C. H. Hodges, Recurrente, Contra Carmen Regalado Y Maria Gay, Recurridas

Summary

In this 1940 Supreme Court case, petitioner C.H. Hodges sought to execute a mortgage against respondents Carmen Regalado and Maria Gay while simultaneously pursuing rescission of their land purchase contract. The respondents had failed to pay the purchase price of P17,362.80 for three parcels of land under a 1928 contract. When Hodges obtained rescission in a separate case, he also attempted to collect P10,235.16 through mortgage execution based on a promissory note and mortgage deed executed in 1931. The Supreme Court affirmed the Court of Appeals' decision limiting recovery to P1,871.48, ruling that a party cannot obtain both rescission and mortgage execution simultaneously. The Court found most amounts in the account statement were imaginary and violated usury laws, demonstrating the principle that contracting parties cannot establish clauses contrary to law, morals, or public policy under Civil Code Article 1255.