GR 157075; (July, 2006) (Digest)
G.R. No. 157075 ; July 17, 2006
RAMCAR, INCORPORATED, petitioner, vs. HI-POWER MARKETING, LEONIDAS D. BOHOL, and RHODORA A. BOHOL, respondents.
FACTS
Respondent Leonidas Bohol, doing business as Hi-Power Marketing, was a distributor of petitioner Ramcar’s products. On March 4, 1982, they entered into a loan agreement secured by a real estate mortgage over Bohol’s property. Alleging default, Ramcar initiated extrajudicial foreclosure proceedings in 1984. The spouses Bohol filed a petition for prohibition, which the RTC dismissed, finding default. While their appeal was pending before the Court of Appeals, Ramcar proceeded with the foreclosure sale on November 29, 1985, and acquired the property. The Bohols also filed a separate civil case asserting their obligation was extinguished by overpayment.
The CA, in its 1988 decision on the prohibition case, remanded the matter to the RTC for further hearing on the pivotal issue of whether the Bohols were truly in default, as the trial court’s initial decision lacked a thorough evidentiary basis on this point. The related cases were consolidated. After trial, the RTC in 1999 ruled for Ramcar, validating the foreclosure. The Bohols appealed.
ISSUE
Whether the Court of Appeals erred in reversing the trial court’s factual findings and declaring the spouses Bohol’s obligation extinguished and the foreclosure null and void.
RULING
The Supreme Court denied the petition and affirmed the Court of Appeals. The core legal issue was a factual one: the existence of default, which is a condition sine qua non for a valid foreclosure. The CA meticulously reviewed the evidence, particularly comparing Ramcar’s statement of account with the Bohols’ proof of payments and deliveries. It found that the Bohols had presented payments and credit memos not accounted for in Ramcar’s computation for the foreclosure. Consequently, the Bohols had overpaid the secured obligation and could not be considered in default.
Petitioner Ramcar’s recourse to the Supreme Court via a petition for certiorari under Rule 65, raising questions of fact, was improper. The Court emphasized that factual determinations of the CA are generally conclusive and binding. It found no compelling reason to deviate from this rule, as the CA’s conclusion—that Ramcar failed to substantiate the fact and amount of default—was amply supported by the evidence on record. Since the foreclosure was predicated on a default that was not proven, all proceedings emanating from it were void. The CA correctly ordered the cancellation of Ramcar’s title and the reinstatement of the Bohols’ ownership.