SECOND DIVISION
G.R. No. 233774, April 10, 2019
MA. LUISA A. PINEDA, PETITIONER, v. VIRGINIA ZUÑIGA VDA. DE VEGA, RESPONDENT.
D E C I S I O N
CAGUIOA, J.:
This is a Petition for Review on Certiorari1 (Petition) under Rule 45 of the Rules of Court (Rules) assailing the Decision2 dated March 21, 2017 and the Resolution3 dated August 30, 2017 of the Court of Appeals4 (CA) in CA-G.R. CV No. 106404. The CA Decision reversed and set aside the Decision dated April 30, 2015 and the Resolution dated October 14, 2015 of the Regional Trial Court of Malolos City, Bulacan, Branch 17 (RTC) in Civil Case No. 526-M-2005. The RTC Decision ruled in favor of petitioner Ma. Luisa Pineda (petitioner) and the RTC Resolution denied the motion for reconsideration of respondent Virginia Zuñiga vda. de Vega (respondent). The CA Decision also dismissed petitioner's complaint. The CA Resolution denied petitioner's motion for reconsideration.
WHEREFORE, in the light of the foregoing, the defendant is hereby ordered to pay plaintiff the loaned amount of P200,000 plus the interest of 12% per annum from September 3, 2004, the date the defendant received the demand letter from the plaintiff, dated August 2004, until the finality of the decision and the satisfaction of the amount due. She is also ordered to pay the plaintiff the amount of P50,000 as nominal damages and P30,000 as attorney's fees.
In default of payment, the mortgaged property, together with all the buildings and improvements existing thereon, shall be foreclosed and sold and the proceeds of their sale shall be applied to the payment of the amounts due the plaintiff, including damages and attorney's fees.
SO ORDERED.19 (Italics in the original)
WHEREFORE, the appeal is GRANTED. The assailed Decision and Resolution of the Regional Trial Court, Third Judicial Region, Branch 17, City of Malolos, Bulacan, in Civil Case No. 526-M-2005 are REVERSED and SET ASIDE. Accordingly, the complaint is DISMISSED.
SO ORDERED.29
"7. The time for the payment of the subject loan is long overdue and the defendant, despite repeated demands by the plaintiff to pay, has continuously failed and refused to pay both the principal obligation and the accumulated interest. A copy of the demand letter is appended as Annex "C" and made [integral] part hereof." (Underscoring supplied)37
It was, indeed, alleged in the complaint, as well as in her testimony, that demand was sent to [respondent] by registered mail and was received on September 7, 2004. However, the registry return card evidencing such receipt was not specifically and formally offered in evidence. What she presented, instead, was a copy of the said demand letter with only a photocopy of the face of a registry return card claimed to refer to the said letter. Thus, in her formal offer of evidence:Exhibit "C" – Demand Letter sent by plaintiff's lawyer to the defendant, demanding that the latter comply with the terms and conditions of the [R]eal Estate Mortgage (REM) between them within three (3) months from receipt: otherwise, the former will be constrained to enforce the REM.
Purpose: To prove that when the defendant failed to comply with the terms and conditions of the said Real Estate Mortgage, a letter was sent to her demanding compliance; otherwise, the former will enforce the mortgage contract.
[Respondent] properly opposed the said evidence as it does not prove that she, in fact, received the letter. We have thoroughly reviewed her formal offer as well and found no reference to the registry receipt card or any other competent proof i.e., postman certificate or the testimony of the postman, that [respondent] actually received the said demand letter.
[Petitioner] could have simply presented and offered in evidence the registry receipt or the registry return card accompanying the demand letter. However, she offered no explanation why she failed to do so. There is, thus, no satisfactory proof that the letter was received by [respondent].
In emphasizing further that the registry return card is the best evidence of actual receipt of [respondent], We find the High Court's discussion in Mangahas v. Court of Appeals,38 apt, viz[.]:In addition, petitioners could have easily presented the original Registry Receipt No. A-2094. It would have constituted the best evidence of tile fact of mailing on 7 February 2006, even if a different date had been stamped on the envelope of the subject registered mail. Regrettably, petitioners have not seen fit to present such original. Their continued failure to present tile original receipt can only lead one to remember the well-settled rule that when the evidence tends to prove a material fact which imposes a liability on a party, and he has it in his power to produce evidence which from its very nature must overthrow the case made against him if it is not founded on fact, and he refuses to produce such evidence, the presumption arises that the evidence, if produced, would operate to his prejudice, and support the case of his adversary. Mere photocopy of Registry Receipt No. A-2094 militates against their position as there is no indicium of its authenticity. A mere photocopy lacks assurance of its genuineness, considering that photocopies can easily be tampered with. (Emphasis supplied.)39
ART. 1169. Those obliged to deliver or to do something incur in delay from the time the obligee judicially or extrajudicially demands from them the fulfillment of their obligation.
However, the demand by the creditor shall not be necessary in order that delay may exist:
(1) When the obligation or the law expressly so declares; or
(2) When from the nature and the circumstances of the obligation it appears that the designation of the time when the thing is to be delivered or the service is to be rendered was a controlling motive for the establishment of the contract; or
(3) When demand would be useless, as when the obligor has rendered it beyond his power to perform.
In reciprocal obligations, neither party incurs in delay if the other does not comply or is not ready to comply in a proper manner with what is incumbent upon him. From the moment one of the parties fulfills his obligation, delay by the other begins. (1100a)
WHEREFORE, in the light of the foregoing, the defimdant is hereby ordered to pay plaintiff the loaned amount of P200,000 plus the interest of 12% per annum from September 3, 2004, the date the defendant received the demand letter from the plaintiff, dated August 2004, until the finality of the decision and the satisfaction of the amount due. She is also ordered to pay the plaintiff the amount of P50,000 as nominal damages and P30,000 as attorney's fees.
In default of payment, the mortgaged property, together with all the buildings and improvements existing thereon, shall be foreclosed and sold and the proceeds of their sale shall be applied to the payment of the amounts due the plaintiff, including damages and attorney's fees.
SO ORDERED.47 (Italics in the original)
We hold, therefore, that, in the absence of express statutory provisions, a mortgage creditor may institute against the mortgage debtor either a personal action for debt or a real action to foreclose the mortgage. In other words, he may pursue either of the two remedies, but not both. By such election, his cause of action can by no means be impaired, for each of the two remedies is complete in itself. Thus, an election to bring a personal action will leave open to him all the properties of the debtor for attachment and execution, even including the mortgaged property itself. And, if he waives such personal action and pursues his remedy against the mortgaged property, an unsatisfied judgment thereon would still give him the right to sue for a deficiency judgment, in which case, all the properties of the defendant, other than the mortgaged property, are again open to him for the satisfaction of the deficiency. In either case, his remedy is complete, his cause of action undiminished, and any advantages attendant to the pursuit of one or the other remedy are purely accidental and are all under his right of election. On the other hand, a rule that would authorize the plaintiff to bring a personal action against the debtor and simultaneously or successively another action against the mortgaged property, would result not only in multiplicity of suits so offensive to justice (Soriano vs. Enriques, 24 Phil., 584) and obnoxious to law and equity (Osorio vs. San Agustin, 25 Phil., 404), but also in subjecting the defendant to the vexation of being sued in the place of his residence or of the residence of the plaintiff, and then again in the place where the property lies.50
For non-payment of a note secured by mortgage, the creditor has a single cause of action against the debtor. This single cause of action consists in the recovery of the credit with execution of the security. In other words, the creditor in his action may make two demands, the payment of the debt and the foreclosure of the mortgage. But both demands arise from the same cause, the non-payment of the debt, and, for that reason, they constitute a single cause of action. Though the debt and the mortgage constitute separate agreements, the latter is subsidiary to the former, and both refer to one and the same obligation. Consequently, there exists only one cause of action for a single breach of that obligation. Plaintiff, then, by applying the rule above stated, cannot split up his single cause of action by filing a complaint for payment of the debt, and thereafter another complaint for foreclosure of the mortgage. If he does so, the filing of the first complaint will bar the subsequent complaint. By allowing the creditor to file two separate complaints simultaneously or successively, one to recover his credit and another to foreclose his mortgage, we will, in effect, be authorizing him plural redress for a single breach of contract at so much cost to the courts and with so much vexation and oppression to the debtor.
x x x x
x x x But, as we have heretofore stated, the creditor's cause of action is not only single but indivisible, although the agreements of the parties, evidenced by the note and the deed of mortgage, may give rise to different remedies. x x x The cause of action should not be confused with the remedy created for its enforcement. And considering, as we have shown, that one of the two remedies available to the creditor is as complete as the other, he cannot be allowed to pursue both in violation of those principles of procedure intended to secure simple, speedy and unexpensive administration of justice.51
Endnotes:
1Rollo, pp. 8-22.
2 Id. at 23-32. Penned by Associate Justice Normandie B. Pizarro, with Associate Justices Samuel H. Gaerlan and Jhosep Y. Lopez concurring.
3 Id. at 40-41.
4 Twelfth Division and Former Twelfth Division.
5Rollo, p. 24.
6 Id.
7 Id.
8 Referring to a supposed Demand Letter dated August 4, 2004, id.
9 Id.
10 Id.
11 Id.
12 Id. at 24-25.
13 Id. at 25.
14 Id.
15 Id.
16 Id.
17 Id.
18 Id. at 25-26.
19 Id. at 26.
20 Id. at 23-32.
21 Id. at 32.
22 Id. at 30.
23 Id.
24 Id.
25 Id.
26 ART. 1169. Those obliged to deliver or to do something incur in delay from the time the obligee judicially or extrajudicially demands from them the fulfillment of their obligation.
However, the demand by the creditor shall not be necessary in order that delay may exist:
(1) When the obligation or the law expressly so declares; or
(2) When from the nature and the circumstances of the obligation it appears that the designation of the time when the thing is to be delivered or the service is to be rendered was a controlling motive for the establishment of the contract; or
(3) When demand would be useless, as when the obligor has rendered it beyond his power to perform.
In reciprocal obligations, neither party incurs in delay if the other does not comply or is not ready to comply in a proper manner with what is incumbent upon him. From the moment one of the parties fulfills his obligation, delay by the other begins. (1100a)
27Rollo, p. 31.
28 Id. at 32.
29 Id.
30 Id. at 40-41.
31 Id. at 46-55.
32 Id. at 12.
33 Id., citing Cabigting v. San Miguel Foods, Inc., 620 Phil. 14, 22 (2009).
34 Id. at 54.
35 Id. at 6.
36 Id. at 18.
37 Id.
38 588 Phil. 61, 81 (2008).
39Rollo, pp. 30-31.
40 Id. at 31.
41 Desiderio P. Jurado, COMMENTS AND JURISPRUDENCE ON OBLIGATIONS AND CONTRACTS (1987 Ninth Revised Edition), p. 54.
42 Id.
43 Id. at 54-55.
44 Id. at 55.
45Rollo, p. 27, citing Development Bank of the Philippines v. Guariña Agricultural & Realty Development Corporation, 724 Phil. 209, 220 (2014).
46 Id. at 24.
47 Id. at 26.
48 68 Phil. 287 (1939).
49 See Bank of America, NT and SA v. American Realty Corp., 378 Phil. 1279, 1290 (1999); Danao v. Court of Appeals, 238 Phil. 447, 458 (1987); Manila Trading and Supply Co. v. Co Kim, 71 Phil. 448, 449 (1941); Movido v. Rehabilitation Finance Corporation, 105 Phil. 886, 890 (1959).
50Bachrach Motor Co., Inc. v. Icarañgal, supra note 48, at 294-295.
51 Id. at 293-295.
52 292-A Phil. 649, 656 (1993).
53 716 Phil. 267 (2013).
54Rollo, p. 25.
55 Id.
56 175 Phil. 256 (1978).
57 Id. at 263.