5. Rural Bank of Caloocan Case Digest

Credit Trans

GR no. L-32116  April 21, 1981 FACTS: Maxima Castro, aompani!" #$ S!%!rino &al!nia, '!nt to R(ral )an* o+ Calooan to appl$ +or in"(strial loan. T! loan 'as s!(r!" #$ a r!al !stat! morta! on Castros o(s!, a+t!r tat, t! #an* appro%!" t! loan o+ /3000. &al!nia o#tain!" +rom t! #an* an !(al !(al amo(nt amo(nt o+ loan loan a++ixi a++ixin n Castro Castros s sinat sinat(r! (r! as o-ma*! o-ma*!rr 'ito( 'ito(tt its *no'l!"!. T! s!ri++ t!n s!nt a noti! anno(nin t! prop!rt$ 'o(l" #! sol" at p(#li p(#li a(tion a(tion to satis+ satis+$ $ t! o#liat o#liation ion.. pon pon r!(!st r!(!st,, t! a(tion a(tion sal! sal! 'i 'i 'as s!"(l s!"(l!" !" +or Mar 10, 1961'as 1961'as postpo postpon!" n!" +or April April 10, 1961. 1961. )(t April April 10 'as s(#s!( s(#s!(!nt !ntl$ l$ "!lar! "!lar!" " a sp!ia sp!iall oli"a$ oli"a$ so t! s!ri+ s!ri+++ sol" sol" t! prop!rt prop!rt$ $ on p(#li p(#li a(tion on April 11, 1961 'i 'as t! n!xt s(!!"in #(sin!ss "a$ +ollo'in t! sp!ial oli"a$. Castro pra$!" +or t! ann(lm!nt o+ sal! all!in tat t!r! 'as +ra(" on t! part o+ &al!nias 'o in"(!" !r to sin as o-ma*!r o+ a promissor$ not! sin! s! is a 0-$!ar ol" 'i"o' 'o annot r!a" an" 'rit! an" it 'as onl$ '!n s! r!!i%! t! noti! o+ s!ri++, s! l!arn!" tat t! !n(m#ran! on !r prop!rt$ 'as /6000 an" not +or /3000, t! amo(nt o+ !r loan. 4SS5S: 1. !t!r or or not t! p(#li p(#li a(tion a(tion sal! 'as 'as n(ll an" %oi" %oi" +or trans+!rr trans+!rrin in t! "at! "at! alr!a"$ s!t #$ la'. 2. !t!r or or not t! t! morta! morta! 'ill !xt!n" to to t! loan loan o+ //3,000. //3,000.00 00 i%!n to to spo(s!s &al!nia &al!nia 3. !t!r or or not t! t! )an* 'ill 'ill #!ar t! t! loss as a r!s(lt o+ t! +ra("(l +ra("(l!nt !nt at o+ o+ spo(s!s &al!nia &al!nia RL47G: 1. T! sal! is n(ll n(ll an" %oi" +or +or not a%in a%in in aor"an! aor"an! 'it At At 313 'i 'i stat!s stat!s tat tat a noti! sall #! i%!n #$ postin noti!s o+ sal! +or not l!ss tan 20 "a$s in at l!ast 3p(#li pla!s an" i+ t! prop!rt$ is 'ort mor! tan /00 s( noti! sall also #! p(#lis!" +or in a n!'spap!r o+ !n!ral ir(lation in t! m(niipalit$ or it$ on! a '!!* +or 3 ons!(ti%! '!!*s. T! pr!t!rmission o+ a oli"a$ appli!s appli!s onl$ '!r! t! "a$, or t! last "a$ +or "oin an$ at r!(ir!" r!(ir!" or  p!rmitt!" #$ la' +alls on a oli"a$ or '!n t! last "a$ o+ a i%!n p!rio" +or  "oin an at +alls on oli"a$. 4t "o!s not appl$ to a "a$ +ix!" #$ an o++i! or o++i!r  o+ t! o%!rnm!nt +or an at to #! "on!. Sin! April 10, 1961 'as not t! "a$ or  t! last "a$ s!t #$ la' +or t! !xtra;("iial +or!los(r! sal!, nor t! last "a$ o+ a i%!n p!rio" #(t a "at! +ix!" #$ "!p(t$ s!ri++, t! sal! annot #! l!all$ ma"!

/a! 1 o+ 2

Credit Trans

on t! n!xt s(!!"in #(sin!ss "a$ 'ito(t t! noti! o+ t! sal! in aor"an! 'it At no. 313 2. 7o. #!a(s! Spo(s!s &al!nia ommitt!" +ra(" %iolatin Art 132 misr!pr!s!ntation #$ a tir" p!rson "o!s not %itiat! ons!nt, (nl!ss s( misr!pr!s!ntation as r!at!" s(#stantial mista*!. 4t annot #! "!lar!" tat t! promissor$ not! is %ali" #!t'!!n t! #an* an" Castro an" t! morta! ontrat #in"in on Castro #!$on" t! amo(nt o+  /3,000.00, +or 'il! t! ontrats ma$ not #! in%ali"at!" inso+ar as t!$ a++!t t! #an* an" Castro on t! ro(n" o+ +ra(" #!a(s! t! #an* 'as not a partiipant t!r!to, s( ma$ o'!%!r #! in%ali"at!" on t! ro(n" o+ s(#stantial mista*! m(t(all$ ommitt!" #$ t!m as a ons!(!n! o+ t! +ra(" an" misr!pr!s!ntation in+lit!" #$ t! &al!nias. 3.
/a! 2 o+ 2