G.R. No. 161074 March 22, 2010
MANUEL T. DE GUIA, for himself and as Attorney-in-Fact of FE DAVIS MARAMBA, RENATO DAVIS, FLORDELIZA D. YEH, JOCELYN D. QUEBLATIN and BETTY DAVIS, Petitioners, vs. HON. PRESIDING JUDGE, REGIONAL TRIAL COURT, BRANCH 12, MALOLOS, BULACAN; SPOUSES TEOFILO R. MORTE, ANGELINA C. VILLARICO; SPOUSES RUPERTO and MILAGROS VILLARICO; AND DEPUTY SHERIFF BENJAMIN C. HAO, Respondents.

FACTS

Petitioners are the heirs of Primitiva Lejano Davis, owner of a one-half undivided portion of two fishpond parcels in Meycauayan, Bulacan. Petitioner Manuel T. de Guia claims ownership, having acquired it from his co-petitioners. On November 10, 1979, Primitiva executed several documents before Notary Public Mamerto A. Abaño, with petitioner Renato Davis as an instrumental witness: 1) a Kasulatan ng Sanglaan (Exhibit “A”) mortgaging the property to respondents Spouses Teofilo R. Morte and Angelina C. Villarico for a ₱500,000.00 loan; 2) a General Power of Attorney (Exhibit “B”) appointing respondents Spouses Ruperto and Milagros Villarico as her attorney-in-fact; 3) a Kasulatan ng Pagpapabuwis ng Palaisdaan (Exhibit “C”) leasing the property to the Spouses Villarico; 4) a Pagpapawalang Saysay ng Kasulatan ng Sanglaan (Exhibit “D”) cancelling a prior mortgage; and 5) a Kasulatan ng Pagpapawalang Saysay at Pagpapawalang Bisa ng mga Kasulatan (Exhibit “E”) cancelling prior sale documents. Primitiva failed to pay the ₱500,000.00 loan, prompting the mortgagees to petition for extrajudicial foreclosure. Petitioners filed an Amended Complaint to annul Exhibit “A” and Exhibit “C”, alleging Primitiva signed them under threat of immediate foreclosure and without valuable consideration. The Regional Trial Court (RTC) dismissed the complaint and declared the documents valid, ordering the foreclosure to proceed. The Court of Appeals affirmed the RTC decision.

ISSUE

Whether the Court of Appeals erred in affirming the RTC’s declaration that the Kasulatan ng Sanglaan (Exhibit “A”) and the Kasulatan ng Pagpapabuwis ng Palaisdaan (Exhibit “C”), both dated November 10, 1979, are valid and not simulated contracts.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Court of Appeals Decision. The Court held that the issue raised was factual, and in a petition for review under Rule 45, only questions of law may be raised. The findings of fact of the Court of Appeals, which affirmed the trial court, are generally conclusive and binding. The Court found no reason to depart from this rule, as the factual conclusions were supported by the evidence. The RTC and CA correctly found that the documents were executed for valuable consideration, as testified by petitioner Renato Davis, who stated his mother executed them to restructure her indebtedness and avoid foreclosure. The alleged threat of foreclosure was a legitimate exercise of the mortgagee’s rights. Testimony from Notary Public Atty. Abaño confirmed the exchange of consideration. Petitioner Renato’s participation as an instrumental witness who read and understood the documents bolstered their validity. The claim that petitioner De Guia was an innocent purchaser for value was raised for the first time on appeal and could not be entertained.