773 Phil. 338
REYES, J.:
[Crisostomo] x x x is a long time client of [Allied Bank]. Sometime in 1993, [Fukuoka] x x x engaged the services of [Crisostomo] for the renovation of her house located at No. 25 Camino Real St., Pilar Village, Las Piñas City covered by Transfer Certificate of Title No. 347720 [herein subject property]. After the renovation of her house, [Fukuoka] became interested in buying the adjacent lot owned by Emily Costales but she had no money. [Fukuoka] intimated her plan and her financial problem to [Crisostomo] who answered that it was easy as long as she has the title to her land. [Fukuoka] requested [Crisostomo] to inquire from [Allied Bank] as to how much is the monthly amortization for a loan of P1 million. The next day, [Crisostomo] met [Fukuoka] and gave her a Schedule of Monthly Amortization, which shows that the monthly amortization for sixty (60) months is P29,583.34.In her Complaint,[5] Fukuoka prayed for the deletion of the name of Crisostomo as a party in the Real Estate Mortgage (REM) contract[6] dated December 15, 1995, and insofar as it authorizes Crisostomo to use her mortgaged property for other purposes. According to Fukuoka, the petitioners and Crisostomo jointly conspired to impose the latter's unrelated obligations upon her mortgaged property.[7]
Thereafter, [Crisostomo] applied for a loan which was approved by [Allied Bank] on December 15, 1995 and the former executed Promissory Note No. 0036-95-00767. Consequently, a Loan Release Manifold was issued in the name of [Crisostomo] showing that the amount of P984,937.50 was credited to his Current Account No. 0361-005542. On even date, [Crisostomo] accompanied [Fukuoka], Emily Costales, and Evelyn Pajarillaga x x x, to [Allied Bank's] Talon Branch in Las Piñas City. Thereupon, [Crisostomo] gave P979,000.00 to [Fukuoka] who subsequently signed a Real Estate Mortgage over the subject property in the presence of [Allied Bank's] Talon Branch Manager, Ernesto Pascual xxx. The deed of Real Estate Mortgage states that for and in consideration of the credit accommodation obtained from [Allied Bank] in the amount of P1 million, [Fukuoka] mortgages the subject property in favor of the former. The deed likewise contains a note which states "[t]o secure the loan of [Crisostomo]/C.P. Borillo Const."
[Fukuoka] subsequently requested that her monthly amortizations for the P1 million loan should be deducted through an automatic deduction scheme. Thus, sometime in January 1996, [Fukuoka] directed Evelyn Pajarillaga to open a savings account at [Allied Bank's] Talon Branch. From January 1996 up to May 1999, [Allied Bank] had been deducting the monthly amortizations from Evelyn Pajarillaga's savings account with account number 0360166289.
It appears, however, that from December 18, 1995 until July 1996, [Crisostomo] executed several promissory notes in favor of [Allied Bank], viz:In June 1999, [Allied Bank] refused to deduct the monthly amortization from Evelyn Pajarillaga's account. Evelyn Pajarillaga informed [Fukuoka] who was then in Japan. [Fukuoka] immediately returned to the Philippines and proceeded to [Allied Bank's] Talon Branch, [Fukuoka] confronted defendant-appellant Pascual and the latter told her that she signed other documents and that she should look for [Crisostomo] and secure the services of a lawyer. On June 23, 1999, [Fukuoka's] counsel sent a letter demanding from [Allied Bank] to make the deduction for the month of June.
Date of Execution Promissory Note Number Amount Due Date December 18, 1995 0036-95-00783 P300,000.00 December 12, 1996 December 19, 1995 0036-95-00791 P600,000.00 December 13, 1996 January 17, 1996 0036-96-00044 P1,500,000.00 December 13, 1996 February 23, 1996 0036-96-00265 P2,000,000.00 December 31, 1996 February 26, 1996 0036-96-00281 P800,000.00 December 31, 1996 March 27, 1996 0036-96-00478 P500,000.00 December 31, 1996 May 31, 1996 0036-96-00801 P300,000.00 December 31, 1996 July 3, 1996 0036-96-00931 P1,000,000.00 December 31, 1996
On July 7, 1999, [Fukuoka] filed a Complaint for Reformation of Contract, Specific Performance, Consignation, and Damages against [the petitioners] and [Crisostomo] before the Regional Trial Court of Las Piñas City, Branch 275, docketed as Civil Case No. LP-99-0153. The complaint was later amended to implead [Crisostomo's] spouse, Warlita Borillo. x x x.[4] (Citations omitted and italics in the original)
WHEREFORE, judgment is hereby rendered on the Complaint in favor of [Fukuoka] and against the [petitioners and Crisostomo] directing the latter to pay, jointly and severally, to [Fukuoka], as follows:Allied Bank claimed that Fukuoka is liable not only for the P1,000,000.00 loan but also for all the loans obtained by Crisostomo, past, present and future. Allied Bank argued that the phrase in the REM contract stating, viz: "NOTE" [t]o secure the loan of [Crisostomo]/CP Borillo Const., is sufficient basis for Fukuoka to be liable for all the loans obtained by Crisostomo.[13]As to the cross-claim of [the petitioners] against [Crisostomo], the same is hereby DISMISSED for lack of merit.
- Php100,000.00 as moral damages;
- Php50,000.00 as exemplary damages;
- Php580,800.00 to cover lost income for one year;
- Php100,000.00 as Attorney's fees and the cost of the suit.
SO ORDERED.[12]
I
THE HONORABLE [CA] GRAVELY ERRED IN NOT FINDING THAT THE REQUISITES FOR REFORMATION OF CONTRACT ARE NOT PRESENT AS [FUKUOKA] NEVER OBTAINED ANY LOAN FROM [ALLIED BANK] BUT BOUND HERSELF AS SURETY OF THE LOAN OBLIGATIONS OF [CRISOSTOMO] OBTAINED FROM [ALLIED BANK].II.
THE HONORABLE [CA] GRAVELY ERRED IN NOT FINDING THAT [THE PETITIONERS] ARE NOT BOUND BY THE INTERNAL ARRANGEMENT BETWEEN [FUKUOKA] AND [CRISOSTOMO] AS THEY HAVE NO PRIVITY THERETO.III.
THE HONORABLE [CA] GRAVELY ERRED IN NOT FINDING THAT [CRISOSTOMO] ACTED ALONE IN DEFRAUDING [FUKUOKA].IV.
THE HONORABLE [CA] GRAVELY ERRED IN NOT GRANTING THE CROSS[-]CLA1M OF [THE PETITIONERS] AGAINST [CRISOSTOMO].[22]
A scrutiny of the Credit Ticket reveals that it was issued to [Fukuoka] and that the date typewritten therein is the same date when the Loan Release Manifold was issued to [Crisostomo]. Anent the Schedule of Monthly Amortizations while [the petitioners] insist that it was made by [Crisostomo] himself without their participation, the records clearly show that the monthly amortizations written therein in the amount of P29,583.34 correspond with the monthly amortizations actually deducted from [Pajarillaga's] account in the amount of P29,585.00. Except for their bare assertions that this document originated from [Crisostomo], the unmistakable equivalence in the amount of monthly amortizations was never explained by [the petitioners]. As a matter of fact, despite the subsequent loans granted by [Allied Bank] to [Crisostomo], the monthly amortizations deducted from [Pajarillaga's] account remained unchanged, save for the imposition of interest. Hence, while it was [Crisostomo's] name which was written on the deed of [REM] dated December 15, 1995, from the aforementioned documents and circumstances, the inescapable conclusion is that [Allied Bank], in actuality, intended to loan the amount of P1 million to [Fukuoka].[28]The Court finds that the findings of the CA are more logical and congruent with reality. It is simply a ludicrous notion that either Crisostomo or Fukuoka would unilaterally impose the monthly amortizations to be deducted by Allied Bank as payment for the P1,000,000.00 loan. It is also implausible how the petitioners, up to this point, fail to explain how the amounts written on the Schedule of Monthly Amortizations[29] coincide with the deductions made from Pajarillaga's account, save for the interests. Even though the petitioners insist that it was never the intention of Allied Bank to grant a loan to Fukuoka and there could not have been a meeting of the minds,[30] their actions reveal otherwise. Allied Bank accepted the monthly payments from Fukuoka by way of deduction and in accordance with the Schedule of Monthly Amortizations, despite its claim that it is not privy to whatever internal agreement Crisostomo and Fukuoka had. It is also notable how Fukuoka was never remiss in her monthly payment which only goes to show that she was holding up her end of the agreement.
[F]raud on the part of [Allied Bank] can readily be seen from the feet that despite its release of the amount P984,937.50 in [Crisostomo's] account on December 15, 1995, [Allied Bank's] employee, Marilou Opeña, still issued a Credit Ticket in the name of [Fukuoka] on the same date, thereby causing the latter to believe that she was the one who obtained the loan. To make matters worse, [Allied Bank's] employees inserted the phrase "[t]o secure the loan of [Crisostomo]/C.P. Borillo Const" in the deed of [REM] dated December 15, 1995 without [Fukuoka's] knowledge or consent. In doing so, [Allied Bank] unfairly subjected [Fukuoka's] property to an additional obligation by making it appear that it was mortgaged not only to secure the P1 million loan of [Fukuoka], but also to secure all the loans of [Crisostomo], regardless of their amount.Besides, the RFC earlier revealed that the notaries public, whose acts of notarizing the questioned REMs were disputed, were not presented to belie Fukuoka's claim that she never appeared before them. Additionally, the trickery was made even more manifest by the fact that in all of the questioned REMs, the first page invariably does not cany any signature at all giving rise to the impression that page one was simply inserted in all such documents. The testimony of Fukuoka is that, she was merely told to sign blank documents. There was no notice given to Fukuoka about any purported default of Crisostomo that they claimed cover the mortgage put up by Fukuoka. Instead, Allied Bank continued accepting payments from Fukuoka until it decided to stop collecting for all monthly amortization commencing June 1999.[32]
x x x As to the deed of [REM] dated December 15, 1995, while [Crisostomo] is not the owner of the subject property, his name was typewritten therein as a co-mortgagor upon the instructions of defendant-appellant Pascual. Also, while [the petitioners'] witnesses testified that the deed of [REM] was for the amount of P1 million only, a perusal of the deed of [REM] bearing the date December 15, 1995 which was submitted by [the petitioners] as part of their documentary evidence, was for the amount of P2,200,000.00. We likewise observed that [the petitioners] are insisting that [Fukuoka] executed another deed of [REM] on May 28, 1996. However, [Fukuoka's] passport which was not objected to or refuted by [the petitioners] unmistakably shows that [Fukuoka] was not in the Philippines on such date. In fact, defendant-appellant Pascual himself admitted that there were only two instances when [Fukuoka] went to [Allied Bank's] Talon Branch, one on December 15, 1995 and two, when [Fukuoka] was already seeking help. Taken collectively, these circumstances weigh heavily against [the petitioners'] claim of ignorance over what they refer to as the "trickery" perpetrated by [Crisostomo]. For this reason, We agree with the ruling of the court a quo that [the petitioners] should be held jointly and severally liable with [Crisostomo].[31]