WILFREDO VERDEJO, PETITIONER, VS. HONORABLE COURT OF APPEALS, HERMINIA PATINIO AND JOHN DOE, RESPONDENTS.

This is a petition for review on certiorari under Rule 45
of the Revised Rules of Court of the decision of the Court of Appeals in
CA-G.R. CV No. 22638, titled “Wilfredo Verdejo v. Herminia Patinio and
John Doe.”

On January 11, 1985, petitioner instituted an action for sum of
money against private respondents, docketed as Civil Case No. 2546-P before the
Regional Trial Court, Branch 111, Pasay City. He alleged that on November 17, 1983, private respondents executed in
his favor a Deed of Sale with Right to Repurchase for the sum of P60,560.00, to
be paid every 15 days starting January 1984 until fully paid. Private respondents failed to make any
payment notwithstanding repeated demands by petitioner, causing the latter to
file said action (Rollo, p. 22).

In their answer with counterclaim, private respondents denied
having received the amount of P60,560.00 from petitioner. They claimed that they had been previously
borrowing from petitioner and for the purpose of reconciling their outstanding
accounts of P20,000.00 at 10% interest per month, and P7,000.00 at 12% interest
per month, the said deed of sale was executed. However, it was understood by the parties that the amount of P60,560.00
represented their outstanding account of P27,000.00 plus 10% interest per
month. Private respondents pointed out
that the actual loan received sometime in 1982 was much lower than P60,650.00
and that the same had already been paid (Rollo, pp. 25-29).

Private respondents further argued that petitioner charged
usurious interest rates of 10% to 12% per month in contravention of the Usury
Law. They sought the recovery of
P12,490.00 representing overpayment of interest, damages and attorney’s fees.

The trial court dismissed the complaint in its Decision dated
September 3, 1986, the dispositive portion of which reads:

WHEREFORE, judgement is hereby rendered dismissing plaintiff’s
complaint for lack of merit.

On defendants’ counterclaim, plaintiff is hereby ordered to refund
to defendants the amount of P13,890.00 and to further pay to defendants the
amount of P5,000.00 as attorney’s fees and the costs of this suit (Rollo, p.
41).

The trial court found that the Deed of Sale with Right to Repurchase
was the culmination of a series of loan transactions entered into by the
parties. Of the P60,650.00
consideration, the actual amount received by private respondents by way of loan
was P22,000.00 with the balance of P38,560.00 representing interest. It ruled that the usurious interest rates
were incorporated to the main consideration of P60,650.00 to circumvent the
laws against usury. Considering that at
the time the loans were entered into, the Usury Law was still in effect and
beyond the scope of Central Bank (CB) Circular No. 905, January 1, 1983, which
lifted the ceiling on interest rates prescribed under the Usury Law, it held
that the contract of loan was valid as to the loan but void as to the usurious
interest (Rollo, pp. 37-39).

The trial court also found that private respondents made a total
payment of P35,890.00 with an overpayment of P13,890.00 (Rollo, p. 41).

On appeal by petitioner, the Court of Appeals modified the
judgment of the trial court in its Decision dated April 30, 1992, the
dispositive portion of which provides:

WHEREFORE, except for the modification that plaintiff Wilfredo
Verdejo should be ordered to refund defendant Herminia Patinio the amount of
P15,990.00 instead of P13,890.00 as found by the lower court, and that the award
of attorney’s fees of P5,000.00 should be disallowed, the Decision of September
3, 1986 of the RTC-Pasay City, Branch 111, in Civil Case No. 2546-P, is hereby
AFFIRMED, in all other respects (Rollo, p. 106).

The appellate court explained that the loans were obtained by
private respondents before the promulgation of CB Circular No. 905, thus:

xxx While Exhibit A, Deed of Sale with
Right to Repurchase, was executed on November
17, 1983, the same was a consolidation
or carry over of previous loan transactions
in February, 1982 (Exhibit 1), November, 1982 (Exhibit 2), and November–December,
1982 (Exhibit 1), before the “open ceiling
policy” of the Central Bank Circular
No. 905 took effect. At the time the transactions took place per Exhibits 1, 2 and 3, the
Usury Law was still in effect, and Exhibit A, which was merely a carry over of
transactions in Exhibits 1, 2 and 3 could not legalize previous unlawful loan
transactions (Rollo, p. 103, Underscoring supplied).

The Court of Appeals denied petitioner’s motion for
reconsideration in its Resolution dated June 23, 1992 (Rollo, p. 111).

Hence, the instant
petition where petitioner raised the following errors of the appellate court
in: (1) holding that the Deed of
Sale with Right to Repurchase cannot be enforced against private respondent
Herminia Patinio notwithstanding the effectivity of CB Circular No. 905; and
(2) making conclusions of fact unsupported by substantial evidence.

The petition is bereft of merit and merely raises factual issues, the determination of
which is best left to the trial court. Well-settled is the rule that findings of fact of the trial court and
the Court of Appeals are not to be disturbed on appeal and are entitled to
great weight and respect (Tay Chun Suy v. Court of Appeals, 229 SCRA 151
[1993]). We see no reason to depart
from the findings of the Court of Appeals.

CONSIDERING THE FOREGOING, the Court Resolved to DENY the
petition for lack of merit.

SO ORDERED.

Padilla, (Chairman), Davide, Jr., Bellosillo, and Kapunan, JJ., concur.