G.R. No. 176791 - COMMUNITIES CAGAYAN, INC., VS. SPOUSES ARSENIO (DECEASED) AND ANGELES NANOL AND ANYBODY CLAIMING RIGHTS UNDER THEM.D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, titles were transferred in the names of respondent-spouses under Transfer Certificates of Title (TCT) Nos. 105202 and 105203, and submitted to Capitol Development Bank for loan processing. [12] Unfortunately, the bank collapsed and closed before it could release the loan. [13] Thus, on November 30, 1997, respondent-spouses entered into another Contract to Sell [14] with petitioner over the same property for the same price of P368,000.00. [15] This time, respondent-spouses availed of petitioners in-house financing [16] thus, undertaking to pay the loan over four years, from 1997 to 2001. [17] Sometime in 2000, respondent Arsenio demolished the original house and constructed a three-story house allegedly valued at P3.5 million, more or less. [18] In July 2001, respondent Arsenio died, leaving his wife, herein respondent Angeles, to pay for the monthly amortizations. [19] On September 10, 2003, petitioner sent respondent-spouses a notarized Notice of Delinquency and Cancellation of Contract to Sell [20] due to the latters failure to pay the monthly amortizations. In December 2003, petitioner filed before Branch 3 of the Municipal Trial Court in Cities of Cagayan de Oro City, an action for unlawful detainer, docketed as C3-Dec-2160, against respondent-spouses. [21] When the case was referred for mediation, respondent Angeles offered to pay P220,000.00 to settle the case but petitioner refused to accept the payment. [22] The case was later withdrawn and consequently dismissed because the judge found out that the titles were already registered under the names of respondent-spouses. [23] Unfazed by the unfortunate turn of events, petitioner, on July 27, 2005, filed before Branch 18 of the RTC, Cagayan de Oro City, a Complaint for Cancellation of Title, Recovery of Possession, Reconveyance and Damages, [24] docketed as Civil Case No. 2005-158, against respondent-spouses and all persons claiming rights under them. Petitioner alleged that the transfer of the titles in the names of respondent-spouses was made only in compliance with the requirements of Capitol Development Bank and that respondent-spouses failed to pay their monthly amortizations beginning January 2000. [25] Thus, petitioner prayed that TCT Nos. T-105202 and T-105203 be cancelled, and that respondent Angeles be ordered to vacate the subject property and to pay petitioner reasonable monthly rentals from January 2000 plus damages. [26] In her Answer, [27] respondent Angeles averred that the Deed of Absolute Sale is valid, and that petitioner is not the proper party to file the complaint because petitioner is different from Masterplan Properties, Inc. [28] She also prayed for damages by way of compulsory counterclaim. [29] In its Reply, [30] petitioner attached a copy of its Certificate of Filing of Amended Articles of Incorporation [31] showing that Masterplan Properties, Inc. and petitioner are one and the same. As to the compulsory counterclaim for damages, petitioner denied t