G.R. No. 123807 - PACIFIC MILLS, INC. AND CLOVER MANUFACTURING CORPORATION, VS. THE HON. COURT OF APPEALS, THE DEVELOPMENT BANK OF THE PHILIPPINES AND THE ASSET PRIVATIZATION TRUST (NOW SUBSTITUTED BY THE PRIVATIZATION AND MANAGEMENT OFFICE).D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, premises above considered, finding that plaintiffs have paid in full their last remaining obligation in the amount of P4,018,940.67 as admitted by defendants in their communication as of August 20, 1987, Exhibits "E" and also "1", said defendants are hereby ordered to cancel the Deed of Mortgage constituted on their T.C.T. Nos. 136639, 136640, 136641, 134249 and 134252, and for the defendants to release the said titles to plaintiffs, together with the improvements thereon, namely: acrylic, spinning and finishing equipments. Further, the defendants are likewise ordered to reimburse plaintiffs the amount of P146,815.62 which is plaintiff's excess payment with interest of 14% per annum from date plaintiffs made demand therefore. Defendants are likewise ordered to pay the attorney's fees of plaintiffs in the amount of P30,000.00, plus the costs of suit. [6] The trial court's decision was fundamentally based on the letter dated 20 August 1987 sent by DBP to the petitioners, viz: August 20, 1987 Clover Manufacturing Corporation 28 Novaliches, Balintawak Quezon City Attention: Mr. Joseph U. Lim Acting President Gentlemen: This refers to your letter of August 17, 1987 indicating that the Central Bank has credited our account for P4,495,700.00 in full settlement of the remaining balance of Clover's account including additional charges thereon which as of August 12, 1987 amounted to P4,018,940.67. The credit advice we received from the Central Bank, however, indicates a credit of only P4,165,756.29; hence, the excess amount is P146,815.62. As previously agreed, the excess shall be refunded to you by way of credit to the savings account to be set up for Pacific Mills, Inc. with DBP. Herewith are the application/specimen signature forms and the list of other requirements. With regards to the remaining assets of Clover mortgaged with DBP, our Legal Department is now preparing the necessary Deed of Cancellation of Mortgage. This document shall be released after clearance of your account with our Transaction Processing Department. Thank you. Very truly yours, (SGD)AMANDA S. GUIAM Senior Manager [7] Herein private respondents, not satisfied with the ruling of the trial court, interposed an appeal with the Court of Appeals. It was docketed as CA-G.R. CV No. 35108. The court a quo , in its decision dated 24 August 1995, reversed and set aside the ruling of the trial court, the dispositive portion of which is quoted hereunder: WHEREFORE, the Decision, dated July 25, 1991, of the RTC-Quezon City, Branch 101, in Civil Case No. Q-53552 is hereby REVERSED and SET ASIDE . Plaintiffs Pacific Mills, Inc. and Clover Manufacturing Corporation are hereby ordered to pay their obligations to defendants Development Bank of the Philippines (DBP) and Asset Privatization Trust (APT), which, as of August 12, 1987, amounted to P5,152,916.98, subject to interest and penalties until fully paid. Costs against plaintiffs Pacific Mills, Inc. and Clover Manufacturing Corporatio