FIRST DIVISION
G.R. No. 215691, November 21, 2018
SPOUSES FRANCIS N. CELONES AND FELICISIMA CELONES, Petitioners, v. METROPOLITAN BANK AND TRUST COMPANY AND ATTY. CRISOLITO O. DIONIDO, Respondents.
D E C I S I O N
TIJAM, J.:
Before Us is a petition for review on certiorari1 filed by petitioners Spouses Francis N. Celones and Felicisima Celones (Spouses Celones), against respondents Metropolitan Bank and Trust Company (Metrobank) and Atty. Crisolito O. Dionido (Atty. Dionido), assailing the Decision2 dated April 14, 2014 and the Resolution3 dated December 11, 2014 of the Court of Appeals (CA) in CA-G.R. CV No. 96236, reversing the Order4 dated September 1, 2010 of the Regional Trial Court (RTC) of Pasig City, Branch 154, declaring the Memorandum of Agreement5 (MOA) without force and effect and declaring that Spouses Celones were the ones who redeemed the mortgaged properties.
WHEREFORE, judgment is hereby rendered declaring the questioned [MOA] without force and effect as the same has not been fully executed. The Court further declares the [Spouses Celones] to be the redemptioners of their foreclosed properties and directs defendant Metrobank to execute and deliver the corresponding certificates of redemption over the said properties and turn-over all the Transfer Certificates of Titles covering the same to [Spouses Celones] so that they could be registered in accordance with Section 29, Rule 39 of the Revised Rules of Court.Upon appeal to the CA, the latter reversed the RTC Order and rendered a Decision21 dated April 14, 2014, thus:
On the other second transaction, the Court hereby finds that the transaction between the [Spouses Celones] and defendant [Atty.] Dionido is one of a simple loan.
Lastly, the writ of preliminary injunction is hereby made permanent.
SO ORDERED.20
WHEREFORE, premises considered, the instant appeal is hereby GRANTED. The Order dated September 1, 2010 issued by the [RTC] of Pasig City, Branch 154, in the case for Declaratory Relief and Injunction, docketed as SCA No. 3270-PSG is hereby REVERSED and SET ASIDE.The Motion for Reconsideration23 filed by the spouses Celones was likewise denied by the CA in its Resolution24 dated December 11, 2014.
Accordingly, the [MOA] dated December 20, 2007 entered into by [Metrobank], [PPPC], [Spouses Celones] and [Atty. Dionido], is declared a Contract of Subrogation which entitles Atty. Dionido to be subrogated to the rights of Metrobank as a foreclosure buyer. And having failed to redeem the property within the redemption period, the [Spouses] Celones are hereby DIRECTED to immediately and voluntarily surrender the possession of the foreclosed properties to Atty. Dionido in accordance with the provisions of the said [MOA].
The [Spouses] Celones are ORDERED to pay Atty. Dionido the loan amount of Two Million Five Hundred Thousand (P2,500,000.00) Pesos as payment for the loan they contracted from the latter with legal interest thereon at the rate of six (6%) percent per annum from the time of its availment, December 20, 2007, until fully paid.
Additionally, the [Spouses] Celones are ordered to pay Atty. Dionido moral damages in the amount of Five Hundred Thousand (P500,000.00) Pesos, the amount of Three Hundred Thousand (P300,000.00) Pesos, as exemplary damages, and Fifty Thousand (P50,000.00) Pesos by way of attorney's fees. The [Spouses] Celones are likewise ORDERED to pay Metrobank the amount of Three Hundred Thousand (P300,000.00) Pesos as exemplary damages and Fifty Thousand (P50,000.00) Pesos as attorney's fees.
With Costs.
SO ORDERED.22
1. DIONIDO shall pay Metrobank the amount of FIFTY-FIVE MILLION PESOS (P55,000,000.00) upon execution of this Agreement. The said amount shall be exclusive of all taxes, fees and charges, which shall likewise be exclusively assumed by DIONIDO that may be incurred arising from the execution and subsequent consummation of this Agreement, including friction costs and expenses associated with the redemption transaction; and all realty taxes, dues and other assessments on the Subject Properties from date of foreclosure. The payment shall be made in the form of Manager's Check in the name of METROBANK and shall be deposited via METROBANK's bills payment facility.Metrobank and Atty. Dionido claimed that the MOA being of a later date, superseded and novated the CNAR. As such, the redemption agreed upon by Metrobank and Spouses Celones was no longer controlling.
2. For and in consideration of the said payment by DIONIDO, METROBANK, PPPC, and SPS. CELONES agree to fully and absolutely assign and transfer all of METROBANK's rights, interests, and authorities over the Assumed Obligation and the Subject Properties to DIONIDO, including those arising from the foreclosure proceedings and foreclosure sale made by METROBANK over the Subject Properties, and the authority to sign the Deed of Redemption over the Subject Properties. METROBANK agree to the full subrogation of its rights in favor of DIONIDO, and to free PPPC and SPS. CELONES from the Assumed Obligation.27
x x x Novation is done by the substitution or change of the obligation by a subsequent one which extinguishes the first, either by changing the object or principal conditions, or by substituting the person of the debtor, or by subrogating a third person in the rights of the creditor. Novation may:Examination of the MOA showed no express stipulation as to the novation or extinction of the CNAR. Thus, for implied novation to exist, it is necessary to determine whether the CNAR and the MOA are incompatible on every point such that they cannot be reconciled and stand together.
ChanRoblesVirtualawlibrary[E]ither be extinctive or modificatory, much being dependent on the nature of the change and the intention of the parties. Extinctive novation is never presumed; there must be an express intention to novate; in cases where it is implied, the acts of the parties must clearly demonstrate their intent to dissolve the old obligation as the moving consideration for the emergence of the new one. Implied novation necessitates that the incompatibility between the old and new obligation be total on every point such that the old obligation is completely superceded by the new one. The test of incompatibility is whether they can stand together, each one having an independent existence; if they cannot and are irreconcilable, the subsequent obligation would also extinguish the first.
An extinctive novation would thus have the twin effects of, first, extinguishing an existing obligation and, second, creating a new one in its stead. This kind of novation presupposes a confluence of four essential requisites: (1) a previous valid obligation, (2) an agreement of all parties concerned to a new contract, (3) the extinguishment of the old obligation, and (4) the birth of a valid new obligation. Novation is merely modificatory where the change brought about by any subsequent agreement is merely incidental to the main obligation (e.g., a change in interest rates or an extension of time to pay; in this instance, the new agreement will not have the effect of extinguishing the first but would merely supplement it or supplant some but not all of its provisions.)32 (Emphasis ours)
Art. 1236. The creditor is not bound to accept payment or performance by a third person who has no interest in the fulfillment of the obligation, unless there is a stipulation to the contrary.Thus, Atty. Dionido has the right to demand payment of the amount of P55 Million from Spouses Celones since it is undisputed that such amount came from Atty. Dionido. It is unjust enrichment on the part of Spouses Celones to acquire the amount ofP55 Million and not be required to pay the same. To save on the time and resources of this Court and because of the possibility that this case will once again reach this Court, although this case is not an action to recover a sum of money, we deem it proper to rule on the propriety of Atty. Dionido's right to recover the said sum from Spouses Celones. Thus, Spouses Celones should pay the amount of P55 Million to Atty. Dionido with legal interest counted from the date of finality of this Decision.
Whoever pays for another may demand from the debtor what he has paid, except that if he paid without the knowledge or against the will of the debtor, he can recover only insofar as the payment has been beneficial to the debtor. (Emphasis ours)
Endnotes:
* Designated Acting Chairperson per Special Order No. 2606 dated October 10, 2018.
** Designated Additional Member per Special Order No. 2607 dated October 10, 2018.
1Rollo, pp. 9-54.
2 Penned by Associate Justice Stephen C. Cruz, concurred in by Associate Justices Magdangal M. De Leon and Eduardo B. Peralta, Jr.; id. at 58-87.
3 Id. at 117-120.
4 Rendered by Judge Abraham B. Borreta; id. at 150-158.
5 Id. at 141-146.
6 Id. at 58-59.
7 Id. at 60.
8 Id.
9 Id. at 121-122.
10 Id. at 121.
11 Id. at 60-61.
12 Id. at 61.
13 Id. at 141-145.
14 Id. at 63.
15 Id. at 123.
16 Id. at 64.
17 Id.
18 Id. at 64-65.
19 Id. at 150-158.
20 Id. at 158.
21 Id. at 58-87.
22 Id. at 85-86.
23 Id. at 89-111.
24 Id. at 117-120.
25 Id. at 35.
26 Id. at 121-122.
27 Id. at 128.
28 Article 1291 of the New Civil Code.
Art. 1291. Obligations may be modified by:
ChanRoblesVirtualawlibrary
(1) Changing their object or principal conditions;
(2) Substituting the person of the debtor;
(3) Subrogating a third person in the rights of the creditor.
29 Article 1292 of the New Civil Code.
Art. 1292. In order that an obligation may be extinguished by another which substitute the same, it is imperative that it be so declared in unequivocal terms, or that the old and the new obligations be on every point incompatible with each other.
30Arco Pulp and Paper Co., Inc., et al. v. Lim, 737 Phil. 133, 137 (2014).
31 648 Phil. 314 (2010).
32 Id. at 322-323, citing Foundation Specialists, Inc. v. Betonval Ready Concrete, Inc., et al., 613 Phil. 303, 313-314 (2009).
33Licaros v. Gatmaitan, 414 Phil. 857, 866 (2001).