GR 164968; (July, 2009) (Digest)
G.R. No. 164968; July 3, 2009
GLORIA OCAMPO and TERESITA TAN, Petitioners, vs. LAND BANK OF THE PHILIPPINES, URDANETA, PANGASINAN BRANCH and EX OFFICIO PROVINCIAL SHERIFF OF PANGASINAN, Respondents.
FACTS
Petitioners Gloria Ocampo and Teresita Tan obtained a ₱10,000,000.00 quedan loan from respondent Land Bank of the Philippines in 1991. The loan was guaranteed by the Quedan and Rural Credit Guarantee Corporation (Quedancor) for 80% of the outstanding amount, with the remaining 20% unsecured. To cover this unsecured portion, petitioners executed a Deed of Real Estate Mortgage dated September 6, 1991, over two unregistered parcels of land owned by Ocampo. They delivered the tax declarations and a survey plan to the bank, which registered the mortgage. Upon petitioners’ default on the loan, Land Bank initiated extrajudicial foreclosure proceedings on the mortgaged properties.
Petitioners filed a complaint to declare the real estate mortgage null and void, alleging forgery. They claimed the mortgage document was signed in blank for a different, unavailed loan application of ₱5,000,000.00, not to secure the quedan loan. They further argued Tan could not mortgage property she did not own and that the quedan loan had been fully paid via a Deed of Absolute Assignment to Quedancor. The Regional Trial Court ruled in favor of petitioners, declaring the mortgage void. The Court of Appeals reversed this decision, prompting this petition.
ISSUE
Whether the real estate mortgage executed by petitioners is valid and binding to secure the 20% unsecured portion of their quedan loan.
RULING
The Supreme Court DENIED the petition and AFFIRMED the Court of Appeals’ decision, upholding the validity of the real estate mortgage. The Court found petitioners’ claim of signing a blank document unsubstantiated. Ocampo admitted signing the mortgage document, and her claim that it was incomplete was belied by the document’s specific details, including the correct loan account number and the explicit purpose of securing the 20% balance of the quedan loan. The act of delivering the tax declarations and survey plan to the bank further demonstrated their consent to the mortgage’s terms.
The Court also rejected the defense of full payment. The Deed of Absolute Assignment between Ocampo and Quedancor did not constitute payment to Land Bank, as the bank was not a party thereto and did not consent to a dation in payment. A creditor is not bound to accept payment from a third party. Land Bank’s subsequent demand for the balance and initiation of foreclosure were consistent with the loan’s subsisting obligation. Consequently, the mortgage was a valid accessory contract to secure the principal quedan loan, and its extrajudicial foreclosure was proper.