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    Alano Vs Planter'S Development Bank: Whether or Not The Defendant Is A Mortgagee in Good Faith?

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    Kayee Kat
    - Armando Alano and his brother inherited a property in Manila, which they sold to purchase a property in Quezon City. After his brother died, his wife Lydia and children claimed ownership of the Quezon City property. - Lydia took out a loan for ₱2.3 million from Planter's Development Bank's predecessor, using the property as collateral. Alano filed a case to cancel Lydia's title. - The RTC ruled Alano owned half the property but upheld the validity of the mortgage. The CA affirmed, finding the bank was a mortgagee in good faith. - The Supreme Court ruled the bank was not a mortgagee in good faith

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    Alano Vs Planter'S Development Bank: Whether or Not The Defendant Is A Mortgagee in Good Faith?

    Uploaded by

    Kayee Kat
    197 views2 pages
    - Armando Alano and his brother inherited a property in Manila, which they sold to purchase a property in Quezon City. After his brother died, his wife Lydia and children claimed ownership of the Quezon City property. - Lydia took out a loan for ₱2.3 million from Planter's Development Bank's predecessor, using the property as collateral. Alano filed a case to cancel Lydia's title. - The RTC ruled Alano owned half the property but upheld the validity of the mortgage. The CA affirmed, finding the bank was a mortgagee in good faith. - The Supreme Court ruled the bank was not a mortgagee in good faith

    Original Description:

    CAse digest

    Original Title

    ALANO VS PLANTER

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    - Armando Alano and his brother inherited a property in Manila, which they sold to purchase a property in Quezon City. After his brother died, his wife Lydia and children claimed ownership of the Quezon City property. - Lydia took out a loan for ₱2.3 million from Planter's Development Bank's predecessor, using the property as collateral. Alano filed a case to cancel Lydia's title. - The RTC ruled Alano owned half the property but upheld the validity of the mortgage. The CA affirmed, finding the bank was a mortgagee in good faith. - The Supreme Court ruled the bank was not a mortgagee in good faith

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    197 views2 pages

    Alano Vs Planter'S Development Bank: Whether or Not The Defendant Is A Mortgagee in Good Faith?

    Uploaded by

    Kayee Kat
    - Armando Alano and his brother inherited a property in Manila, which they sold to purchase a property in Quezon City. After his brother died, his wife Lydia and children claimed ownership of the Quezon City property. - Lydia took out a loan for ₱2.3 million from Planter's Development Bank's predecessor, using the property as collateral. Alano filed a case to cancel Lydia's title. - The RTC ruled Alano owned half the property but upheld the validity of the mortgage. The CA affirmed, finding the bank was a mortgagee in good faith. - The Supreme Court ruled the bank was not a mortgagee in good faith

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    ALANO VS PLANTER’S DEVELOPMENT BANK

    Facts:

    Petitioner Armando V. Alano and his brother, the late Agapito V. Alano, Jr., inherited from their father a
    parcel of land located at Gov. Forbes St., Sampaloc, Manila. petitioner executed a Special Power of
    Attorney5 authorizing his brother to sell their property in Manila. From the proceeds of the sale, the brothers
    purchased a residential house located in Quezon City. The title of the Quezon City property, however, was not
    immediately transferred to them because the duplicate and original copies of the title were destroyed by a fire that
    gutted the Quezon City Hall Building.

    On June 27, 1990, Agapito V. Alano, Jr. died leaving behind his wife, Lydia J. Alano (Lydia), and four
    legitimate children. The property was reconstituted and registered under them. Thus, petitioner to execute an
    Affidavit of Adverse Claim. But because of the assurance of his nieces that they would put things right, petitioner
    agreed to delay the filing of a case in court.

    Because of this, Lydia filed with the Register of Deeds of Quezon City an Affidavit of Cancellation of
    Adverse Claim executed by Alano. Thereafter, her children allegedly executed a Deed of Absolute Sale in favor by
    Lydia and used such property to obtain loan from Maunlad Savings and Loan Association, Inc. which is the
    predecessor-in interest of Planter’s Development Bank for the amount of ₱2.3 million.

    Petitioner filed a Complaint19 against Lydia, and Maunlad Savings and Loan Association, Inc. and sought
    the cancellation of title issued under Lydia.

    Ruling of RTC:

    It declared that petitioner was the owner of the one-half of the property. However, sustained the validity of
    the real estate mortgage. According to the RTC, Maunlad Savings and Loan Association, Inc. had the right to rely on
    the Torrens title as there was no reason for it to doubt the mortgagor’s ownership over the subject property.

    Ruling of CA:

    Petitioner appealed to the CA found and sustained the decision of RTC that Maunlad Savings and Loan
    Association, Inc. to be a mortgagee in good faith since it took the necessary precautions to ascertain the status of the
    property

    Issue:

    Whether or not the defendant is a mortgagee in good faith?

    Ruling:

    Maunlad Savings and Loan Association, Inc. is not a mortgagee in good faith. The general rule that a
    mortgagee need not look beyond the title does not apply to banks and other financial institutions as greater care and
    due diligence is required of them. Imbued with public interest, they "are expected to be more cautious than ordinary
    individuals." Thus, before approving a loan, the standard practice for banks and other financial institutions is to
    conduct an ocular inspection of the property offered to be mortgaged and verify the genuineness of the title to
    determine the real owner or owners thereof. Failure to do so makes them mortgagees in bad faith.

    In this case, petitioner contends that Maunlad Savings and Loan Association, Inc. failed to exercise due
    diligence in inspecting and ascertaining the status of the mortgaged property because during the ocular inspection,
    the credit investigator failed to ascertain the actual occupants of the subject property and to discover petitioner’s
    apartment at the back portion of the subject property.

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