116. Philippine Bank of Commerce vs.

Tomas De Vera
GR L-18816 December 29, 1962

Facts:

Tomas De Vera was the owner of two parcels of land mortgaged to the Philippine Bank of Commerce to
secure his debt in the amount of P127,000.00. Failing to pay, De Vera’s property was auctioned but the
total amount of the property was not sufficient to cover the debt.

PBC now seeks to recover the remaining amount. And for his defense, De Vera says that Act No. 31351 is
silent as to the mortgagee's right to recover deficiency arising after an extrajudicial foreclosure sale of
mortgage. Thus, the bank may not recover the same.

Issue:

Can the bank recover the amount despite the silence of the law?

Ruling:

Yes. Under the Mortgage Law, the mortgagee has the right to claim for the deficiency resulting from the
price obtained in the sale of the real property at public auction and the outstanding obligation at the
time of the foreclosure proceedings. Article 2131 of the new Civil Code expressly provides that "The
form, extent and consequence of a mortgage, both as to its constitution, modification and
extinguishment, and as to other matters not included in this Chapter shall be governed by the provisions
of the Mortgage Law and of the Land Registration Law.'

1
An Act To Regulate The Sale Of Property Under Special Powers Inserted In Or Annexed To Real-Estate Mortgages