GR 239418; (October, 2020) (Digest)
G.R. No. 239418 , October 12, 2020
DANILO DECENA AND CRISTINA CASTILLO (FORMERLY DECENA), PETITIONERS, VS. ASSET POOL A (SPV-AMC), INC., RESPONDENT.
FACTS
Petitioners Danilo Decena and Cristina Castillo obtained loans from Prudential Bank, evidenced by promissory notes. Following a merger, the Bank of the Philippine Islands (BPI) assumed the obligation. Respondent Asset Pool A (SPV-AMC), Inc. acquired the petitioners’ indebtedness from BPI through a Deed of Assignment. After petitioners allegedly defaulted, respondent sent demand letters and subsequently filed a Complaint for Sum of Money.
In their defense, petitioners admitted securing the loans but claimed they had substantially paid the obligation and that their properties had been foreclosed by the bank, settling the debt. They argued that respondent failed to present comprehensive records and that the action was barred by laches, being filed nearly ten years after the loans’ maturity.
ISSUE
Whether the petitioners are liable to pay the loan obligation to the respondent.
RULING
Yes, the petitioners are liable. The Supreme Court affirmed the Court of Appeals’ ruling, which found respondent established petitioners’ liability by preponderance of evidence. The promissory notes, whose authenticity petitioners never contested, prima facie proved the existence and non-payment of the obligation. Possession of these credit instruments by the respondent creditor creates a presumption of non-payment.
The legal burden of proving payment, as an affirmative defense, rested on the petitioners. Their bare allegations of payment and foreclosure, unsupported by convincing evidence, could not overcome respondent’s documentary evidence. The defense of laches was unavailing as the action was filed well within the ten-year prescriptive period for written contracts. However, the Court upheld the CA’s modification reducing the awardable principal to only P10,000,000.00, as this was the specific amount prayed for in the complaint, and a court cannot grant relief beyond what is sought.
On interest, the Court applied a 12% per annum interest from the date of extrajudicial demand (September 19, 2006) until June 30, 2013, pursuant to prevailing jurisprudence. Following Bangko Sentral ng Pilipinas Circular No. 799, the interest rate was reduced to 6% per annum from July 1, 2013, until full payment. This adjustment aligns with the legal principle that monetary judgments for loans or forbearance of money earn interest at the rate stipulated, or, in its absence, at the legal rate, which was modified in 2013.