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Spouses Simon Yap and Milagros Guevarra Vs. First e-Bank, Inc.

Spouses SIMON YAP AND MILAGROS GUEVARRA,Petitioners, versus FIRST e-BANK CORPORATION (previously known as PDCP DEVELOPMENT BANK, INC.), Respondent.

G.R. No. 169889 | 2009-09-29

D E C I S I O N


CORONA, J.:


On August 30, 1990, Sammy Yap obtained a P2 million loan from PDCP Development Bank, Inc.[1] (PDCP). As security, Sammy's parents, petitioners Simon Yap and Milagros Guevarra, executed a third-party mortgage on their land[2] and warehouse standing on it. The mortgage agreement provided that PDCP may extrajudicially foreclose the property in case Sammy failed to pay the loan.

On November 7, 1990, Sammy issued a promissory note and six postdated checks[3] in favor of PDCP as additional securities for the loan.

When Sammy defaulted on the payment of his loan, PDCP presented the six checks to the drawee bank...