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PHILIPPINE TRUST COMPANY v. REDENTOR R. GABINETE

FACTS:

The case involves a complaint filed by petitioner Philippine Trust Company (Philtrust Bank) against Shangrila Realty Corporation, Elisa Tan, and respondent Redentor Gabinete. Philtrust granted a loan to Shangrila and required the execution of a Continuing Suretyship Agreement wherein Tan and Gabinete served as sureties. The loan had various promissory notes with different amounts and interest rates. When Shangrila failed to pay upon maturity, Philtrust demanded payment but was ignored. Philtrust then filed for extrajudicial foreclosure of the real estate mortgage, becoming the highest bidder at the auction. However, the proceeds from the foreclosure were insufficient to fully satisfy Shangrila's obligations. As of February 28, 2006, Shangrila's total outstanding obligation to Philtrust was P50,425,059.20.

In this case, respondent Redentor Gabinete denied under oath the genuineness and due execution of the confirmation letter dated May 28, 1997, claiming that his signature of conformity is a forgery and he had no involvement in the loans. He also argued that the properties mortgaged do not belong to Shangrila, the mortgagor in the real estate mortgage dated July 6, 1995. Gabinete asserted that the loan transactions or promissory notes are void because Tan, the borrower, did not have authority to incur the loan for Shangrila or execute the loan documents. He claimed that he immediately replied to Philtrust's demand for payment, denying any participation and informing them that his signature in the Continuing Surety Agreement had been forged. Gabinete also requested that the National Bureau of Investigation (NBI) analyze his signature appearing in the agreement, which was eventually found to be different from his standard sample signatures.

After Gabinete filed his formal offer of evidence, the Regional Trial Court (RTC) rendered a decision in favor of the petitioner, ordering Shangrila Realty Corporation, Elisa Tan, and Redentor Gabinete to pay the outstanding obligations under the promissory notes, plus penalties, interests, attorney's fees, and costs of suit. Gabinete appealed to the Court of Appeals (CA), which ruled in his favor, holding him not liable for the loan transactions entered into by Shangrila Realty Corporation, or jointly and severally liable with Elisa Tan under the Continuing Surety Agreement.

The CA found that the RTC failed to give due weight to the findings of the NBI Document Examiner, who concluded that Gabinete's signature in the Continuing Suretyship Agreement was forged. The CA also determined that there was sufficient evidence to compare Gabinete's questioned signature to his shortened signature. Dissatisfied with the CA's decision, the petitioner filed a petition for review before the Supreme Court, raising various grounds, including the alleged errors committed by the CA in giving credence to the NBI's findings and disregarding the presumption of regularity accorded to the notarized Continuing Suretyship Agreement.

In response, petitioner argues that the Court of Appeals (CA) erred in not considering the presumption of regularity accorded to the Continuing Suretyship Agreement, which was duly notarized. Petitioner also asserts that the testimony of the notary public should have been given credence, as the notary public stated that respondent Gabinete signed the agreement in her presence. Respondent Gabinete, on the other hand, argues that the conflicting findings of the trial court and the appellate court do not automatically warrant a re-examination of the evidence. He insists that the CA did not commit a grave error by giving credence to the NBI document examiner's findings that the signature in the agreement was forged. Respondent also asserts that the presumption of regularity of a notarized document is merely a presumption and can be rebutted by evidence. The Court clarifies that petitions filed under Rule 45 should only raise questions of law, as the Court is not a trier of facts. Factual findings of the appellate courts are considered final, binding, and conclusive when supported by substantial evidence. However, there are exceptions to this general rule, as enumerated in Medina v. Mayor Asistio, Jr. These exceptions allow the Court to review and revise factual findings in certain circumstances.

ISSUES:

  1. Whether the testimony of handwriting experts is mandatory or indispensable in determining the authenticity or genuineness of signatures in a case involving forgery.

  2. Whether the judge properly exercised his independent judgment in determining the authenticity or genuineness of the signature in question.

  3. Whether the requirements for specimen signatures for comparison were complied with.

  4. Whether the dissimilarities between the standard and questioned signature are sufficient evidence of forgery.

  5. Whether the RTC judge conducted an independent examination on the questioned signature.

  6. Whether the respondent was able to prove that his signature was forged.

  7. Whether the notarized mortgage deeds are valid and binding.

  8. Whether the petitioners presented strong, complete, and conclusive proof of the falsity or nullity of the mortgage deeds.

RULING:

  1. The testimony of handwriting experts is not mandatory or indispensable in determining the authenticity or genuineness of signatures in a case involving forgery. While their expertise is usually helpful due to the technicality of the procedure involved in examining forged documents, judges must also exercise independent judgment in determining authenticity. A finding of forgery does not depend entirely on the testimony of handwriting experts.

  2. The judge properly exercised his independent judgment in determining the authenticity or genuineness of the signature in question. The judge cannot rely solely on the testimony of a handwriting expert. They must conduct an independent examination of the signature itself, which cannot be done without the original copy being produced in court.

  3. The requirements for specimen signatures were not complied with. The submitted specimen signatures were not written in the same style as the questioned signature and were not executed contemporaneously with the date of the questioned signature.

  4. The dissimilarities between the standard and questioned signature are not sufficient evidence of forgery. The findings of the NBI and the document examiner were inconclusive, and there was no categorical statement of forgery.

  5. The claim that the RTC judge failed to conduct an independent examination on the questioned signature is disproven by the findings.

  6. The respondent was not able to prove that his signature was forged. The burden of proof lies on the party alleging forgery, and the respondent failed to establish his case by clear, positive, and convincing evidence.

  7. The notarized mortgage deeds are valid and binding. The testimonies of the two notaries public, who declared that the mortgagor signed the deeds in their presence, are more convincing than the bare denials and interested disavowals of the petitioners.

  8. The petitioners failed to present the two witnesses to the mortgage deeds, and their self-serving declarations are insufficient to overturn the presumption of regularity and authenticity of the notarized documents.

PRINCIPLES:

  • The findings of fact of the trial court, as affirmed on appeal by the Court of Appeals, are conclusive on the Supreme Court. (Exception: There are 10 recognized exceptions to this rule, as enumerated in Medina v. Mayor Asistio, Jr.)

  • A finding of forgery does not depend entirely on the testimony of handwriting experts. The judge still exercises independent judgment on the issue of authenticity of the signatures under scrutiny.

  • The expertise of questioned document examiners is usually helpful in cases involving forgery, but their testimony is not mandatory or indispensable. Judges must exercise independent judgment in determining authenticity.

  • Judges must conduct an independent examination of signatures in order to determine their authenticity or genuineness.

  • When the dissimilarity between genuine and false specimens of writing is visible to the naked eye and would not ordinarily escape notice or detection from an unpracticed observer, the opinion of handwriting experts is no longer necessary.

  • Forgery cannot be presumed and must be proved by clear, positive, and convincing evidence. The burden of proof lies on the party alleging forgery.

  • A document that has been notarized is considered a public document and has the presumption of regularity in its favor. To contradict this, evidence must be clear, convincing, and more than merely preponderant.

  • Notarized documents with the requisite safeguards are evidence of high character and are presumed to be valid and binding. The party challenging a notarized document has the burden to prove its falsity or nullity with clear, convincing, and more than merely preponderant evidence.

  • The positive testimony of attesting witnesses prevails over expert opinions, which are subject to inherent infirmities and are only persuasive, not conclusive.

  • Forgery is not presumed and must be proved by clear, positive, and convincing evidence by the party alleging it. Mere disclaimer of the authenticity of a signature on a public document is not sufficient; corroborating witnesses or an expert witness may be necessary.