Duñgao v. Roque
REITERATIONFacts
1. The Antecedents: Maria Gervacio Blas borrowed P5,000 from Alfonso Roque and Justina Roque, secured by a mortgage on a parcel of land. The loan was for five years with 10% annual interest. Bernardo Duñgao, husband of Maria Gervacio Blas, paid the accrued interest from October 1941 to December 1943 at a reduced rate of 6% to Angel Roque, the father of the creditors. 2. Procedural History: In July 1944, Atty. Conrado S. Carlos, representing the spouses Blas and Duñgao, attempted to pay the full indebtedness plus interest to Angel Roque, who refused, stating his children were in Pangasinan. Carlos then deposited P5,183.28 with the Clerk of Court as payment. The spouses subsequently filed Civil Case No. 105 seeking to compel the Roques to accept payment and release the mortgage. Later, Alfonso and Justina Roque filed Civil Case No. 77 to foreclose the mortgage. The trial court consolidated both cases, dismissed the spouses' complaint in Civil Case No. 105, and ordered the spouses to pay the full amount with 10% interest and attorney's fees in Civil Case No. 77, or face foreclosure. The Court of Appeals affirmed this decision. 3. The Petition: The appellants, Bernardo S. Duñgao and Maria Gervacio Blas, seek review of the Court of Appeals' decision. Their petition raises five assignments of error, primarily arguing that the trial court erred in denying their motion to dismiss Civil Case No. 77 due to the pendency of Civil Case No. 105, in not recognizing Angel Roque as the real mortgagee, and in finding that the tender of payment and subsequent consignation were sufficient to redeem the mortgage. They contend that the consignation was valid despite the creditors' absence and lack of personal notice, as they had made reasonable efforts to locate them and the creditors' father refused payment.
Issue(s)
Whether the trial court erred in denying the motion to dismiss Civil Case No. 77 based on the pendency of Civil Case No. 105. Whether Angel Roque, and not his children Alfonso and Justina Roque, was the real mortgagee. Whether the tender of payment to Angel Roque and the subsequent consignation of P5,183.28 with the Clerk of Court constituted a sufficient redemption and payment of the mortgage. Whether Civil Case No. 105 was erroneously dismissed.
Ruling
The Supreme Court affirmed the decision of the Court of Appeals, holding that the consignation was inefficacious due to the lack of proper notice to the creditors, Alfonso and Justina Roque. The Court ordered the mortgagors to pay the mortgage debt with 10% annual interest from September 23, 1941, plus attorney's fees.
Ratio Decidendi
On the denial of the motion to dismiss (Civil Case No. 77): The Court held that the objection was rendered moot by the parties' agreement to try and decide both cases jointly. Even if not moot, the identity of the actions was not such that a judgment in one would automatically adjudicate the other. The Court of Appeals' dismissal of this objection was deemed correct, as the joint trial saved the parties time and expense. On the identity of the real mortgagee: The Court noted that this issue had already been decided by the Court of Appeals, which found that Alfonso and Justina Roque were the owners of the loaned money and thus the rightful mortgagees. This factual finding was not subject to review by the Supreme Court in a petition for certiorari. On the sufficiency of the tender of payment and consignation: The Court found the consignation to be inefficacious. Applying Articles 1162, 1176, and 1177 of the Civil Code of Spain, the Court emphasized that payment must be made to the creditor or their authorized representative. While consignation can be valid without prior tender if the creditor refuses without reason, or is absent, incapacitated, or payment is claimed by multiple parties, Article 1177 requires prior notice to interested parties. The debtors knew, or ought to have known, the whereabouts of Alfonso and Justina Roque in Pangasinan but failed to provide any notice of the consignation, either prior or subsequent. This omission rendered the consignation invalid because it did not put the creditors in a position to withdraw the money, especially considering the depreciating value of the Japanese military notes deposited. The subsequent filing of the suit and service of summons did not cure this defect as it occurred when the deposited currency was already worthless. On the dismissal of Civil Case No. 105: The dismissal was a consequence of the finding that the consignation was inefficacious. Since the consignation did not validly extinguish the obligation, the debtors were still liable for the mortgage debt, and the mortgagees were entitled to pursue foreclosure.
Main Doctrine
Consignation of payment is inefficacious if the debtor fails to provide prior and subsequent notice to the creditor, especially when the creditor's whereabouts are known or can be ascertained with reasonable diligence, as such notice is vital for the creditor's right to accept or reject the payment and to withdraw the deposited amount.