501 Phil. 387
Petitioners and Carmen Cerbo represented by petitioners filed Civil Case No. 97016 for annulment of the certificate of sale at public auction, accounting and damages against private respondents.Aggrieved by the order of the trial court, the Spouses Cerbaña, private respondents herein, filed with the appellate court a petition for certiorari contending that the dismissal of the case was improper and that they are the real parties-in-interest in the case being children of the late Carmen Cerbo and having paid the redemption price to petitioner Rural Bank of Calinog.
Petitioners alleged that Carmen D. Cerbo executed a real estate mortgage over her property covered by Transfer Certificate of Title No. T-118033, in favor of private respondent Rural Bank of Calinog (Calinog Bank for brevity); that the mortgage was foreclosed and the subject property was sold at public auction with private respondent Calinog Bank as the highest bidder; that petitioners redeemed the subject property by depositing the amount of P18,000.00 to private respondent Calinog Bank; that to complete payment of the total redemption price of the subject property, petitioners obtained a loan from private respondent Rural Bank of Dingle, Iloilo, (Dingle Bank, for brevity) in the amount of P109,000.00; that to secure payment of the loan obtained from private respondent Dingle Bank petitioners mortgaged the subject property in favor [of] private respondent Dingle Bank; that petitioners have paid the loan obtained from private respondents; that on September 26, 1996, petitioners received a Notice of Sale at public auction of the subject property allegedly for failure to pay the mortgage debt; that petitioners demanded from private respondents an accounting of all payments made and the holding in abeyance by private respondent Dingle Bank of the public sale; that the public sale proceeded as scheduled and the subject property was adjudicated in favor of private respondent Calinog Bank; that because of the failure of the private respondents to account all payments made by and for petitioners the mortgaged property was unjustly foreclosed.
On October 21, 1998, private respondent Calinog Bank moved for the dismissal of the petitioners' complaint.
Private respondent Calinog Bank contended that Carmen Cerbo is the only one who has a cause of action against it because she was the one who executed the Contract of Real Estate Mortgage; that since Carmen Cerbo is already dead, the case should be dismissed against private respondent Calinog Bank; that petitioners do not have the legal personality to represent the late Carmen Cerbo; that petitioners lack cause of action against private respondent Calinog Bank.
Petitioners opposed the motion to dismiss filed by private respondent Calinog Bank. Petitioners contended that as heirs of Carmen Cerbo, they have the personality and the cause of action to institute the action against private respondent Calinog Bank.
On February 2, 1999, assailed order was issued granting private respondent Calinog Bank's motion to dismiss.
Petitioners filed a motion for reconsideration of the order granting private respondent Calinog Bank's motion to dismiss. The same was denied by public respondent.
It is enough that private respondents allege that they made a deposit in the amount of P18,000.00 after the mortgaged property was sold to petitioner at public auction; that they subsequently applied for and obtained an agricultural loan from another rural bank, the net proceeds of which they paid to petitioner in order to discharge the obligation under the mortgage constituted on Carmen Cerbo's property; that the excess amount of P392.47 was not accounted for by petitioner; and that the P18,000.00 deposit was not deducted from the repurchase price of the property. In fine, private respondents contend that they were the ones who paid Carmen Cerbo's loan obligation with petitioner. Whether these allegations entitle private respondents to the reliefs prayed for is a question which can best be resolved after trial on the merits at which each party can present evidence to prove their respective allegations and defenses.
- That Carmen D. Cerbo executed that Real Estate Mortgage on April 5, 1988 involving her property covered by Transfer Certificate of Title No. T-118033 of the Registry of Deeds for the Province of Iloilo, in favor of Rural Bank of Calinog, Inc., a copy of said Real Estate Mortgage is hereto attached as Annex "A";
- That for failure to pay the mortgage indebtedness of Carmen D. Cerbo to Rural Bank of Calinog, Inc., foreclosed the mortgaged property and adjudicated the same in its favor as the highest bidder at the time of public auction sale for a price of P63,616.65 as shown by Certificate of Sale at Public Auction hereto attached as Annex "B";
- That sometime in August 28, 1991, plaintiff Gregorio N. Cerbaña made a deposit of P18,000.00 to Rural Bank of Calinog, Inc., as deposit on asset acquired from Felimon Cerbo/Carmen Cerbo, machine copy of Official Receipt No. 22356 dated August 28, 1991 is hereto attached as Annex "C";
- That sometime in January 20, 1992, plaintiff Spouses Gregorio Cerbaña and Filma Cerbaña secured that agricultural loan from defendant Community Rural Bank of Dingle (Iloilo), Inc., in the amount of P109,000.00 and obtained a net proceeds of P83,392.47 as shown in the Discount Statement dated January 20, 1992 hereto attached as Annex "D";
- That for the net proceeds of P83,392.47, defendant Community Rural Bank of Dingle (Iloilo), Inc., issued check No. 16925 dated January 20, 1992 for P43,392.47 and Far East Bank Check No. C1853959 dated January 20, 1992 for P40,000.00, copies of said checks are hereto attached as Annexes "E" and "F" respectively;
- That aforesaid checks (Annexes "E" and "F") were paid to defendant Rural Bank of Calinog (Iloilo), Inc. and the latter issued its Official Receipt No. 22977 dated January 20, 1992 for P76,000.00 with notation below of P7,000.00 as attorney's fees, or for a total amount of P83,000.00. Copy of said receipt is hereto attached as Annex "G";
- That the excess amount of P392.47 was not accounted for by defendant Rural Bank of Calinog (Iloilo), Inc., to Spouses Gregorio and Filma Cerbaña, neither was the P18,000.00 deposit made by said spouses and covered by Annex "C" hereof, deducted from the repurchase price of the property of Carmen Cerbo;
- That the loan of P109,000.00 with defendant Community Rural Bank of Dingle, (Iloilo), Inc. was settled by spouses by paying P80,000.00 on May 8, 1992 for which they were issued O.R. No. 9105 A and the P89,000.00 was subject of a re-loan on October 19, 1992 with defendant Rural Bank of Dingle (Iloilo), Inc.;
- That sometime in December 22, 1991, plaintiff Gregorio Cerbaña, paid in full the account with defendant Community Rural Bank of Dingle (Iloilo), Inc., as shown by Official Receipt hereto attached as Annex "H";
- That plaintiff spouses Gregorio and Filma Cerbaña, were not properly informed of the handling [of] their loan account with Community Rural Bank of Dingle (Iloilo), Inc., such that they were in the dark of the application of payments they [sic] were made;
- That on September 26, 1996 the plaintiff Spouses Gregorio and Filma Cerbaña were caught in surprise to receive that Sheriff's Notice of Sale at Public Auction, copy of which is hereto attached as Annex "I";
- That because of the notice (Annex "I") Spouses Gregorio and Filma Cerbaña sought the assistance of an accountant/lawyer to examine their account with Community Rural Bank of Dingle (Iloilo), Inc., and their lawyer/accountant sent that [sic] letters dated October 17, 1996 and October 21, 1996 respectively to defendants rural banks, copies of which are hereto attached as Annexes "J" and "K", respectively;
- That said letters were inserted to inform the defendant rural banks to account for the claims of plaintiff spouses, and for Community Rural Bank of Dingle (Iloilo), Inc., to defer foreclosure of the mortgaged property, but those letters were unavailing as defendants Community Rural Bank of Dingle (Iloilo), Inc., proceeded with the sale at public auction of the mortgaged property as scheduled;
- That the foreclosure and outright sale at public auction of the mortgaged properties of plaintiffs are shocking to conscience considering that per computation of an accountant, the obligation of plaintiff Spouses amounts to only P1,153.02 when all their payments made are accounted for by both defendant rural banks;
- That for failure of defendant rural banks to account for the payments of plaintiffs which resulted to the foreclosure and sale at public auction of mortgaged properties of plaintiffs, the latter was obliged to engage the services of counsel at an agreed fee of P25,000.00 plus P1,500.00 per court appearance to defend and protect their rights herein transgressed by defendants;
- That the unconscionable acts of defendants brought about moral anxiety on plaintiffs who likewise claim moral damages in an amount which may be assessed by this Honorable Court as proper in the circumstances;
- That in the filing of this instant case, the plaintiffs incurred actual expenses of P5,000.00 and they are bound to suffer additional actual expenses until this case is finally terminated.