Sec Trans Cases Digests

8/13/2019 Sec Trans Cases Digests

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SECURITIES TRANSACTIONSCourse Outline

LOANCIVIL CODE (NCC) ARTICLE 1933 1934

Article 1933.By the contract o !oan" one o the #art$e% &e!$'er% to another" e$ther %oeth$n not con%*a+!e %o that the!atter ay *%e the %ae or a certa$n t$e an& ret*rn $t" $n ,h$ch ca%e the contract $% ca!!e& a coo&at*- or oney orother con%*a+!e th$n" *#on the con&$t$on that the %ae ao*nt o the %ae .$n& an& /*a!$ty %ha!! +e #a$&" $n ,h$chca%e the contract $% %$#!y ca!!e& a !oan or *t**0

Coo&at* $% e%%ent$a!!y rat*$to*%0$#!e !oan ay +e rat*$to*% or ,$th a %t$#*!at$on to #ay $ntere%t0In coo&at* the +a$!or reta$n% the o,ner%h$# o the th$n !oane&" ,h$!e $n %$#!e !oan" o,ner%h$# #a%%e% to the

+orro,er0

10 People v. Concepcion,44 2h$!0 1" 50R0 No0 19196" No'e+er " 1907BINAR(o*rce8htt#8,,,0%cr$+&0co&oc:6;;39:e&an e?ten%$on o cre&$t $n a'or o @2*no y Conce#c$on" 0 en C0 to the anaer o the A#ar r$ +ranch o the2h$! $##$ne Nat$ona! Ban.0

@2*no y Conce#c$on" 0 en C0 @,a% a co7#artner%h$# ,here Conce#c$on $% a #artner0

*+%e/*ent!y" Conce#c$on ,a% chare& an& o*n& * $!t y $ n the Co*rt o $r%t In% tance o Caaya n ,$th'$o!at$on o %ect$on 3; o ActNo0 < 4 < 0 e c t $ o n 3 ; o A c t N o 0 < 4 < # r o ' $ & e % t h a t t h e N a t $ o n a ! B a n . % h a ! !n o t " & $ r e c t ! y o r $n&$rect!y" rant !oan% to any o the e+er% o the +oar& o &$rector% o the +an. nor toaent% o th e +ranch +an.%0

Co*n%e! or the &een%e ar* e that t he &oc*ent% o reco r& &o no t #ro'e that a*thor$ty to a.e a!oan ,a% $'en" +*t on!y %ho, the conce%%$on o a cre&$t0 They a'erre& that the ran t$n o a cre& $t to theco7#artner%h$# @2*no y Conce#c$on" 0 en C0@ +y Venanc$o Conce#c$on" 2re%$&ent o the2h$!$ ##$n e Na t$ona ! Ban." $% n ot a @!oan@ ,$th$ n t he ean $n o %ect$on 3; o Act No0


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+*t the coo&at* or %$#!e !oan $t%e! %ha!! not +e #erecte& *nt$! the &e!$'ery o the o+Hect o the contract

10 a*ra I#ort '0 DB2" 44 CRA 44;" 50R0 No0 L749:" A#r$!


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o An acce#te& #ro$%e to &e!$'er %oeth$n +y ,ay o coo&at* or %$#!e !oan $% +$n&$n *#on the#art$e%" +*t the coo&at* or %$#!e !oan $t%e! %ha!! not +e #erecte& *nt$! the &e!$'ery o the o+Hect othe contract

The o+Hect o the contract $n th$% ca%e $% the !oan #rocee&% ,h$chA*rora K*eao ,o*!& enHoy on!y *#on theenca%hent o the chec.% %$ne& or $n&or%e& +yCe!e%t$naNa*$at0

I $n&ee& the chec.% ,ere enca%he& or &e#o%$te&" Ce!e%t$naNa*$at ,o*!& ha'e certa$n!y #re%ente& thecorre%#on&$n &oc*entary e'$&ence" %*ch a% the ret*rne& chec.% an& the #ert$nent +an. recor&%0

o $nce Na*$at #re%ente& no %*ch #roo" $t o!!o,% that the chec.% ,ere not enca%he& or cre&$te& toK*eaoF% acco*nt0

A#!e e'$&ence that R*+y R*e+ene!&t $% a*thor$>e& aent o Na*$at R*e+ene!&t to!& to ho!& chec.% or K*eano #en&$n &e!$'ery o a&&$t$ona! co!!atera!

30 Th$o '0 5arc$a" ;1: CRA 433" 50R0 No0 1;4:


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+*!!% ,$th a &e&*ct$on o year!y &e#rec$at$on0 The D$rector a&'$%e& h$ that the 'a!*e cannot +e &e#rec$ate& an& a%.e&

Bata% to e$ther ret*rn the +*!!% or #ay the$r +oo. 'a!*e0

Bata% ne$ther #a$& nor ret*rne& the +*!!%0 The Re#*+!$c then coence& an act$on aa$n%t Bata%

or&er$n h$ to ret*rn the +*!!% or #ay the$r +oo. 'a!*e0

Ater hear$n" the tr$a! Co*rt r*!e& $n a'or o the Re#*+!$c" a% %*ch" the Re#*+!$c o'e& e? #arte or a

,r$t o e?ec*t$on ,h$ch the co*rt rante&0

e!$c$&a& Bata%" the %*r'$'$n %#o*%e an& a&$n$%trator o Bata%F e%tate" ret*rne& the t,o +*!!% an&

$!e& a ot$on to /*a%h the ,r$t o e?ec*t$on %$nce one +*!! cannot +e ret*rne& or $t ,a% .$!!e& +y *n%hot &*r$n a =*.

ra$&0 The Co*rt &en$e& her ot$on hence" th$% a##ea! cert$$e& +y the Co*rt o A##ea!% +eca*%e on!y /*e%t$on% o !a,

are ra$%e&0

ISSUE8 ON the contract ,a% coo&at*-th*%" Bata% +e he!& !$a+!e or $t% !o%% &*e to orce aHe*re0

RULIN8

A contract o coo&at* $% e%%ent$a!!y rat*$to*%0 *#ree Co*rt he!& that Bata% ,a% !$a+!e or the !o%% o

the +*!! e'en tho*h $t ,a% ca*%e& +y a ort*$to*% e'ent0

I the contract ,a% one o !ea%e" then the 16 +ree&$n chare $% co#en%at$on (rent) or the *%e o the +*!!

an& Bata%" a% !e%%ee" $% %*+Hect to the re%#on%$+$!$t$e% o a #o%%e%%or0 =e $% a!%o $n +a& a$th +eca*%e he cont$n*e& to

#o%%e%% the +*!! e'en tho*h the ter o the contract ha% a!rea&y e?#$re&0

I the contract ,a% one o coo&at*" he $% %t$!! !$a+!e +eca*%e8 (1) he .e#t the +*!! !oner than the #er$o&

%t$#*!ate&- an& () the th$n !oane& ha% +een &e!$'ere& ,$th a##ra$%a! o $t% 'a!*e (16)0 No %t$#*!at$on that $n ca%e o

!o%% o the +*!! &*e to ort*$to*% e'ent the !ate h*%+an& o the a##e!!ant ,o*!& +e e?e#t ro !$a+$!$ty0

The or$$na! #er$o& o the !oan ,a% ro : ay 194: to < ay 19490 The !oan o one +*!! ,a% rene,e& or

another #er$o& o one year to en& on : ay 19;60 B*t the a##e!!ant .e#t an& *%e& the +*!! *nt$! No'e+er 19;3 ,hen

&*r$n a =*. ra$& $t ,a% .$!!e& +y %tray +*!!et%0

*rtherore" ,hen !ent an& &e!$'ere& to the &ecea%e& h*%+an& o the a##e!!ant the +*!!% ha& each an

a##ra$%e& +oo. 'a!*e" to ,$th8 the $n&h$" at 21"1


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PTC Q CA8 r*!e& $n a'or o V$'e%0Issue$s(1)ON the tran%act$on $% a coo&at* or a *t**0 COODATG0() ON the act that there $% an a&&$t$ona! 21"666 (a!!ee&!y re#re%ent$n $ntere%t) $nthe ao*nt to +e ret*rne& to V$'e% con'ert% the tran%act$on ro coo&at*to*t**0 NO0(3)ON 2ro&*cerF% Ban. $% %o!$&ar$!y !$a+!e to V$'e%" con%$&er$n that $t ,a% not #r$'y tothe tran%act$on+et,een V$'e% an& Doron$!!a0 E0!el)$R&tio(1)The tran%act$on $% a coo&at*0PCC 1933 (the #ro'$%$on &$%t$n*$%h$n +et,een the t,o .$n&% o !oan%) %ee to $#!ythat $ the %*+Hect o the contract $% acon%*a+!e th$n" %*ch a% oney" the contract,o*!& +e a *t**0 =o,e'er" there are $n%tance% ,hen a coo&at*ay ha'e or$t% o+Hect a con%*a+!e th$n0 *ch can +e o*n& $n CC 193 ,h$ch %tate% thatcon%*a+!e oo&% ay+e the %*+Hect o coo&at* $ the #*r#o%e o the contract$% not the con%*#t$on o the o+Hect" a% ,hen $t $% ere!y ore?h$+$t$on0 In th$% ca%e"the $ntent$on o the #art$e% ,a% ere!y or e?h$+$t$on0 V$'e% aree& to &e#o%$t h$% oney$n tre!aF%acco*nt %#ec$$ca!!y or #*r#o%e o a.$n $t a##ear that trea! ha& %*$c$entca#$ta!$>at$on or $ncor#orat$on" ,$ththe #ro$%e that the ao*nt %ho*!& +e ret*rne&

Article 19*.The +a$!ee $% !$a+!e or the !o%% o the th$n" e'en $ $t %ho*!& +e thro*h a ort*$to*% e'ent8(1) I he &e'ote% the th$n to any #*r#o%e &$erent ro that or ,h$ch $t ha% +een !oane&-() I he .ee#% $t !oner than the #er$o& %t$#*!ate&" or ater the acco#!$%hent o the *%e or ,h$ch thecoo&at* ha% +een con%t$t*te&-(3) I the th$n !oane& ha% +een &e!$'ere& ,$th a##ra$%a! o $t% 'a!*e" *n!e%% there $% a %t$#*!at$on e?e#t$n the

+a$!ee ro re%#on%$+$!$ty $n ca%e o a ort*$to*% e'ent-(4) I he !en&% or !ea%e% the th$n to a th$r& #er%on" ,ho $% not a e+er o h$% ho*%eho!&-(;) I" +e$n a+!e to %a'e e$ther the th$n +orro,e& or h$% o,n th$n" he cho%e to %a'e the !atter0

10 Re#*+!$c '0 Bata%" CRA " 50R0 No0 L71


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The a##e!!ant conten&% that the contract ,a% coo&at* an& that" or that rea%on" a% the a##e!!ee reta$ne& o,ner%h$#or t$t!e to the +*!! $t %ho*!& %*er $t% !o%% &*e to orce aHe*re0

A contract o coo&at* $% e%%ent$a!!y rat*$to*%0 I the +ree&$n ee +e con%$&ere& a co#en%at$on" then the contract,o*!& +e a !ea%e o the +*!!0

Gn&er art$c!e 1


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R*!$n8 The a##ea!e& H*&ent $% o&$$e& an& the &een&ant $% or&ere& to ret*rn an& &e!$'er to the #!a$nt$" $n the re%$&ence or ho*%e o the!atter"

a!! the *rn$t*re &e%cr$+e& $n #arara#h 3 o the %t$#*!at$on o act0 The e?#en%e% ,h$ch ay +e occa%$one& +y the &e!$'ery to an& &e#o%$t othe *rn$t*re ,$th the her$ %ha!! +e or the acco*nt o the &een&ant0 The &een&ant %ha!! #ay the co%t% $n+oth $n%tance%0 o or&ere&

30 2aH*yo '0 CA" 436 CRA 49" 50R0 No0 1434" *ne 3" 664072ABALANo*rce8 htt#8ant%!ea!0+!o%#ot0co6111&$e%t%7cre&$t7tran%act$on%0ht!F&cts2aH*yo entr*%te& a ho*%e to 5*e'ara or the !atterS% *%e #ro'$&e& he %ho*!& ret*rn the %ae *#on &ean& an&,$th the con&$t$on that 5*e'ara %ho*!& +e re%#on%$+!e o the a$ntenance o the #ro#erty0 G#on &ean& 5*e'ara re*%e&to ret*rn the #ro#erty to 2aH*yo0 The #et$t$oner then $!e& an eHectent ca%e aa$n%t 5*e'ara ,$th the TC ,ho r*!e& $na'or o the #et$t$oner0 On a##ea! ,$th the CA" the a##e!!ate co*rt re'er%e& the H*&ent o the !o,er co*rt on the ro*n&that +oth #art$e% are $!!ea! %ett!er% on the #ro#erty th*% ha'e no !ea! r$ht %o that the Co*rt %ho*!& !ea'e the #re%ent%$t*at$on ,$th re%#ect to #o%%e%%$on o the #ro#erty a% $t $%" an& r*!$n *rther that the contract*a! re!at$on%h$# o 2aH*yoan& 5*e'ara ,a% that o a coo&at*0

IssueI% the contract*a! re!at$on%h$# o 2aH*yo an& 5*e'ara that o a coo&at*

!el)No0 The Co*rt o A##ea!%F theory that the a%*n&*an $% one o coo&at* $% &e'o$& o er$t0 In a contract ocoo&at*" one o the #art$e% &e!$'er% to another %oeth$n not con%*a+!e %o that the !atter ay *%e the %ae or acerta$n t$e an& ret*rn $t0 An e%%ent$a! eat*re o coo&at* $% that $t $% rat*$to*%0 Another eat*re o coo&at* $%that the *%e o the th$n +e!on$n to another $% or a certa$n #er$o&0 Th*%" the +a$!or cannot &ean& the ret*rn o the th$n!oane& *nt$! ater e?#$rat$on o the #er$o& %t$#*!ate&" or ater acco#!$%hent o the *%e or ,h$ch the coo&at* $%con%t$t*te&0 I the +a$!or %ho*!& ha'e *rent nee& o the th$n" he ay &ean& $t% ret*rn or te#orary *%e0 I the *%e o

the th$n $% ere!y to!erate& +y the +a$!or" he can &ean& the ret*rn o the th$n at ,$!!" $n ,h$ch ca%e the contract*a!re!at$on $% ca!!e& a #recar$*0 Gn&er the C$'$! Co&e" #recar$* $% a .$n& o coo&at*0 The a%*n&*an re'ea!% that theaccoo&at$on accor&e& +y 2aH*yo to 5*e'arra ,a% not e%%ent$a!!y rat*$to*%0 h$!e the a%*n&*an &$& not re/*$re5*e'arra to #ay rent" $t o+!$ate& h$ to a$nta$n the #ro#erty $n oo& con&$t$on0 The $#o%$t$on o th$% o+!$at$on a.e%the a%*n&*an a contract &$erent ro a coo&at*0 The eect% o the a%*n&*an are a!%o &$erent ro that o acoo&at*0 Ca%e !a, on eHectent ha% treate& re!at$on%h$# +a%e& on to!erance a% one that $% a.$n to a !an&!or&7tenantre!at$on%h$# ,here the ,$th&ra,a! o #er$%%$on ,o*!& re%*!t $n the ter$nat$on o the !ea%e0 The tenantF% ,$thho!&$n othe #ro#erty ,o*!& then +e *n!a,*!0

SIPLE LOANNCC ARTICLE 19;37191

Article 1923.A #er%on ,ho rece$'e% a !oan o oney or any other *n$+!e th$n ac/*$re% the o,ner%h$# thereo" an& $%+o*n& to #ay to the cre&$tor an e/*a! ao*nt o the %ae .$n& an& /*a!$ty0

10 Re#*+!$c '0 5r$Ha!&o" 1; CRA :1" 50R0 No0 L7646" Dece+er 31" 19;07ORTE

Repu6lic o' t%e P%ilippines v. 7ose ri8&l)o -19420

F&cts

19438 5r$Ha!&o o+ta$ne& ; %er$e% o !oan% ro Ban. o Ta$,an $n Baco!o& C$ty $n the ao*nt o 21":109*e!a" CRA 1" 50R0 No0 L73:a an& Re&$c*!o Va!&eh*e>a rea$ne& $n the #o%%e%%$on o the !an&0

A co#!a$nt or $nH*nct$on $!e& +y Tan to enHo$n the Va!&eh*e>a% @ro enter$n the #arce! o !an& an& ather$n the n*t%there$n 0000@ Th$% co#!a$nt an& the co*nterc!a$ ,ere %*+%e/*ent!y &$%$%%e& or a$!*re o the #art$e% @to %ee. or the$e&$ate tr$a! thereo" th*% e'$nc$n !ac. o $ntere%t on the$r #art to #rocee& ,$th the ca%e0ro+!e% '$rt*a! !a, !$+raryThe Dee& o 2acto &e Retro reerre& to ,a% not re$%tere& $n the Re$%try o Dee&%" ,h$!e the n& Dee& o 2acto &e Retro,a% re$%tere&0

I%%*e8hether the tran%act$on% +et,een the #art$e% ,ere %$#!e !oan

=e!&8NO0 Gn&er art$c!e 1:a% ha'$n rea$ne& $n #o%%e%%$on o the !an& an& the rea!ty ta?e% ha'$n +een #a$& +y the" the contract%,h$ch #*r#orte& to +e #acto &e retro tran%act$on% are #re%*e& to +e e/*$ta+!e ortae%" ; ,hether re$%tere& or notthere +e$n no th$r& #art$e% $n'o!'e&0

0 ar&en$! '0 o!a%"


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On < Dec 1996" Bo+$e Ro%e r$a% an& Dr0 !ora an7D$eo $%on entere& $nto a OA o'er r$a%F#ro#erty OA con%$&erat$on $% 3

$%on ha% onth% ro the &ate o contractF% e?ec*t$on to not$y r$a% o her $ntent$on to #*rcha%e the #ro#erty,$th the $#ro'eent% at 04

2r$or to th$% onth #er$o&" r$a% ay %t$!! oer the #ro#erty to other #er%on%" #ro'$&e& that 3 %ha!! +e #a$& to$%on $nc!*&$n $ntere%t +a%e& on #re'a$!$n co#o*n&e& +an. $ntere%t U ao*nt o %a!e $n e?ce%% o


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On a##ea!" #et$t$oner o##o%e the $#o%$t$on o #er onth0 CA *#he!& the &ec$%$on o the TC" ,h$ch o*n& +a%$% on theareeent ,here $t %t$#*!ate% that non #ayent ,$th$n 1; &ay% or ,$!! $nc*r a onth!y $ntere%t0

2et$t$oner ar*e% that a!tho*h the Areeent conta$ne& a #ro'$%$on ,$th rear& to the $ntere%t" th$% #ro'$%$on ,a% notent$one& +y the tr$a! co*rt $n a,ar&$n $ntere%t $n the &$%#o%$t$'e #ort$on0 Th$% #ro'$%$on o the Areeent &oe% not a##!yto the c!a$ o re%#on&ent +*t reer% to the @onth!y #rore%% +$!!$n%0@ The ao*nt o 29"4340arraa y 5a!'e>@" the &een&ant% %*rnae& A>arraa +ecae $n&e+te& to

Attorney Leo&ear$o A>arraa" ,ho re#re%ente& the $n %a$& ca%e" or attorneyS% ee%" ,h$ch on Octo+er 1" 1919the co*rt" ,h$ch too. con$>ance o the ca%e" $?e& at 23"666 (E?h$+$t B)0

The &een&ant% A>arraa ha& #re'$o*%!y aree& aon the%e!'e% to #ay Attorney Leo&ear$o A>arraaattorneyS% ee% $n the anner %et o*t $n E?h$+$t A" ,h$ch they e?ec*te& on an*ary 6" 1919 an& a##ro'e& +y theco*rt on A**%t 9" o the %ae year0 (E?h$+$t C0) The #ert$nent #art o the aore%a$& E?h$+$t A rea&% a% o!!o,%8

o The #art$e% a!%o aree that the #arce!% o !an& !ocate& $n Bay7an" Ne, a%h$nton" Ca#$>" 20 I0" ,h$ch

are en*erate& $n the $n'entory o th$% #art$t$on a% No%0 :1" : an& :3" are %#ec$a!!y ortae& an&%*+Hect to the #ayent o the ee% o %a$& attorney o the te%tate e%tate" ,h$ch ee% %ha!! +e $?e& +y theco*rt" an& %a$& attorney ay ho!& %a$& !an&% *n&er no o+!$at$on to #ay any rent *nt$! h$% ee% %ha!! ha'e+een *!!y #a$&8 Provided, however" that $" at the en& o the #er$o& o $'e year% ro the &ate o thea##ro'a! o th$% #roHect o #art$t$on" %a$& #art$e% %ha!! not ha'e +een a+!e to #ay $n *!! the ee% o %a$&

attorney" then %a$& #arce!% o !an&" No%0 :1" : an& :3" !ocate& $n Bay7an" %ha!! +e &e$n$te!y a&H*&$cate&to %a$& attorney" r0 Leo&ear$o A>arraa" a% h$% #ro#erty" $n #ayent o h$% ee%" an& a!! %*% ,h$ch heay ha'e rece$'e& ro t$e to t$e ro the $ntere%te& #art$e% $n the%e te%tate #rocee&$n%" ,$th$n the%a$& #er$o&" %ha!! +e ret*rne& to %a$& #art$e%8 Provided, further" that $n ca%e %a$& $ntere%te& #art$e% $n thete%tate #rocee&$n% %ha!! +e a+!e to #ay $n *!! the ee% o the attorney or the e%tate +eore the e?#$rat$ono %a$& #er$o& o $'e year%" then %a$& #arce!% o !an& %$t*ate& $n Bay7an %ha!! cont$n*e $n the #o%%e%%$ono %a$& attorney or an a&&$t$ona! #er$o& o three year% ro the &ate o the !a%t #ayent $n the e'ent that%a$& attorney ay ha'e .e#t !$'e%toc. $n %a$& !an&%0

On *ne 9" 196" ,h$ch ,a% !on +eore the e?#$rat$on o the #er$o& o $'e year% ,$th$n ,h$ch the &een&ant%A>arraa ,ere +o*n& to #ay Attorney Leo&ear$o A>arraa h$% ee%" ,h$ch ha& +een $?e& at 23"666" %a$&attorney &ec$&e& to %e!! an& &$& %e!! to the o%*e onc*ya h$% cre&$t aa$n%t the &een&ant% or the %* o 2";66,$th a!! the r$ht% $nherent there$n $n accor&ance ,$th the areeent% an& %t$#*!at$on% a##ear$n $n %a$&&oc*ent0


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hen the onc*ya +ecae the cre&$tor o the &een&ant% A>arraa +y '$rt*e o the %a!e an& ce%%$on ,h$chAttorney A>arraa ha& a&e $n h$% a'or o the r$ht% ,h$ch %a$& attorney ha& *n&er E?h$+$t A" he a!!o,e& the&een&ant% an e?ten%$on o a e, year% o'er the $'e year% ,$th $n ,h$ch they ,o*!& ha'e to #ay h$ h$% cre&$t" o*# to e+r*ary 1" 19" +*t ,$th the e?#re%% con&$t$on that they ,o*!& #ay h$ $ntere%t at the rate o 1 #er cent#er ann*" ro A**%t 36" 1940 Th$% ter ,a% !ater e?ten&e& to A#r$! " 19 on the re/*e%t o the&een&ant%" +*t a!%o ,$th the con&$t$on that they ,o*!& #ay the #!a$nt$ the %ae $ntere%t o 1 #er cent0 The#!a$nt$ rante& another e?ten%$on to e?#$re on Octo+er 31" 19:" +*t %*+Hect to the con&$t$on that $n%tea& o%e'en tho*%an& an& o&& #e%o%" ,h$ch *n&o*+te&!y reerre& to the $ntere%t o 1 #er cent #er ann* chare& the&een&ant%" they %ho*!& #ay h$ 21"6660 In %a$& t,o ao*nt% o 2arraa y 5a!'e>"con%$%t$n o an *n&$'$&e& tract o !an& conta$n$n an e%t$ate& area o 3 hectare% an& !ocate& $n Bay7an Ch$coNe, a%h$nton" Ca#$>0 It $% *rther %tate& there$n that the #er$o& o re&e#t$on ,o*!& +e $'e year% to +eco*nte& ro e+r*ary 1" 191" ,h$ch ,a% !ater e?ten&e& to A#r$! " 190 In rant$n h$ th$% e?ten%$on" the#!a$nt$ $#o%e& on oa/*$n A>arraa the con&$t$on that he %ho*!& #ay h$ $ntere%t at the rate o 1 #er cent rothe e?#$rat$on o the $r%t ter (E?h$+$t - #ar0 III o the %econ& aen&e& co#!a$nt o #!a$nt$- an& #ae ; o the+r$e o the #!a$nt$ a% a##e!!ant)0 A %econ& e?ten%$on ,a% *rther rante&" +*t *n&er the con&$t$on that he %ho*!&toether ,$th h$% +rother%" #ay the #!a$nt$ $n%tea& o %e'en tho*%an& an& o&& #e%o%" re#re%ent$n the $ntere%treerre& to $n the #rece&$n #arara#h" $n ,h$ch the 23"666 ent$one& $n E?h$+$t A ,ere $nc!*&e&" 21"6660

I%%*e81) a% the contract entere& $nto +y7the A>arraa +rother%" the &een&ant% here$n" ,$th Attorney Leo&ear$o

A>arraa ro ,ho the #!a$nt$ &er$'e& h$% r$ht" a %a!e ,$thpacto de retro" or an a%%$nent $n #ayent o a&e+t" or ,a% $t an ant$chre%$% #arta.$n o the nat*re o ,hat ,a% anc$ent!y .no,n a% pacto comisorio" or aortae" or ,a% $t ere!y a !oan ,$th rea! e%tate %ec*r$ty

2) a% the contract e?ec*te& +y the &een&ant oa/*$n A>arraa" on the one han&" an& the #!a$nt$" on the othere+o&$e& $n E?h$+$t E" a %a!e ,$thpacto de retro or %$#!y a !oan ,$th rea! e%tate %ec*r$ty

R*!$n81) hen onc*ya e?ten&e& the #er$o& to e+r*ary 1" 19 ,$th$n ,h$ch the &een&ant% A>arraa co*!& #ay h$ h$%

cre&$t" +*t $#o%e& on the the con&$t$on that they #ay h$ 1 #er cent ann*a! $ntere%t ro A**%t 36" 194 onthe #r$nc$#a! o 23"666 an& a'e the another e?ten%$on *# to A#r$! " 19" *n&er the %ae con&$t$on% a%rear& $ntere%t ,hat #erha#% co*!& ha'e +een con%$&ere& a% a ant$chre%$% orpacto comisorio not ana%%$nent $n #ayent o a &e+t" or a %a!e ,$th pacto de retro +eca*%e there $% noth$n to $n&$cate that %*ch ,a%the $ntent$on o the &een&ant% A>arraa or" at !ea%t" that they +o*n& the%e!'e% to &e!$'er the !an& $n /*e%t$on tothe #!a$nt$ an& that the !atter %ho*!& #ay the the 'a!*e thereo- an& +eca*%e there ,a% ,hat ay +e con%$&ere&the re%o!*tory con&$t$on o $'e year% ,a% con'erte& $nto a %$#!e !oan +y the &ec$%$'e c$rc*%tance tha#!a$nt$ cho%e to co!!ect thereater" an& the o+!$or% aree& to #ay h$" 1 #er cent ann*a! $ntere%t0

It $% on!y $n contract% o !oan" ,$th or ,$tho*t *aranty" that $ntere%t ay +e &ean&e&) Con%$&er$n the 'ar$o*% no'at$on% ,h$ch" a% ha% +een %a$&" ha& ta.en #!ace an& ha& +een e?ten&e& not on!y to

the A>arraa +rother% ,$th re%#ect to the$r o+!$at$on o 23"666 or 2"


12/16

I%%*e%-oN the %a!e ,a% an o*tr$ht %a!e or ere con%$nentoN Co $% +o*n& +y the $ntere%t %t$#*!ate& $n the $n'o$ce0R*!$n810 OGTRI5=T ALEoCo acce#te& the $n'o$ce o the +a!!et %hoe%an& he e'en note& &o,n $n h$% o,nhan&,r$t$n the #art$a! #ayent% thathea&e0oI the %a!e ha% +een on con%$nent" a%t$#*!at$on a% to the #er$o& o t$e or theret*rn o the *n%o!& %hoe% %ho*!&ha'e+een a&e" ho,e'er" th$% ,a% not &one0 NOT BOGND B T=E INTERETo=e &$& not %$n the $n'o$ce %!$# the%t$#*!ate& $ntere%t ,a% 6" hence" not+$n&$no=o,e'er" he $% +o*n& +y the !ea! $ntere%t o

X=ence" Co ,a% or&ere& to #ay the +a!ance o the#*rcha%e #r$ce or the +a!!et %hoe% U !ea! $ntere%t


13/16

The Co*rt re$terate& the Ta#$a R*!$n (16; CRA 49" *ne 11" 19:1)" the Co*rt he!& that @the o+!$at$on to #ay$ntere%t on the &e#o%$t cea%e% the oent the o#erat$on o the +an. $% co#!ete!y %*%#en&e& +y the &*!ycon%t$t*te& a*thor$ty" the Centra! Ban.

E?e#t a!%o ro #ay$n $ntere%t to &e#o%$ter%8 the %ae or*!a that e?e#t% #et$t$oner ro the #ayent o$ntere%t to $t% &e#o%$tor% &*r$n the ,ho!e #er$o& o act*a! %to##ae o $t% o#erat$on% +y or&er% o the Centra!Ban.

#ON Coerc$a! Ban. $% !$a+!e or $ntere%t" &*r$n the #er$o& o the +an.S% orc$+!e c!o%*re" on !oan% an& a&'ance%a&e +y re%#on&ent Centra! Ban. NOJ

!EL"re%#on&ent Centra! Ban. ,hen ca!!e& *#on to &ea! ,$th coerc$a! +an.% an& e?ten& to the eerency !oan%an& a&'ance%" &ea!% ,$th the not a% an or&$nary cre&$tor enae& $n +*%$ne%%" +*t a% the *!t$ate onetary a*thor$ty oo'ernent chare& ,$th the %*#er'$%$on an& #re%er'at$on o the +an.$n %y%te0

90 L$na '0 " 1;3 CRA 33:" 50R0 No0 L7336;" A**%t 31" 19:a an& Re&$c*!o Va!&eh*e>a rea$ne& $n the #o%%e%%$on o the !an&0

A co#!a$nt or $nH*nct$on $!e& +y Tan to enHo$n the Va!&eh*e>a% @ro enter$n the #arce! o !an& an& ather$n the n*t%there$n 0000@ Th$% co#!a$nt an& the co*nterc!a$ ,ere %*+%e/*ent!y &$%$%%e& or a$!*re o the #art$e% @to %ee. or the$e&$ate tr$a! thereo" th*% e'$nc$n !ac. o $ntere%t on the$r #art to #rocee& ,$th the ca%e0ro+!e% '$rt*a! !a, !$+raryThe Dee& o 2acto &e Retro reerre& to ,a% not re$%tere& $n the Re$%try o Dee&%" ,h$!e the n& Dee& o 2acto &e Retro,a% re$%tere&0

I%%*e8

hether the tran%act$on% +et,een the #art$e% ,ere %$#!e !oan

=e!&8NO0 Gn&er art$c!e 1:a% ha'$n rea$ne& $n #o%%e%%$on o the !an& an& the rea!ty ta?e% ha'$n +een #a$& +y the" the contract%,h$ch #*r#orte& to +e #acto &e retro tran%act$on% are #re%*e& to +e e/*$ta+!e ortae%" ; ,hether re$%tere& or notthere +e$n no th$r& #art$e% $n'o!'e&0

Article 1925. Contract% an& %t$#*!at$on%" *n&er any c!oa. or &e'$ce ,hate'er" $nten&e& to c$rc*'ent the !a,% aa$n%t*%*ry %ha!! +e 'o$&0 The +orro,er ay reco'er $n accor&ance ,$th the !a,% on *%*ry0

10 Ane! o%e areho*%e '0 Che!&a" 3 CRA 119" 50R0 No0 L7;


14/16

&$%#o%e& o the$r #ro#erty" or are a+o*t to &o %o" ,$th$ntent to &era*& the$r cre&$tor%" #re!$$nary attachent,a% a!%o %o*ht0

An%,er$n" &een&ant% a'erre& that they o+ta$ne&o*r !oan% ro #!a$nt$ $n the tota! ao*nt o2";66066" o ,h$ch 2;"6066 ha& +een #a$&" !ea'$n a+a!ance o 26"::6066- that #!a$nt$ chare& an&&e&*cte& ro the !oan *%*r$o*% $ntere%t% thereon" at rate%o an& 0; #er onth" an&" con%e/*ent!y" #!a$nt$ ha%no ca*%e o act$on aa$n%t &een&ant% an& %ho*!& not +e#er$tte& to reco'er *n&er the !a,0 A co*nterc!a$ or2"666066 attorneyS% ee% ,a% $nter#o%e&02!a$nt$ $!e& on *ne ;" 194 an an%,er to theco*nterc!a$" %#ec$$ca!!y &eny$n *n&er oath thea!!eat$on% o *%*ry0

IGE8In a !oan ,$th *%*r$o*% $ntere%t" ay the cre&$torreco'er the #r$nc$#a! o the !oan

RGLIN585reat re!$ance $% a&e +y a##e!!ant% on Art0 1411 othe Ne, C$'$! Co&e ,h$ch %tate%8

Art0 14110 hen the n*!!$ty #rocee&% ro the $!!ea!$ty othe ca*%e or o+Hect o the contract" an& the act con%t$t*te%cr$$na! oen%e" +oth #art$e% +e$n $n #ar$ &e!$cto" they%ha!! ha'e no act$on aa$n%t each other" an& +oth %ha!! +e#ro%ec*te&0 oreo'er" the #ro'$%$on% o the 2ena! Co&ere!at$'e to the &$%#o%a! o eect% or $n%tr*ent% o a cr$e%ha!! +e a##!$ca+!e to the th$n% or the #r$ce o thecontract0

Th$% r*!e %ha!! +e a##!$ca+!e ,hen on!y one o the#art$e% $% *$!ty- +*t the $nnocent one ay c!a$ ,hat heha% $'en" an& %ha!! not +e +o*n& to co#!y ,$th h$%#ro$%e0

The *#ree Co*rt &o not aree ,$th %*chrea%on$n0 Art$c!e 1411 o the Ne, C$'$! Co&e $% not ne,- $t$% the %ae a% Art$c!e 136; o the O!& C$'$! Co&e0 Thereore"%a$& #ro'$%$on $% no ,arrant or &e#art$n ro #re'$o*%$nter#retat$on that" a% #ro'$&e& $n the G%*ry La, (Act No0;;" a% aen&e&)" a !oan ,$th *%*r$o*% $ntere%t $% nottota!!y 'o$& on!y a% to the $ntere%t0

Tr*e" a% %tate& $n Art$c!e 1411 o the Ne, C$'$!Co&e" the r*!e o #ar$ &e!$cto a##!$e% ,here a contractS% n*!!$ty #rocee&% ro $!!ea!$ty o the ca*%e or o+Hect o%a$& contract0

=o,e'er" a##e!!ant% a$! to con%$&er that a contracto !oan ,$th *%*r$o*% $ntere%t con%$%t% o #r$nc$#a! an&acce%%ory %t$#*!at$on%- the #r$nc$#a! one $% to #ay the &e+t-the acce%%ory %t$#*!at$on $% to #ay $ntere%t thereon0 An&%a$& t,o %t$#*!at$on% are &$'$%$+!e $n the %en%e that theorer can %t$!! %tan& ,$tho*t the !atter0 Art$c!e 1


15/16

$ntere%t

10 C* GnH$en '0 a+a!acat" ;4 2h$!0 9" $%%*e& a ,r$t o attachent o'er rea! #ro#ert$e% co'ere& +y TCT No%0 :6


16/16

$ntere%t on!y an& %a$& noth$n a+o*t #ayent o co#o*n& $ntere%t" +*t the re%#on&ent H*&e or&er% #ayent oco#o*n& $ntere%t" then" he oe% +eyon& the con$ne% o a H*&ent ,h$ch ha& +ecoe $na!0

Article 194/. I the +orro,er #ay% $ntere%t ,hen there ha% +een no %t$#*!at$on thereor" the #ro'$%$on% o th$% Co&econcern$n %o!*t$o $n&e+$t$" or nat*ra! o+!$at$on%" %ha!! +e a##!$e&" a% the ca%e ay +e0

10 Ve!e> '0 Ba+arra"

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