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REPUBLIC OF THE PHILIPPINES

REGIONAL TRIAL COURT OF NEGROS OCCIDENTAL


Sixth Judicial Region
Branch 69 – Silay City
-o0o-

SPOUSES ARTURO D. AGUIRRE and


LETICIA M. AGUIRRE,
Plaintiffs,

- versus - Civil Case No. 2126-69

FAR EAST BANK & TRUST COMPANY,


FAITH AND WORD MISSION and
REGISTER OF DEEDS OF NEGROS
OCCIDENTAL,
Defendants.
x----------------------------------------------------------x

MEMORANDUM
(For The Plaintiff)

COMES NOW the Plaintiff by the undersigned Counsel and unto this

Honorable Court, most respectfully submits this Memorandum in compliance with

the Order dated May 28, 2005 and thereby avers that:

PRELIMINARY STATEMENT

This is a civil action for Annulment of Auction Sale and Reconveyance of Title

to Real Property with Damages filed by the plaintiff-spouses Arturo and Leticia

Aguirre against the defendants Far East Bank and Trust Co. (now Bank of the

Philippine Islands) and Faith and Word Mission Inc. The defendant Register of

Deeds was likewise impleaded in the complaint of the said plaintiff-spouses as a

nominal party hereof.


The real property subject matter of this case, is located at Manapla, Neg. Occ.

and was formerly registered in the name of the plaintiff-spouses Aguirre. The said

property was allegedly mortgaged to the defendant Far East Bank by a certain

Vicente Jose Garcia on May 24, 1996 by virtue of a Special Power of Attorney dated

April 25, 1996. For failure of Mr. Garcia to pay his account, the defendant Far East

Bank caused the foreclosure of said property and eventually sold the same in favor of

co-defendant Faith and Word Mission Inc. on June 16, 2000.

When the plaintiffs learned of the foreclosure and the eventual sale of the

subject property for the first time in June, 2000, they immediately filed the instant

complaint on the ground that its mortgage and foreclosure thereof is invalid since it

is conjugal property but lacks the consent and participation of the spouse Leticia

Aguirre. Moreover, the foreclosure of the subject property was conducted without

any personal notice made upon the plaintiff-spouses thus violating their basic

constitutional rights to due process. Finally, the eventual sale of the subject property

on June 16, 2000 in favor of defendant Faith and Word Mission Inc. is highly

questionable as said organization was incorporated with the Securities and Exchange

Commission also on June 16, 2000 (see Exhibit “1” of Faith and Word Mission Inc.)

and at the time of incorporation, the registered capital of the said entity per its

Articles of Incorporation was only P500.00. The plaintiff-spouses further maintained

that the sale by defendant Far East Bank of the subject property to defendant Faith

and Word Mission for the price of P375,000.00 was not only illegal but likewise

tainted with bad faith for two (2) out of five (5) of its officers/incorporators were in

fact very close relatives of Vicente Jose Garcia, the person who originally mortgaged

the same property for P1,000,000.00.


STATEMENT OF FACTS

With the indulgence of the Honorable Court, the following enumerated facts

have been established during the trial proper of this case and remain to be

uncontroverted:

1. The real property subject matter of this case, is located at Manapla, Neg. Occ.

and was formerly registered in the name of the plaintiff-spouses Aguirre per

TCT No. T-181202.

2. The subject property was previously acquired by virtue of a Deed of Donation

dated September 23, 1972 (see plaintiffs exhibit “B”) from the late Josefa A.

Garcia and her husband Vicente Garcia and in the said document, both the

names of the plantiff-spouses are specified.

3. Both the plaintiffs Arturo and Leticia Aguirre testified that the clear intention

of the late Josefa Garcia was to donate the subject property to the spouses not

only to Arturo Aguirre but also Leticia Aguirre (October 3, 2001 TSN pp. 21,

26, 41, October 5, 2001 TSN pp. 5-11, January 11, 2002 TSN pp. 12-14).

4. The subject property was mortgaged to the defendant Far East Bank by a

certain Vicente Jose Garcia on May 24, 1996 in order to secure his personal

loan of P1,000,000.00 using a Special Power of Attorney dated April 25, 1996

(see plaintiffs exhibit “C” and “D”).

5. The plaintiff Leticia testified that she never was never a party nor did she sign

the Special Power of Attorney dated April 25, 1996 (October 3, 2001 TSN, p.

22, 36, 37, October 5, 2001 TSN p. 23) leading to the mortgage of the subject

property by Vicente Jose Garcia in favor of defendant Far East Bank. This

matter was corroborated by an independent expert witness from the NBI

Head Office, Mr. Noel Cruz declaring categorically that the alleged signature

appearing as Leticia Aguirre found on the subject SPA was not the real
signature of the plaintiff Leticia Aguirre (see plaintiffs exhibit “L” and March

30, 2005 TSN pp. 15-16).

6. The defendant Far East Bank despite the court subpoena, never produced the

bank records mentioned by witness Gregorio Lauron III in his testimony

(January 6, 2003 TSN pp. 16-30) supposed to support its claim that it

conducted a proper Credit/Character Investigation on the loan obtained by

Vicente Jose Garcia and which is essential to prove that it was in good faith at

the time of the execution of the alleged mortgage over the subject property.

7. For failure of Vicente Jose Garcia to pay his account, the defendant Far East

Bank caused the foreclosure of subject property to which said bank was also

awarded as highest bidder in the amount of P475,000.00. The same property

was eventually sold in favor of defendant Faith and Word Mission Inc. on

June 16, 2000 for the price of only P375,000.00.

8. The foreclosure of the subject property was conducted without any personal

notice made upon the plaintiff-spouses by the defendant Far East Bank as

admitted by former branch manager Gregoria Lauron III (January 6, 2003 TSN

pp. 32-33, 41-42).

9. The defendant Faith and Word Mission was incorporated with the Securities

and Exchange Commission (SEC) only on June 16, 2000 (see Exhibit “1” of

Faith and Word Mission Inc.) which was also the very same date the Deed of

Sale was executed in their favor by defendant Far East Bank and Trust Co. for

the price of P375,000.00. At the time of incorporation on June 16, 2000

however, the total capital of defendant Faith and Word Mission Inc. with the

SEC as clearly specified in its Articles of Incorporation was only P500.00.

10. Two (2) out of five (5) officers/incorporators of defendant Faith and Word

Mission Inc. which eventually brought the subject property for P375,000.00,

were very close relatives of Vicente Jose Garcia, the person who originally
mortgaged the same property for P1,000,000.00. To be precise, Faith and Word

Mission Inc. witness Albert Jo in his testimony categorically admitted that he

is in fact the brother in law of Vicente Jose Garcia (August 13, 2003 TSN pp.

54-55).

ISSUES TO BE RESOLVED

Based on the proceedings from the Pre-Trial Conference and during the course

of the trial, the following are the major issues that need to be resolved in this case:

1. Whether or not the property located at Manapla, Neg. Occ. which is the

subject matter of the present civil action, is a conjugal property of the plaintiff-

spouses Arturo and Leticia Aguirre.

2. Whether or not the Manapla property subject matter of this action was validly

mortgaged in favor of the defendant Far East Bank and Trust Co.

3. Whether or not the defendant Far East Bank and Trust Co. acted in good faith

as the mortgagee of the subject property.

4. Whether or not the defendant Faith and Word Mission Inc. is a buyer in good

faith of the Manapla property subject matter of this action.

5. Whether or not the plaintiff-spouses Aguirre are entitled to the reconveyance

of the Manapla property subject matter of this action as prayed for in the

complaint.

6. Whether or not the plaintiff-spouses are entitled to the damages prayed for in

their complaint against the defendants Far East Bank and Trust Co., (now

Bank of the Philippine Islands) and Faith and Word Mission Inc.
7. Whether or not the defendant Far East Bank and Trust Co. (now Bank of the

Philippine Islands) is entitled to damages prayed for in its counterclaim

against the plaintiffs.

8. Whether or not the defendant Faith and Word Mission Inc. is entitled to

damages prayed for in its counterclaim against the plaintiffs.

ARGUMENTS AND SUBMISSIONS

Anent the 1st Issue - The property located at


Manapla, Neg. Occ. which is subject matter of
the present civil action is a conjugal property of
the plaintiff-spouses Arturo and Leticia Aguirre.

All surrounding circumstances considered and taken collectively, it is the

humble submission of the plaintiffs that the subject property in this case is truly their

conjugal property. To prove this very pivotal issue, the plaintiffs wish to point out

the following supporting facts:

First and foremost, the testimonies of both plaintiffs clearly established that

the very intent of the late Josefa Garcia with her husband Vicente Garcia, was to

donate the subject property to both Arturo and Leticia Aguirre. In fact at the time of

the execution of the Deed of Donation, both plaintiffs personally met and signed the

subject document together with the donor Josefa Garcia upon request of the latter.

This simply indicates that the intention of the donor was to convey the subject

property to both spouses as a sign of said donor’s gratitude and appreciation.

In relation thereto, the plaintiffs wish to cite Article 1370 of the New Civil

Code as the applicable provision on the matter at hand and which provides:

“x x x If the words appear to be contrary to the evident intention of


the parties, the latter shall prevail over the former x x x”
Without doubt, the plantiffs Arturo and Leticia Aguirre are therefore the best

and the only surviving authorities (the donor being already deceased) for purposes

of determining what was the real intention of the late Josefa Garcia with regards to

whom the property was to be given to. As a matter of fact, the testimonies of the

plaintiff-spouses on the intention of the donor were consistent and were never

proven otherwise by the defendant bank nor the defendant Faith and Word Mission.

In fairness to the plaintiff-spouses Aguirre and the donor, none of them are

lawyers who are knowledgeable and well versed on how a Deed of Donation is

supposed to be specifically written in order to reflect their real intentions. In fact, a

close scrutiny of the Deed of Donation dated September 23, 1972 even shows that the

“Donor” referred to in the subject document is not only Josefa Garcia but also her

husband Vicente Garcia and so in the same manner, the term “Donee” is not to be

limited only to Arturo Aguirre but must also cover Leticia Aguirre. At the very least,

it is respectfully submitted that there is some vagueness in the subject Deed of

Donation as to who is/are the “donees” referred to. Substance over form must

therefore be given consideration in this case so as not to frustrate the wishes and real

intentions of the donor. As relatively provided in the rules of statutory construction,

“Let us not interpret the law by the letter that killeth but by the spirit that giveth

life”.

Secondly, the defendant Far East Bank and Trust Co. has impliedly

acknowledged from the beginning that the subject property is conjugal property and

is actually estopped from saying otherwise. For starters, the said bank made use of

the Special Power of Attorney showing the forged signature of plaintiff Leticia

Aguirre in order to successfully annotate the mortgage encumbrance of the subject

property with the Register of Deeds. Moreover, the defendant bank even went to the
extent of claiming and falsely representing that Leticia Aguirre personally went to

the office of Gregorio Lauron III to sign the subject Special Power of Attorney.

For the record, Leticia Aguirre never went to the bank to sign the Special

Power of Attorney nor met Mr. Lauron and this was matter was corroborated by no

less than the NBI which declared that the signature of Mrs. Aguirre on the subject

document is not her real signature. Now why would a reputable bank go to all the

trouble of involving Mrs. Aguirre in the mortgage process and even misrepresent

that she appeared in the office of Mr. Lauron if it truly believed that said person has

no conjugal right to the subject property?

Thirdly, the testimonies of both plaintiffs also established that their

subsequent acts with third parties show that the subject property is indeed treated

and considered as conjugal. Several years after the donation of Josefa Garcia, the

plaintiffs subdivided the donated property into three (3) parts and which matter was

stated in the testimony of Mrs. Aguirre. One part was sold to Vicente Jose Garcia

wherein both spouses affixed their signatures. Another part was mortgaged in favor

of the Rural Bank of Manapla wherein again both spouses affixed their signatures. In

this regard, Article 1371 of the New Civil Code applies and which specifically states:

“x x x In order to judge the intention of the contracting parties, their


contemporaneous and subsequent acts shall be principally considered”

Anent the 2nd Issue- The Manapla property subject


matter of this action was not validly mortgaged in
favor of the defendant Far East Bank and Trust Co.

It is a well-settled legal doctrine that for conjugal property to be validly

disposed, mortgaged or alienated in whatever manner, it needs the consent of both


spouses. In a very related case, the Supreme Court in Embrado vs. Court of Appeals

(G.R. No. 51457, June 27, 1994) held,

“x x x Even assuming in gratia argumenti that Lucia signed the document


knowing that it was a deed of sale of the property, the sale thereof by
Lucia to Eda Jimenez without her husband's conformity should be
considered void ab initio being contrary to law x x x wife cannot bind the
conjugal partnership without the husband's consent, except in cases
provided by law x x x it follows that Lucia Embrado Torregiani could not,
by herself, validly dispose of Lot 564 without her husband's consent x x x”

It was clearly established in this case that the plaintiff Leticia Aguirre did not

sign the Special Power of Attorney used to mortgage the subject property in favor of

defendant Far East Bank and Trust Co., thus, the said mortgage is null and void. The

testimony of Mrs. Aguirre was further corroborated by an impartial third party

witness in the person of Mr. Noel Cruz of the NBI who testified that the signature

found in the questioned Special Power of Attorney is not the authentic signature of

said plaintiff. Neither the defendant Far East Bank nor the defendant Faith and Word

Mission Inc. even seriously contested the findings of the NBI expert witness which

only proves to show that indeed Mrs. Aguirre was not a party to the invalid

mortgage of her subject property.

Anent the 3rd Issue - The defendant Far East


Bank and Trust Co. acted in bad faith as the
mortgagee of the subject property

Despite the subpoena of this Honorable Court, the defendant bank never

produced any of the credit investigation documents it claimed to have made before

releasing the loan to Vicente Jose Garcia as testified by its witness Gregorio Lauron,

III. This would have established the good faith of the bank which had the lawful duty

to investigate and determine whether or not the registered owners of the mortgaged

property were truly consenting to such transaction or not. In the recent case of DBP
vs. Court of Appeals (G.R. No. 129471, April 28, 2000), the Supreme Court had

occasion to rule as follows,

“x x x The evidence before us, however, indicates that petitioner


is not a mortgagee in good faith. To be sure, an innocent
mortgagee is not expected to conduct an exhaustive investigation
on the history of the mortgagor’s title. Nonetheless, especially in
the case of a banking institution, a mortgagee must exercise due
diligence before entering into said contract. Judicial notice is
taken of the standard practice for banks, before approving a loan,
to send representatives to the premises of the land offered as
collateral and to investigate who are the real owners thereof.
Banks, their business being impressed with public interest, are
expected to exercise more care and prudence than private indivi-
duals in their dealings, even those involving registered landsx x”

Moreover, bank witness Gregorio Lauron III further admitted in his testimony

that the subject property was foreclosed without any personal notice made upon the

plaintiff-spouses. In fact, the foreclosure documents introduced by the defendant

bank as its exhibits did not even consider the plaintiffs as a proper party thereof and

completely disregarded them in the foreclosure process which is a utter violation of

their constitutional right to due process. Had the plaintiffs only known of the status

of their property, their testimonies clearly stated that they would have redeemed

their property which was later on sold for only P375,000.00. Finally and for the

record, no single demand letter was presented by the defendant Far East Bank

informing the plaintiff-spouses that their property was already to be foreclosed

which is material to prove the good faith of the said bank.

All points considered, had the defendant Far East Bank only made the

necessary notification or verification with the plaintiffs, this present legal mess

would have been avoided. By totally disregarding the plaintiffs in the entire process

from the mortgage to the foreclosure and eventual sale of the subject property,

defendant Bank is undoubtedly in bad faith and has clearly deprived the spouses of

Aguirre of their constitutional right to due process.


Anent the 4th Issue - The defendant Faith and
Word Mission Inc. is a buyer in bad faith of the
Manapla property subject matter of this action.

From the very start, the bad faith of defendant Faith and Word Mission Inc.

has been very obvious and apparent which in effect renders their purchase of the

subject property as null and void. First of all, the said defendant was incorporated

with the Securities and Exchange Commission (SEC) only on June 16, 2000 (see

Exhibit “1” of Faith and Word Mission Inc.) the very same date it bought the subject

property from defendant Far East Bank as per Deed of Sale. It therefore did not

possess any legal personality at the time it negotiated for the property purchase as

contemplated in Section 19 of the Corporation Code which states,

“Sec. 19. A private corporation formed or organized under


this code commences to have corporate existence and
juridical personality and is deemed incorporated from the
date the SEC issued the certificate of incorporation under
its official seal x x x”

Secondly, the total capital of defendant Faith and Word Mission Inc. at the

time of its incorporation on June 16, 2004 was only P500.00 but surprisingly, it was

able to purchase the subject property on the same day for the price of P375,000.00.

Thirdly, it is very intriguing to note that two (2) out of five (5) officers/incorporators

of the defendant Faith and Word Mission Inc. were very close relatives of Vicente

Jose Garcia, the person who originally mortgaged the subject property. (Director

Albert Jo is in fact the brother in law of Vicente Jose Garcia). Fourth, Vicente Jose

Garcia mortgaged the subject property for P1,000,000.00 and the corporation where

his brother-in-law Albert Jo is a director, later bought the same property for only

P375,000.00. Finally, the officers/directors of defendant Faith and Word Mission Inc.

personally knew the plaintiff-spouses Aguirre for a long time already yet they
claimed that they did not know that said spouses were still in possession of the

subject property at the time they bought the same nor did they even personally

inquire with them as to the status of the said property prior to the sale.

The foregoing circumstances considered, it appears that the acts of the

defendant Faith and Word Mission Inc. and its directors/incorporators appear to be

very scheming and highly suspicious. At the very least, said collective acts manifestly

show the evident bad faith of said corporation. It is basic in our existing Torrens

system that a buyer of real property which is in the possession of persons other than

the seller should investigate the rights of those in possession. Otherwise, without

such inquiry, the buyer can hardly be regarded as a buyer in good faith. (Cardente v.

Intermediate Appellate Court, G.R. No. 73651, 27 November 1987, 155 SCRA 685,

690-691). Moreover, when a man proposes to buy or deal with realty, his first duty is

to read the public manuscript to look and see who is there upon it, and what are his

rights. The buyer who has failed to know or discover that the land sold to him is in

the adverse possession of another, is a buyer in bad faith. (J.M. Tuason & Co., Inc., v.

Court of Appeals, No. L-41233, 21 November 1979, 94 SCRA 413, 422-423; see also

Angelo v. Pacheco, 56 Phil. 70 [1931]; Andaya v. Manansala, 107 Phil. 1151 [1960]).

Finally, the decision of the high tribunal in DBP vs. Court of Appeals (G.R.

No. 129471, April 28, 2000) also applies in this case. The high court ruled,

“In other words, petitioner was already aware that a person


other than the registered owner was in actual possession of
the land when it bought the same at the foreclosure sale. A
person who deliberately ignores a significant fact which
would create suspicion in an otherwise reasonable man is
not an innocent purchaser for value. It is a well-settled rule
that a purchaser cannot close his eyes to facts which should
put a reasonable man upon his guard, and then claim that
he acted in good faith under the belief that there was no
defect in the title of the vendor x x x

One who purchases real property which is in the actual


possession of another should, at least, make some inquiry
concerning the right of those in possession. The actual
possession by other than the vendor should, at least put
the purchaser upon inquiry. He can scarcely, in the
absence of such inquiry, be regarded as a bona fide
purchaser as against such possessors x x x"

Anent the 5th Issue - The plaintiff-spouses Aguirre


are entitled to the reconveyance of the Manapla
property subject matter of this action as a result
of the illegal mortgage and foreclosure by the
defendant Far East Bank and Trust Co. and
subsequent invalid sale to the defendant Faith
and Word Mission Inc.

It is undisputed and acknowledged by all party litigants that prior to the

foreclosure of the subject property, the same was registered in the name of the

plaintiffs as per TCT No. T-181202. The lack of marital consent with respect to the

mortgage of said property in 1996 as earlier discussed, renders the transaction with

defendant Far East Bank as null and void applying the ruling of the Supreme Court

in Embrado vs. Court of Appeals (supra).

The defendant Faith and Word Mission Inc. later bought the subject property

from the defendant bank but said transaction was likewise tainted with evident

malice and bad faith. As admitted by Faith and Word Mission Inc. witnesses Wanda

Casper and Albert Jo in their respective testimonies, they did not even personally

inquire from the registered owners Arturo and Leticia Aguirre on the status of the

subject property or why they are still in possession of the same at the time of the

alleged sale. Had they done so, defendant Faith and Word Mission Inc. would have

discovered the utter defect in the mortgage and the highly suspicious arrangement

entered into by Vicente Jose Garcia with the defendant bank. On the other hand, it is

even possible that defendant Faith and Word Mission, Inc. all together ignored these

irregularities surrounding the subject property so that they may just proceed
hurriedly with the illegal titling thereof in their favor. In any case, there is evident

bad faith on the part of defendant Faith and Word Mission Inc. applying the earlier

discussed ruling of DBP vs. Court of Appeals (supra).

The foregoing circumstances considered, it is the humble position of the

herein plaintiffs that the legal effect of the lack of marital consent on the mortgage of

the subject property is that as if there was no mortgage at all and the subsequent

consolidation of title in favor of defendant bank was invalid. The bad faith of the

defendant Faith and Word Mission Inc. as purchaser of the same property, also

subjects it to the same legal defects as that of defendant bank and so as if no

conveyance was actually effected as a result. By reason of the foregoing, the plaintiffs

now submit that they are entitled to the reconveyance of the subject property in their

favor since the mortgage in the first place was null and void and such utter defect

extends to the third part buyer defendant Faith and Word Mission Inc.

Anent the 6th Issue - The plaintiff-spouses are


entitled to the damages prayed for in their
complaint against defendants Far East Bank
and Trust Co., (now Bank of the Philippine
Islands) and Faith and Word Mission Inc.

During the course of the trial, both plaintiffs testified that they were

personally affected by the unjustified taking of their property which has resulted to

their emotional and mental distress. Pertinent excerpts of the separate testimonies of

the plaintiffs on two separate occasions, illustrate their personal feelings on the

subject matter as follows,

“Atty. Arbolado: The basis of your claim for damages is your


allegation that the property is conjugal?

Arturo Aguirre: Not only as far as we claim that the


property is conjugal but also of the pain we
felt that we have cultivated the said lot, had
I known that VJ Garcia would be able to
secure the loan of P1 Million using the lot
as collateral, I would have been one to secure
the loan x x x” (January 11, 2002 TSN p.24)

“Atty. Arbolado: When did you confront your husband and


discovered that there was this Special
Power of Attorney? x x x

Leticia Aguirre: My husband and my children went to Far


East Bank to make inquiries as to why the
poperty was foreclosed. They went back
several times, then they showed me this
Special Power of Attorney. I was enraged
because I had no idea of any transaction
relative to that property, and I had not
signed this document x x x” (October 5,
2001 TSN, pp. 26-27)

Moreover, the plaintiffs have also incurred legal costs as a result of bringing

their case in court which was confirmed by Arturo Aguirre in his testimony dated

October 29, 2001 (see TSN pp. 31-32).

It is evident from the records and testimonies presented that there was already

bad faith demonstrated from the very start by the defendants Far East Bank and

Faith and Word Mission Inc. resulting to the prejudice of the plaintiffs. By reason

thereof, the spouses Arturo and Leticia Aguirre who have considerably suffered in

the process, are therefore entitled to all the damages prayed for in their complaint.

Anent the 7th Issue - The defendant Far East Bank


and Trust Co. (now Bank of the Philippine Islands)
is not entitled to damages it has prayed for in its
counterclaim against the plaintiffs.

With all due respect, the defendant Far East Bank has no other else to blame

for in this legal action but itself. Had it only exercised the necessary precautions and

observed the basic guidelines set out in its Manual of Regulations as mandated by

the Central Bank, this legal suit would have been avoided from the very beginning.
There were simply so many instances in this case that showed the glaring negligence

of the defendant bank in handling the alleged mortgage of the subject property - the

defective signing of the Special Power of Attorney and its illegal use thereof, the lack

or even absence of credit investigation support documents, the sale of the property

for P375,000.00 to a new corporation whose incorporators are relatives of the debtor

Vicente Jose Garcia (who got P1,000,000.00 for the mortgage of the same property a

several years back!), the total lack of any notice whatsoever to the registered owners

before foreclosure and consolidation of the subject property and many more.

All circumstances considered, the defendant bank is therefore not entitled to

the damages prayed in its counterclaim as the filing of the instant action by the

plaintiffs was undoubtedly justified and was in fact brought about by the very

negligence and bad faith of the defendant Far East Bank and Trust Co.

Anent the 8th Issue - The defendant Faith


and Word Mission Inc. is not entitled to
damages it has prayed for in its counter-
claim against the plaintiffs.

The plaintiffs respectfully submit that one of the principal causes to this

present legal mess is the defendant Faith and Word Mission Inc. More specifically,

such mess was brought about by some of the said defendants

incorporators/directors related to the Vicente Jose Garcia who on the other hand

personally received a P1,000,000.00 loan by reason of the mortgage of the subject

property. The defendant Faith and Word Mission Inc. is undoubtedly in bad faith for

it later bought the same property at only P375,000.00 without exercising the

necessary diligence of a good buyer and considering that the plaintiffs were still in

possession thereof.
By reason of which, the damages prayed for by the defendant Faith and Word

Mission Inc. should be dismissed as said corporation is in fact even guilty of taking

advantage of the situation and is obviously in bad faith since the time of their

incorporation. The basic legal premise “those who go to court or ask for relief thereof

must do so with clean hands” should now come into play in this situation for the

purpose of determining whether or not said defendant is truly entitled to the

damages it has prayed for in its counterclaim.

PRAYER

WHEREFORE, premises considered, it is most respectfully prayed of this

Honorable Court to now render a decision awarding all the reliefs and remedies

prayed for by the plaintiff-spouses Aguirre in their complaint and denying all the

counterclaims of defendants Far East Bank and Trust Co. and Faith and Word

Mission Inc. for utter lack of merit and legal basis.

Respectfully Submitted.

Bacolod City for Silay City, Neg. Occ., Philippines, July 12, 2005.

AMEGO & ASSOCIATES LAW OFFICE


Counsel for the Plaintiff-Spouses Aguirre
Mezzanine Floor, Ilbenna Building
Lacson-Luzuriaga Sts., Bacolod City

BY:

PACIFICO M. MAGHARI, III


PTR No. 1873750 B. C. Dec. 29, 2004
IBP No. 629734 B. C. Dec. 29, 2004
ROLL OF ATTORNEY’S NO. 44869
COPY FURNISHED

ATTY. ROEM J. ARBOLADO


Counsel for the Defendant
FAR EAST BANK & TRUST CO. (BPI)
Midtown Arcade, Rosario-Araneta Sts.
Bacolod City

ATTY. JOSE MAX ORTIZ


Counsel for the Defendant
FAITH & WORD MISSION, INC.
Corner Canary & Stork Sts., PHHC
(Montevista) Bacolod City

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