This case has been cited 2 times or more.
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2015-07-22 |
PERLAS-BERNABE, J. |
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| Records show that other than the matter of interest, the principal loan obligation and the payments made were not disputed by the parties. Nonetheless, the Court finds the stipulated 5% monthly interest to be excessive and unconscionable. In a plethora of cases, the Court has affirmed that stipulated interest rates of three percent (3%) per month and higher are excessive, iniquitous, unconscionable, and exorbitant,[51] hence, illegal[52] and void for being contrary to morals.[53] In Agner v. BPI Family Savings Bank, Inc.,[54] the Court had the occasion to rule:Settled is the principle which this Court has affirmed in a number of cases that stipulated interest rates of three percent (3%) per month and higher are excessive, iniquitous, unconscionable, and exorbitant. While Central Bank Circular No. 905-82, which took effect on January 1, 1983, effectively removed the ceiling on interest rates for both secured and unsecured loans, regardless of maturity, nothing in the said circular could possibly be read as granting carte blanche authority to lenders to raise interest rates to levels which would either enslave their borrowers or lead to a hemorrhaging of their assets. Since the stipulation on the interest rate is void for being contrary to morals, if not against the law, it is as if there was no express contract on said interest rate; thus, the interest rate may be reduced as reason and equity demand. (Emphases supplied) | |||||
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2015-02-18 |
PERLAS-BERNABE, J. |
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| Moreover, the Court notes that the stipulated three percent (3%) monthly interest is excessive and unconscionable.In a plethora of cases, the Court has affirmed that stipulated interest rates of three percent (3%) per month and higher are excessive, iniquitous, unconscionable, and exorbitant,[63] hence, illegal[64] and void for being contrary to morals.[65] In Agner v. BPI Family Savings Bank, Inc.,[66] the Court had the occasion to rule: Settled is the principle which this Court has affirmed in a number of cases that stipulated interest rates of three percent (3%) per month and higher are excessive, iniquitous, unconscionable, and exorbitant. While Central Bank Circular No. 905-82, which took effect on January 1, 1983, effectively removed the ceiling on interest rates for both secured and unsecured loans, regardless of maturity, nothing in the said circular could possibly be read as granting carte blanche authority to lenders to raise interest rates to levels which would either enslave their borrowers or lead to a hemorrhaging of their assets. Since the stipulation on the interest rate is void for being contrary to morals, if not against the law, it is as if there was no express contract on said interest rate; thus, the interest rate may be reduced as reason and equity demand. (Emphases supplied)[67] | |||||