G.R. No. 215175 . April 25, 2022
ALJEM’S CREDIT INVESTORS CORPORATION, PETITIONER, VS. SPOUSES CATALINA AND PORFERIO BAUTISTA, RESPONDENTS.

FACTS

Petitioner Aljem’s Credit Investors Corporation filed a complaint for rescission of contract to sell, with damages and attorney’s fees, against respondent-spouses Catalina and Porferio Bautista. The case originated from a mortgage over the spouses’ property securing a loan. Upon the spouses’ failure to pay, petitioner foreclosed the mortgage, consolidated title after the redemption period, and later entered into two separate Contracts to Sell (August 29, 2000 and September 27, 2001) with Catalina Bautista for the repurchase of the property. The spouses failed to comply with these contracts. Petitioner filed its complaint and subsequently filed a Motion for Summary Judgment, alleging no genuine issue of fact because the spouses admitted the Transfer Certificate of Title was in petitioner’s name, did not specifically deny material allegations, and raised only legal defenses. The spouses opposed, contending a full-blown trial was necessary to determine issues including whether the contract was an equitable mortgage, the propriety of interest rates, the presence of a pactum commissorium, and whether Porferio’s signature was forged. The Regional Trial Court (RTC) denied the motion, finding genuine issues of fact. The Court of Appeals (CA) affirmed the RTC’s denial. Petitioner elevated the case to the Supreme Court.

ISSUE

Whether the RTC’s denial of petitioner’s Motion for Summary Judgment is proper.

RULING

Yes, the RTC’s denial of the Motion for Summary Judgment is proper. The Supreme Court affirmed the rulings of the CA and RTC. Summary judgment is proper only when there is no genuine issue as to any material fact. A genuine issue of fact requires the presentation of evidence for its resolution. The Court found that the defenses raised by the spouses Bautista, including the alleged invalidity of the original mortgage due to the lack of Porferio’s consent (potentially void under the Family Code), the allegation of forgery of Porferio’s signature, the claim that the contract to sell constituted an equitable mortgage, and the issue of the propriety of interest rates, all presented genuine issues of fact that necessitated a full trial for the presentation of evidence. The trial court is duty-bound to examine the motion, supporting documents, and opposition to determine if a genuine issue exists, and its action on such a motion is generally not subject to appeal or special civil action. The CA correctly limited its review to the propriety of the denial and did not rule on the substantive merits of the defenses like pactum commissorium or equitable mortgage. The petition was denied for lack of merit.