07 September 2015

xxxx

Subject: DEMAND FOR SPECIFIC PERFORMANCE

Dear xxxx:

We are writing for and on behalf of our clients, xxxxxx in relation to the
amount of seventy-five thousand pesos (Php75,000.00) they received from
you by virtue of a loan agreement you orally entered with them sometime in
2009.

By virtue of said loan, you had them executed a deed entitled “Kasulatan ng
Sanglaan ng Lupa at Bahay” dated xxxx, with amendments dated xxxx, and
demanded from them the delivery of xxxxx as security thereof. A copy of the
said deed is hereto attached for your easy reference.

For more than six (6) years now, xxxx remains under your possession even
after the loan obligation of our clients had long been paid in full. Contrary to
law, as well as to the more exacting standards of morals, you continuously fail
and persistently refused to return xxxxx to our clients despite repeated
demands, erroneously basing your claim to retain possession of the said title
on account of interests allegedly still outstanding.

In this regard, we would like to call your attention regarding the severely
unconscionable seven percent (7%) monthly interest, or an annual interest rate
of eighty-four percent (84%) you have been charging our clients for the last six
years in connection with their Php75,000.00 loan obligation. You may be of
the impression that such rate is sanctioned by the wide latitude given to
parties to agree on contract terms. However, you are very wrong.

In a litany of cases, the Supreme Court has resolved that despite the wide
latitude given to parties to agree on interest rates, the same does not give

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 them the authority to stipulate for the payment of interest which will enslave
the borrowers. Thus, in the case of Medel vs. CA1, the Court annulled a 5.5%
monthly interest rate or 66% annual interest on a Php500,000.00 loan. In the
same vein, the Court in the case of Spouses Solangon vs. Salazar2 annulled a
6% monthly interest rate or 72% annual interest on a Php60,000.00 loan. In
both of these cases, the Court reduced the interest rates for being excessive
and iniquitous to an annual interest of only 12%.

Needless to state, but without admitting your right to collect interest in the
absence of a written stipulation, the 7% monthly interest or 84% annual
interest on the Php75,000.00 loan should be altogether struck down for being
contrary to moral and law or be reduced to 12% annual interest at the most.

Nonetheless, based on our records consisting of acknowledgement receipts of

payments among others, you have already received from our clients
payments in the total amount of two hundred forty-one thousand five
hundred pesos (Php241,500) for the said loan. Of said amount, one hundred
fifty-six thousand six hundred pesos (Php156,600.00) has already been paid
by our clients as early as 12 December 2011, which amount would have
constituted a final settlement of the principal amount and any interests
which you could have validly claimed until such date, assuming that you
had the right to collect interests. In fact, until 11 December 2011, you could
have only collected Php102,000.00 consisting of the principal amount of
Php75,000.00 and Php27,000.00 as interest thereof computed at the rate 12%.

Yet, despite said payments in the total amount of Php241,500.00, you still
wrongfully retain xxxxx in your possession after repeated demands. More so,
you still demand from our clients the payment of groundless interests in so
much excessive amounts. Worse, you even threatened our clients to initiate a
case against their son, xxxx, in the event that they take no heed of your
baseless demands, a clear act of abuse and harassment to the grave prejudice
of our clients, and motivated only by your selfish desire to obtain under
duress more payments of groundless interests from our clients whose assets
have already been rendered hemorrhaging by your own iniquitous acts.

1 359 Phil 820 (1998)

2 412 Phil. 816 (2001)

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Considering the foregoing, it is clear that our clients have now all the right to
the possession of xxxx after paying you the total amount of Php241,500.00
since the said title was only delivered to you as a mere security for their
principal obligation to pay the loan. Since the loan has long been settled, not
to mention their payments to you of interests in excess of what could be just
and legally due, assuming you had really any legal right to demand payment
of interests, there are no longer any bases, both in fact and law, upon which
your continued retention of the title and prejudicial refusal to return the same
to our clients may find support.

Therefore, we hereby make this FINAL DEMAND upon you to deliver xxxx
to our clients within five (5) days from receipt of this letter in order for you to
settle once and for all this matter without undergoing through the arduous
incidents of litigation and the expenses and embarrassment incident thereto.

Your failure or refusal to comply with such legitimate demand shall leave our
clients with no option but to file all appropriate actions against you, including
the recovery of interest payments wrongfully paid in your favor.

We trust that you will give this matter your preferential attention.

Thank you.

Very truly yours,

xxxx

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