G.R. No. 178218 - RAMONA RAMOS AND THE ESTATE OF LUIS T. RAMOS, VS. PHILIPPINE NATIONAL BANK, OPAL PORTFOLIO INVESTMENTS (SPV-AMC), INC. AND GOLDEN DRAGON STAR EQUITIES, INC..D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, Luis Ramos executed a Contract of Pledge [12] in favor of PNB on April 6, 1989. Pledged as security for the availment were two official warehouse receipts ( quedans ) for refined sugar issued by Noahs Ark Sugar Refinery (Noahs Ark), which bore the serial numbers NASR RS-18080 and NASR RS-18081. [13] The said quedans were duly indorsed to PNB. On June 6, 1989, Luis Ramos procured another availment of P7,800,000.00 that was likewise contained in a promissory note [14] and for which he executed another Contract of Pledge [15] on the aforementioned quedans on even date. Thereafter, Luis Ramos was granted a renewal on the promissory notes dated April 3, 1989 and June 6, 1989. Hence, he executed in favor of PNB the promissory notes dated October 3, 1989 and October 9, 1989. [16] Luis Ramos eventually failed to settle his sugar quedan financing loans amounting to P15,600,000.00. On December 28, 1989, he issued an Authorization [17] in favor of PNB, stating as follows: AUTHORIZATION KNOW ALL MEN BY THESE PRESENTS: In consideration of my Sugar Quedan Financing line granted by Philippine National Bank, Balayan Branch in the amount of P50.0 Million, as evidenced by Credit Agreement dated March 31, 1989 , the undersigned, as borrower, authorizes the Philippine National Bank, Balayan Branch, or any of its duly authorized officer, to dispose and sell all the Quedan Receipts (Warehouse Receipts) pledged to said bank, after maturity date of the Sugar Quedan Financing line . The Sugar Quedan Receipts are hereunder specifically enumerated: Official Warehouse Receipt (Quedan) Serial Nos.: 1) NASR RS 18081 Crop Year 1988-89 (16,129.03 50 kilo bags) 2) NASR RS 18080 Crop Year 1988-89 (16,393.44 50 kilo bags) Incidentally, the above-mentioned sugar quedans became the subject of three other cases between PNB and Noahs Ark, which cases have since reached this Court. [18] The Agricultural Crop Loan Meanwhile, on August 7, 1989, the spouses Luis Ramos and Ramona Ramos (spouses Ramos) also obtained an agricultural loan of P160,000.00 from PNB. Said loan was evidenced by a promissory note [19] issued by the spouses on even date. The said loan was secured by the real estate mortgage previously executed by the parties on October 23, 1973. On November 2, 1990, the spouses Ramos fully settled the agricultural loan of P160,000.00. [20] They then demanded from PNB the release of the real estate mortgage. PNB, however, refused to heed the spouses demand. [21] On February 28, 1996, the spouses Ramos filed a complaint for Specific Performance [22] against the PNB, Balayan Branch, which was docketed as Civil Case No. 3241 in the Regional Trial Court (RTC) of Balayan, Batangas. The spouses claimed that the actions of PNB impaired their rights in the properties included in the real estate mortgage. They alleged that they lost business opportunities since they could not raise enough capital, which they could have acquired by mortgaging or disposing of the said p