G.R. NO. 158674 - LAPRECIOSISIMA CAGUNGUN, REMEDIOS L. CAGUNGUN, JESUS L. CAGUNGUN, VICENTE L. CAGUNGUN, JR., RICARDO L. CAGUNGUN, EDUARDO L. CAGUNGUN, ROWENA L. CAGUNGUN, ALVIN L. CAGUNGUN AND ALMA L. CAGUNGUN, VS. PLANTERS DEVELOPMENT BANK.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the defendant as follows: 1.) Enjoining the defendant from foreclosing the mortgage of plaintiffs property located at No. 88 Gordon Avenue, Pag-asa, Olongapo City; 2.) Ordering the defendant to pay plaintiffs the amount of P220,000.00 actual damages representing the total amount withdrawn from their accounts plus twelve (12%) per cent interest per annum from the date of the filing of the complaint until it shall have been fully paid; 3.) Considering plaintiffs mortgaged account in the amount of P58,297.16 to have been paid; 4.) Ordering the defendant to pay plaintiffs the amount of P300,000.00 moral damages; 5.) Ordering the defendant to pay plaintiffs the amount of P300,000.00 exemplary damages; and 6.) Ordering defendant to pay plaintiffs the amount of P50,000.00 litigation expense, P50,000.00 attorney's fee plus the cost of suit. [6] Aggrieved, respondent appealed to the Court of Appeals. The Court of Appeals agreed that money was withdrawn from the deposits of petitioners without their authority or knowledge, and that this was done by one or some of the personnel of respondent. However, it held that petitioners are not free from the obligation to pay the admitted loan (P58,297.16) for though the same was not paid for failure of respondent to comply with the instruction to apply the remainder of the sums deposited to their loan, it remained admittedly an unpaid obligation. It removed the awards for moral and exemplary damages and reduced the awards for attorney's fees and litigation expenses. The Court of Appeals promulgated its decision on 25 March 2002, the dispositive portion of which reads: WHEREFORE, the appealed decision is AFFIRMED, but with these MODIFICATONS (a) the dispositions in Par. 1 and Par. 3 of the fallo deeming the mortgaged loan paid and enjoining foreclosure, are DELETED; (b) the disposition in Par. 4 and Par. 5 of the fallo awarding moral and exemplary damages, are DELETED; and (c) the awards of litigation fees and expenses are REDUCED to a combined P30,000.00. [7] The motion for reconsideration filed by petitioners was denied in a resolution dated 06 June 2003. [8] Petitioners are now before us assailing the Decision and Resolution of the Court of Appeals when the latter: (A) DELETED THE PORTION OF THE RTC DECISION DECLARING THE MORTGAGED LOAN PAID AND ENJOINING FORECLOSURE; (B) DELETED THE AWARD OF MORAL AND EXEMPLARY DAMAGES; AND (C) REDUCED THE LITIGATION FEES AND EXPENSES. [9] Respondent filed a Comment [10] on 04 September 2003 to which petitioners filed their Reply [11] dated 06 February 2004. On 06 December 2004, the Court gave due course to the petition and required the parties to submit their respective memoranda within thirty (30) days from notice. [12] Both parties complied. [13] We first discuss the deletion made by the Court of Appeals of the awards of moral damages and exemplary damages. Petitioners maintain that the Court of Appea