REPUBLIC OF THE PHILIPPINES, PLAINTIFF AND APPELLANT, VS. HEIRS OF CRESENCIO V. MARTIR:  MARIO MARTIR, ESTHER M. TUPAS, RUTH C. VDA. DE MARTIR, ET AL., DEFENDANTS AND APPELLEES.

On December 8, 1961, the Republic of the Philippines filed with
the Court of First Instance of Occidental Negros a complaint for foreclosure of mortgage against Cresencio V.
Martir (Civil Case No. 6386).  This
complaint was later amended by substituting
herein appellees as parties defendants, it having been found that Cresencio V.
Martir was already dead.  The amended
complaint alleged that on May 11 and June 4, 1943, said deceased obtained two
separate loans from the former Bank of Taiwan, Ltd. in the total amount of
P2,000.00, with interest at the rate of six per centum per annum, compounded
quarterly, payable one year thereafter, as evidenced by two promissory notes
executed by him in favor of said bank, copies of which were attached to the
complaint as Annexes “A” and “B”
thereof; that as security therefor, the obligor executed in favor of
said bank a real estate mortgage on a parcel of land covered by Transfer
Certificate of Title No. 34979 of the Register of Deeds of Negros Occidental
issued in his name, and a chattel mortgage an the growing crops thereon, which
instruments were registered on June 22 and 23, 1943, respectively, with the office of the Register of Deeds of Negros
Occidental; that said account was one of the assets of the Bank of Taiwan, Ltd.,
vested in the United States of
America through the Alien Pro­perty Custodian on January 21, 1946, under
authority of the Trading With the Enemy Act, and transferred to the Republic of
the Philippines on July 20, 1954; and that, despite repeated demands by the
latter, Martir had failed to pay the mortgage debt and the interests due
thereon.

On December 27, 1961, appellees filed a motion to dismiss the
complaint on the ground that the cause of action alleged therein was already
barred by the Statute of Limitations.

The lower court sustained the motion and dismissed the case.  Hence, the present appeal, it being
appellant’s con­tention – to secure a reversal – that the lower court erred in
holding:  firstly, that the property
subjectmatter of the action is subject
to prescription; secondly, that appellant’s cause of action had already
prescribed when the action was filed; and finally, in dismissing the complaint.

Considering the undisputed facts of the case, we believe that the
question of whether or not the prescriptive period had already elapsed when
appellant commenced its action would be decisive of this appeal – on the
assumption, of course, that the subjectmatter of appellant’s action is subject to prescription.  We shall, therefore, proceed to its consider­ation.

In relation to the first promissory note in question, appellant’s
cause of action accrued on May 11, 1944.

It is the law in this jurisdiction that actions to enforce
written contracts prescribe upon the lapse of ten years from the accrual of the
cause of action (Article 1144, New Civil Code).

However, Executive Order No. 25 issued on November 18, 1944
provides for the suspension of payment of all debts and other monetary
obligations contracted after December 31, 1941 – that is, during the war.

On the other hand, Executive Order No. 32 issued on March 10,
1945 provides for the suspension of payment of all debts and other monetary
obligations incurred before and after December 31, 1941, except debts
contracted in any area liberated from the enemy.  That Executive Order No. 32 merely amended
the previous one by providing for the suspension of payment of all debts and
other monetary obligations incurred before December 31, 1941 – which
were not covered by the pro­visions of Executive Order No. 25 – is beyond question.

Lastly, Republic Act No. 342 enacted on July 26, 1948 provided for the lifting of the
moratorium only with respect to pre-war obligations, except in such
cases where the debtors are war sufferers and had filed claims with the War Damage Commission.

We have held heretofore in several cases that during the period
of time the two executive orders mentioned above were in force, no action could
be taken to collect any outstanding monetary obligation covered by their
provisions (Cruz vs. Avila 42 O.G. No. 9, p. 2114; dela Fuente vs. Borromeo, 42
O.G. p. 3172; Ma-ao Sugar Central Company
vs. Barrios, 45 O.G. 2444), and that the time during which the moratorium was
in force must be excluded in the computation of the prescriptive period
(Philippine National Bank vs. Osena
et al., January 21, 1958).  In fact, in Manila Motor Company, Inc.
vs. R. F. Fer­nandez (52 O.G. No. 16, p. 6884) We held not only to this same effect but ruled likewise that
“The debt moratorium lasted from November 18, 1944, etc.” (Underline supplied).

On the other hand, it is not disputed that it was only on May 18, 1953 that the
moratorium was declared unconstitutional in Rutter vs. Esteban, G.R. No.
L-3708.  Consequently, the suspension of the running of the
prescriptive period lasted from November 18, 1944 to May 18, 1953 – a
period of eight (8) years and six (6)
months.

From May 11, 1944 – the date when the earliest cause of action in
favor of appellant accrued – until December 8, 1961 – the date when appellant
commenced the action at bar – we have a period of seventeen (17) years.  Deducting therefrom the period during which
the moratorium was in force, namely, eight
(8) years and six (6) months,
the result would be eight (8) years and
six (6) months.  It is, therefore, clear
that appellant filed the action before the lapse of the period of prescription.

With the conclusion arrived at on the decisive issue, We find it
unnecessary to consider the others raised in appellant’s brief.

WHEREFORE, the order appealed from is reversed and set aside and the
record of this case is remanded below for further Proceedings.  With costs.

Concepcion, C.J., Reyes, Regala, Makalintal, Bengzon, Zaldivar,
Sanchez and Ruiz Castro, JJ., concur.