, while the balance of PhP 10 million would be
payable in seven (7) years. The Spouses Sy could no longer pay
their loan which resulted to the sale of three (3) of their
mortgaged parcels of land for PhP 150,000 to Angelina Gloria
Ong, Evangeline’s mother, under a Deed of Sale with Assumption
of Mortgage. Evangeline’s father, petitioner Alfredo Ong, later went
to Land Bank to inform them about the sale and assumption of
mortgage. Land Bank Branch Head told Alfredo that there was
nothing wrong with agreement with the Spouses Sy and provided
him requirements for the assumption of mortgage. Alfredo later
found out that his application for assumption of mortgage was not
approved by Land Bank. On December 12, 1997, Alfredo initiated
an action for recovery of sum of money with damages against
Land Bank, as Alfredo’s payment was not returned by Land Bank.
Alfredo said that Land Bank’s foreclosure without informing him of
the denial of his assumption of the mortgage was done in bad faith
and that he was made to believe that P750,000 would cause Land
Bank to approve his assumption to the mortgage.

He also claimed incurring expenses for attorney’s fees of PhP


150,000, filing fee of PhP 15,000, and P hP250,000 in moral
damages.

This prompted Alfredo to file a case with RTC against Land Bank.
On its decision to the case, RTC held that the contract approving
the assumption of mortgage was not perfected as a result of the
credit investigation conducted on Alfredo where he was
disapproved. As such, it ruled that it would be incorrect to consider
Alfredo a third person with no interest in the fulfillment of
the obligation under Article 1236 of the Civil Code. Although Land
Bank was not bound by the Deed between Alfredo and the
Spouses Sy, the appellate court found that Alfredo and Land
Bank’s active preparations for Alfredo’s assumption of mortgage
essentially novated the agreement.

Issue:

Is Land Bank liable to Ong?

Held:

Unjust enrichment exists “when a person unjustly retains a benefit


to the loss of another, or when a person retains money or property
of another against the fundamental principles of justice, equity and
good conscience.” There is unjust enrichment under Art.22 of the
Civil Code when (1) a person is unjustly benefited, and (2) such
benefit is derived at the expense of or with damages to another.
Lan Bank made Alfredo Ong believe that with the payment PhP
750,000, he would be able to assume the mortgage of the
Spouses Sy. The act of receiving payment without returning it
when demanded is contrary to the adage of giving someone what
us due to him. The outcome of the application would have been
different had Land Bank first conducted the credit investigation
before accepting Alfredo’s payment. He would have been notified
that his assumption of mortgage had been disapproved; and he
would not have taken the futile action of paying PhP 750,000. The
procedure Land Bank took in acting on Alfredo’s application cannot
be said to have been fair and proper.

Petition is DISMISSED, but the interest is at 6%.

WHEREFORE, the appeal is DENIED. The CA Decision in CA-G.R. CR-


CV No. 84445 is AFFIRMED with MODIFICATION in that the amount of
PhP 750,000 will earn interest at 6% per annum reckoned from
December 12, 1997, and the total aggregate monetary awards will in
turn earn 12% per annum from the finality of this Decision until fully paid.

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