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Francisco vs. DEAC Construction

13072010

FRANCISCO vs. DEAC CONSTRUCTIONG.R. No. 171312 February 4, 200

Fa!"s#

S$ouses Fra%!&s!o ob"a&%e' "(e serv&!es o) DEAC Co%s"ru!"&o%, I%!. "o !o%s"ru!" a 3*s"oreyres&'e%"&a+ bu&+'&% o% "(e&r +o" +o!a"e' a" To%'o, -a%&+a )or a !o%"ra!" $r&!e o) 3./-.2- u$o% s&%&% o) "(e !o%"ra!" o) !o%s"ru!"&o%7/0 u$o% !o$+e"&o% o) "(e )ou%'a"&o% s"ru!"ure a%' rou%' oor7/0 u$o% !o$+e"&o% o) "(e se!o%' oor

 T(e !o%s"ru!"&o% o) "(e res&'e%"&a+ bu&+'&% !oe%!e' &"(ou" "(e %e!essary bu&+'&%$er&". e!ause o) "(&s, "(e s$ouses Fra%!&s!o ere !r&&%a++y !(are' &"( "(e v&o+a"&o% o) 

"(e Na"&o%a+ u&+'&% Co'e 5D 1068. To )a!&+&"a"e "(e a$$rova+ o) "(e $er&", "(e s&%a"ureso) Gu&a Fra%!&s!o ere )ore' by DEAC9s re$rese%"a"&ve.

 T(e bu&+'&% &%s$e!"or a+so observe', a)"er $er&o'&! &%s$e!"&o%s o) "(e !o%s"ru!"&o% s&"e, "(a""(e !o%"ra!"or 'ev&a"e' o% soe s$e!&:!a"&o%s )ro "(e a$$rove' $+a%s.

 T(e RTC or'ere' $ar"&a+ res!&ss&o% s&%!e "(e sub;e!" bu&+'&% as a+rea'y 70< "o 7/<!o$+e"e' a" "(e "&e o) "(e $ro!ee'&%s.

Issue#

=ON $ar"&a+ res!&ss&o% as $ro$er+y or'ere' by "(e RTC> ?ES

@e+'#

DEAC, "o (o "(e ob+&a"&o% o) se!ur&% "(e bu&+'&% $er&" $er"a&%e', s(ou+' obv&ous+y(ave e%sure' !o$+&a%!e &"( "(e reu&ree%"s se" )or"( by +a. I" s(ou+' (ave &%)ore'"(e S$ouses "(a" "(e bu&+'&% $er&" (a' %o" ye" bee% &ssue' es$e!&a++y "(a" "(ey (a'a+rea'y re!e&ve' a subs"a%"&a+ aou%" o) o%ey )ro "(e +a""er a%' (a' a+rea'y s"ar"e' "(e!o%s"ru!"&o% o) "(e bu&+'&%.

Res$o%'e%"s9 &s"aBe &% &'e%"&)y&% "(e ea!" +o!a"&o% o) "(e $ro$er"y (&!( +e' "o "(e 'e+ay&% "(e &ssua%!e o) a bu&+'&% $er&" a%' )orery o) $e"&"&o%er Gu&a Fra%!&s!o9s s&%a"ure o%"(e bu&+'&% $+a% e(&b&"s a $ro!+&v&"y )or error a%' "aB&% "(e easy ay ou". T(e S$ousesFra%!&s!o s(ou+' be a++oe' "o res!&%' "(e !o%"ra!" "o "(e e"e%" "(a" "(&s &s $oss&b+e u%'er"(e !&r!us"a%!es.

 T(e :+&% o) a !r&&%a+ !ase aa&%s" res$o%'e%" Da'u+a a%' "(e subseue%" :+&% o) "(&s !&v&+!ase )or res!&ss&o% a%' 'aaes &"(&% a reaso%ab+e "&e a)"er "(e S$ouses Fra%!&s!o (a'+ear%e' "(a" !o%s"ru!"&o% o) "(e&r bu&+'&% !oe%!e' &"(ou" "(e %e!essary bu&+'&% $er&"a%' '&s!overe' "(a" "(ere ere 'ev&a"&o%s )ro "(e bu&+'&% $+a% 'eo%s"ra"e "(e v&&+a%!e&"( (&!( "(ey uar'e' "(e&r r&("s.

G&ve% "(e )a!" "(a" "(e !o%s"ru!"&o% &% "(&s !ase &s a+rea'y 7/< !o$+e"e, &" &s !orre!" "oor'er $ar"&a+ res!&ss&o% o%+y o) "(e u%'e+&vere' or u%:%&s(e' $or"&o% o) "(e !o%s"ru!"&o%.

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Eu&"ab+e !o%s&'era"&o%s ;us"&)y res!&ss&o% o) "(e $or"&o% o) "(e ob+&a"&o% (&!( (a' %o" bee%'e+&vere'.

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6. I-ERIA S AUCIAN

FACTS#

• I$er&a+ !re'&"or au!&a% 'eb"or

•  T(e $rese%" !o%"roversy arose )ro a !ase )or !o++e!"&o% o) o%ey, :+e' by

A+e A. au!&a% aa&%s" Res"&"u"a I$er&a+, o% O!"ober 2, 166.

•  T(e !o$+a&%" a++ees, &%"er a+&a, "(a" 'e)e%'a%" ob"a&%e' )ro $+a&%"&H s& 58

se$ara"e +oa%s )or (&!( "(e )orer ee!u"e' &% )avor o) "(e +a""er s& 58

se$ara"e $ro&ssory %o"es a%' &ssue' severa+ !(e!Bs as uara%"ee )or

$aye%".

• =(e% "(e sa&' +oa%s be!ae over'ue a%' u%$a&', es$e!&a++y (e%

"(e 'e)e%'a%"9s !(e!Bs ere '&s(o%ore', $+a&%"&H a'e re$ea"e' ora+ a%'

r&""e% 'ea%'s )or $aye%".

•  T(e $ro&ssory %o"es &%'&!a"e "(e &%"eres" o) 1< $er o%"(, 'a"e o) &ssue,

'ue 'a"e, "(e !orres$o%'&% uara%"ee !(e!Bs &ssue' by 'e)e%'a%", $e%a+"&es

a%' a""or%ey9s )ees.•  T(e arra%ee%" be"ee% $+a&%"&H a%' 'e)e%'a%" rear'&% "(ese uara%"ee

!(e!Bs as "(a" ea!( "&e a !(e!B a"ures "(e 'e)e%'a%" ou+' e!(a%e &"

&"( !as(.

• De)e%'a%" !o%"e%'s "(a" "(ere as e!ess $aye%" o) 121,70.00 (&!( &s

ore "(a% "(e &%"eres" "(a" !ou+' be +ea++y !(are', a%' &% )a!" "(e "o"a+

re+eases (ave bee% )u++y $a&'.

• RTC De!&s&o%#

 T(e "r&a+ !our" re%'ere' "(e assa&+e' 'e!&s&o%#

 Judgment is hereby rendered declaring Section I, Central an!

Circular "o. #0$, series o% &#'( to be o% no %orce and legal e)ect, it havingbeen *romulgated by the +onetary oard o% the Central an! o% the

hili**ines -ith grave abuse o% discretion amounting to ecess o%

 /urisdiction declaring that the rate o% interest, *enalty, and charges %or

attorney1s %ees agreed u*on bet-een the *arties are unconscionable,

ini2uitous, and in violation o% Act "o. (3$$, other-ise !no-n as the 4sury

5a-, as amendedJ K

• CA De!&s&o%# O% a$$ea+, "(e CA (e+' "(a"

-ithout /udicial in2uiry, it -as im*ro*er %or the 6C to rule on the

constitutionality o% Section &, Central an! Circular "o. #0$, Series o%&#'(. No%e"(e+ess, the a**ellate court a8rmed the /udgment o% the trial

court reducing the interest rate %rom &3 *ercent to &.&37 *ercent *er

month or &9 *ercent *er annum a%' "(e sti*ulated *enalty charge, )ro /

$er!e%" "o 1.17 $er!e%" $er o%"( or 14 $er!e%" $er a%%u.

• @e%!e, "(&s e"&"&o%.

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ISSUE#

:hether or not the rate o% interest o% &3; *er month is *ro*erly reduced

being unconscionable, ini2uitous, and in violation o% Act "o. (3$$,

other-ise !no-n as the 4sury 5a- even i% its o*eration is sus*ended by

C Circular "o. #0$.

RUING#

•  ?es, "(e ra"e o) &%"eres" o) 1< $er o%"( &s $ro$er+y re'u!e' be&%

u%!o%s!&o%ab+e, &%&u&"ous, a%' &% v&o+a"&o% o) A!" No.2//, o"(er&se B%o%

as "(e Usury a eve% &) &"s o$era"&o% &s sus$e%'e' by C C&r!u+ar No. 60/.

• e"&"&o%er a++ees "(a" abse%" a%y r&""e% s"&$u+a"&o% be"ee% "(e $ar"&es, "(e

+oer !our"s s(ou+' (ave &$ose' "(e ra"e o) 12 $er!e%" $er a%%u o%+y.

•  T(e records sho- that there -as a -ritten agreement bet-een the

*arties %or the *ayment o% interest on the sub/ect loans at the rate

o% &3 *ercent *er month