PBTC v. Abasolo (G.R. No. 186738; September 27, 2010)


FACTS: Leonor Valenzuela-Rosales inherited two parcels of land situated in Palanan, Sta. Cruz, Laguna (the properties), registered as Original Certificates of Title Nos. RO-527 and RO-528. After she passed away, her heirs executed Special Power of Attorney (SPA) in favor of Liwayway Abasolo (respondent) empowering her to sell the properties.Corazon Marasigan (Corazon) wanted to buy the properties which were being sold for P2,448,960, but as she had no available cash, she broached the idea of first mortgaging the properties to petitioner Prudential Bank and Trust Company (PBTC), the proceeds of which would be paid directly to respondent. Respondent agreed to the proposal.

On Corazon and respondent’s consultation with PBTC’s Head Office, its employee, Norberto Mendiola (Mendiola), allegedly advised respondent to issue an authorization for Corazon to mortgage the properties, and for her (respondent) to act as one of the co-makers so that the proceeds could be released to both of them.

To guarantee the payment of the property, Corazon executed a Promissory Note for P2,448,960 in favor of respondent.

By respondent’s claim, Mendiola advised her to transfer the properties first to Corazon for the immediate processing of Corazon’s loan application with assurance that the proceeds thereof would be paid directly to her (respondent), and the obligation would be reflected in a bank guarantee.

Heeding Mendiola’s advice, respondent executed a Deed of Absolute Sale over the properties in favor of Corazon following which, Transfer Certificates of Title Nos. 164159 and 164160 were issued in the name of Corazon.

Corazon’s application for a loan with PBTC’s Tondo Branch was approved. She thereupon executed a real estate mortgage covering the properties to secure the payment of the loan. In the absence of a written request for a bank guarantee, the PBTC released the proceeds of the loan to Corazon.

Respondent eventually accepted from Corazon partial payment in kind consisting of one owner type jeepney and four passenger jeepneys, plus installment payments, which, by the trial court’s computation, totaled P665,000.

In view of Corazon’s failure to fully pay the purchase price, respondent filed a complaint for collection of sum of money and annulment of sale and mortgage with damages, against Corazon and PBTC (hereafter petitioner), before the Regional Trial Court.

Corazon denied that there was an agreement that the proceeds of the loan would be paid directly to respondent. And she claimed that the vehicles represented full payment of the properties, and had in fact overpaid P76,040.

Petitioner also denied that there was any arrangement between it and respondent that the proceeds of the loan would be released to her. It claimed that it “may process a loan application of the registered owner of the real property who requests that proceeds of the loan or part thereof be payable directly to a third party [but] the applicant must submit a letter request to the Bank.”

RTC rendered judgment in favor of respondent and against Corazon who was made directly liable to respondent, and against petitioner who was made subsidiarily liable in the event that Corazon fails to pay.

In finding petitioner subsidiarily liable, the trial court held that petitioner breached its understanding to release the proceeds of the loan to respondent finding that Liwayway would not have executed the deed of sale in favor of Corazon had Norberto Mendiola did not promise and guarantee that the proceeds of the loan would be directly paid to her.

HELD: In the absence of a lender-borrower relationship between petitioner and Liwayway, there is no inherent obligation of petitioner to release the proceeds of the loan to her.

To a banking institution, well-defined lending policies and sound lending practices are essential to perform its lending function effectively and minimize the risk inherent in any extension of credit.

In order to identify and monitor loans that a bank has extended, a system of documentation is necessary. Under this fold falls the issuance by a bank of a guarantee which is essentially a promise to repay the liabilities of a debtor, in this case Corazon. It would be contrary to established banking practice if Mendiola issued a bank guarantee, even if no request to that effect was made.

For Liwayway to prove her claim against petitioner, a clear and deliberate act of conferring a favor upon her must be present. A written request would have sufficed to prove this, given the nature of a banking business, not to mention the amount involved.

Since it has not been established that petitioner had an obligation to Liwayway, there is no breach to speak of. Liwayway’s claim should only be directed against Corazon. Petitioner cannot thus be held subsidiarily liable.

The trial Court’s reliance on the doctrine of apparent authority – that the principal, in this case petitioner, is liable for the obligations contracted by its agent, in this case Mendiola, – does not lie.

The onus probandi that attempt to commit fraud attended petitioner’s employee Mendiola’s acts and that he abused his authority lies on Liwayway. She, however, failed to discharge the onus. It bears noting that Mendiola was not privy to the approval or disallowance of Corazon’s application for a loan nor that he would benefit by the approval thereof.

Aside from Liwayway’s bare allegations, evidence is wanting to show that there was collusion between Corazon and Mendiola to defraud her. Even in Liwayway’s Complaint, the allegation of fraud is specifically directed against Corazon.

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