Cogtong v. Kyoritsu International, Inc.
REITERATIONFacts
The Antecedents: Petitioner Josefina Cogtong claims she did not execute a deed of Real Estate Mortgage (REM) or a promissory note in favor of respondent Kyoritsu International, Inc., asserting that her signatures on these documents were forgeries. She learned of the mortgage and impending foreclosure sale of her property through a Sheriff's Sale notice. Her son, William Lao, allegedly admitted to forging her signature to mortgage the property. Procedural History: Petitioner filed an action seeking to enjoin the extrajudicial foreclosure sale. The Regional Trial Court (RTC) of Pasay City granted the injunctive relief, declaring the signatures forged and the REM and promissory note void. The RTC ordered the return of the title and documents and enjoined the sheriff from proceeding with the foreclosure. Respondent Kyoritsu appealed this decision. The Court of Appeals (CA) reversed the RTC's ruling, finding that the signatures were not forged and upholding the validity of the mortgage and promissory note. The CA dismissed petitioner's complaint. Petitioner's motion for reconsideration was denied. The Petition: Petitioner seeks review of the Court of Appeals' decision and resolution via a petition for review on certiorari under Rule 45 of the Rules of Civil Procedure. The core issue presented is whether the CA's reversal of the trial court's finding of forgery was in accordance with law and established jurisprudence. Petitioner argues that her signatures on prayer booklets should be used as standards for comparison and that the testimony of Kyoritsu's witness, Mr. Gusilatar, is inconsistent and lacks credibility. She contends that the CA erred in not finding her signatures to be forged.
Issue(s)
Whether the Court of Appeals erred in reversing the trial court's finding of forgery regarding the Deed of Real Estate Mortgage and promissory note, and the admissibility of evidence presented to prove forgery. Whether the petitioner successfully proved forgery, considering the credibility of witnesses, the presumption of due execution of notarized documents, and the plausibility of fraud.
Ruling
The petition is denied for lack of merit. The assailed Decision and Resolution of the Court of Appeals are affirmed.
Ratio Decidendi
On the issue of forgery and admissibility of evidence: The Court held that the question of forgery is a question of fact, and while appellate court findings are generally conclusive, conflicting findings between the RTC and CA necessitate examination. The Court rejected petitioner's claim that her signatures on prayer booklets were authentic standards for comparison, agreeing with the CA that these were self-serving and could be manipulated. The Court emphasized that passage of time and age can influence handwriting, and standards of comparison should be close in time to the suspected signature. A review of several documents executed by the petitioner before, during, and after the questioned documents showed a close resemblance to the signatures on the promissory note and deed of REM. On the issue of proving forgery, witness credibility, presumption of due execution, and plausibility of fraud: The Court emphasized that forgery cannot be presumed and must be proven by clear, positive, and convincing evidence, a burden the petitioner failed to discharge. The duly notarized deed of REM and promissory note enjoy the presumption of due execution, which petitioner failed to overcome with mere self-declaration and prayer booklets. The Court found no merit in the petitioner's averment that the witness, Mr. Gusilatar, Jr., was inconsistent regarding the receipt of loan proceeds. The Court found it improbable for William Lao to have successfully mortgaged the property using forged signatures, as a reputable lending institution would conduct investigations and would not typically transact with someone whose collateral is in another person's name, especially when the Transfer Certificate of Title clearly indicated Josefina Cogtong as the registered owner.
Main Doctrine
Forgery must be proven by clear, positive, and convincing evidence, and the burden of proof rests on the party alleging it. A notarized document enjoys the presumption of due execution, which can only be overcome by sufficient evidence to the contrary.