G.R. No. 169407 - BANK OF THE PHILIPPINE ISLANDS, VS. AMADOR DOMINGO.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, premises considered, judgment is hereby rendered in favor of [BPI], ordering defendant Amador Domingo: To pay [BPI] the sum of P275,562.00 plus interest thereon at the rate of 36% per annum from November 15, 2000 until fully paid; To pay [BPI] the sum equivalent to 25% of the total amount due as atorney's fees; and To pay the costs of suit. [11] Acting on Amador's Motion for Reconsideration, the MeTC issued an Order [12] dated September 6, 2004 affirming its earlier judgment but reducing the attorney's fees awarded, thus: WHEREFORE, premises considered the Decision of this Court dated June 10, 2014 stands, subject to the modification that the attorney's fees of twenty-five percent (25%) is ordered reduced to ten percent (10%) of the total amount due. [13] Dissatisfied, Amador appealed his case before the Regional Trial Court (RTC) of Manila, Branch 26, wherein it was docketed as Civil Case No. 04-111100. In its Decision dated February 10, 2005, the RTC held that in novation, consent of the creditor to the substitution of the debtor need not be by express agreement, it can be merely implied. The consent is not required to be in any specific or particular form; the only requirement being that it must be given by the creditor in one way or another. To the RTC, the following circumstances demonstrated the implied consent of BPI to the novation: (1) BPI had knowledge of the Deed of Sale and Assumption of Mortgage executed between Mercy and Carmelita, but did not interpose any objection to the same; and (2) BPI (through FEBTC) returned the personal checks of the spouses Domingo and accepted the payments made by Carmelita. The RTC also noted that BPI made a demand for payment upon the spouses Domingo only after 30 months from the time Carmelita assumed payments for the installments due. The RTC reasoned that if the spouses Domingo truly remained as debtors, BPI would not have wasted time in demanding payments from them. Ultimately, the RTC decreed: WHEREFORE, premises considered, the judgment appealed from is hereby reversed. The complaint filed by [BPI] before [MeTC] Branch 9, Manila, is hereby DISMISSED and ordering [BPI] to pay defendant/appellant Amador Domingo the following, to wit: a) One Hundred Thousand (P100,000.00) Pesos as moral damages; b) Fifty Thousand (P50,000.00) Pesos as exemplary damages; c) Fifty Thousand (P50,000.00) Pesos as attorney's fees; d) Twenty-Five Thousand (P25,000.00) [Pesos] as litigation expenses; e) Costs of this suit. [14] Aggrieved by the foregoing RTC judgment, BPI filed a Petition for Review with the Court of Appeals, docketed as CA-G.R. SP No. 88836. The Court of Appeals promulgated its Decision on July 11, 2005, affirming the finding of the RTC that novation took place. The Court of Appeals, relying on the declaration in Babst v. Court of Appeals [15] that consent of the creditor to the substitution of debtors need not always be express and may be inferred from the acts of the creditor, ruled that: In t