#9 DBP VS TOMELDAN  Upon an obligation created by law;

GR # 51269  Upon a judgment

DATE: November 17, 1980  Court agreed with this.
By: Julpha Policina  It has been held that mortgagee in both real and chattel mortgages has by
Petitioners: Development Bank of the Philippines law the right to claim for the deficiency resulting from the price obtained
Respondents: Sps. Rufo Tomeldan and Soledad Castelo, Sps. Pedro Tomeldan and in sale of property at public auction and the outstanding obligation at the
Magdalena Caburian, Sps. Fernando Gabriana and Catalina Tomeldan, Gerardo time of the foreclosure proceedings.
Tomeldan and CFI Pangasinan  Therefore, DBP has the right to claim payment of the deficiency after it had
Ponente: Abad Santos, J. foreclosed the property and that private respondents have the
DOCTRINE: Obligation created by law has a prescriptive period of 10 years. corresponding obligation created by law to pay such deficiency
FACTS:  Since obligation was created by law, Art. 1144 must apply – 10 year
 June 23, 1963: DBP approved and released a loan to the private prescriptive period.
respondents which they promised to pay jointly and severally  Respondent Judge ordered to continue its trial.
 Secured by a real estate mortgage
 Sept. 15, 1967: Mortgage was extrajudicially foreclosed since respondents
failed to pay
 March 14, 1977: There was still deficiency (unpaid balance) so DBP filed
action for the deficiency
 All respondents were declared in default
 Nov. 27, 1978: Lower court dismissed on the ground that the cause of
action has prescribed
o Cause of action of DBP is covered by the 5-year prescriptive
period
o Art. 1149 CC: all other actions whose periods are not fixed in the
code or in other laws must be brought within 5 years from time
the cause of action accrues
o Since deficiency payment accrued on Sept. 16, 1967 (day after
extrajudicial foreclosure and public auction), action should have
been filed within 5 years but DBP filed on March 14, 1977 (less
than 10 years after)
 Hence, this appeal
ISSUE: Whether or not the cause of action of DBP has already prescribed
HELD/RATIO: NO
 It is right that cause of action accrued on Sept. 16, 1967 and case filed on
March 14, 1977 which is less than 10 years after
 As DBP’s contention that the their cause of action must be governed by
Art. 1144 of CC since the obligation of the private respondents to pay the
deficiency is one created by law
o Art. 1144: The following actions must be brought within 10 years
from the time the right of action accrues:
 Upon a written contract;