A-14_Soncuya v Azarraga

A-14

Soncuya v. Azarraga (1938)

1956

Payment of Interest  Must be EXPRESSLY stipulated

 Atty. Azzaraga served as counsel for the defendant Azzaragas in a case for which the latter owed the lawyer P2700 for his services  Defendants mortgaged to him a parcel of land which the lawyer assigned to Petitioner Soncuya thru a”sale and cession” of his rights.  Soncuya possessed the land, brought in cattle that allegedly destroyed the crops and coconut trees planted by one of the defendants (but was actually destroyed by drought)  The relevant facts: petitioner became the creditor of the defendants.  When the debt matured he allowed them extension to Feb. 16, 1926 with condition (12% annual interest); he later agreed to an extension to April 26, 1926 with same condition. These were made in writing (Exhibit A).  The plaintiff granted another extension to expire on October 31, 1928, but subject to the condition that instead of seven thousand and odd pesos, which undoubtedly referred to the interest of 12 per cent per annum charged

WON Soncuya is the rightful owner of the land

NO  It is only in contracts of loan, with or without guaranty, that interest may be demanded.  The contention of the defendants that the plaintiff did not and could never receive the lands in question as an assignment in payment of a debt, and much less did he acquire them by purchase with pacto de retro, is well taken.  The plaintiff alone has the right (1) to recover from the defendants Azarraga, by virtue of the assignment and sale made to him by Attorney Leodegario Azarraga of the latters' credit of P2,700 against the said defendants, the aforesaid sum plus interest at the rate of 12 per cent per annum from August 30, 1924; (2) to recover from the defendant Joaquin Azarraga, in particular, the sum of P4,000 plus interest at the rate of 12 per cent per annum from April 26, 1926.

the defendants, they should pay him P12,000 (Exhibit 2). In said two amounts of P7,000 and P12,000 the sum of P4,000 which the plaintiff had given to the defendant Joaquin Azarraga.  The defendants was able to register the land in their name, no objection from plaintiff.