Tuesday, July 11, 2023

Case Digest: Pureza vs. CA et.al., G.R. No. 122053

Pureza vs. CA et.al., G.R. No. 122053, May 15, 1998  

Subject: Obligations and Contracts

FACTS

Respondent spouses Bonifacio and Crisanta Alejandro are building contractors conducting business under the name of Boncris Trading and Builders. Petitioner Ruperto Pureza sought their services in the construction of a two-story house at Don Juan Bayview Subdivision, at Sucat, Muntinlupa. To facilitate this project, he applied for a Pag-Ibig Housing Loan with the Asia Trust Development Bank in the amount of P194,100.00, signing an order of payment authorizing the release of specified amounts to the contractor in connection with the construction. This arrangement was embodied in a Construction Agreement entered into by the parties, with the net proceeds of the loan amounting to P155,356.30.

On March 19, 1986, petitioner (as plaintiff) filed an action for Specific Performance and damages with a Prayer for the Issuance of a Writ of Preliminary Injunction before the RTC of Makati to prevent respondent Bank from collecting the loan or foreclosing the mortgage on plaintiffs house and lot. He claimed that although the construction was only seventy percent (70%) finished, the Bank had released to the spouses ninety percent (90%) of the proceeds of the loan, except for the sum of P14,000.00 which the Bank applied to amortizations. In their answer, the defendant spouses alleged that the plaintiff and his wife Myrna authorized the release of the proceeds of the loan on a staggered basis, in accordance with the Order of Payment. They further state that, the plaintiff having signed a Certificate of House Completion/ Acceptance, the Bank was likewise authorized to turn the loan over to the Pag-Ibig Housing as creditor.

ISSUE

Whether or not the defendants are jointly and severally liable for the costs of repair, moral and exemplary damages, attorney's fees and the costs of suit.

RULING

No.

Under Article 1431 of the Civil Code, whenever a party has, by his own declaration, act or omission, intentionally and deliberately led another to believe a particular thing to be true, and to act upon such a belief he cannot, in any litigation arising out of such declaration, act or omission, be permitted to falsify it.

In this case, the application of the principle of estoppel is proper and timely in heading off petitioner's shrewd efforts at renouncing his previous acts to the prejudice of parties who had dealt with him honestly and in good faith. Respondent Bank and respondent spouses cannot be held jointly and solidarily liable for the costs of repair, moral and exemplary damages, attorney's fees and the costs of suit. The findings of the lower court that respondent Bank recklessly and negligently released the proceeds of the loan to the spouses were not supported by evidence. The Bank did nothing but fulfill its undertakings under the loan agreement in accordance with petitioner's instructions. It cannot be charged for any damage caused upon the house of petitioner even if such damage may be attributable to the spouses. If, indeed, repairs were necessary to improve the physical condition of the house, respondent Bank not being the contractor thereof, cannot be held jointly and severally liable with the spouses.

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