G.R. No. 102314. May 26, 1993
LEA O. CAMUS, PETITIONER, VS. THE HONORABLE COURT OF APPEALS, CONRADO S. DAVID AND DAVID MOTORS AND MARKETING CORPORATION, RESPONDENTS.
MELO, J.:
Both the trial and appellate courts construed the transaction
effected between herein petitioner and private respondent on May 20, 1986 as an
absolute sale of a piece of realty, but petitioner thinks otherwise, saying
that it was a mere equitable mortgage. Hence, the petition at bar.
Respondent court briefly narrated the background of the case
which petitioner did not bother to assail in her pleadings before this Court,
thus:
On May 20, 1986, the parties, with plaintiff-appellant as vendor
and defendant-appellee David Motors and Marketing Corporation (DMMC, for
brevity) through its representative,
defendant-appellee David, executed by and between themselves a “Deed of
Absolute Sale of Real Property” over a parcel of land (Lot 7-B of the
Subd. plan (LRC) psd-324403, approved as a non-subd. proj. being a portion of
Lot 7 (LRC) Pcs-16468 LRC Rec. No. 5941), including all improvements thereon,
situated in the barrio of Hen. T. de Leon, Municipality of Valenzuela, Metro
Manila, containing an area of Six Hundred Thirty One (631) square meters, more
or less, covered by Transfer Certificate of Title No. 119038 of the Registry of
Deeds of Caloocan City, and for and in consideration of One Hundred Fifty
Thousand (P150,000.00) Pesos (Exhibit “B” also Exhibit
“2”).
On November 27, 1987, plaintiff-appellant filed the instant
complaint, praying for the annulment of the subject deed of absolute sale and
consequent cancellation of the certificate of title obtained by
defendants-appellees by virtue thereof; the interpretation and declaration of
the subject deed of absolute sale as an equitable mortgage; and for a writ of
preliminary injunction (Record, pp. 1-38).
In their answer, defendants-appellees contended that the subject
encumbrance was one of absolute sale (Record, pp. 51-70).
After trial on the merits, the lower court rendered the impugned
decision … (p. 62, Rollo.)
In her memorandum, petitioner hastened to add a few more details
on how the so-called sale in favor of private respondent evolved. According to petitioner, she previously
mortgaged the same parcel of land on July 23, 1985 to Mrs. Macaria
Dimafelis. Before the mortgage matured,
she had to look for other sources from whom she can borrow money to liquidate
the mortgage and this financial constraint led to her being introduced to
Conrado S. David, herein private respondent, through one Natividad de
Gula. It was in the office of private
respondent where petitioner impressed the idea of utilizing the mortgaged lot
as collateral for the loan which she wanted to obtain from private respondent.
In response to the request, private respondent allegedly agreed
to extend the loan subject to the following terms:
a) the gross principal amount of the indebtedness shall be
P150,000.00;
b) repayment period will be two years with an automatic grace
period of one month;
c) interest shall be ten percent a month payable monthly;
d) the transaction shall be denominated as an absolute sale
instead of a real estate mortgage; and that
e) out of the proceeds of the loan, P40,000.00 will be retained by
private respondent as payment for two months advance interest (P30,000.00 at
P15,000.00 interest a month) and the remaining sum of P10,000.00 will be for
documentation expense.
Petitioner claims that she was initially reluctant to express her
conformity but she nonetheless agreed to the conditions after she was
supposedly assured by private respondent that the nomenclature attached to
their transaction was a mere formality and that petitioner had no reason to be
apprehensive inasmuch as private respondent will register the deed of
conveyance only if petitioner does not
pay the monthly interest. Petitioner
signed the “Deed of Absolute Sale” and surrendered the owner’s
duplicate copy of the certificate of title after private respondent issued a
check in the amount of P109,000.00 to Mrs. Dimafelis as full settlement
of petitioner’s previous indebtedness. For her part, petitioner received P1,000.00 in cash and was made to sign
a cash voucher to show that she received P150,000.00. Further, payment of the interest for four months was allegedly
made to private respondent, who did not issue any receipt therefor, until
petitioner discovered, to her dismay, that the instrument was registered which
triggered the issuance of a new certificate of title in the name of respondent
corporation.
All of the foregoing statements were derived by petitioner from
her open court declarations when she sat on the witness stand in order to
develop the theory that the entire scheme was a simple loan accommodation.
But the trial court was far from convinced by petitioner’s
disquisition and neither was respondent court which concurred with the factual
observation of the court of origin that gross inadequacy of price had not been
sufficiently demonstrated. In
interpreting the covenant as an absolute transmission of dominion in favor of
private respondent, Justices Aldecoa, Jr., Campos, and Felimon Mendoza were in
unison when they declared that none of the badges of an equitable mortgage
under Article 1602 of the Civil Code can be appreciated in favor of herein
petitioner (p. 68, Rollo).
Of particular significance to the resolution of the question on
the true character of the disputed transaction are the contemporaneous and
subsequent acts of the contracting parties which have been translated into
testimonial evidence in the course of the trial on the merits. Indeed, this specie of evidentiary proof,
known as the Parol Evidence Rule, may well be the acknowledged adjective norm
that can spell the difference between success or failure of the instant
petition (Macapinlac vs. Gutierrez Repide, 43 Phil. 770
[1922]; Cuyugan vs. Santos, 34 Phil. 100 [1916]). For there can be a better appreciation of
the problem at hand only if we resort to what the parties had already
emphasized below to buttress their respective contentions and in this respect,
the decision of respondent court seems a bit deficient considering that it
relied more on the alleged sufficiency of the purchase price (p. 66, Rollo) and
the bare fact that petitioner, who was accompanied by her “businesswoman
daughter”, could not have been duped into accepting private respondent’s
offer to purchase the property (p. 67, Rollo).
We concede that on these two aspects, we do not occupy a superior
position to brush aside what respondent court arrived at but the so-called
adequacy of the consideration, pegged at P150,000.00 by private respondent
himself (p. 33, Rollo) for a 631 square meter lot, and the impression of
petitioner’s willingness to absolutely part with her possession, do not necessarily diminish the
existence of other circumstances under Article 1602 of the Civil Code.
Verily, petitioner
endeavored to demonstrate her financial constraint and the need to pay off the
mortgage in favor of Mrs. Dimafelis, which she was able to rectify by
approaching Conrado S. David who offered to help thus:
ATTY. MABBAYAD, JR.:
Q. Mrs.
Camus, are you the same Lea O. Camus who is the plaintiff in this case:
A. Yes,
sir.
Q. Do
you know the defendant Conrado S. David in this case?
A. Yes,
sir.
Q. Since when have you known him?
A. When
I was introduced to him by an old woman, sir.
Q. When was that?
A. The
1st week of May, 1986, sir.
Q. And
what is the name of the lady who introduced you to him?
A. Natividad
de Gula, sir.
COURT:
By the way, is she
connected with this case?
ATTY. MABBAYAD, JR.:
I think so, your Honor.
Q. And why were you so introduced by
Madam Natividad de Gula to the defendant Conrado S. David?
A. Because
Natividad de Gula learned that I am in need of a loan.
Q. And
when for the first time did you come to know and become acquainted with Mrs.
Natividad de Gula?
A. Later
part of April, 1986, sir.
Q. How
did you came to meet her?
A. She
went to our house, sir.
Q. That
was on the last week of April?
A. Yes,
sir.
Q. And when she went to your house, were
you there?
A. Yes,
sir, I was.
Q. Were you able to talk to each other?
A. Yes,
sir.
Q. How did the conversation start and
finish?
A. I
am in need of a loan and she told me that she can help me and she knows
somebody and that is Conrado David who can extend the loan to me, sir.
Q. Did
she tell you how she came to know that you needed to borrow money?
A. She
learned from another person, sir.
Q. And
on the same occasion when you first met and talked to Ms. de Gula and she told
you that she could help you obtain a loan from Mr. Conrado David, did she tell
you her official or personal relationship with Mr. David?
A. According
to her, she knows Mr. David and she used to bring borrowers to Mr. David, sir.
x x x x x x x x x
ATTY. MABBAYAD, JR.:
Q. On
that same occasion did Mrs. de Gula explain to you the terms and conditions
that Mr. David, the lender to whom she brought many borrowers previously on the
loan that he normally extends?
A. Yes,
sir.
Q. What
were those terms and conditions of the loan that was extended to you?
x x x x x x x x x
WITNESS:
A. She
asked me how much money do I need, if I have a title and complete papers, tax
declarations, tax receipts.
ATTY. MABBAYAD, JR.:
Q. And
what did you tell her?
A. She
told me that Mr. David can give what I need, sir.
Q. And
what did you tell her after she asked you whether you have a title or any
supporting papers that you have in support of the loan?
A. That
if it is necessary that she introduce me to Mr. David, sir.
Q. Now,
why did you have to borrow money?
A. I
badly needed money because I have an obligation.
Q. What kind of obligation?
A. I
have a property mortgaged with Mrs. Macaria Dimafelis, sir.
Q. The same property now subject of this
case?
A. Yes,
sir.
Q.
Now, did you in fact go and see
Mr. David as suggested to you by Mrs. Natividad de Gula?
A. Yes,
sir.
Q. When
did you go and see Mr. David?
A. On
May 9, 1986, sir.
Q. And
were you able to see Mr. David?
A. Yes,
sir.
Q. Whereat?
A. At
their factory office at Dalandanan, sir.
Q. In
what municipality or city?
A. Valenzuela,
Metro Manila, sir.
Q. And
who were your companions when you went to see Mr. David at the said factory?
A. One
of my daughters, sir.
Q. How
about Mrs. de Gula, was she with you then?
A. Yes,
sir.
Q. What
is the name of your daughter?
A. Ms.
Paz Camus, sir.
Q. Now, when you were already in the
office of Mr. David and saw him, what happened?
A. Mrs.
de Gula introduced me to Mr. David and she told Mr. David what I needed, sir.
Q. What
specifically did Mrs. de Gula tell Mr. David about your so-called
“pangangailangan” or need?
A. Mrs.
de Gula told Mr. David that I needed a “sangla”.
COURT:
Q. What do you mean by that?
A. That
I needed a collateral to borrow money, ma’am.
ATTY. MABBAYAD, JR.:
Q. Did you need a collateral to borrow
money or you needed money to be collateralized by a collateral?
A. That I needed to put up a collateral to get the
money, sir.
Q.
In short you already have the
collateral that you needed in order .. interrupted..
ATTY. FIDELINO:
Q. Objection, your Honor, very leading.
COURT:
Reform the question.
ATTY. MABBAYAD, JR.:
Q. After Mrs. de Gula explained to Mr.
David your purpose in going to Mr. David, what did Mr. David say or comment?
A. He
will first look into the property, sir.
Q. Did
Mr. David ask you what kind of collateral you are willing to offer him to
secure the loan you intended to obtain from him?
A. Yes,
sir.
Q. And what did you tell him?
A. I
told him that the property is a house and lot located at No. 11 Gumamela St.,
Marulas, Valenzuela, Metro Manila.
Q. And
after you told Mr. David that, that was the time he said that he will first
inspect the property being offered as collateral?
A. Yes,
sir.
Q. Did
he ask you how much money you wanted to borrow from him?
A. He
asked me, sir.
Q. And
what did you tell him?
A. I
told him P150,000.00, sir.
Q. Why
do you need to borrow the amount of P150,000.00 from anybody?
A. For
the payment of my obligation, sir.
COURT:
Q. The
one you are mentioning, your obligation to Mrs. Dimafelis?
A. Yes,
your Honor.
ATTY. MABBAYAD, JR.:
Q. How much is your obligation to Mrs.
Dimafelis?
A. P109,000.00,
sir.
Q. Since
you needed only P109,000.00 and yet you borrowed P150,000.00, what do you
intend to do with the remaining amount of at least P41,000.00?
A. To
meet other needs and also to give commission to the person who helped me.
Q. And
did Mr. David or any of his agents or employees in fact inspect the proffered
collateral as he said to you?
A. Yes,
sir.
Q. When
was that?
A. May
11 or 12, 1986, sir.
Q. And
who made the inspection of the proffered collateral?
A. Mr.
David himself, sir.
Q. But
in that first meeting of yours with Mr. David, did he require you to present to
him or show to him any paper?
A. Yes,
sir.
Q. What
papers or documents did Mr. Conrado David require you to present or show to
him?
A. Like
the xerox copy of the title, tax declaration, tax receipts, plan or building
permit.
Q. Building
or construction plan of what?
A. Of
the house which I had constructed, sir.
Q. Where
is this house so constructed?
A. At
No. 11 Gumamela St., Marulas, Valenzuela,
Metro Manila.
Q.
You told the Court that you offered as collateral or security
to the intended loan you are trying to obtain
from Mr. David your house and
lot located at No. 11 Gumamela St., do you have proof to show that you are the owner of that
property?
A. Yes,
sir, I have a xerox copy of my
own title.
x x x x x x x x x
ATTY. MABBAYAD, JR.:
Q. Were
you there in your residence when Mr.
David inspected the property which you offered as collateral?
A. Yes,
sir, I was there.
Q. And after Mr. David inspected the property, the proffered collateral, what did he say or do?
A. He
told me to meet him in his office, sir.
Q. Did
you in fact go to his office
after Mr. David inspected the proffered
collateral?
A. Yes, sir, at Dalandanan.
Q. When
was that?
A. May
15, 1986, sir.
Q. And
did you have any companion when you went there?
A. I have, sir.
Q. Who?
A. Mrs.
de Gula and my daughter, Ma. Paz, sir.
Q. Were
you able to see Mr. David on that
date?
A. Yes,
sir.
Q. And did you talk about this loan with
him?
A. Yes,
sir.
Q. What
happened when you talked about the loan you were trying to obtain from him?
A.
HE TOLD ME THAT HE CAN GIVE ME
THE MONEY PROVIDED I EXECUTE A DEED OF SALE.
COURT:
For how much?
A. For
P150,000.00, ma’am.
Q. AND
WHAT DID YOU TELL HIM?
A.
I FELT SAD BECAUSE WHAT HE WANTED
ME TO EXECUTE WAS A DEED OF SALE AND I SUGGESTED IF THE DOCUMENT THAT I WOULD
EXECUTE WOULD BE AN ORDINARY LOAN DOCUMENT.
Q.
WAIT, BEFORE HE SUGGESTED THAT YOU
EXECUTE A DEED OF SALE, YOU SAID YOU WERE BORROWING. DID YOU NOT TALK ABOUT ANY INTEREST THAT YOU ARE GOING TO PAY?
A. WE TALKED ABOUT THE INTEREST, MA’AM.
Q. Before he asked you to execute a deed
of sale?
A. Yes,
ma’am.
Q. HOW
MUCH?
A. 10%
INTEREST, MA’AM.
ATTY. MABBAYAD, JR.:
Q. WHAT OTHER TERMS AND CONDITIONS DID MR.
DAVID TALK WITH YOU ON THAT PARTICULAR SECOND OCCASION THAT YOU WENT TO HIM?
A. WE
TALKED ABOUT THE LOAN, THAT HE IS AGREEABLE TO EXTEND THE LOAN WITH 10%
INTEREST PROVIDED THAT THE DOCUMENT WOULD BE A DEED OF SALE. I TOLD HIM THAT WHY IS IT THAT IT IS A DEED
OF SALE, AND HE TOLD ME THAT THAT IS HIS POLICY.
Q. Now did you not talk about the
repayment period for this loan?
A. We
talked about the repayment, we agreed on a loan term payment of 2 years, and
provided that 10% interest monthly be made.
Q. Did you agree to those terms and conditions
that Mr. David told you?
Q.
AT
FIRST, I DO NOT WANT TO ACCEPT THE CONDITIONS BUT LATER ON, I AGREED BECAUSE I
BADLY NEEDED THE MONEY.
Q. IN OTHER WORDS, YOU AGREED TO THE
FOLLOWING: THAT THE DEED OF SALE
COVERING THE PROFFERED COLLATERAL BE EXECUTED INSTEAD OF AN ORDINARY DEED OF REAL ESTATE MORTGAGE?
A. Yes,
sir.
Q. YOU ALSO AGREED TO THE PAYMENT OF 10% MONTHLY
INTEREST?
A. Yes,
sir.
Q. AND YOU FINALLY AGREED TO A REPAYMENT PERIOD
OF 2 YEARS?
A. Yes,
sir.
Q. NO OTHER CONDITION?
A. HE ALSO TOLD ME THAT HE WILL NOT HAVE THE
DOCUMENT REGISTERED IN HIS NAME UNLESS OR IN CASE I WILL NOT BE ABLE TO PAY OR
REDEEM THE PROPERTY AFTER THE LAPSE OF THE PERIOD, sir.”
(pp. 3-18, TSN, January
26, 1988; Underscoring supplied.)
Petitioner continued to testify regarding her acquiescence to the
terms and the disposition of the proceeds in this manner:
ATTY. MABBAYAD, JR.:
Q. In
the last hearing of this case Madam Witness, you said that Mr. David and you
agreed on the amount of the loan and the terms and conditions thereof. After you so agreed with Mr. David, the
amount, terms and conditions thereof, what transpired?
A. He
told me that he will have the documents prepared and will send them over to me,
sir. He will cause the preparation of
the deed of sale and requested me to bring more documents.
Q. What documents did Mr. David ask you
to bring with you?
A. The
copy of the title, tax declarations, tax
receipts, the plan, the plan of the house and the building permit, sir.
Q.
And after he told you, that, did
he tell you when you are going to meet again?
ATTY. FIDELINO:
Leading, your Honor, and
no basis.
ATTY. MABBAYAD:
I will reform the
question.
Q. Was the
deed of sale indeed prepared?
A. Yes,
sir.
Q. And were you able to bring the
documents you just mentioned to Mr. David?
A. Yes,
sir.
Q. And where did you bring those
documents to him?
A. 2
days after we talked, sir.
Q. You agreed on the terms and
conditions?
A. Yes,
sir.
Q.
And what happened when you
submitted the documents required of you by Mr. David?
A. He
took hold of the document but we will return to sign the deed of sale.
Q. And did you go back to see him as he
told you to do?
A. Yes,
sir.
Q. And did you sign the deed of sale that
he caused to be prepared?
A. I
signed the document, sir.
Q. After signing the deed of sale caused
to be prepared by defendant Conrado David, were you given a copy thereof?
A. No,
sir.
x x x x x x x x x
Q. Since you already signed the document and
submitted the documents already requested of you, did he give you the amount?
A. Not
yet, sir.
Q. Why?
A. Because
I fetched first the person to whom I have an obligation.
Q. What is the name of that person?
A. Mrs.
Macaria Demafelis, sir.
Q. Were you able to fetch Mrs. Macaria
Dimafelis?
A. Yes,
sir.
Q. Where did you bring her?
A. To
the office of Mr. David, sir.
Q.
When was that in relation to the
deed of sale which you signed, Exhibits A and A-1?
A. May
19, 1986, sir.
Q. And when you and Mrs. Dimafelis went
to the office of Mr. David were you able to see him?
A. Yes,
sir.
Q.
Who were with you when you went
to the office of Mr. David on May 19, 1986?
A. My
daughter Josefina and also Ma. Paz.
Q. Nobody
else?
A. And
Mrs. Natividad de Gula and also the agent.
Q. What happened when you and your other
companions met in the office of Mr. David on that particular date?
A. Mr.
David asked for the title in possession of Mrs. Dimafelis, sir.
Q. Did
Mrs. Dimafelis give the title to Mr. David as he requested?
A. Yes,
sir, it is complete.
Q. And after Mrs. Dimafelis handed over
the title to Mr. David, what also happened?
A. Mr.
David prepared the check for Mrs. Dimafelis, sir.
COURT:
Q. How
much?
A. P109,000.00,
ma’am.
ATTY. MABBAYAD:
Q. Now, you said earlier Madam, that you
and Mr. David agreed on a preferred amount of loan of P150,000.00. My question to you is, was the said amount
of P150,000.00 given to you by Mr. David?
A. No, sir.
Q. Why?
A. WHAT
WAS GIVEN BY MR. DAVID WAS ONLY
P109,000.00 IN FACT WHICH WAS RECEIVED AND SIGNED BY MRS. DIMAFELIS AND ANOTHER
P1,000.00 IN CASH.
xxx xxx xxx
ATTY. MABBAYAD:
Q. Now, you said earlier that you and Mr. David
agreed on a loan in the amount of P150,000.00 and you said just now that what
actually was given by Mr. David was P109,000.00 in the form of check issued and
delivered to Macaria Dimafelis in the amount of P109,000.00 and P1,000.00 cash
which he gave you. WHAT HAPPENED
TO THE BALANCE OF P40,000.00?
A. MR. DAVID SAID THAT IT WOULD BE USED
FOR DOCUMENTATION AND FOR 2 MONTHS ADVANCE INTEREST.
Q. DID HE TELL YOU THE BREAKDOWN OF THE
APPLICATION OF THE AMOUNT OF P40,000.00?
A. NO
MORE, sir.
(pp.
3-5, 7-10, 12, TSN, April 7, 1989; Underscoring supplied.)
To the question of whether petitioner agreed to an outright sale,
she emphasized a vehement denial on June 15, 1989:
ATTY. MABBAYAD:
Q. Mrs. Camus, when Mr. Conrado S. David
testified as the first and only witness for the defendants, he said that
although initially the transaction you approached (?) to him was one of a loan,
eventually and finally it became an outright sale and that you sold the
property to him for and in consideration of the price of P150,000.00. What can you say about this testimony of Mr.
Conrado David?
A. OUR
TRANSACTION WITH HIM IS A LOAN FOR THE AMOUNT OF P150,000.00, SIR, WHEN WE APPROACHED HIM, WE REALLY INTENDED TO HAVE A LOAN WITH MORTGAGE
AND THEN WHEN I ASKED HIM FOR THE AMOUNT OF P150,000.00 FOR A LOAN, HE SAID WHY
IS IT BIG AND ASKED ME HOW MUCH IS THE PRICE PER SQ. METER AND I ANSWERED
P500.00.
COURT:
Q. YOU
AGREED TO A SALE?
A. I DID NOT AGREE TO A SALE AND OUR
AGREEMENT IS ONLY FOR A LOAN WITH MORTGAGE AND HE SAID IF HE IS GOING TO
PREPARE A DEED OF SALE, IT IS ONLY FOR PURPOSES OF FORMALITY, MA’AM.
(pp. 2-3, TSN, June 15, 1989; Underscoring
supplied.)
The foregoing narration was corroborated by petitioner’s daughter
who declared:
ATTY. MABBAYAD:
A. And before leaving what did Mr. David tell
your mother, if any, after inspecting your property?
A. He told us to go to his office again so that
we could talk, sir.
Q. Did your mother go to Mr. David’s office as
he instructed?
A. Yes,
sir.
COURT:
Q. Alone?
A. Together
with Aling Naty and me, ma’am.
Q. When?
A. The
following day, ma’am.
ATTY. MABBAYAD:
Q. That
could be about May 10, 1986?
A. Yes, sir.
Q. And
were you and your mother and the other members of your group able to talk to
Mr. David when he instructed your mother to see him in his office?
A. Yes,
sir.
Q. Who
talked to Mr. David on that particular occasion?
A. My
mother, sir.
Q. Were
you present?
A. Yes,
sir.
Q. What
about Natividad de Gula?
A. She
was also there but she is outside
the office, sir.
Q. And
what did Mr. David and your mother talk about?
A. He
said he is AMENABLE IN GRANTING THE P150,000.00 LOAN TO MY MOTHER BUT MY MOTHER
WILL ONLY GET P110,000.00 BECAUSE THE REST WILL BE FOR THE DOCUMENTATIONS AND
FOR THE ADVANCE INTEREST.
Q. Did Mr. David tell your mother
how much is for documentation?
A. P10,000.00,
sir.
Q. And did Mr. David tell your
mother how much would be deducted from the agreed gross amount of the loan for
the advance interest?
A. P30,000.00,
sir.
Q. How
much interest was finally agreed upon between Mr. David and your mother?
A. 10%
per month, sir.
Q. And aside from the amount of the
loan and the rate of interest agreed upon by your mother and Mr. David, were
there other terms and conditions imposed on by Mr. David?
COURT:
Is there no written
agreement?
ATTY. MABBAYAD:
None, your Honor.
COURT:
Alright.
WITNESS:
A. He told my
mother that the DOCUMENT TO
BE EXECUTED IS A DEED OF SALE, INSTEAD OF A DEED OF REAL ESTATE MORTGAGE, sir.
ATTY. MABBAYAD:
Q. What
about other terms of payment or period of payment of the loan that was agreed
upon between him and your mother?
A. To
be paid in 2 years, sir.
Q. WHEN MR. DAVID TOLD YOUR MOTHER THAT THE
TRANSACTION WOULD BE DOCUMENTED AS A DEED OF SALE NOT AN ORDINARY
COLLATERALIZED DOCUMENT AS A DEED OF REAL ESTATE MORTGAGE, WHAT DID YOUR MOTHER
TELL HIM?
A. MY MOTHER TOLD HIM THAT
COULD IT BE POSSIBLE THAT INSTEAD OF A DEED OF SALE A DEED OF REAL ESTATE
MORTGAGE WOULD BE EXECUTED BECAUSE IF THE DOCUMENT WOULD BE A DEED OF SALE, IT
IS DANGEROUS.
Q. AND
WHAT DID MR. DAVID REPLY TO YOUR
MOTHER?
A. HE
SAID THAT THAT IS HIS POLICY.
Q. And what did your mother finally
decide?
A. My
mother told him that we will first talk about it, sir.
Q. When
you used the word “namin”, to whom in particular was your mother
referring?
A. We,
sir: my mother, myself and my sister?
Q. You
are referring to your other sister Josefina?
A. Yes,
sir.
Q.
Going back to the rate of
interest, when Mr. David told your mother that the rate of interest would be
10% per month, did your mother accept that condition of Mr. David?
ATTY. FIDELINO:
Already answered, your
Honor. The answer is “We would
talk about the matter”.
ATTY. MABBAYAD:
Referring to the
documentation, this is a different matter, your Honor.
COURT:
Answer.
WITNESS:
A. She
did not readily agree because she said we would talk about it first, your
Honor.
ATTY. MABBAYAD:
Q. You
would like to tell the Honorable Court that in that second meeting that you and
your group had with Mr. David nothing definite yet was arrived at or agreed
upon?
A. None,
sir, because of that deed of sale.
Q.
And since there was no meeting of
the minds on that particular second meeting, was there another meeting between
you and your group and Mr. David?
A. Yes,
sir.
Q. When was that?
A. That
was about May 19, I am not so sure about the date, sir.
Q. And when you returned, using the word
“you” in the plural form, to Mr. David, regarding this transaction,
were you able to talk to Mr. David, using the word “you” in plural
form?
A. Yes,
sir.
x x x x x x x
x x
Q. On
that particular third time what did Mr. David and your mother talk about?
A. MY MOTHER THEN REQUESTED MR. DAVID IF IT
COULD BE POSSIBLE THAT INSTEAD OF A DEED OF SALE A DEED OF REAL ESTATE DOCUMENT
WOULD BE EXECUTED BUT HE SAID HE CANNOT DO ANYTHING AND HE ALSO TOLD US NOT TO
WORRY BECAUSE AS LONG AS WE CAN PAY THE MONTHLY INTEREST, HE WOULD NOT HAVE THE
DEED OF SALE REGISTERED, sir.
x x x x x x x x x
Q. IN SHORT, WHEN MR. DAVID REFUSED TO GRANT THE
REQUEST OF YOUR MOTHER WITH RESPECT TO THE MANNER OF DOCUMENTATION OF THE
TRANSACTION AND THE RATE OF INTEREST, WHAT HAPPENED?
A. MY MOTHER FINALLY AGREED BECAUSE WE ARE
REALLY IN NEED OF MONEY, sir.
(pp. 14-22, TSN, December 8, 1988; Underscoring supplied.)
On the other end of this controversy is private respondent’s
indifference throughout his comment (p. 81, Rollo) and memorandum as well (p.
200, Rollo) vis-a-vis the clarification made by petitioner herself and
petitioner’s daughter which unconcerned and nonchalant attitude inevitably
leads to the conclusion that petitioner had established her onus probandi
by a preponderance of evidence and that private respondent had failed to prove
his positive allegations in support of his stance (Section 1, Rule 131,
Revised Rules on Evidence). Apart from
this procedural axiom is our belief that private respondent’s demeanor in
retaining a portion of the alleged purchase price, as advance interest for two
months, is akin to, if not precisely the very circumstance mentioned by Article
1602(4) of the Civil Code that will warrant the legal presumption of an
equitable mortgage. Besides, it was
erroneous for respondent court to have made a sweeping insinuation that it was
petitioner as vendor who suggested the “purchase price” and is thus
precluded from assailing the sufficiency thereof (p. 66, Rollo), on account of
the admission in judicio of private respondent that it was he who
“placed the value of P150,000.00” as consideration on the document
(p. 33, Rollo; TSN, April 6, 1989, pp. 8-11). The fact that petitioner was accompanied by her “businesswoman
daughter” to the office of private respondent is of no practical bearing
because even persons of average intelligence invariably find themselves in no position whatsoever when
bargaining with their creditor (Cabigao vs. Sales, et al., (C.A.) 51
O.G. 5265; 5 Tolentino, Commentaries and Jurisprudence on the Civil
Code, 1959 edition, p. 137) such as private respondent’s corporation whose
primary business concern includes giving loans (TSN, March 30, 1989, pp. 8-10;
p. 32, Rollo). Moreover, it may be
recalled that petitioner only received the sum of P1,000.00 out of the
P150,000.00 alleged as consideration for the “sale” (p. 18, supra). Such a measly sum is certainly another
circumstance that reinforces our belief that the entire transaction was but a
loan accommodation since no seller in her right senses will part with her
treasured possession via a tedious process only to end up with a small
sum of money in her pocket as consideration therefor.
At any rate, substantive law mandates that a contract purporting
to be venta con pacto de retro or an outright sale shall be construed as
an equitable mortgage for it involves a smaller transmission of rights (Olino
vs. Molina, 13 Phil. 379 (1909); Villa vs. Santiago, 38 Phil. 157
(1918); 5 Tolentino, supra, at p. 15). Moreover, there is no doubt that petitioner
agreed to the execution of the so-called sale in favor of private respondent
because of the urgent necessity for money of the apparent vendor to liquidate
her indebtedness to Mrs. Dimafelis (Claravall vs. Court of Appeals, 190
SCRA 439 (1990); Labasan vs. Lacuesta, 86 SCRA 16 (1978). This is another circumstance where it may be
fairly inferred that the real intention of the parties is for the transaction to
secure the payment of a debt or the performance of any other obligation (Article
1602(6), New Civil Code).
WHEREFORE, the decision of respondent court dated October
10, 1991 is hereby SET ASIDE. The deed
of absolute sale executed by Lea O. Camus in favor of Conrado S. David is
hereby declared as an equitable mortgage and, petitioner is declared entitled
to redeem the property. Private
respondent is hereby ordered to execute the necessary deed of conveyance upon full
payment of the total amount of P110,000.00 with legal interest from May 20,
1986, the time the loan matured until it is fully satisfied.
SO ORDERED.
Feliciano, (Chairman), Bidin, Davide, Jr., and Romero, JJ.,
concur.