ChanRobles Virtual law Library

chanrobles.com - PHILIPPINE SUPREME COURT RESOLUTIONS - ON-LINE

cralaw_scresolutions_separator.NHAD

[G.R. No. 132051.September 3, 2003]

TALA REALTY vs. BANCO FILIPINO

THIRD DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated SEP 3 2003.

G.R. No. 132051 (Tala Realty Services Corporation vs. Banco Filipino Savings and Mortgage Bank.)

For resolution is respondent Banco Filipino Savings and Mortgage Bank's motion for reconsideration of our Resolution dated July 24, 2002 which granted petitioner Tala Realty Services Corporation's motion for partial modification of our Decision dated June 25, 2001. In our Resolution, we held that respondent bank is liable, not only for the unpaid rentals from April 1994 until it vacates the premises, but also for interest thereon at 6% per annum.

Respondent bank's ground for its motion for reconsideration is as follows:

"Such award does not find support in the evidence adduced in this case as well as in the substantive and procedural laws and jurisprudence applicable to the factual milieu of this case."

We grant the motion, but not for the reasons advanced by respondent bank.

On November 22, 2002, the Court En Banc rendered a Decision in G.R. No. 137533, "Tala Realty Services Corporation vs. Banco Filipino Savings and Mortgage Bank." This case and the case at bar involve the same parties and issues, except that in G.R. No. 137533, the subject property is in Bulacan. In that case, the Court, through Justice Reynato S. Puno, ruled that respondent bank is not liable for unpaid rents, thus:

"Equity dictates that Tala should not be allowed to collect rent from the Bank. The factual milieu of the instant case shows that both the Bank and Tala participated in the deceptive creation of a trust to circumvent the real estate investment limit under Sections 25(a) and 34 of the General Banking Act. Upholding Tala's right to collect rent for the period during which the Bank was arbitrarily closed would allow Tala to benefit from the illegal "warehousing agreement." This would result in the application of the Bank's advance rentals covering the eleventh to the twentieth years of the lease, to the rentals due for the period during which the Bank was arbitrarily closed. With the advance rentals already used up, and the Bank having stopped payment of the rent on the thirteenth year of the lease or in April 1994, rentals would be due Tala from the time the Bank stopped paying rent in April 1994 up to the expiration of the lease period. Just as the Bank should not be allowed to benefit from its deceptive "warehousing agreement," Tala should not also benefit from the arrangement as it was the Bank's major stockholders that proposed the arrangement and incorporated Tala. Tala committed deception by participating in the "warehousing agreement," and committed another deception when it turned the tables on the Bank and denied the arrangement. Allowing Tala to further benefit from the "warehousing agreement" is unconscionable, to say the least.

"The Bank and Tala are in pari delicto, thus, no affirmative relief should be given to one against the other. The Bank should not be allowed to dispute the sale of its lands to Tala nor should Tala be allowed to further collect rent from the Bank. The clean hands doctrine will not allow the creation or the use of a juridical relation such as a trust to subvert, directly or indirectly, the law. Neither the Bank nor Tala came to court with clean hands; neither will obtain relief from the court as one who seeks equity and justice must come to court with clean hands. By not allowing Tala to collect from the Bank rent for the period during which the latter was arbitrarily closed, both Tala and the Bank will be left where they are, each paying the price for its deception."

Mindful of such pronouncement, we are now constrained to apply it to the case at bar.

WHEREFORE, respondent bank's motion is GRANTED. Our Resolution dated July 24, 2002 ordering respondent bank to pay 6% interest per annum on the unpaid rentals from April 1994 up to the time it vacates the premises is hereby RECONSIDERED and SET ASIDE.

SO ORDERED.

Panganiban, J., no part.

Very truly yours,

(Sgd.) JULIETA Y. CARREON
Clerk of Court


Back to Home | Back to Main

 

CLICK HERE FOR THE LATEST SUPREME COURT JURISPRUDENCE

PHILIPPINE SUPREME COURT DECISIONS

QUICK SEARCH

cralaw

 







chanrobles.com





ChanRobles Legal Resources:

ChanRobles On-Line Bar Review

ChanRobles Internet Bar Review : www.chanroblesbar.com

ChanRobles MCLE On-line

ChanRobles Lawnet Inc. - ChanRobles MCLE On-line : www.chanroblesmcleonline.com