G.R. No. 165617 - SUPREME TRANSLINER, INC., MOISES C. ALVAREZ AND PAULITA S. ALVAREZ, VS. BPI FAMILY SAVINGS BANK, INC..[G.R. No. 165837]BPI FAMILY SAVINGS BANK, INC., VS. SUPREME TRANSLINER, INC., MOISES C. ALVAREZ AND PAULITA S. ALVAREZ.DECISION - Supreme Court E-Library

Ruling

Accordingly, the following Statement of Account [3] was prepared by the bank indicating the total amount due under the mortgage loan agreement: x x x x Balance of Principal P 9,551,827.64 Add: Interest Due 1,417,761.24 Late Payment Charges 155,546.25 MRI 0.00 Fire Insurance 0.00 Foreclosure Expenses 155,817.23 Sub-total P 11,280,952.36 Less: Unapplied Payment 908,241.01 Total Amount Due As of 08/07/96 (Auction Date) 10,372,711.35 Add: Attorney's Fees (15%) 1,555,906.70 Liquidated Damages (15%) 1,555,906.70 Interest on P 10,372,711.35 from 08/07/96 to 04/07/97 (243 days) at 17.25% p.a. 1,207,772.58 x x x x Asset Acquired Expenses: Documentary Stamps 155,595.00 Capital Gains Tax 518,635.57 Foreclosure Fee 207,534.23 Registration and Filing Fee 23,718.00 Add'l. Registration & Filing Fee 660.00 906,142.79 Interest on P 906,142.79 from 08/07/96 to 04/07/97 (243 days) at 17.25% p.a. 105,509.00 Cancellation Fee 300.00 Total Amount Due As of 04/07/97 (Subject to Audit) P 15,704,249.12 x x x x The mortgagors requested for the elimination of liquidated damages and reduction of attorney's fees and interest (1% per month) but the bank refused. On May 21, 1997, the mortgagors redeemed the property by paying the sum of P15,704,249.12. A Certificate of Redemption [4] was issued by the bank on May 27, 1997. On June 11, 1997, the mortgagors filed a complaint against the bank to recover the allegedly unlawful and excessive charges totaling P5,331,237.77, with prayer for damages and attorney's fees, docketed as Civil Case No. 97-72 of the Regional Trial Court of Lucena City, Branch 57. In its Answer with Special and Affirmative Defenses and Counterclaim, the bank asserted that the redemption price reflecting the stipulated interest, charges and/or expenses, is valid, legal and in accordance with documents duly signed by the mortgagors. The bank further contended that the claims are deemed waived and the mortgagors are already estopped from questioning the terms and conditions of their contract. On September 30, 1997, the bank filed a motion to set the case for hearing on the special and affirmative defenses by way of motion to dismiss. The trial court denied the motion on January 8, 1998 and also denied the bank's motion for reconsideration. The bank elevated the matter to the Court of Appeals (CA-G.R. SP No. 47588) which dismissed the petition for certiorari on February 26, 1999. On February 14, 2002, the trial court rendered its decision [5] dismissing the complaint and the bank's counterclaims. The trial court held that plaintiffs-mortgagors are bound by the terms of the mortgage loan documents which clearly provided for the payment of the following interest, charges and expenses: 18% p.a. on the loan, 3% post-default penalty, 15% liquidated damages, 15% attorney's fees and collection and legal costs. Plaintiffs-mortgagors' claim that they paid the redemption price demanded by the defendant bank under extreme pressure was rejected by the trial court since there