Alicia Arnaldo mortgaged to the Philippine Veterans Bank (PVB) three (3) lots to secure the loan amounting to PhP 290,000. Upon default, the mortgaged was foreclosed and said lots were sold at public auction, with Tiongco as the highest bidder. When the property was not redeemed, Tiongco requested PVB for the delivery of the owner's duplicate copy, having been unheeded, petitioner filed with the RTC a petition to require PVB to surrender such document. PVB denied the allegations in the petition, averred that it was not served with a notice of the auction sale, it then set up the defense that the sale of the property was irregular and that the right of petitioner over the property as a purchaser may be respected only upon the release of the mortgage and that the property was sold for a scandalously low amount and thus, it is shocking to the corresponds to the delinquent taxes to be recovered; considering that there is a subsisting mortgage obligation of PhP 290,000 plus interest, annotated on the title, the auction sale was the product of an illicit machination and actionable collusion between city officials and the purchaser.
ISSUE: WON inadequancy of price would invalidate the sale?
HELD:
It is well-settled that "while in ordinary sales for reasons of equity a transaction may be invalidated on the ground of inadequacy of price, or when such inadequacy shocks one's conscience as to justify the court to interfere, such does not follow when the law gives to the owner the right to redeem, as when a sale is made at public auction, upon the theory that the lesser the price the easier it is for the owner to effect redemption."
Then too, petitioner purchased the property fully cognizant of the risk that he could eventually lose it in a foreclosure sale conducted to satisfy the mortgage, unless he was prepared to pay PhP 290,000 more, with interest due them, as well as the other charges and penalties which the contract of mortgage or the promissory note secured by it has stipulated, without any hope of seeking reimbursement from the mortgagor.
Showing posts with label Philippine cases. Show all posts
Showing posts with label Philippine cases. Show all posts
Friday, August 19, 2016
Sunday, July 31, 2016
CERNA VS. CA, 220 SCRA 517
Delgado borrowed money from Leviste. As payment, he made a promissory note in favor of Leviste. To secure the note, Delgado executed a chattel mortgage over a jeep owned by him and a car owned by the Cerna (under a special power of Attorney).
Delgado defaulted. Leviste filed a collection suit against Delgado and Cerna as solidarily debtors. Cerna filed a motion against him. The motion was denied and the CA held that Delgado and Leviste are solidarily debtors.
ISSUES:
1. Is Cerna solidarily bound with the principal debtor?
2. What is the extent of the mortgagor's liability?
3. Is Cerna a co-mortgagor?
4. If Cerna as co-mortgagor, would he be liable in an action for recovery of money?
HELD:
1. NO. There is no legal provision nor jurisprudence in our jurisdiction which makes a third person who secures the fulfillment of another's obligation by mortgaging his own property to be solidarily bound with the principal obligor. A chattel mortgagor may be an "accessory contract" to a contract of loan, but that fact alone does not make a third party mortgagor solidarily bound with the principal debtor in fulfilling the principal obligation of paying the loan. Moreover, it is a basic precept that there is solidarily liability only when the obligation expressly so states or when the law or nature of the obligation requires solidarity.
2. A third party mortgagor becomes liable only to the extent of the property mortgaged. It is only upon default of the principal debtor that the creditor may have recourse on the mortgagor by foreclosing the mortgage properties in lieu of an action for the recovery of the amount of the loan. And the liability of the third party mortgagor extends only to the property mortgaged. Should there be any deficiency, the creditor has recourse on the principal debtor.
3. NO. The special power of attorney authorizing Delgagdo to mortgage Cerna's property as security for Delgado's obligation does not itself make Cerna a co-mortgagor, especially so since only Delgagdo signed the chattel mortgage as mortgagor. The special power of attorney did not make Cerna as mortgagor, all it did was to authorize Delgado to mortgage certain properties belonging to Cerna. And this is in compliance with the requirement in Article 2085 of the New Civil Code, It is essential in mortgage xxx (3) That the person constituting the pledge or mortgage have the free disposal of their property, and IN ABSENCE THEREOF, THAT THEY BE LEGALLY AUTHORIZED FOR THE PURPOSE. Thus, it is clear that only Delgado was the sole mortgagor regardless of the fact that he used properties belonging to a third person to secure the debt.
4. And even if Cerna was a co-mortgagor, Cerna could not be held liable because the complaint was for recovery of a sum of money and not for the foreclosure, thereby abandoning the chattel mortgage as basis for relief, he clearly manifests his lack of desire and interest to go after the mortgaged property as security for the promissory note.
Delgado defaulted. Leviste filed a collection suit against Delgado and Cerna as solidarily debtors. Cerna filed a motion against him. The motion was denied and the CA held that Delgado and Leviste are solidarily debtors.
ISSUES:
1. Is Cerna solidarily bound with the principal debtor?
2. What is the extent of the mortgagor's liability?
3. Is Cerna a co-mortgagor?
4. If Cerna as co-mortgagor, would he be liable in an action for recovery of money?
HELD:
1. NO. There is no legal provision nor jurisprudence in our jurisdiction which makes a third person who secures the fulfillment of another's obligation by mortgaging his own property to be solidarily bound with the principal obligor. A chattel mortgagor may be an "accessory contract" to a contract of loan, but that fact alone does not make a third party mortgagor solidarily bound with the principal debtor in fulfilling the principal obligation of paying the loan. Moreover, it is a basic precept that there is solidarily liability only when the obligation expressly so states or when the law or nature of the obligation requires solidarity.
2. A third party mortgagor becomes liable only to the extent of the property mortgaged. It is only upon default of the principal debtor that the creditor may have recourse on the mortgagor by foreclosing the mortgage properties in lieu of an action for the recovery of the amount of the loan. And the liability of the third party mortgagor extends only to the property mortgaged. Should there be any deficiency, the creditor has recourse on the principal debtor.
3. NO. The special power of attorney authorizing Delgagdo to mortgage Cerna's property as security for Delgado's obligation does not itself make Cerna a co-mortgagor, especially so since only Delgagdo signed the chattel mortgage as mortgagor. The special power of attorney did not make Cerna as mortgagor, all it did was to authorize Delgado to mortgage certain properties belonging to Cerna. And this is in compliance with the requirement in Article 2085 of the New Civil Code, It is essential in mortgage xxx (3) That the person constituting the pledge or mortgage have the free disposal of their property, and IN ABSENCE THEREOF, THAT THEY BE LEGALLY AUTHORIZED FOR THE PURPOSE. Thus, it is clear that only Delgado was the sole mortgagor regardless of the fact that he used properties belonging to a third person to secure the debt.
4. And even if Cerna was a co-mortgagor, Cerna could not be held liable because the complaint was for recovery of a sum of money and not for the foreclosure, thereby abandoning the chattel mortgage as basis for relief, he clearly manifests his lack of desire and interest to go after the mortgaged property as security for the promissory note.
Tuesday, July 26, 2016
Commissioner vs. Tours Specialist
Tours specialist had derived income from its activities as a travel agency servicing the need of foreign tourists and travelers and Filipino during their stay in the country.
In order to ably supply these services to the foreign tourists, Tour specialist and its counterpart tourist agencies abroad have agreed to offer a package fee for the tourists. Although the fee to be paid by said tourist is quoted by the petitioner, the payment of the hotel accommodations food and other personal expenses, as a rule, are paid directly either by tourists themselves or by their foreign travel agencies to the local hotels.
In some cases the foreign agencies request local tour agencies such as respondent that the hotel room charges be paid through them. By this arrangement, the foreign tour agency entrust to respondent the fund for hotel room accommodation, which in turn is paid by respondent tour agency to the local hotel when billed because room charge is exempt from tax under PD 31.
Petitioner CIR assessed respondent for deficiency of 3% contractor's tax as independent contractor by including the entrusted hotel charges in its gross receipt from services for the year 1974 to 1976. Respondent formally protested the assessment made by CIR on the ground that the hotel room charges were not considered and have never been considered by it as part of its taxable gross receipt for purposes of computing and paying its contractor's tax.
ISSUE:
WON the amount received by a local tourist and travel agency included in a package fee from tourist or foreign tour agencies, intended or earmarked for hotel accommodation form part of gross recipt subject to 3% contractor's tax?
Held:
NO. Money entrusted to Tour Specialist, earmarked and paid for hotel room charges does not form part of its gross receipt subject to the 3% independent contractor's tax under NIRC.
GROSS RECEIPT do not include monies or receipt entrusted to the taxpayer which do not belong to them and do not redound to the taxpayer's benefit; it is not necessary that there must be a law or regulation which would exempt such monies or receipt within the meaning of gross receipts under the Tax Code.
If the hotel room charges entrusted to petitioner will be subject to 3% contractor's tax as what CIR would want to do in this case, that would in effect do indirectly what PD 31 would not like hotel room charges of foreign tourist to be subject to hotel room tax.
In order to ably supply these services to the foreign tourists, Tour specialist and its counterpart tourist agencies abroad have agreed to offer a package fee for the tourists. Although the fee to be paid by said tourist is quoted by the petitioner, the payment of the hotel accommodations food and other personal expenses, as a rule, are paid directly either by tourists themselves or by their foreign travel agencies to the local hotels.
In some cases the foreign agencies request local tour agencies such as respondent that the hotel room charges be paid through them. By this arrangement, the foreign tour agency entrust to respondent the fund for hotel room accommodation, which in turn is paid by respondent tour agency to the local hotel when billed because room charge is exempt from tax under PD 31.
Petitioner CIR assessed respondent for deficiency of 3% contractor's tax as independent contractor by including the entrusted hotel charges in its gross receipt from services for the year 1974 to 1976. Respondent formally protested the assessment made by CIR on the ground that the hotel room charges were not considered and have never been considered by it as part of its taxable gross receipt for purposes of computing and paying its contractor's tax.
ISSUE:
WON the amount received by a local tourist and travel agency included in a package fee from tourist or foreign tour agencies, intended or earmarked for hotel accommodation form part of gross recipt subject to 3% contractor's tax?
Held:
NO. Money entrusted to Tour Specialist, earmarked and paid for hotel room charges does not form part of its gross receipt subject to the 3% independent contractor's tax under NIRC.
GROSS RECEIPT do not include monies or receipt entrusted to the taxpayer which do not belong to them and do not redound to the taxpayer's benefit; it is not necessary that there must be a law or regulation which would exempt such monies or receipt within the meaning of gross receipts under the Tax Code.
If the hotel room charges entrusted to petitioner will be subject to 3% contractor's tax as what CIR would want to do in this case, that would in effect do indirectly what PD 31 would not like hotel room charges of foreign tourist to be subject to hotel room tax.
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