G.R. No. L-3430 and L-3431; May 23, 1951
PAZ E. SIGUION, plaintiff-appellee, vs. GO TECSON, ETC., defendants-appellants. ALBERTO MAXIMO TORRES, plaintiff-appellee, vs. GO TECSON, ETC., defendants-appellants.

FACTS

On October 1, 1927, Paulino P. Gocheco mortgaged a piece of registered real property in Manila to Paz E. Siguion to secure a debt of P30,000. About ten years later, he constituted a second mortgage on the same property in favor of Alberto Maximo Torres to secure a debt of P20,000. Both mortgages were duly registered. Gocheco died in 1943 without discharging the mortgages. In 1944, proceedings for the settlement of his estate were instituted in the Court of First Instance of Manila, and Go Tecson was appointed judicial administrator. On February 3, 1949, separate actions were filed against administrator Go Tecson for the foreclosure of the two mortgages. The lower court rendered judgment against the administrator, who appealed, contending that: (1) he could no longer be sued as administrator because the administration proceedings had already been closed; (2) the matter was res judicata; (3) the plaintiffs’ claim had already been paid; and (4) Republic Act No. 342 (the moratorium law) was unconstitutional and void.

ISSUE

The main issues are whether the lower court erred in: (1) not holding that the administrator could no longer be sued due to closed administration proceedings; (2) not holding the matter res judicata; (3) not finding the mortgage debt already paid; and (4) not ruling on the constitutionality of Republic Act No. 342 .

RULING

The Supreme Court affirmed the lower court’s decision.
(1) The first assignment of error was without merit, as a certificate from the Clerk of Court showed the order for distribution of the estate had not been complied with, and appellant’s counsel admitted the proceedings were technically still pending.
(2) The claim of res judicata was unsupported. The record did not show the mortgage indebtedness was formally filed, litigated, and judicially determined in the administration proceedings. An order dated September 7, 1944, merely indicated the administrator’s overture to pay and the mortgagee’s willingness to accept payment, but did not show a formal filing of a claim. Without such formality, the mortgagees did not waive their mortgage lien and were not estopped from bringing a foreclosure suit.
(3) The alleged payment was not proven. No receipt or supporting document existed. The testimony of the administrator’s former attorney, Judge Bienvenido Tan, that Paz E. Siguion accepted payment but asked him to keep the money for her, was denied by Siguion and was an unwarranted inference from her words. The Court found her words constituted a refusal to accept payment, consistent with her previous refusals and the natural reaction to depreciated currency in October 1944. The absence of a receipt, release of mortgage, or evidence the money was counted led the Court to hold the lower court did not err in finding the debt unpaid.
(4) The defense of moratorium under Republic Act No. 342 was not properly invoked in the court below. It was not pleaded in the answer nor made a ground for a motion to dismiss. The answer admitted the moratorium had been lifted by Republic Act No. 342 , subject to exceptions not applicable to the estate. Appellant’s counsel’s request at trial to amend the answer to challenge the Act’s constitutionality was withdrawn after opposition. Since moratorium was not invoked as a defense, the validity of the Act was not a necessary issue, and the Court declined to rule on its constitutionality. The decision was affirmed, with costs against the appellant.