Legal Obligations for a Mortgaged Property After the Death of Both Parties

Question:

My mother-in-law mortgaged a lot to her friend for P500,000. Both are now deceased, and it has been 25 years. The property is still under my mother-in-law's name. The lender's husband now asks for P1,500,000. What should we do? How much should we pay?

Answer:

Legal Framework:

Prescription: In Philippine law, actions to enforce a written contract must be brought within 10 years from the time the right of action accrues. After 25 years, the claim may have prescribed, rendering it unenforceable.
Interest Rates: If the mortgage agreement specified interest rates, they should be observed, but only up to a point where it doesn't become unlawfully high.
Personal Obligation: If the loan was between individuals and not with the lending company, this may limit the lender’s estate’s ability to claim it was a business transaction subject to different rules.

What to Do:

Check Documentation: Scrutinize any mortgage agreement, promissory notes, or other documents to understand the terms.
Legal Advice: Consult an attorney to determine the enforceability of the debt, especially considering the lapse of time.
Negotiation: If the debt is still enforceable, negotiate with the lender's estate, possibly bringing the amount down or structuring it in a more manageable way.
Mediation: If negotiation fails, consider alternative dispute resolution methods like mediation.
Court: As a last resort, legal action may be required either to assert that the claim has prescribed or to otherwise resolve the dispute.

How Much to Pay:

Principal Amount: Legally, you may only be obliged to pay the principal amount if the claim has not yet prescribed.
Interest: Any interest should be as per the agreement but should not be unlawfully high.
Prescription: If the debt has prescribed, you may not be legally required to pay anything.

Conclusion:

Given the 25-year lapse, it's likely that the claim has prescribed, and you may not be legally required to pay anything. However, it's essential to consult an attorney to evaluate the specific circumstances of your case, as exceptions may apply.

Disclaimer:

This article is intended for informational purposes only and should not be construed as legal advice. Consultation with a qualified attorney is recommended for personalized legal guidance.