Jocelyn B. Doles, G.R. No.
149353
Petitioner,
Present:
PANGANIBAN, C.J.
(Chairperson)
- versus - YNARES-SANTIAGO,
AUSTRIA-MARTINEZ,
CALLEJO, SR., and
CHICO-NAZARIO, JJ.
Ma.
Aura Tina
Angeles, Promulgated:
Respondent.
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D E C I S I O N
AUSTRIA-MARTINEZ, J.:
This refers
to the Petition for Review on Certiorari under
Rule 45 of the Rules of Court questioning the Decision[1]
dated April 30, 2001 of the Court of Appeals (CA) in C.A.-G.R. CV No. 66985,
which reversed the Decision dated July 29, 1998 of the Regional Trial Court
(RTC), Branch 21, City of Manila; and the CA Resolution[2]
dated August 6, 2001
which denied petitioner’s Motion for Reconsideration.
The
antecedents of the case follow:
On P405,430.00 representing the principal amount and interest;
that on October 5, 1996, by virtue of a “Deed of Absolute Sale”,[3]
petitioner, as seller, ceded to respondent, as buyer, a parcel of land, as well
as the improvements thereon, with an area of 42 square meters, covered by
Transfer Certificate of Title No. 382532,[4] and
located at a subdivision project known as Camella Townhomes Sorrente in Bacoor,
Cavite, in order to satisfy her personal loan with respondent; that this
property was mortgaged to National Home Mortgage Finance Corporation (NHMFC) to
secure petitioner’s loan in the sum of P337,050.00 with that entity;
that as a condition for the foregoing sale, respondent shall assume the undue
balance of the mortgage and pay the monthly amortization of P4,748.11
for the remainder of the 25 years which began on September 3, 1994; that the
property was at that time being occupied by a tenant paying a monthly rent of P3,000.00;
that upon verification with the NHMFC, respondent learned that petitioner had
incurred arrearages amounting to P26,744.09, inclusive of penalties and
interest; that upon informing the petitioner of her arrears, petitioner denied
that she incurred them and refused to pay the same; that despite repeated
demand, petitioner refused to cooperate with respondent to execute the
necessary documents and other formalities required by the NHMFC to effect the
transfer of the title over the property; that petitioner collected rent over
the property for the month of January 1997 and refused to remit the proceeds to
respondent; and that respondent suffered damages as a result and was forced to
litigate.
Petitioner,
then defendant, while admitting some allegations in the Complaint, denied that
she borrowed money from respondent, and averred that from June to September
1995, she referred her friends to respondent whom she knew to be engaged in the
business of lending money in exchange for personal checks through her
capitalist Arsenio Pua. She alleged that
her friends, namely, Zenaida Romulo, Theresa Moratin, Julia Inocencio, Virginia
Jacob, and Elizabeth Tomelden, borrowed money from respondent and issued
personal checks in payment of the loan; that the checks bounced for
insufficiency of funds; that despite her efforts to assist respondent to
collect from the borrowers, she could no longer locate them; that, because of
this, respondent became furious and threatened petitioner that if the accounts
were not settled, a criminal case will be filed against her; that she was
forced to issue eight checks amounting to P350,000 to answer for the
bounced checks of the borrowers she referred; that prior to the issuance of the
checks she informed respondent that they were not sufficiently funded but the
latter nonetheless deposited the checks and for which reason they were
subsequently dishonored; that respondent then threatened to initiate a criminal
case against her for violation of Batas Pambansa Blg. 22; that she was
forced by respondent to execute an “Absolute Deed of Sale” over her property in
Bacoor, Cavite, to avoid criminal prosecution; that the said deed had no valid
consideration; that she did not appear before a notary public; that the
Community Tax Certificate number on the deed was not hers and for which
respondent may be prosecuted for falsification and perjury; and that she
suffered damages and lost rental as a result.
The RTC identified the issues as
follows: first, whether the Deed of Absolute Sale is valid; second; if valid,
whether petitioner is obliged to sign and execute the necessary documents to
effect the transfer of her rights over the property to the respondent; and
third, whether petitioner is liable for damages.
On
WHEREFORE, premises
considered, the Court hereby orders the dismissal of the complaint for insufficiency
of evidence. With costs against
plaintiff.
SO ORDERED.
The RTC held that the sale was void for
lack of cause or consideration:[5]
Plaintiff
Angeles’ admission that the borrowers are the friends of defendant Doles and
further admission that the checks issued by these borrowers in payment of the
loan obligation negates [sic] the cause or consideration of the contract of
sale executed by and between plaintiff and defendant. Moreover, the property is not solely owned by
defendant as appearing in Entry No. 9055 of Transfer Certificate of Title No.
382532 (Annex A, Complaint), thus:
“Entry No.
9055. Special Power of Attorney in favor
of Jocelyn Doles covering the share of Teodorico Doles on the parcel of land
described in this certificate of title by virtue of the special power of
attorney to mortgage, executed before the notary public, etc.”
The rule under the Civil
Code is that contracts without a cause or consideration produce no effect
whatsoever. (Art. 1352, Civil Code).
Respondent
appealed to the CA. In her appeal brief,
respondent interposed her sole assignment of error:
THE TRIAL COURT
ERRED IN DISMISSING THE CASE AT BAR ON THE GROUND OF [sic] THE DEED OF SALE
BETWEEN THE PARTIES HAS NO CONSIDERATION OR INSUFFICIENCY OF EVIDENCE.[6]
On
WHEREFORE, IN
VIEW OF THE FOREGOING, this appeal is hereby GRANTED. The Decision of the lower court dated
SO ORDERED.
The
CA concluded that petitioner was the borrower and, in turn, would “re-lend” the
amount borrowed from the respondent to her friends. Hence, the Deed of Absolute Sale was
supported by a valid consideration, which is the sum of money petitioner owed
respondent amounting to P405,430.00, representing both principal and
interest.
The CA took
into account the following circumstances in their entirety: the supposed
friends of petitioner never presented themselves to respondent and that all
transactions were made by and between petitioner and respondent;[7] that the
money borrowed was deposited with the bank account of the petitioner, while
payments made for the loan were deposited by the latter to respondent’s bank
account;[8] that
petitioner herself admitted in open court that she was “re-lending” the money
loaned from respondent to other individuals for profit;[9] and that
the documentary evidence shows that the actual borrowers, the friends of
petitioner, consider her as their creditor and not the respondent.[10]
Furthermore, the CA held that the
alleged threat or intimidation by respondent did not vitiate consent, since the
same is considered just or legal if made to enforce one’s claim through
competent authority under Article 1335[11] of the
Civil Code;[12] that with
respect to the arrearages of petitioner on her monthly amortization with the
NHMFC in the sum of P26,744.09, the
same shall be deemed part of the balance of petitioner’s loan with the NHMFC
which respondent agreed to assume; and that the amount of P3,000.00
representing the rental for January 1997 supposedly collected by petitioner, as
well as the claim for damages and attorney’s fees, is denied for insufficiency
of evidence.[13]
On May 29, 2001,
petitioner filed her Motion for Reconsideration with the CA, arguing that
respondent categorically admitted in open court that she acted only as agent or
representative of Arsenio Pua, the principal financier and, hence, she had no
legal capacity to sue petitioner; and that the CA failed to consider the fact
that petitioner’s father, who co-owned the subject property, was not impleaded
as a defendant nor was he indebted to the respondent and, hence, she cannot be
made to sign the documents to effect the transfer of ownership over the entire
property.
On
On
I.
WHETHER OR NOT THE
PETITIONER CAN BE CONSIDERED AS A DEBTOR OF THE RESPONDENT.
II.
WHETHER OR NOT AN
AGENT WHO WAS NOT AUTHORIZED BY THE PRINCIPAL TO COLLECT DEBT IN HIS BEHALF
COULD DIRECTLY COLLECT PAYMENT FROM THE DEBTOR.
III.
WHETHER OR NOT THE
CONTRACT OF
Although,
as a rule, it is not the business of this Court to review the findings of fact
made by the lower courts, jurisprudence has recognized several exceptions, at
least three of which are present in the instant case, namely: when the judgment
is based on a misapprehension of facts; when the findings of facts of the
courts a quo are conflicting; and when the CA manifestly overlooked
certain relevant facts not disputed by the parties, which, if properly
considered, could justify a different conclusion.[15] To arrive at a proper judgment, therefore,
the Court finds it necessary to re-examine the evidence presented by the
contending parties during the trial of the case.
The
Petition is meritorious.
The
principal issue is whether the Deed of Absolute Sale is supported by a valid
consideration.
1.
Petitioner argues that since she is merely the agent or representative
of the alleged debtors, then she is not a party to the loan; and that the Deed
of Sale executed between her and the respondent in their own names, which was
predicated on that pre-existing debt, is void for lack of consideration.
Indeed,
the Deed of Absolute Sale purports to be supported by a consideration in the
form of a price certain in money[16] and that
this sum indisputably pertains to the debt in issue. This Court has consistently held that a contract of
sale is null and void and produces no effect whatsoever where the same is
without cause or consideration.[17] The question that has to be resolved for the
moment is whether this debt can be considered as a valid cause or consideration
for the sale.
To restate, the CA cited four instances in the record to support its
holding that petitioner “re-lends” the amount borrowed from respondent to her
friends: first, the friends of petitioner never presented themselves to
respondent and that all transactions were made by and between petitioner and
respondent;[18] second;
the money passed through the bank accounts of petitioner and respondent;[19] third,
petitioner herself admitted that she was “re-lending” the money loaned to other
individuals for profit;[20] and
fourth, the documentary evidence shows that the actual borrowers, the friends
of petitioner, consider her as their creditor and not the respondent.[21]
On the
first, third, and fourth points, the CA cites the testimony of the petitioner,
then defendant, during her cross-examination:[22]
Atty. Diza:
q. You also mentioned that you were not the one indebted to the plaintiff?
witness:
a. Yes, sir.
Atty. Diza:
q. And you mentioned the persons[,] namely, Elizabeth Tomelden, Teresa Moraquin, Maria Luisa Inocencio, Zenaida Romulo, they are your friends?
witness:
a. Inocencio and Moraquin are my friends while [as to] Jacob and Tomelden[,] they were just referred.
Atty. Diza:
q. And you have transact[ed] with the plaintiff?
witness:
a. Yes, sir.
Atty. Diza:
q. What is that transaction?
witness:
a. To
refer those persons to Aura and to refer again to Arsenio Pua, sir.
Atty. Diza:
q. Did the plaintiff personally see the transactions with your friends?
witness:
a. No, sir.
Atty. Diza:
q. Your friends and the plaintiff did not meet personally?
witness:
a. Yes, sir.
Atty. Diza:
q. You are intermediaries?
witness:
a. We are both intermediaries. As evidenced by the checks of the debtors they were deposited to the name of Arsenio Pua because the money came from Arsenio Pua.
x x x x
Atty. Diza:
q. Did the plaintiff knew [sic] that you will lend the money to your friends specifically the one you mentioned [a] while ago?
witness:
a. Yes, she knows the money will go to those persons.
Atty. Diza:
q. You are re-lending the money?
witness:
a. Yes, sir.
Atty. Diza:
q. What profit do you have, do you have commission?
witness:
a. Yes, sir.
Atty. Diza:
q. How much?
witness:
a. Two percent to Tomelden, one percent to Jacob and then Inocencio and my friends none, sir.
Based
on the foregoing, the CA concluded that petitioner is the real borrower, while
the respondent, the real lender.
But
as correctly noted by the RTC, respondent, then plaintiff, made the following
admission during her cross examination:[23]
Atty. Villacorta:
q. Who is this Arsenio Pua?
witness:
a. Principal financier, sir.
Atty. Villacorta:
q. So the money came from Arsenio Pua?
witness:
a. Yes, because I am only representing him, sir.
Other portions of the testimony of respondent must likewise be
considered:[24]
Atty. Villacorta:
q. So
it is not actually your money but the money of Arsenio Pua?
witness:
a. Yes, sir.
Court:
q. It is not your money?
witness:
a. Yes, Your Honor.
Atty. Villacorta:
q. Is
it not a fact Ms. Witness that the defendant borrowed from you to accommodate
somebody, are you aware of that?
witness:
a. I am aware of that.
Atty. Villacorta:
q. More
or less she [accommodated] several friends of the defendant?
witness:
a. Yes, sir, I am aware of
that.
x x x x
Atty. Villacorta:
q. And
these friends of the defendant borrowed money from you with the assurance of
the defendant?
witness:
a. They go direct to Jocelyn
because I don’t know them.
x x x x
Atty. Villacorta:
q. And
is it not also a fact Madam witness that everytime that the defendant borrowed
money from you her friends who [are] in need of money issued check[s] to
you? There were checks issued to you?
witness:
a. Yes, there were checks
issued.
Atty. Villacorta:
q. By the friends of the
defendant, am I correct?
witness:
a. Yes, sir.
Atty. Villacorta:
q. And
because of your assistance, the friends of the defendant who are in need of
money were able to obtain loan to [sic] Arsenio Pua through your assistance?
witness:
a. Yes, sir.
Atty. Villacorta:
q. So that occasion lasted
for more than a year?
witness:
a. Yes, sir.
Atty. Villacorta:
q. And
some of the checks that were issued by the friends of the defendant bounced, am
I correct?
witness:
a. Yes, sir.
Atty. Villacorta:
q. And because of that
Arsenio Pua got mad with you?
witness:
a. Yes, sir.
Respondent
is estopped to deny that she herself acted as agent of a certain Arsenio Pua,
her disclosed principal. She is also
estopped to deny that petitioner acted as agent for the alleged debtors, the
friends whom she (petitioner) referred.
This Court
has affirmed that, under Article 1868 of the Civil Code, the basis of agency is
representation.[25] The question of whether an agency has been
created is ordinarily a question which may be established in the same way as
any other fact, either by direct or circumstantial evidence. The question is ultimately one of intention.[26] Agency may even be implied from the words and
conduct of the parties and the circumstances of the particular case.[27] Though the fact or extent of authority of the
agents may not, as a general rule, be established from the declarations of the
agents alone, if one professes to act as agent for another, she may be estopped
to deny her agency both as against the asserted principal and the third persons
interested in the transaction in which he or she is engaged.[28]
In this
case, petitioner knew that the financier of respondent is Pua; and respondent
knew that the borrowers are friends of petitioner.
The CA is
incorrect when it considered the fact that the “supposed friends of
[petitioner], the actual borrowers, did not present themselves to [respondent]”
as evidence that negates the agency relationship—it is sufficient that
petitioner disclosed to respondent that the former was acting in behalf of her
principals, her friends whom she referred to respondent. For an agency to arise, it is not necessary
that the principal personally encounter the third person with whom the agent
interacts. The law in fact contemplates,
and to a great degree, impersonal dealings where the principal need not personally
know or meet the third person with whom her agent transacts: precisely,
the purpose of agency is to extend the personality of the principal through the
facility of the agent.[29]
In the case
at bar, both petitioner and respondent have undeniably disclosed to each other
that they are representing someone else, and so both of them are estopped to
deny the same. It is evident from the
record that petitioner merely refers actual borrowers and then collects and
disburses the amounts of the loan upon which she received a commission; and
that respondent transacts on behalf of her “principal financier”, a certain
Arsenio Pua. If their respective
principals do not actually and personally know each other, such
ignorance does not affect their juridical standing as agents, especially since
the very purpose of agency is to extend the personality of the principal
through the facility of the agent.
With
respect to the admission of petitioner that she is “re-lending” the money
loaned from respondent to other individuals for profit, it must be stressed
that the manner in which the parties designate the relationship is not
controlling. If an act done by one
person in behalf of another is in its essential nature one of agency, the
former is the agent of the latter notwithstanding he or she is not so called.[30] The
question is to be determined by the fact that one represents and is acting for
another, and if relations exist which will constitute an agency, it will be
an agency whether the parties understood the exact nature of the relation or
not.[31]
That both
parties acted as mere agents is shown by the undisputed fact that the friends
of petitioner issued checks in payment of the loan in the name of Pua. If it is true that petitioner was
“re-lending”, then the checks should have been drawn in her name and not directly
paid to Pua.
With
respect to the second point, particularly, the finding of the CA that the
disbursements and payments for the loan were made through the bank accounts of
petitioner and respondent,
suffice it
to say that in the normal course of commercial dealings and for reasons of
convenience and practical utility it can be reasonably expected that the
facilities of the agent, such as a bank account, may be employed, and that a
sub-agent be appointed, such as the bank itself, to carry out the task,
especially where there is no stipulation to the contrary.[32]
In view of
the two agency relationships, petitioner and respondent are not privy to the
contract of loan between their principals.
Since the sale is predicated on that loan, then the sale is void for
lack of consideration.
2.
A further scrutiny of the record shows, however, that
the sale might have been backed up by another
consideration that is separate and distinct from the debt: respondent averred
in her complaint and testified that the parties had agreed that as a condition
for the conveyance of the property the respondent shall assume the balance of
the mortgage loan which petitioner allegedly owed to the NHMFC.[33] This Court in the recent past has declared
that an assumption of a mortgage debt may constitute a valid consideration for
a sale.[34]
Although
the record shows that petitioner admitted at the time of trial that she owned
the property described in the TCT,[35] the Court
must stress that the Transfer Certificate of Title No. 382532[36] on its
face shows that the owner of the property which admittedly forms the subject
matter of the Deed of Absolute Sale refers neither to the petitioner nor to
her father, Teodorico Doles, the alleged co-owner. Rather, it states that the property is
registered in the name of “Household Development Corporation.” Although there is an entry to the effect that
the petitioner had been granted a special power of attorney “covering the
shares of Teodorico Doles on the parcel of land described in this certificate,”[37] it cannot
be inferred from this bare notation, nor from any other evidence on the record,
that the petitioner or her father held any direct interest on the property in
question so as to validly constitute a mortgage thereon[38] and, with
more reason, to effect the delivery of the object of the sale at the
consummation stage.[39] What is worse, there is a notation that the
TCT itself has been “cancelled.”[40]
In view of
these anomalies, the Court cannot entertain the
possibility that respondent agreed
to assume the balance of the mortgage loan which petitioner allegedly owed to
the NHMFC, especially since the record is bereft of any factual finding that
petitioner was, in the first place, endowed with any ownership rights to
validly mortgage and convey the property.
As the complainant who initiated the case, respondent bears the burden
of proving the basis of her complaint.
Having failed to discharge such burden, the Court has no choice but to
declare the sale void for lack of cause.
And since the sale is void, the Court finds it unnecessary to dwell on
the issue of whether duress or intimidation had been foisted upon petitioner
upon the execution of the sale.
Moreover,
even assuming the mortgage validly exists, the Court notes respondent’s
allegation that the mortgage with the NHMFC was for 25 years which began
WHEREFORE, the petition is
granted. The Decision and Resolution of the Court of Appeals are REVERSED
and SET ASIDE. The complaint of
respondent in Civil Case No. 97-82716 is DISMISSED.
SO ORDERED.
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
WE CONCUR:
ARTEMIO V. PANGANIBAN
Chief Justice
Chairperson
CONSUELO
YNARES-SANTIAGO ROMEO J. CALLEJO,
SR.
Associate Justice Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
CERTIFICATION
Pursuant to
Section 13, Article VIII of the Constitution, it is hereby certified that the
conclusions in the above Decision were reached in consultation before the case
was assigned to the writer of the opinion of the Court’s Division.
ARTEMIO V. PANGANIBAN
Chief
Justice
[1] Penned by Associate Justice Fermin A. Martin (now retired), with Associate Justices Portia Aliño-Hormachuelos and Mercedes Gozo-Dadole, concurring.
[2] Penned by Associate Justice Mercedes Gozo-Dadole (vice retired Justice Fermin A. Martin, Jr.), with Associate Justices Portia Aliño-Hormachuelos and Marina L. Buzon (new Third Member).
[3] Exhibit “B”, records, p. 9.
[4] Exhibit “A”; records, p 7.
[5] RTC Decision, at 7-8.
[6] CA records, p. 19.
[7] CA Decision, rollo, pp. 52-54.
[8]
[9]
[10]
[11] Article 1335 of the Civil Code provides:
Art. 1335. There is violence when in order to wrest consent, serious or irresistible force is employed.
There is intimidation when one of the contracting parties is compelled by a reasonable and well-grounded fear of an imminent and grave evil upon his person or property, or upon the person or property of his spouse, descendants or ascendants, to give his consent.
x x x x
A threat to enforce one's claim through competent authority, if the claim is just or legal, does not vitiate consent. (emphasis supplied).
[12] CA Decision, at 10-12.
[13]
[14] Rollo, p. 81.
[15] See Rivera v. Roman, G.R. No. 142402, September 20, 2005, 470 SCRA 276; The Insular Life Assurance Company, Ltd. v. Court of Appeals, G.R. No. 126850, April 28, 2004, 428 SCRA 79, 86; Aguirre v. Court of Appeals, G.R. No. 122249, January 29, 2004, 421 SCRA 310, 319; C & S Fishfarm Corporation v. Court of Appeals, 442 Phil. 279 (2002).
[16] The fourth paragraph of the Deed of Absolute Sale reads: “NOW THEREFORE, for and in consideration of the sum of FOUR HUNDRED FIVE THOUSAND FOUR HUNDRED THIRTY PESOS ONLY (P 405,430.00) Philippine Currency, the Seller hereby SELLS, TRANSFERS and CONVEYS to the Buyer, his heirs, successors or assigns, the above-described parcel of land together with all the improvements thereon.” Exhibit “B”.
[17] See Zulueta v. Wong, G.R. No. 153514, June 8, 2005, 459 SCRA 671; Buenaventura v. Court of Appeals, G.R. No. 126376, November 20, 2003, 416 SCRA 263; Montecillo v. Reynes, 434 Phil. 456 (2002); Cruz v. Bancom Finance Co., 429 Phil. 224 (2002); Rongavilla v. Court of Appeals, 355 Phil. 720 (1998); Bagnas v. Court of Appeals, G.R. No. 38498, August 10, 1989, 176 SCRA 159; Civil Code (1950) Arts. 1352, 1458 & 1471.
[18] CA Decision, at 5-7; rollo, p. 48.
[19]
[20]
[21]
[22] TSN,
[23] TSN,
[24]
[25] See Amon Trading Co. v. Court of Appeals, G.R. No. 158585, December 13, 2005; Victorias Milling Co., Inc. v. Court of Appeals, 389 Phil. 184 (2000); Civil Code (1950), Art. 1868.
[26] See Victorias Milling Co., Inc. v.
Court of Appeals, id. citing Connell v. McLoughlin, 28 Or. 230, 42
P. 218; Halladay v. Underwood, 90
[27] Civil Code (1950), Arts. 1869-72.
[28] De Leon & De Leon, Jr., supra note 24, at 409.
[29]
[30] Id. at
356, citing Cia v. Phil. Refining Co., 45 Phil. 556, December 20, 1923; 5
Arturo M. Tolentino, Commentaries and Jurisprudence on the Civil Code of the
Philippines 398 (1991).
[31] See Cia
v. Phil. Refining
[32] Civil Code (1950), Arts. 1892-93.
[33] Paragraph 6 of respondent’s complaint reads:
6. On October 5. 1996 after defendant continuously failed to settle her
personal obligation to plaintiff, defendant offered to pay plaintiff by way of
ceding the above-described property on condition that plaintiff would assume
the balance of the mortgage and pay the monthly amortization of P4,748.11
for the remainder of the 25 years to which the latter agreed; x x x
Annex “D” of the Petition, Rollo, p. 39. Respondent testified as follows:
Q. At the time of the sale, can you tell to this Court whether the defendant [is] still indebted to the [NHMFC]?
A. I am aware that she is indebted.
Q. Is there any agreement with respect to the obligation of the defendant to the NHMFC?
A. We have a verbal agreement that I will
be the one to assume the balance.
Q. When you speak of balance what are you talking to? [sic]
A. Undue [sic] balance, sir.
TSN,
[34] See Bravo-Guerrero v. Bravo, G.R.
No. 152658,
[35] TSN,
[36] Exhibit “A”; Rollo, p. 17.
[37]
[38] Civil Code (1950), Art. 2085(3).
[39] See Gonzales v. Toledo, G.R. No.
149465, December 8, 2003, 417 SCRA 260; Tsai v. Court of Appeals, 418
Phil. 606 (2001); Philippine Bank of Communications v. Court of Appeals, et
al., 418 Phil. 606 (2001); Noel v. Court of Appeals, 310 Phil. 89 (1995);
Segura v. Segura, 165 SCRA 368, 375 (1988).
[40] Exhibit “A”; Rollo, p. 71.