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land title that was not continously paid

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1 land title that was not continously paid on Fri Feb 19, 2016 5:23 am


Arresto Menor
Good Day!

My father is a wholesaler of a known beverage product. Our father let our supplier borrow our land title where our house is also situated as a form of help to boost their capital by using it as a collateral for their business. There was no written agreement or whatsoever happened between my father and our supplier, as my father fully trusts our supplier. To reciprocate the help that my father gave to our supplier, our supplier is giving us 5trucks full of supply in advance. Unfortunately, our supplier got separated with her wife and the business was eventually handled by the wife. Though they got separated, the wife continues to supply our products until eventually everything was put into writing. The contract says that we are in debt of them for around 1.2million at that time and this debt will be paid by deducting our discount of 3pesos for every 1 case that we are buying to them. In short, we are paying them 3pesos for every 1case that we buy. The contract also acknowledged that they can use our land title as a collateral to one known beverage company.

Our business was going well until my father had stroke which suffers our business much and the rule of the company was also changed which totally aggravates the whole situation more. The new rule prohibits our supplier to supply us as there will be by area designation and we are not under their area. Now that we are under different supplier, we cannot continue to pay our debt under what was agreed upon because they can no longer supply our goods. That time our financial status were so down that we have no way of paying them because our money went to all the hospital bills.

We were anxious because our land title is with them and we cannot get it back until we fully paid our debt. However, the owner console us that she will not take advantage on our land title and just try to work hard to get back on track. So we were at ease but we still keep on calling them to ask for other issues but the issue about the debt were never brought up and we were just able to talk to her right hand and never the owner though we are asking if we could also talk to her.

After 4 years, our business is now just starting to recover and we are now planning to pay our debts slowly so we could recover our land now. We keep on calling our supplier but the secretary is the only one who picks up the phone and whenever we are asking if we could talk to the owner the secretary will say that the owner is not present. We went to their house and asked if we could speak to the owner but we were told that she is not at home so we just talked to the one who is handling her business to please relay our message that we want to talk to her personally so we could now settle our debt. One day, we received a letter that computes our debt which is 1.2m and all other expenses that they have paid like fire insurance and real estate tax which costs them 38thousand but we were so shocked when we also saw that they have given us 18thousand interest for every month that we haven't paid them that it totaled to an amount of 2.2million. We keep on calling them but the owner doesn't want to talk to us. We want to talk to her because we want to bargain on our debt, we could not afford the 2.2million that she is asking. A 1.2million debt is a big amount of money for us, how much more is 2.2million. Our land including our house maybe worth around 4million and it will be gone for 2.2million. We continue to call them until eventually the secretary told us that whatever it is that we want to say please put it in writing and if we still insist on forcing her to talk to us then we may just talk to her attorney.

We really are under stress by now, especially my father since our land is where we live and where our present business is located. I am now worried on my father's and my mother's condition that their health condition might give in because of this too much stress. As much as possible we don't want to take everything into court as one they are more influential than us and second we could not afford the additional payment that we will be spending if this goes to court and we don't know how long will this go most especially that we have 18thousand interest monthly. The longer this debt remains unpaid, the higher it will be.

Please help us on what to do and do you think we don't have any choice but to pay the 2.2million?

Any advice is a big help as we have no proper attorney to ask and we don't know how much a legal advice costs

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2 Re: land title that was not continously paid on Wed Mar 02, 2016 8:43 am

tsi ming choi

Reclusion Perpetua
Did your father agreed on that 18k interest per month? was that interest reduced in writing?

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3 Re: land title that was not continously paid on Wed Mar 02, 2016 1:46 pm


Reclusion Perpetua
Let me check my understanding of some key facts and state my assumptions.

-Your father surrendered your land title to a beverage dealer to be used as a collateral for their dealership. The title is still under your father's name but may have been surrendered by the beverage dealer to the principal or to a bank as compliance to the dealership. I also assume as annotated with the Register of Deeds, it is not mortgaged.
-In exchange for the use of your land title, your father is compensated for stocks. The value of the stocks is not mentioned but you may have a record of how much you were compensated.
-A contract was formalized which established that based on accounting, you owe them certain amount for the stocks you acknowledged received.

At this point ask these questions:
1. Was there a value placed on the use of the title which they used as a collateral?
2. Has the valuation been updated based on recent estate zonal value?
3. Who has been paying the annual real estate tax?
4. How long has this arrangement been going on?
5. Where is your area?

They claimed that you owe them for the principal amount plus the interest and other expenses. Who established these rates? Are they valid and reasonable?

They also declared that they have been violating their dealership coverage agreement because your area is no longer within their area but they continue to serve you.

You are not inclined to go to court for the cost and the trouble.

My initial thoughts are:
1. Work to get back your title. If it is still under your name, you have an advantage.
2. Understand the financials. Reconstruct the records.
3. Review the written contracts. Ask experts for its validity.
4. Confront. But get a legal and financial expert. Get the help of the principal as well.
5. After establishing objectively all the facts, agree on the settlement so you can get back your title.

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