157163.pdf - -i:1 g·c·o ~ ·~�!U'l:~/Mjc,~.~\1 �"�'~ l �_1.11.it �'T'~ ~!~'�'< 3Republic of tbe llbtlipptneg ~upreme QC:ourt!llllnniln FIRST DIVISION

157163.pdf - -i:1 g·c·o ~ ·~�!U'l:~/Mjc,~.~1 �"�'~ l...

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.,,-i:1' g·c·o,; ! ~~~ ·~·\ /Mjc,~ '.,: U'l :~ .~~ \1: l ' ·'"·-'~.,, \;(.'(" ·, ....... _1.11-.it ,.,.., '·""'<' · ..... _'T'~ '-- .. ~!'"'"!~ 3Republic of tbe llbtlipptneg ~upreme QC:ourt ;!llllnniln FIRST DIVISION BANK OF THE PHILIPPINE ISLANDS, Petitioner, - versus - HON. JUDGE AGAPITO L. HONTANOSAS, JR., REGIONAL TRIAL COURT, BRANCH 16, CEBU CITY, SILVERIO BORBON, SPOUSES XERXES AND ERLINDA FACULTAD, AND XM FACULTAD & DEVELOPMENT CORPORATION, Respondents. G.R. No. 157163 Present: SERENO, CJ, LEONARDO-DE CASTRO, BERSAMIN, VILLARAMA, JR., and REYES, JJ Promulgated: JUN 2 5 2011t x-----------------------------------------------------------------------------------------x DECISION BERSAMIN, J.: Injunction should not issue except upon a clear showing that the applicant has a right in esse to be protected, and that the acts sought to be enjoined are violative of such right. A preliminary injunction should not determine the merits of a case, or decide controverted facts, for, being a preventive remedy, it only seeks to prevent threatened wrong, further injury, and irreparable harm or injustice until the rights of the parties can be settled. , .,
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Decision 2 G.R. No. 157163 The Case Under review at the instance of the defendant, now the petitioner herein, is the decision promulgated on July 9, 2002, 1 whereby the Court of Appeals (CA) upheld the order issued on July 5, 2001 in Civil Case No. CEB-26468 entitled Spouses Silverio & Zosima Borbon, et al . v. Bank of the Philippine Islands by the Regional Trial Court (RTC), Branch 16, in Cebu City, presided by Hon. Judge Agapito L. Hontanosas, Jr. Antecedents On May 22, 2001, respondents Spouses Silverio and Zosima Borbon, Spouses Xerxes and Erlinda Facultad, and XM Facultad and Development Corporation commenced Civil Case No. CEB-26468 to seek the declaration of the nullity of the promissory notes, real estate and chattel mortgages and continuing surety agreement they had executed in favor of the petitioner. They further sought damages and attorney’s fees, and applied for a temporary restraining order (TRO) or writ of preliminary injunction to prevent the petitioner from foreclosing on the mortgages against their properties. The complaint alleged that the respondents had obtained a loan from the petitioner, and had executed promissory notes binding themselves, jointly and severally, to pay the sum borrowed; that as security for the payment of the loan, they had constituted real estate mortgages on several parcels of land in favor of the petitioner; and that they had been made to sign a continuing surety agreement and a chattel mortgage on their Mitsubishi Pajero. It appears that the respondents’ obligation to the petitioner had reached P17,983,191.49, but they had only been able to pay P13 Million because they had been adversely affected by the economic turmoil in Asia in 1997. The petitioner required them to issue postdated checks to cover the loan under threat of foreclosing on the mortgages. Thus, the complaint sought a TRO or a writ of preliminary injunction to stay the threatened foreclosure.
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