[ G.R. No.

201892, July 22, 2015 ]

NORLINDA S. MARILAG, PETITIONER, VS. MARCELINO B. MARTINEZ, RESPONDENT.

Facts:

In 1992, Rafael Martinez obtained a loan of P160,000 from a petitioner, which was secured by a
mortgage over a parcel of land. Rafael defaulted on the loan, and the petitioner filed a complaint
for judicial foreclosure of the mortgage in 1995. The RTC-Imus issued a decision in favor of the
petitioner, declaring the stipulated 5% monthly interest to be usurious and reducing it to 12% per
annum. Rafael's son, the respondent, agreed to pay Rafael's obligation to the petitioner, which
was pegged at P689,000. After paying P400,000, the respondent executed a promissory note to
pay the balance of P289,000, which he later refused to pay. The petitioner filed a complaint for
sum of money and damages, and the court denied recovery on the promissory note, but later
granted the petitioner's motion for reconsideration, directing the respondent to pay the amount
due under the promissory note plus interest and costs of suit. The respondent appealed the
decision to the CA, which reversed the court a quo's decision, and ordered the petitioner to
return the excess payment of P171,000 to the respondent, plus interest and costs of suit. The
Court's Ruling:

Issue:
Whether or not the CA committed reversible error in upholding the dismissal of the collection
case.

Decision:
The court found that the principle of res judicata did not apply in the case due to lack of
evidence that the judgment had been finalized, but the principle of litis pendentia did apply. Litis
pendentia refers to a situation where another action is pending between the same parties for the
same cause of action, making the second action unnecessary and vexatious. In loan contracts
secured by a real estate mortgage, the creditor-mortgagee has a single cause of action against
the debtor-mortgagor to recover the debt, either through a personal action for the collection of a
sum of money or through a real action to foreclose on the mortgage security. Each remedy is
complete by itself, and the creditor-mortgagee's choice of remedy waives the other remedy.
Therefore, the availment of the remedy of foreclosure thus bars recourse to the subsequent
filing of a personal action for collection of the same debt under the principle of litis pendentia.