• Mortgaging apartment possible only with special power of attorney

    Persida Acosta

    Persida Acosta

    Dear PAO,
    I used to work as an OFW but an accident paralyzed my legs and I have been unable to work for almost a year now. I want to seek help regarding my apartment, which was mortgaged by my brother. I was able to purchase that property out of blood, sweat and tears, so to speak. Around five years ago, I allowed my brother and his live-in partner to stay there because no one is looking after my house while I am working abroad. I was afraid someone else might just squat in my property. I told him that I won’t be paying him anything and in the same manner, he does not have to pay me any rent. I left him the title and other documents, which he can use whenever he pays for the real property taxes. Just recently, I learned that he mortgaged my apartment because he had some gambling problems he needed to settle. Is this even valid? Is there anything I can do to regain my property? I am in dire need right now for my continued therapy and I am really considering selling it. The thing is, I will not be able to sell it without my title.

    Dear Ronita11,
    Generally speaking, your brother may not mortgage your real property without him first securing from you a special power of attorney particularly for that purpose. As a rule, only the owner of the property has the right to enjoy and dispose of the same, without other limitations than those established by law (Article 428, New Civil Code of the Philippines). Our laws explicitly state that the following requirements must concur in order for a contract of pledge or mortgage to prosper: “(1) That they be constituted to secure the fulfillment of a principal obligation; (2) That the pledgor or mortgagor be the absolute owner of the thing pledged or mortgaged; (3) That the persons constituting the pledge or mortgage have the free disposal of the property, and in the absence thereof, that they be legally authorized for the purpose. x x x” (Article 2085, New Civil Code of the Philippines)

    Accordingly, if your brother did not secure such express authority from you to have your property mortgaged, then the contract that he entered into is undoubtedly null and void. As a consequence thereof, you have the right to demand from the person to whom he mortgaged your property to release the title in your favor. It would be more prudent for you to talk to this person first and enlighten him of the contractual muddle your brother got himself into. Enlighten him that a private settlement among you would save him from the rigors and possible costs of court litigation. Lastly, assure him that the release of your title will not, in any way, absolve your brother from his financial obligation.

    Should he refuse to heed your demand, you may opt to file a complaint for annulment of contract with damages. In addition thereto, you may seek for cancelation of the encumbrance made, should the mortgage be annotated at the back of your title.

    We hope that we were able to answer your queries. Please be reminded that this advice is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

    Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to dearpao@manilatimes.net


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