G.R. No. L-18652 September 14, 1965
AMADO C. TIGNO and FLORA M. TIGNO, plaintiffs-appellants, vs. SILVESTRE PINGOL, RIZALINA REYES-PINGOL, DEVELOPMENT BANK OF THE PHILIPPINES and the CITY OF MANILA, defendants-appellees.

FACTS

Plaintiffs-appellants Amado C. Tigno and Flora M. Tigno (the Tignos) borrowed money from defendants-appellees Silvestre Pingol and Rizalina Reyes-Pingol (the Pingols), secured by a second mortgage on real estate. The Pingols filed a foreclosure complaint (Civil Case No. 30773). The Tignos, in their answer, admitted the loan but interposed the special defense of usury. The trial court, after the Tignos failed to present evidence on usury at a hearing set for that purpose, granted summary judgment in favor of the Pingols. This foreclosure judgment became final and executory. The mortgaged property was sold at public auction to the Pingols, and the sheriff’s sale was confirmed by the court. The Tignos appealed the confirmation order to the Supreme Court (G.R. No. L-14749), again raising the issue of usury, but the Supreme Court held it was too late to raise such questions as the foreclosure judgment was final. The Pingols subsequently obtained a writ of possession. The Tignos then filed the present action (Civil Case No. 45675) seeking: (1) recovery of usurious interests paid; (2) annulment of the second mortgage for being usurious; and (3) recovery of damages, including P40,000 for the alleged difference between the property’s market value and the price they received in a sale to third parties (the Cornistas) made during the pendency of the appeal in G.R. No. L-14749. The Pingols moved to dismiss on grounds of res judicata. The trial court granted the motion and dismissed the complaint. The Tignos appealed.

ISSUE

Whether the trial court correctly dismissed the complaint on the ground that the causes of action were barred by prior judgment (res judicata).

RULING

Yes, the trial court correctly dismissed the complaint. The Supreme Court affirmed the order of dismissal. The causes of action asserted by the Tignos were not new but had been settled in the prior litigations. The defense of usury and the implied prayer for annulment of the mortgage based on usury were raised in the answer in the foreclosure case (Civil Case No. 30773) and were rejected by the final judgment therein. The issue was again raised in the appeal from the order confirming the sheriff’s sale (G.R. No. L-14749) and was refused for being tardy. The principle of res judicata bars not only matters actually litigated but also any other admissible matter that could have been offered for that purpose. The claim for damages based on the sale to the Cornistas was frivolous, as its validity depended on the propriety of the foreclosure and sheriff’s sale, which had already been conclusively settled. The appeal was without merit. The order was affirmed, with treble costs against appellants.