Republic of the
Supreme Court
SECOND DIVISION
|
RURAL
BANK OF DASMARIÑAS, INC.
Petitioner, - versus - NESTOR JARIN, APOLINAR
OBISPO, and VICENTE GARCIA in his capacity as Register of Deeds of the
Province of Cavite, Respondents. |
G.R. No.
180778 Present:
QUISUMBING,* Acting C.J., Chairperson, CARPIO
MORALES, NACHURA,**
BRION, and ABAD, JJ. Promulgated: October
16, 2009 |
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D E C I S I O N
CARPIO MORALES, J.:
Respondents Nestor Jarin (Jarin) and
Apolinar Obispo (Obispo) were awarded Certificates of Land Transfer (CLT) over
portions of a parcel of land in Burol, Dasmariñas,
Before respondents could be issued
Emancipation Patents (EP), they obtained on
On
Respondents failed to settle their
loans, hence, the mortgages were foreclosed and RBDI purchased the farm lots as
the highest bidder. As at that time the
EPs were still not yet issued, respondents authorized RBDI to receive them.
The EPs were eventually released on
On
complaint[2]
against them for delivery of the owners’ copies of TCT Nos. 994, 995, and 996,
and damages, with prayer for the issuance of a writ of injunction and/or
temporary restraining order.
In their Answer, respondents claimed
that from the proceeds of the original loan, Obispo received P266,750
while Jarin received P150,000; and that they were later forced to sign
additional affidavits requesting additional loans for P435,000 in the
case of Jarin, and P260,000 in the case of Obispo, which amounts were “manufactured”
to circumvent Presidential Decree No. 315 allowing financial institutions to
accept as collateral for loans duly registered CLTs issued by the government to
tenant farmers provided that, among other things, the amount of the
loans is not less than 60% of the value of the landholdings as determined under
Presidential Decree No. 27.[3]
Respondents furthermore claimed that
they were forced to sign affidavits waiving their rights in the farm lots,[4] which affidavits
In sum, respondents answered in the
negative the issue of “whether or not a CLT or an EP can be transferred other
than through hereditary succession or to the government.”[7]
Obispo
died during the pendency of the case and was substituted by his spouse.[8]
Branch
22 of the Regional Trial Court (RTC) of Imus,
WHEREFORE, premises considered, judgment is rendered:
1.
Ordering defendant Nestor Jarin to pay plaintiff the
amount of P150,000.00 representing the amount received, plus interest at
the prevailing rural bank[‘]s rate computed from December 26, 1988 until
January 14, 1999;
2.
Ordering the heirs of defendant Apolinar Obispo to pay
plaintiff the amount of P266,750.00 representing the amount received
plus interest at the prevailing rural bank[‘]s rate computed from December 26,
1988 until January 14, 1999;
3.
Ordering the Register of Deeds for the
4. Dismissing the Complaint.
SO ORDERED.[9]
The Court of Appeals affirmed the RTC
Decision.[10]
Hence, RBDI’s present Petition for
Review on Certiorari,[11]
alleging that the Court of Appeals erred in holding that a) there is no right
of foreclosure in its favor; b) it committed fraud; and c) it is not entitled
to damages.[12]
The
petition is bereft of merit.
That fraud was committed against respondents
is supported by the evidence on record.
As the RTC observed:
As stated at the outset, the land awarded to defendants pursuant to PD 27 was formerly owned by Dr. Paulo Campos who, at the time of the transactions x x x and at the time of the filing of the case, was the president of the plaintiff. In addition, the certification dated May 13, 1999 (Exhibit “1”) issued by Genoveva Hernandez, accountant of plaintiff, on the shareholdings of Dr. Paulo C. Campos and his family, as well as the testimony of plaintiff’s witness Shirley Enobal (TSN, May 13, 1999) will clearly prove that Dr. Campos and his family are the only shareholders of the plaintiff. In other words, plaintiff is a family corporation.
Defendants Jarin and Obispo, on the other hand, are both uneducated and have not finished any kind of formal education. They cannot read nor write in English and they have always been, since their early years, farmers or farmworkers.
x x x x
The fact alone that the real estate mortgages were executed even before the Special Power of Attorney[13] to mortgage the property was issued and that both were already in existence even when there was no loan application yet, clearly indicates the premeditated efforts of plaintiff, its officers and Dr. Campos in illegally recovering the subject properties through fraudulent and simulated means. In addition, a perusal of the real estate mortgage shows that the interest rate was not even stated. More importantly, while the mortgage deeds make reference to promissory notes with regard to the due date of the obligations, no promissory notes were presented in evidence if in fact they were executed. The foregoing acts are not normal banking practices. x x x
In addition, plaintiff’s manager, Shirley Enobal, testified on cross-examination that defendants Jarin and Obispo were assisted by Dr. Campos. x x x
x x x x
It is very surprising, to say the least, that plaintiff’s president himself would assist two farmers in obtaining loans when plaintiff surely has sufficient employees assigned to perform such functions. Added to this is the fact that it was plaintiff’s manager herself who was principally involved and was instrumental in the documentation of the aforesaid transactions (Exhibits “A” and “4”). These are clear indications on the objective of Dr. Campos to recover the land through plaintiff by means of anomalous and irregular bank processes.
Plaintiff continued these machinations through a supposed Special Power of Attorney dated June 16, 1990 executed by Dr. Campos appointing defendants Jarin and Obispo again as his attorneys-in-fact and authorizing them to secure additional loans with plaintiff and to mortgage the subject properties (Exhibits “E” and “11”). Similarly, plaintiff again simulated Real Estate Mortgages dated June 15, 1990, purportedly executed by defendants Jarin and Obispo mortgaging in favor of plaintiff the subject properties as attorney[s]-in-fact of Dr. Campos for the alleged additional loans (Exhibits “F”, “F-1”, “12 and “13”).
x x x And to strengthen its purpose of defrauding the defendants, plaintiff produced demand letters seeking payment of the principal amounts of the loan (Exhibits “H,” “H-1”, “14”, and “15”.)
x x x x
The fraud persisted when defendants Jarin and Obispo were made to sign spurious “Sinumpaang Salaysay sa Pagbibitiw” prepared by plaintiff dated February 15, 1995 and allegedly acknowledging the 1988 loan with plaintiff, misrepresenting that they allegedly failed to pay the same; and that they allegedly were voluntarily surrendering their right to till the subject property (Exhibits “21” and “22”).
The
overall scheme and machinations of plaintiff and its officers x x x became very
patent when a request was filed by Dr. Campos with the Department of Agrarian
Reform (DAR) for the release of the EPs generated in the names of defendants
Jarin and Obispo. Based on the Order
dated
Under the threat of losing the land awarded to them and after having finally realized that they had been defrauded and taken advantage of, defendants Jarin and Obispo sought help from their relatives who might be able to help them with their problem, which they never understood in the first place until circumstances became clear.
Thus, in a letter dated May 26, 1997 written by defendants Jarin and Obispo as well as their respective heirs addressed to the then Secretary of DAR, the said defendants requested, among others, that the subject properties be returned to them for tilling or that the same be transferred to their respective heirs (Exhibit “23”). This was supplemented in a letter dated August 17, 1997 written by the defendants addressed to the then Secretary of DAR, reiterating their pleas and prayers over the subject properties as contained in their earlier letter dated May 26, 1997 (“Exhibit 25”). This second letter included a Sworn Statement dated July 15, 1997 (Exhibit “25-A”) executed by defendants Jarin and Obispo and their respective spouses disowning the “Sinumpaang Salaysay sa Pagbibitiw” dated February 15, 1995 (Exhibits “21” and “22”) for lack of voluntariness. On the basis of the foregoing, an Order dated October 8, 1997 was issued by the then Secretary of DAR setting aside the earlier Order dated August 7, 1996 (Exhibit “19”) and directing the issuance of Emancipation Patents to defendants Jarin and Obispo (Exhibit “26”).
It was likewise brought to the attention of this Court that even prior to the institution of the instant case, plaintiff and its officers unsuccessfully attempted to consolidate their claim and title over the subject property through the filing of a Petition dated April 15, 1997, for an Action to Remove Cloud or Quiet Title to the Real Property and for Preliminary Injunction and Prayer for TRO against the then Secretary of DAR and defendants Jarin and Obispo (Exhibits “24”, “24-A” to “24-G”).
The foregoing will clearly establish that the transactions subject of this case were attended with fraud and formed part of a grand design to defraud the defendants Jarin and Obispo to enable plaintiff to recover the subject property awarded to said defendants.[14] (Emphasis and underscoring supplied)
Respecting
RBDI’s right to foreclose the mortgages, Presidential Decree No. 27 provides:
Title to land acquired pursuant to this
Decree or the Land Reform Program of the Government shall not be
transferable except by hereditary
succession or to the Government in accordance with the provisions of this
Decree, the Code of Agrarian Reforms and other existing laws and regulations. (Emphasis and underscoring supplied)
Respondents’
farm lots subject of the mortgages are thus not subject to foreclosure, except
by the Land Bank, because foreclosure contemplates the transfer of ownership
over the mortgaged lands.[15]
RBDI invokes, however, Section 1 of Presidential
Decree No. 315 which amended Presidential Decree No. 27, which reads:
SECTION 1. All financing
institutions shall hereafter accept as collateral for loans any duly registered
Land Transfer Certificate issued by the Government, through the Department
of Agrarian Reform to tenant-farmers in an amount not less than sixty percent
(60%) of the value of the farmholding as determined under Presidential Decree
No. 27; Provided, That such loans shall be guaranteed by the Guarantee Fund
established by the Samahang Nayon (Barrio Association) in which a tenant-farmer
is a full-pledged member; Provided, Further, That the loans obtained shall be
used in the improvement or development of the farmholding of the tenant-farmer
or the establishment of facilities that will enhance production or marketing of
agricultural products or increase farm income therefrom. (Underscoring supplied)
.
To the RBDI,
“[t]he mere fact that the farmer-beneficiary is allowed by the Government to
offer his landholdings as collateral to the financial institutions shows the
Government’s intent to include foreclosure of [sic] creditor-banks as one of the modes for transferring titles to land
acquired pursuant to PD No. 27.”[16]
RBDI’s position does not impress.
The policy behind the prohibition in Presidential Decree No. 27
precludes expanding the exceptions therein.
So this Court declared:
Upon the promulgation of Presidential Decree
No. 27 on
x x x The prohibition against transfers to
persons other than the heirs of other qualified beneficiaries stems from the policy
of the Government to develop generations
of farmers to attain its avowed goal to have an adequate and sustained
agricultural production. With certitude, such objective will not see
the light of day if lands covered by agrarian reform can easily be converted
for non-agricultural purposes.[18] (Capitalization in the original; italics,
emphasis and underscoring supplied)
In light of the foregoing discussion, resolution of the issue of whether
RBDI is entitled to damages is rendered unnecessary.
WHEREFORE, the
petition is DENIED. The Decision of the Court of Appeals dated
Costs
against petitioner.
SO ORDERED.
CONCHITA CARPIO MORALES
Associate Justice
WE CONCUR:
LEONARDO A. QUISUMBING
Acting Chief Justice
Chairperson
|
ANTONIO EDUARDO B. NACHURA Associate Justice |
ARTURO D. BRION Associate Justice |
ROBERTO A. ABAD
Associate Justice
ATTESTATION
I attest
that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s
Division.
LEONARDO
A. QUISUMBING
Associate
Justice
Chairperson
CERTIFICATION
Pursuant to
Section 13, Article VIII of the Constitution, and the Division Chairperson’s
Attestation, I certify that the conclusions in the above decision had been
reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
LEONARDO A. QUISUMBING
Acting Chief
Justice
* Acting Chief Justice per Special
Order No. 721 dated
** Additional member per Special Order
No. 730 dated
[1] Only copies of TCT Nos. 994 and 996, in the name of Jarin, are found in the records (pp. 312-315).
[2]
[3] Exhibits “16” and “17,” id.. at. 400-403.
[4] Exhibits “21”-“22,” id. at 412-413.
[5] Exhibit “19,” id. at 406-409.
[6] Exhibit “26,” id. at 428-430.
[7]
[8]
[9]
[10] Decision of
[11] Rollo, pp. 8-29.
[12]
[13] The Special Power of Attorney was
executed on
[14]
[15] Hector S. De
[16] Rollo, p. 17.
[17] Torres
v.
[18] Estate
of the Late Encarnacion Vda. De Panlilio v. Dizon, G.R. No. 148777,