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Cabanting Vs BPI Family Savings Bank Inc
Cabanting Vs BPI Family Savings Bank Inc
DECISION
PERALTA, J.:
This deals with the Petition for Review on Certiorari under Rule 45 of the
Rules of Court praying that the Decision1of the Court of
Appeals (CA), promulgated on September 28, 2011, and the
Resolution2 dated May 16, 2012, denying petitioner's motion for
reconsideration thereof, be reversed and set aside.
Come October 16, 2003, however, a Complaint was filed by BPI Family
against petitioners for Replevin and damages before the Regional Trial Court
of Manila (RTC), praying that petitioners be ordered to pay the unpaid
portion of the vehicle's purchase price, accrued interest thereon at the rate
of 36% per annum as of August 26, 2003, 25% attorney's fees and 25%
liquidated damages, as stipulated on the Promissory Note with Chattel
Mortgage. BPI Family likewise prayed for the issuance of a writ of replevin
but it failed to file a bond therefor, hence, the writ was never issued. BPI
Family alleged that petitioners failed to pay three (3) consecutive
installments and despite written demand sent to petitioners through
registered mail, petitioners failed to comply with said demand to pay or to
surrender possession of the vehicle to BPI Family.
In their Answer, petitioners alleged that they sold the subject vehicle to one
Victor S. Abalos, with the agreement that the latter shall assume the
obligation to pay the remaining monthly installments. It was then Abalos who
made payments to BPI Family through his personal checks, and BPI Family
accepted the post-dated checks delivered to it by Abalos. The checks issued
by Abalos for the months of May 2003 to October 2003 were made good, but
subsequent checks were dishonored and not paid. Petitioners pointed out
that BPI Family should have sued Abalos instead of them.
Trial ensued, where BPI Family dispensed with the testimony of its sole
witness and formally offered its documentary evidence. When it was
petitioners' tum to present its defense, several hearing dates were cancelled,
sometimes due to failure of either or both the petitioners' and/or respondent's
counsels to appear. What is clear, though, is that despite numerous
opportunities given to petitioners to present evidence, they were never able
to present their witness, Jacobina T. Alcantara, despite the court's issuance
of a subpoena duces tecum ad testificandum. Said failure to present
evidence on several hearing dates and petitioners' absence at the hearing
on February 13, 2008 prompted BPI Family to move that petitioners' right to
present evidence be deemed waived. On the same date, the R TC granted
said motion and the case was submitted for decision. There is nothing on
record to show that petitioners ever moved for reconsideration of the Order
dated February 13, 2008.
On April 14, 2008, the RTC rendered a Decision, the dispositive portion of
which reads as follows:
SO ORDERED.3
SO ORDERED.4
x x x Even assuming, for argument's sake, that no demand letter was sent
by respondent, there is really no need for it because petitioners legally
waived the necessity of notice or demand in the Promissory Note with Chattel
Mortgage, which they voluntarily and knowingly signed in favor of
respondent's predecessor-in-interest. Said contract expressly stipulates:
In case of my/our failure to pay when due and payable, any sum which I/We
are obliged to pay under this note and/or any other obligation which I/We or
any of us may now or in the future owe to the holder of this note or to any
other party whether as principal or guarantor x x x then the entire sum
outstanding under this note shall, without prior notice or demand,
immediately become due and payable. (Emphasis and underscoring
supplied)
The Civil Code in Article 1169 provides that one incurs in delay or is in default
from the time the obligor demands the fulfillment of the obligation from the
obligee. However, the law expressly provides that demand is not necessary
under ce1iain circumstances, and one of these circumstances is when the
parties expressly waive demand. Hence, since the co-signors expressly
waived demand in the promissory notes, demand was unnecessary for them
to be in default.
Further, the Court even ruled in Navarro v. Escobido that prior demand is not
a condition precedent to an action for a writ of replevin, since there is nothing
in Section 2, Rule 60 of the Rules of Court that requires the applicant to make
a demand on the possessor of the property before an action for a writ of
replevin could be filed.10
Clearly, as stated above, Article 1169 (1) of the Civil Code allows a party to
waive the need for notice and demand. Petitioners' argument that their
liability cannot be deemed due and payable for lack of proof of demand must
be struck down.
There is likewise no merit to petitioners' claim that they were deprived of due
process when they were deemed to have waived their right to present
evidence. Time and again, the Court has stressed that there is no deprivation
of due process when a party is given an opportunity to be heard, not only
through hearings but even through pleadings, so that one may explain one's
side or arguments; or an opportunity to seek reconsideration of the action or
ruling being assailed.11 The records bear out that herein petitioners were
given several opportunities to present evidence, but said opportunities were
frittered away. We stress the fact that petitioners did not even bother to move
for reconsideration of the Order dated February 13, 2008, deeming
petitioners to have waived their right to present evidence. Such is glaring
proof of their propensity to waste the opportunities granted them to present
their evidence.
Lastly, the CA is correct that the interest rate being charged by respondent
under the Promissory Note with Chattel Mortgage is quite
unreasonable. In New Sampaguita Builders Construction, Inc. (NSBCI) v.
1âwphi 1
Philippine National Bank,12the Court ruled that "the interest ranging from
26 percent to 35 percent in the statements of account - 'must be
equitably reduced for being iniquitous, unconscionable and
exorbitant.' Rates found to be iniquitous or unconscionable are void,
as if it there were no express contract thereon. Above all, it is
undoubtedly against public policy to charge excessively for the use of
money." However, pursuant to prevailing jurisprudence and banking
regulations, the Court must modify the lower court's award of legal interest.
In Nacar v. Gallery Frames,13 the Court held, thus:
x x x the guidelines laid down in the case of Eastern Shipping Lines are
accordingly modified to embody BSP-MB Circular No. 799, as follows:
I. When an obligation, regardless of its source, i.e., law, contracts, quasi-
contracts, delicts or quasi-delicts is breached, the contravenor can be held
liable for damages. The provisions under Title XVIII on "Damages" of the
Civil Code govern in determining the measure of recoverable damages.
II. With regard particularly to an award of interest in the concept of actual and
compensatory damages, the rate of interest, as well as the accrual thereof,
is imposed, as follows:
3. When the judgment of the court awarding a sum of money becomes final
and executory, the rate of legal interest, whether the case falls under
paragraph 1 or paragraph 2, above, shall be 6% per annum from such finality
until its satisfaction, this interim period being deemed to be by then an
equivalent to a forbearance of credit.14
Thus, legal interest, effective July 1, 2013, was set at six percent (6%) per
annum in accordance with Bangko Sentral ng Pilipinas – Monetary Board
Circular No. 799, Series of 2013.
WHEREFORE, the petition is DENIED. The Decision of the Court of
Appeals, promulgated on September 28, 2011, and the Resolution dated
May 16, 2012 in CA-G.R. CV No. 91814 are AFFIRMED with
MODIFICATION by ordering payment of legal interest at the rate of twelve
percent (12%) per annum from the time of filing of the complaint up to June
30, 2013, and thereafter, at the lower rate of six percent (6%) per
annum from July 1, 2013 until full satisfaction, pursuant to Bangko Sentral
ng Pilipinas - Monetary Board Circular No. 799, Series of 2013 and
applicable jurisprudence.
SO ORDERED.
DIOSDADO M. PERALTA
Associate Justice
WE CONCUR:
FRANCIS H. JARDELEZA
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court's Division.
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution and the Division
Chairperson's Attestation, I certify that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer
of the opinion of the Court's Division.
Footnotes
1Penned by Associate Justice Ramon A. Cruz, with Associate Justices Jose
C. Reyes, Jr. and Antonio L. Villamor, concurring; rollo, pp. 38-47.
2 Id. at 49-51.
3 Rollo, p. 115. (Emphasis in the original)
4 Id at 47. (Emphasis in the original)
5 Id. at 22.
6 Id. at 61.
7 538 Phil. 944 (2006).
8Dia v. St. Ferdinand Memorial Park, Inc., supra, at 959-960. (Emphasis
supplied)
9 G.R. No. 182963, June 3, 2013, 697 SCRA 89.
10 Agner v. BPI Family Savings Bank, Inc., supra, at 94-95.
Resurreccion v. People, G.R. No. 192866, July 9, 2014, 729 SCRA 508,
11
524.
12 479 Phil. 483, 499 (2004). (Emphasis supplied, citations omitted)
13 G.R. No. 189871, August 13, 2013, 703 SCRA 439.
14 Id. at 457-458.