Commoner Lending Corp. v. Balandra

 

Commoner Lending Corp. v. Balandra

G.R. No. 247646

March 29, 2023

 

FACTS:

                A parcel of land covered by a Transfer Certificate of Title in the name of Spouses Rafael Balandra and Alita Balandra were mortgaged to the petitioner corporation to secure a loan contracted by respondent’s wife, Alita. According to petitioner, the spouses defaulted in their installment payments and had an outstanding obligation. Balandra allegedly promised to pay the remaining balance by way of installments. Petitioner thus asserted that respondent Balandra had ratified the questioned mortgage. Having failed to pay the outstanding obligation, petitioner extra-judicially foreclosed the Real Estate Mortgage (REM) and consequently acquired the mortgaged properties. Balandra filed a Complaint for Nullity of Documents and Damages against petitioner and Alita, and prayed for the nullification of the REM. Balandra alleged that his wife had forged his signature in a General Power of Attorney, making it appear that he gave her authority to mortgage the subject property. The RTC founds respondent’s signature to be a forgery. It ruled that the partial payments made by respondent could not be considered as his ratification of or consent to the loan and was merely a vain effort to save his house from execution. Nonetheless, finding the mortgaged properties as conjugal properties, the RTC sustained the validity of the REM only as regards the one-half (1/2) portion of the mortgaged properties. The CA affirmed the finding of forgery but held that the REM is void in its entirely, having been executed by Anita without respondent’s consent or authority.

 

ISSUE:

                Whether or not the REM is void.

 

HELD:

                No. Citing Article 124 of the Family Code, “void” dispositions under Article 124 of the Family Code are expressly deemed as a continuing offer which may be perfected and accepted by consent of the previously non-consenting spouse. In the case, the REM executed by Alita without the written consent or authority of respondent partook of a continuing offer from petitioner and Alita that a mortgage be constituted over the subject conjugal properties to secure the questioned loan. Respondent had the option of accepting or rejecting the offer before its withdrawal either by petitioner or Alita. As found by both the RTC and CA, respondent, instead of rejecting the offer, undertook to pay the outstanding loan obligation and made partial payments thereon. The circumstances establish respondent's acceptance of the offer, thereby perfecting the previously unauthorized REM into a binding undertaking on his part to constitute the mortgage over the subject conjugal properties as security for the loan.