Case Digest: LINDA UY LIM v. HELEN O. TONG, et al.

LINDA UY LIM v. HELEN O. TONG, et al.

574 SCRA 545, (2008)

Intentional acts to deceive and deprive another of hid rights must be alleged and proved by clear and convincing evidence.

In 1994, Linda Uy Lim (Lim) and her husband Saturnino Lim (Amay) executed a Special Power of Attorney (SPA) in favor of Philip Ong (Ong) and Helen Tong (Tong), president and treasurer, respectively, of Propmech Corporation (Propmech) where Amay worked as sales manager. The SPA authorized Ong and Tong to mortgage or encumber a parcel of land owned by Spouses Lim. About two years after the execution of the SPA, the subject property was made the subject of a Real Estate Mortgage executed by Tong in favor of Propmech to secure a P1,000,000 obligation which the Lim spouses purportedly obtained from it.

In late 1996, Lim received a Notification of Foreclosure of the mortgage, and subsequently received a Sheriff‘s Notice of Public Auction Sale, drawing her to file before the Regional Trial Court of General Santos City a Complaint against attorneys-in-fact Tong and Ong. Lim claimed that Amay, from whom she had in the meantime been separated and had not heard from, obtained her signature on the SPA through fraud by representing to her that the purpose was to secure a loan with which to build a house. She also claimed that she had never been indebted to, and had not received any amount from Propmech, hence, the Real Estate Mortgage was null and void, according to its own terms.

In their Answer, Ong, Tong, and Propmech alleged that Lim co-signed the SPA empowering Ong and Tong to mortgage the property for the purpose of fully satisfying their outstanding obligation, and that Lim received the amount of P400,000 in 1994 and 1995 from them representing a portion of the loan for the purpose of building a house. The RTC and the Court of Appeals both declared that the Real Estate Mortgage was legally executed and accordingly dismissed Lim‘s complaint.

ISSUE:

Whether or not Philip Ong and Helen Tong were within the bounds of the SPA when they executed the Real Estate Mortgage

HELD:

By Lim’s admission, she read the SPA before signing it. She is a college graduate who had worked as a Regional Operations Clerk of Metrobank. It is inconceivable that she did not understand the contents of what she was signing. In fact, her allegation in her complaint that she agreed to sign the SPA believing that the “intention and purpose behind the same was to secure a loan with which to build the house that she had long dreamed of to be erected on the lot in question” confirms that she agreed to authorize the attorneys-in-fact to perform the acts therein enumerated including encumbering the property by way of mortgage.

At the witness stand, as well as before the Court of Appeals and this Court, petitioner posited a different claim – that she signed the SPA merely as a formality to guarantee her husband’s supposed advances in the sum of P400,000, and not intended to authorize respondents to mortgage the property, she having believed her husband’s assurance that said advances would be deducted from his salaries and commissions in the course of his employment at the corporation.

A party to a case should decide early on what version he is going to adopt. A change of theory in the later stage of the proceedings is impermissible, not due to the strict application of procedural rules, but because it is contrary to the rules of fair play, justice, and due process. Lim’s subsequent position thus fails.