GR L 1949; (October, 1949) (Digest)
G.R. No. L-1949; October 31, 1949
REALTY INVESTMENT, INC., and PEOPLES BANK & TRUST COMPANY, plaintiffs-appellants, vs. MARIANO VILLANUEVA, ET AL., defendants. MARIA PASTRANA and PRUDENCIO CASTRENCE, appellees.
FACTS
Plaintiff Realty Investment, Inc., owner of Valhalla Gardens Subdivision, sold a lot with a house to defendant Maria Pastrana under a conditional sale contract. Pastrana made partial payments but defaulted after the war broke out. During the Japanese occupation, she paid the remaining balance to the Japanese Enemy Property Custodian, and the Register of Deeds cancelled the plaintiff’s title and issued a new one in her name. After the war, the plaintiff filed an action seeking primarily a declaration of nullity of the payment to the Custodian and the title issued to Pastrana, and alternatively, payment of the unpaid balance. The trial court dismissed the case as to Pastrana based on the moratorium laws (Executive Orders Nos. 25 and 32), which suspended the enforcement of monetary obligations incurred before the war.
ISSUE
Whether the moratorium laws apply to bar the plaintiff’s action, which primarily seeks to annul a title and a payment made to the Japanese Enemy Property Custodian, with a monetary claim being merely an alternative remedy.
RULING
No. The moratorium laws do not apply. The Supreme Court reversed the dismissal order. The primary objective of the action is not merely to enforce a monetary obligation but to obtain a judicial declaration on the validity of the payments made to the Japanese authorities and the consequent title issued. The prayer for a money judgment is only an alternative remedy contingent on the defendant’s choice or inability to surrender the land and title. The moratorium laws were intended strictly to suspend payments of monetary obligations and are in derogation of constitutional guarantees; they must be confined to cases solely for the enforcement of such debts. Since the main action involves rights other than mere payment, it may proceed. The case was remanded for trial on the merits.
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