G.R. No. 181426 - GAMES AND GARMENTS DEVELOPERS, INC., VS. ALLIED BANKING CORPORATION.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, under the above premises, it is most respectfully prayed that the Honorable Court, after trial, order the dismissal of the instant case with respect to the Defendant Pantaleon Spouses; order the Plaintiff [GGDI] to pay to them moral damages in the amount of TEN MILLION PESOS (P10,000,000.00), exemplary damages of TWO MILLION PESOS (P2,000,000,00), attorney's fees of ONE MILLION PESOS (P1,000,000.00) and costs of suit; and order Defendants Allied Banking Corporation and Ernesto Mercado to annul or render null and void the foreclosure of the mortgage on the property in question and in the event the title has already been consolidate in the bank's name, to reconvey the same to Defendant Pantaleon Spouses and to pay jointly and severally to the Defendant Pantaleon Spouses moral damages of TWENTY MILLION PESOS (P20,000,000.00), exemplary damages of FIVE MILLION PESOS (P5,000,000.00), attorney's fees of ONE MILLION PESOS (P1,000,000.00) and costs of suit. [31] During the Pre-trial Conference, attended by the counsels for GGDI, Allied Bank, and spouses Pantaleon, the parties stipulated and admitted that GGDI received the amount of P6,000,000.00 via Allied Bank Check No. 85-0017246 dated August 23, 1996 as the spouses Pantaleon's partial payment for the subject property. [32] During trial, Hemandas, as witness for GGDI, testified that GGDI only received from the spouses Pantaleon as partial payments for the subject property the amounts of P6,000,000.00 upon execution of the Deed of Sale on August 23, 1996 and P1,000,000.00 through two checks of P500,000.00 each sometime in January 1997; [33] and the amounts of P1,045,000.00 and P665,000.00 were paid by the spouses Pantaleon, not to GGDI, but to Atty, Lao as his attorney's fees and broker's fees, respectively. The spouses Pantaleon failed to present any evidence, while Allied Bank only submitted documentary evidence. On September 25, 2003, the RTC rendered its Decision in favor of GGDI and against the spouses Pantaleon and Allied Bank, but was completely silent regarding Mercado's liability. The RTC found that GGDI had already complied with its obligation to deliver and transfer the title of the subject property to the spouses Pantaleon but the spouses Pantaleon and Allied Bank failed and refused to comply with their obligation to pay GGDI the unpaid balance of the purchase price for the said property; that GGDI likewise complied with the requirements in the letter of guaranty to transfer title to the subject property to the spouses Pantaleon and annotate on the new title the mortgage of the same property to Allied Bank, by virtue of which, Allied Bank was subsequently able to foreclose the mortgage and acquire the subject property as the sole bidder at the public auction sale; that Allied Bank cannot now deny Branch Manager Mercado's authority to issue the letters of guaranty on the ground that banks are prohibited from entering into any contract of guaranty; that there was bad faith on the pa