642 Phil. 349
CARPIO, J.:
It appears that on July 28, 1976 plaintiff Bonifacio Maceda, Jr. (Maceda) obtained a loan from the defendant DBP in the amount of P7.3 million to finance the expansion of the Old Gran Hotel in Leyte. Upon approval of said loan, plaintiff Maceda executed a promissory note and a mortgage of real estate. Project cost of the New Gran Hotel was P10.5M. DBP fixed a debt-equity ratio of 70%-30%, corresponding to DBP and Maceda's respective infusion in the hotel project. Maceda's equity infusion was P2.93M, or 30% of P10.5M. The DBP Governor at that time, Recio Garcia, in-charge of loans for hotels, allegedly imposed the condition that DBP would choose the building contractor, namely, Moreman Builders Co. (Moreman). The contractor would directly receive the loan releases from DBP, after verification by DBP of the construction progress. The period of loan availment was 360 days from date of initial release of the loan. Similarly, suppliers of equipment and furnishings for the hotel were also to be paid directly by DBP. The construction deadline was set for December 22, 1977.
Maceda filed a complaint for Rescission of the building contract with Damages against the contractor Moreman, before the then Manila Court of First Instance Branch 39, which was docketed as Civil Case No. 113498. In its decision dated November 28, 1978, the CFI rescinded the building contract, suspended the period of availment, allowed Maceda to himself take over construction, and directed DBP to release to Maceda the sum of P1.003M, which had previously been approved for release in January 1978. The DBP was further ordered to give plaintiff Maceda such other amounts still pending release. Moreman filed an appeal which was subsequently dismissed in 1990 by the Supreme Court. Entry of judgment on this case was issued on April 23, 1990.
In the meantime, Maceda also instituted the case a quo for Specific Performance with Damages against defendant DBP before the Makati RTC in 1984. The Manila CFI's November 28, 1978 Decision and the factual findings therein contained became part of the evidence submitted before the Makati RTC as Exh. "D." In essence, Maceda's complaint before the Makati RTC alleged that DBP conspired with the contractor, Moreman, by approving anomalous loan releases to the latter despite exaggerated charges and valuation made by said contractor on the hotel project. In effect, it was alleged that despite only a 15% accomplishment which should have cost only P700,000.00, the contractor, thru the active connivance of the DBP, was able to rake in a total of P3,174,358.38 or 60% of the cost of the projected hotel building. When plaintiff Maceda himself tried to resume the completion and construction of the hotel project, after the building contract with Moreman was already rescinded by the CFI Manila, defendant allegedly blocked efforts of the plaintiff by delaying the release of funds from his loan with the DBP and imposing onerous conditions which made it difficult for plaintiff to pursue the construction of the New Gran Hotel. It was further alleged that due to such delays on the part of the DBP, the period of availment of the loan expired without the plaintiff's [sic] having availed of the total approved amount of their loan. The construction of the hotel was never finished. Worse, due to interests and penalties, the obligation of the plaintiff has ballooned to P11,817,365.90 as of January 31, 1984, not to mention the amount of P810,702.68 supposedly representing interests and charges for the period of February 1, 1978 to October 1979. Finally, DBP allegedly threatened to foreclose the mortgaged properties of the plaintiff.[4]
WHEREFORE, in view of all the foregoing premises, the Court renders judgment, to wit:
1. The preliminary injunction issued on December 12, 1984 is hereby made permanent;
2. Defendant Development Bank of the Philippines is ordered, to wit:
(a) To immediately release in favor of Plaintiff Bonifacio Maceda, Jr. the unreleased loan balance of P1,952,489.10. In addition, as to the portion thereof amounting to P1.003M, DBP is further directed to pay interest thereon at the rate of 12% per annum beginning and counted from January, 1978;
(b) To immediately return to plaintiff Bonifacio Maceda, Jr. the sum of P797,988.95 representing the interest/other charges for the period October 31, 1979 to April 1, 1980;
(c) To pay Plaintiff Bonifacio Maceda, Jr. the sum of Five Hundred Thousand Pesos as moral damages;
(d) To pay plaintiff Bonifacio Maceda, Jr. the sum of One Hundred Thousand Pesos as exemplary damages;
(e) To pay plaintiff Bonifacio Maceda, Jr. the sum of P17,547,510.90 representing the additional cost to complete and finish the New Gran Hotel;
(f) To pay plaintiff Bonifacio Maceda, Jr. the sum of P100,000.00 as attorney's fees and litigation expense.
The counterclaims of defendants are hereby dismissed.
SO ORDERED.[5]
WHEREFORE, in view of the foregoing and by way of recapitulation, the Court directs and orders that all other dispositions in the Decision dated February 25, 1997 are hereby maintained, except the dispositions under paragraph 2 (subparagraphs C, D, E) which are hereby amended as underlined, and paragraph G added hereunder in conformity with the guidelines in the case of Eastern Shipping Lines, supra, p. 97. The entire dispositive portion shall be as follows:
1. The preliminary injunction issued on December 12, 1984 is hereby made permanent;
2. Defendant Development Bank of the Philippines is ordered, to wit:
(a) To immediately release in favor of plaintiff Bonifacio Maceda, Jr. the unreleased loan balance of P1,952,489.10. In addition, as to the portion thereof amounting to P1.003M, DBP is further directed to pay interest thereon at the rate of 12% per annum beginning and counted from January 1978;
(b) To immediately return to plaintiff Bonifacio Maceda, Jr. the sum of P797,988.95 representing the interest/other charges for the period October 31, 1979 to April 1, 1980;
(c) To pay plaintiff Bonifacio Maceda, Jr. the sum of Seven Hundred Thousand Pesos as moral damages;
(d) To pay plaintiff Bonifacio Maceda, Jr. the sum of One Hundred Fifty Thousand Pesos as exemplary damages; and the sum of Five Hundred Thousand Pesos as temperate damages;
(e) To pay plaintiff Bonifacio Maceda, Jr. the sum of P17,547,510.90 representing the additional cost to complete and finish the New Gran Hotel, plus six percent interest (6%) thereon effective as of the year 1987 until finality.
(f) To pay plaintiff Bonifacio Maceda, Jr. the sum of P100,000.00 as attorney's fees and litigation expense.
(g) After the finality of the Decision, all the foregoing monetary awards in their totality, including the interest imposed thereon as the case may be, shall earn 12% interest from date of such finality until satisfaction.
The counterclaims of defendants are hereby dismissed.
The Court further orders the execution pending appeal of the award under disposition 2(a), as maintained, without bond, and the award under disposition 2(e), as amended, to be covered by plaintiff's bond in the equivalent sum thereof, including the six percent interest (6%) thereon effective as of the year 1987 until date of the said bond.
SO ORDERED.[6] (Underlining in the original)
Thus, We find that the records support the ruling and conclusions made by the RTC in its assailed Decision. Conclusions and findings of fact by the lower courts are entitled to great weight on appeal and will not be disturbed except for strong and cogent reasons. (Atlantic Gulf and Pacific Company of Manila, Inc. vs. Court of Appeals, 247 SCRA 606)
WHEREFORE, based on the foregoing premises, the appeal of plaintiff-appellant is DISMISSED for lack of merit. Likewise, defendant-appellant's appeal is DISMISSED. Accordingly, the assailed February 25, 1997 Decision of the Regional Trial Court of Makati City - Branch 134 in Civil Case No. 8737, and its October 2, 1997 Order which amended the said February 25, 1997 Decision, are AFFIRMED.
SO ORDERED.[10]
I. Whether the Honorable Court of Appeals was correct in holding DBP liable for the acts of Moreman Builders;
II. Whether the Honorable Court of Appeals was correct in upholding private respondent's contention that petitioner connived with Moreman Builders in the alleged anomalous releases;
III. Whether there was reasonable ground for DBP to stop the loan releases;
IV. Whether the Honorable Court of Appeals was correct in upholding the trial court:V. Whether the damages awarded in favor of Maceda are unreasonable and excessive.[13]
- In imposing interest on the unreleased portion of the loan;
- For the return of interests paid on the loan already released to Maceda;
x x x We find credit in the finding that DBP actively connived with the contractor in the anomalous loan releases. DBP falsely argues that releases on the loan were coursed thru the plaintiff-appellant and the checks were drawn jointly in the names of Maceda and Moreman. As found by the RTC, the records show that checks were drawn only in the name of Moreman and plaintiff's conformity to fund releases were solicited by DBP after the fact of release, not before. Direct releases to the plaintiff, instead of Moreman, began only after Moreman was discharged as contractor. Further, it was agreed that payment to Moreman Builders would be assessed against actual construction of the project upon DBP's verification. Thus, DBP contributed in the swindling perpetrated by Moreman against the plaintiff because it improperly discharged its duty as verifier of the construction project.
DBP was also at fault in not releasing the amount of P1.003 Million which had already been approved for release as early as January 1978. We agree with the RTC that it is apparent that such delay in the release of plaintiff's loan is directly attributable to DBP and contributed to the construction delay, such that radical rise in construction cost and prices of materials had already caught up with the hotel project. The P7.3 million loan is a "straight loan" as described in the document dated March 7, 1977 by A.S. Martinez, a DBP managerial officer. In releasing other sums but not the P1.003 million, and in failing to release the bigger sum of P1,952,489.10 which is the total unreleased balance of the loan, DBP treated its prestation according to its likes and dislikes.
As aptly observed by the RTC, "DBP never released the P1.003M. While DBP resumed releases on October 31, 1979 (Exh. "11"), this resumption of releases came more than three years counted from July 1976 when the loan was approved; nearly two years counted from the construction deadline of December 1977; and eleven months counted from plaintiff's letter request dated December 4, 1978. As already found, the fact is that the last resumed release was on October 10, 1980, but leaving out the P1.003 million which was already approved and scheduled for release in January 1978, and leaving P1.95M as the total unreleased balance." (RTC Decision, February 25, 1997, p. 31)
"Had defendant DBP voluntarily released the full loan long ago, (1) as scheduled by DBP itself in January 1978; or (2) as directed by the Manila CFI in the latter's own decision dated November 28, 1978; or (3) as requested by plaintiff in his letter dated December 4, 1978; or (4) as again promised by DBP in its letter dated July 19, 1979, obviously there would be no need for plaintiff to file the "Motion to Direct Defendant DBP to Release Balance of Loan." (RTC Order, October 2, 1997, p. 10)
x x x x
We affirm the RTC in ruling that DBP was at fault when defendant-appellant DBP gave the impression to suppliers that it was not supporting the hotel project and verbally advised suppliers to pull out their units from the jobsite of the hotel. Moreover, when plaintiff-appellant Maceda personally took over the project after the contract with Moreman was rescinded, some suppliers who submitted their claims to DBP were refused payment by the defendant-appellant bank. Thus, said suppliers were constrained to file collection cases and replevin suits against herein plaintiff-appellant.[14]
1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.
2. When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case be on the amount finally adjudged.
3. When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.[24]