Rutter vs.
Esteban Facts: On August 20,1941 Rutter sold to Esteban two parcels of land situated in the Manila for
1. Constitutional Law; Obligations and Contracts; Moratorium; Limitations upon the police
Power of the State.-—,A1though conceding that the obligations of the mortgage contract were
impaired, the court decided that what it thus described as an impairment was, notwithstanding
the contract clause of the Federal. Constitution, within the police power of the State as that
power was called into exercise by the public economic emergency which the legislature had
found to exist." (Home Building if these bounds are transgressed, there is no room for the
exercise of the power, for the constitutional inhibition against the impairment of contracts
would assert itself. Here are instances by which these bounds may be transgressed. (1) The
impairment should only: refer to the remedy and not to a substantive right (Worthen Co. vs.
Kavanaugh, 79 L. ed., 1298, 1301-1303; Bronson vs. Kinsie, 1 How., 311, 317, 46 Har. Law
Review, p. 1070) ; (2) The protective power of tho state, the police power, may only be invoked
and justified by an emergency, temporary in nature, and can only be exercised upon
reasonable conditions in order that it may not infringe the constitutional provision against
impairment of contracts (First Trust Co. of Lincoln vs. Smith, 27 N. W., pp. 762, 769) ; (3) "A
different situation is presented when 'extensions are so piled up as to make the remedy A
shadow . ." (Worthen vs. Kavanaugh, 295 U. S., 56, 62) ; (4) The decision in the Bleisdell case is
predicated on the ground that the laws altering existing contracts will constitute an impairment
of the contract clause of the Constitution only if they are unreasonable in the light of the
circumstances occasioning their enactment (47 Harvard Law Review, p. 660).
2. Id.; Id.; Id.; Republic Act No. 342 and Executive Orders Nos. 25 and 32 are Unreasonable.-—
The continued operation and enforcement of Republic Act No. 342 at the present time is
unreasonable and oppressive, and should not be prolonged a minute longer, and, therefore,
the same is declared null and void and without effect. And what is said here with respect to
said Act holds true as regards Executive Orders Nos. 25 and 32, perhaps with greater force and
reason as to the latter, considering that said Orders contain no limitation whatsoever in point
of time as regards the suspension of the enforcement and effectivity of monetary obligations.
And there is need to make this pronouncement in view of the revival clause embodied in said
Act if and when it is declared unconstitutional or invalid.
3. Id. ; Id.; Id.; When Extensions of Period of moratorium Become Unreasonable.-—The
obligations covered by Republic Act No. 342 and Executive Orders Nos. 25 and 32 had been
pending since 1945 and would continue to be unenforceable during the eight-year period
granted to prewar debtors to afford them an opportunity to rehabilitate themselves, which in
plain language means that the creditors would have to observe a vigil of at least twelve years
before they could effect a liquidation of their investment dating as far back as 1941. This period
seems unreasonable, if not oppressive. While the purpose of Congress is plausible, and should
be commended, the relief accorded works injustice to creditors who are practically left at the
mercy of the debtors. Their hope to effect collection becomes extremely remote, more so if the
credits .are unsecured. And the injustice is more patent when, under the law, the debtor is not
even required to pay interest during the operation of the relief. There are at least three cases
where the Supreme Court of the United States declared the moratorium laws violative of the
contract clause of the Constitution because the period granted to debtors as a relief was found
unwarranted by the contemplated emergency .
P9,600 of which P4,800 were paid outright, and the balance was made payable as follows:
P2,400 on or before August 7, 1942, and P2,400 on or before August 27, 1943, with interest at
the rate of 7 percent per annum. To secure the payment of said balance of P4,800, a first
mortgage has been constituted in favor of the plaintiff. Esteban failed to pay the two
installments as agreed upon, as well as the interest that had accrued and so Rutter instituted
an action to recover the balance due, the interest due and the attorney's fees. The complaint
also contains a prayer for sale of the properties mortgaged in accordance with law. Esteban
claims that this is a prewar obligation contracted and that he is a war sufferer, having filed his
claim with the Philippine War Damage Commission for the losses he had suffered as a
consequence of the last war; and that under section 2 of RA 342(moratorium law), payment of
his obligation cannot be enforced until after the lapse of eight years. The complaint was
dismissed. A motion for recon was made which assails the constitutionality of RA 342.
Issue: Whether or Not RA 342 unconstitutional on non-impairment clause grounds.
Held: Yes. The moratorium is postponement of fulfillment of obligations decreed by the state
through the medium of the courts or the legislature. Its essence is the application of police
power. The economic interests of the State may justify the exercise of its continuing and
dominant protective power notwithstanding interference with contracts. The question is not
whether the legislative action affects contracts incidentally, or directly or indirectly, but
whether the legislation is addressed to a legitimate end and the
measures taken are reasonable and appropriate to that end.
However based on the President’s general SONA and consistent with what the Court believes
to be as the only course dictated by justice, fairness and righteousness, declared that the
continued operation and enforcement of RA 342 at the present time is unreasonable and
oppressive, and should not be prolonged should be declared null and void and without effect.
This holds true as regards Executive Orders Nos. 25 and 32, with greater force and reason
considering that said Orders contain no limitation whatsoever in point of time as regards the
suspension of the enforcement and effectivity of monetary obligations
Ortigas vs. Feati
4. Local Governments; An exception to the general welfare powers delegated to municipalities
is when the exercise of it’s powers will conflict with vested rights arising from its contracts.-
The only exceptions under Section 12 are existing vested rights arising out of a contract
between a “a province, City or municipality on one hand and a third party on the other,” in
which case the original terms and provisions of the contract should govern. The exceptions,
clearly, do no apply in the case at bar.
5. Local Governments; Police Power; Contracts; Land Registration; The police power is superior
to contractual stipulations between parties on the use of lands sold by subdivisions even if said
conditions are annotated on the Torrens Title.+
6. Local Governments; Police Power; Contracts; Same;-
Resolution No. 27, S-1960 declaring the western part of Highway 54, now E. de los Santos
Avenue (EDSA, for short) from Shaw Boulevard to the Pasig River as an industrial and
commercial zone, was obviously passed by the Municipal Council of Mandaluyong, Rizal in the
exercise of police power to safeguard or promote the health, safety, peace, good order and
general welfare of the people in the locality. Judicial notice may be taken of the conditions
prevailing in the area, especially where Lots Nos. 5 and 6 are located. The lots themselves not
only front the highway; industrial and commercial complexes have flourished about the place.
EDSA, a main traffic artery which runs through several cities and municipalities in the Metro
Manila are, supports an endless stream of traffic and the resulting activity, noise and pollution
are hardly conducive to the health, safety or welfare of the residents in its route. Having been
expressly granted the power to adopt zoning and subdivision ordinances or regulations, the
municipality of Man- daluyong, through its Municipal Council, was reasonably, if not perfectly,
justified under the circumstances, in passing the subject resolution.
7. Local Governments; Police Power; Contracts; Statutory Construction; Foreign
Jurisprudence; American decisions and authorities are not per se controlling in the Philippines.-
In the first place, the views set forth in American decisions and authorities are not per se
controlling in the Philippines, the laws of which must necessarily be construed in accordance
with the intention of its own lawmakers and such intent may be deduced from the language of
each law and the context of other local legislation related thereto.
8. Police Power; Contracts; Balancing the police power with the exercise of property rights may
be called for in certain instances.-
Reference was made in the opinion of the Court to Philippine American Life Insurance
Company v. Auditor General The ponente in that case was Justice Sanchez. A concurrence
came from me. It contained this qualification: “It cannot be said, without rendering negatory
the constitutional guarantee of non-impairment, and for that matter both the equal protection
and due process clauses which equally serve to protect property rights, that at the mere
invocation of the police power, the objection on non-impairment grounds automatically loses
forces. Here, as in other cases where governmental authority may trench upon property rights,
the process of balancing, adjustment or harmonization is called for.”
9. Police Power; Contracts; Same;-
This is the concluding paragraph of my concurrence in the Philippine American Life Insurance
Co. case: “If emphasis be therefore laid, as this concurring opinion does, on the pressing and
inescapable need for such an approach whenever a possible collision between state authority
and an assertion of constitutional right to property may exist, it is not to depart from what
sound constitutional orthodoxy dictates. It is rather to abide by what is compels. In litigations
of this character the, perhaps much more so than in other disputes, where there is a reliance
on a constitutional provision, the judiciary cannot escape what Holmes fitly referred to as the
sovereign prerogative of choice, the exercise of which might possibly be impugned if there be
no attempt, however slight, at such an effort of adjusting or reconciling the respective claims of
state regulatory power and constitutionally protected rights.”
10. Police Power; Contracts; Constitutional Law; The claim to property rights based on the non-
impairment clause has a lesser weight under the present Constitution, vis a vis the police
power.-
The only point I would wish to add is that in the process of such balancing and adjustment, the
present Constitution, the Philippine American Life Insurance Co. decision having been
promulgated under the 1935 Charter, leaves no doubt that the claim to property rights based
on the non-impairment clause has a lesser weight. For as explicitly provided by our present
fundamental law: “The State shall promote social justice to ensure the dignity, welfare, and
security of all the people. Towards this end, the State shall regulate the acquisition, ownership,
use, enjoyment, and disposition of private property, and equitably diffuse property ownership
and profits.
11. Police Power; Contracts; Constitutional Law; Arrangements dealing with property rights are
not impressed with sanctity.-
More specifically, such covenants are an important means of ordering one aspect of property
relationships. Through them, there could be delimitation of land use rights. It is quite
understandable why the law should ordinarily accord them deference. It does so, it has been
said, both on grounds of morality and utility. Nonetheless, there are limits to the literal
enforcement of their terms. To the extent that they ignore technological or economic progress,
they are not automatically entitled to judicial protection. Clearly, they must “speak from one
point of time to another.” The parties, like all mortals, do not have the power of predicting the
future with unfailing certainty. In cases therefore were societal welfare calls for police power
legislation, the parties adversely affected should realize that arrangements dealing with
property rights are not impressed with sanctity. That approach, in my view, was the guiding
principle of the opinion of the Court. Hence my full and entire concurrence.
12. Police Power; Contracts; It is public knowledge that the place in question is already a
commercial area.+
13. Police Power; The municipal ordinance in question was not exacted pursuant to the police
power of the municipality of Mandaluyong. Its effect to the case at bar is to replace the peace
of a residential area with the turmoil of commerce and pollution of industry setting back efforts
of the Metro Manila Governor to improve the quality of life.-
But Resolution No. 27, cannot be described as promotive of the health, morals, peace,
education, good order or safety and general welfare of the people of Mandaluyong. On the
contrary, its effect is the opposite. For the serenity, peace and quiet of a residential section
would be the resolution be replaced by the chaos, turmoil and frenzy of commerce and
industry. Where there would be no industrial and noise pollution these bane of so-called
progress would now pervade and suffocate the environment of the detriment of the ecology.
To characterize the ordinance as an exercise of police power would be retrogressive. It will set
back all the efforts of the Ministry of Human Settlements to improve the quality of life
especially in Metro Manila. It will make Metro Manila, not the city of man as envisioned by its
Governor but a city of commerce and industry.
Case Digest: Ortigas & Co. vs Feati Bank & Trust Co.
Facts:
On March 4, 1952, Ortigas sold Lot 5 and 6, Block 31 of the Highway Hills Subdivision at
Mandaluyong to Augusto Padilla y Angeles and Natividad Angeles. The latter transferred their
rights in favour of Emma Chavez, upon completion of payment a deed was executed with
stipulations, one of which is that the use of the lots are to be exclusive for residential purposes
only. This was annotated in the Transfer Certificate of Titles No. 101509 and 101511. Feati then
acquired Lot 5 directly from Emma Chavez and Lot 6 from Republic Flour Mills. On May 5, 1963,
Feati started construction of a building on both lots to be devoted for banking purposes but
could also be for residential use. Ortigas sent a written demand to stop construction but Feati
continued contending that the building was being constructed according to the zoning
regulations as stated in Municipal Resolution 27 declaring the area along the West part of EDSA
to be a commercial and industrial zone. Civil case No. 7706 was made and decided in favour of
Feati.
Issue:
Whether or not Resolution number 27 declaring Lot 5 and 6 to be part of an industrial and
commercial zone is valid considering the contract stipulation in the Transfer Certificate of
Titles.
Held:
Resolution No. 27 prevails over the contract stipulations. Section 3 of RA 2264 of the Local
Autonomy Act empowers a Municipal Council to adopt zoning and subdivision ordinances or
regulations for the Municipality. Section 12 or RA 2264 states that implied power of the
municipality should be “liberally construed in it’s favour”, “to give more power to the local
government in promoting economic conditions, social welfare, and material progress in the
community”. This is found in the General Welfare Clause of the said act. Although non-
impairment of contracts is constitutionally guaranteed, it is not absolute since it has to be
reconciled with the legitimate exercise of police power, e.g. the power to promote health,
morals, peace, education, good order or safety and general welfare of the people. Resolution
No. 27 was obviously passed in exercise of police power to safeguard health, safety, peace and
order and the general welfare of the people in the locality as it would not be a conducive
residential area considering the amount of traffic, pollution, and noise which results in the
surrounding industrial and commercial establishments.Decision dismissing the complaint of
Ortigas is AFFIRMED.
1. CONSTITUTIONAL LAW; B.P. 22 (BOUNCING CHECK LAW); COVERS ALL KINDS OF CHECKS. —
The language of BP 22 is broad enough to cover all kinds of checks, whether present dated or
postdated, or whether issued in payment of pre-existing obligations or given in mutual or
simultaneous exchange for something of value.
2. CRIMINAL LAW; BOUNCING CHECKS LAW (B.P. 22); ESSENTIAL ELEMENT OF KNOWLEDGE;
PRIMA FACIE PRESUMED BY REFUSAL OF DRAWEE TO PAY UPON PRESENTMENT. — An
essential element of the offense is "knowledge" on the part of the maker or drawer of the
check of the insufficiency of his funds in or credit with the bank to cover the check upon its
presentment. Since this involves a state of mind difficult to establish, the statute itself creates a
prima facie presumption of such knowledge where payment of the check "is refused by the
drawee because of insufficient funds in or credit with such bank when presented within ninety
(90) days from the date of the check.
3. ID.; ID.; ID.; ID.; SHALL NOT ARISE WHEN PAYMENT IS MADE WITHIN FIVE (5) DAYS FROM
RECEIPT OF DISHONOR. — To mitigate the harshness of the law in its application, the statute
provides that such presumption shall not arise if within five (5) banking days from receipt of
the notice of dishonor, the maker or drawer makes arrangements for payment of the check by
the bank or pays the holder the amount of the check.
4. ID.; ID.; DISHONOR OF CHECK BY DRAWEE BANK; PRIMA FACIE PROOF OF MAKING OR
ISSUANCE OF CHECK AND DUE PRESENTMENT THEREOF. — Another provision of the statute,
also in the nature of a rule of evidence, provides that the introduction in evidence of the
unpaid and dishonored check with the drawee bank’s refusal to pay "stamped or written
thereon or attached thereto, giving the reason therefore, shall constitute prima facie proof of
"the making or issuance of said check, and the due presentment to the drawee for payment
and the dishonor thereof . . . for the reason written, stamped or attached by the drawer on
such dishonored check." The presumptions being merely prima facie, it is open to the accused
of course to present proof to the contrary to overcome the said presumptions.
5. ID.; ID.; DISTINGUISHED FROM ARTICLE 315, REVISED PENAL CODE. — Article 315 of the
Revised Penal Code defining the crime of estafa reads as follows: "Article 315. Swindling
(estafa). - Any person who shall defraud another by any of the means mentioned herein below
shall be punished by . . . 2. By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneously with the commission of the fraud: (a) By using fictitious
name, or falsely pretending to possess power, influence, qualifications, property, credit,
agency, business or imaginary transactions, or by means of other similar deceits; . . . (d) By
postdating a check, or issuing a check in payment of an obligation the offender knowing that at
the time he had no funds in the bank, or the funds deposited by him were not sufficient to
cover the amount of the check without informing the payee of such circumstances." The scope
of paragraph 2 (d), however, was deemed to exclude checks issued in payment of pre-existing
obligations. The rationale of this interpretation is that in estafa, the deceit causing the
defraudation must be prior to or simultaneous with the commission of the fraud. In issuing a
check as payment for a pre-existing debt, the drawer does not derive any material benefit in
return or as consideration for its issuance. On the part of the payee, he had already parted with
his money or property before the check is issued to him, hence, he is not defrauded by means
of any "prior" or "simultaneous" deceit perpetrated on him, by the drawer of the check.
6. ID.; ARTICLE 315, REVISED PENAL CODE AS AMENDED BY R.A. 4885; PAYMENT OF PRE-
EXISTING OBLIGATIONS NOT COVERED. — Article 315, as amended by Republic Act 4885, does
not cover checks issued in payment of pre-existing obligations, again relying on the concept
underlying the crime of estafa through false pretense or deceit - which is, that the deceit or
false pretense must be prior to or simultaneous with the commission of the fraud.
7. ID.; BATASANG PAMBANSA 22 (BOUNCING CHECK LAW;) THRUST OF LAW; PUNISHES ACT OF
MAKING OR ISSUING WORTHLESS CHECK AS AN OFFENSE AGAINST PUBLIC ORDER. — The
gravamen of the offense punished by B.P. 22 is the act of making and issuing a worthless check
or a check that is dishonored upon its presentation for payment. It is not the non-payment of
an obligation which the law punishes. The law is not intended or designed to coerce a debtor to
pay his debt. The thrust of the law is to prohibit, under pain of sanctions, the making of
worthless checks and putting them is circulation. Because of its deleterious effects on the
public interest, the practice is proscribed by the law. The law punishes the act not as an offense
against property, but an offense against public order.
8. CONSTITUTIONAL LAW; BATASANG PAMBANSA; MAY PRESCRIBE CRIMINAL PUNISHMENT
FOR ACTS INIMICAL TO PUBLIC WELFARE; MALUM PROHIBITUM. — It may be constitutionally
impermissible for the legislature to penalize a person for non-payment of a debt excontractu.
But certainly it is within the prerogative of the lawmaking body to proscribe certain acts
deemed pernicious and inimical to public welfare. Acts mala in se are not the only facts which
the law can punish. An act may not be considered by society as inherently wrong, hence not
malum in se, but because of the harm that it inflicts on the community, it can be outlawed and
criminally punished as malum prohibitum. The state can do this in the exercise of its police
power.
9. ID.; ID.; POLICE POWER; BATASANG PAMBANSA 22; VALID EXERCISE THEREOF; NOT
REPUGNANT TO CONSTITUTIONAL INHIBITION AGAINST IMPRISONMENT FOR DEBT. — The
police power of the state has been described as "the most essential, insistent and illimitable of
powers" which enables it to prohibit all things hurtful to the comfort, safety and welfare of
society. It is power not emanating from or conferred by the constitution, but inherent in the
state, plenary, "suitably vague and far from precisely defined, rooted in the conception that
man in organizing the state and imposing upon the government limitations to safeguard
constitutional rights did not intend thereby to enable individual citizens or group of citizens to
obstruct unreason able the enactment of such salutary measures to ensure communal peace,
safety, good order and welfare." The enactment of B.P. 22 is a declaration by the legislature
that, as a matter of public policy, the making and issuance of a worthless check is deemed a
public nuisance to be abated by the imposition of penal sanctions. The effect of the issuance of
a worthless checks transcends the private interests of the parties directly involved in the
transaction and touches the interests of the community at large. The mischief it creates is not
only a wrong to the payee or holder, but also an injury to the public. In sum, we find the
enactment of B.P. 22 a valid exercise of the police power and is not repugnant to the
constitutional inhibition against imprisonment for debt.
10. ID.; B.P. 22; FREEDOM OF CONTRACT NOT IMPAIRED CHECKS NOT CATEGORIZED AS
CONTRACTS. — We find not valid ground to sustain the contention that B.P. 22 impairs
freedom of contract. The freedom of contract which is constitutionally protected is freedom to
enter into "lawful" contracts. Contracts which contravene public policy are not lawful. We must
bear in mind that checks can not be categorized as mere contracts. It is a commercial
instrument which, in this modern day and age, has become a convenient substitute for money;
it form part of the banking system and therefore not entirely free from the regulatory power of
the state.
11. ID.; BILL OF RIGHTS; EQUAL PROTECTION OF LAW DOES NOT PRECLUDE CLASSIFICATION OF
INDIVIDUALS; CASE AT BAR. — Neither do we find substance in the claim that the statute in
question denies equal protection of the laws or is discriminatory, since it penalizes the drawer
of the check, but not the payee. It is contended that the payee is just as responsible for the
crime as the drawer of the check, since without the indispensable participation of the payee by
his acceptance of the check there would be no crime. This argument is tantamount to saying
that, to give equal protection, the law should punish both the swindler and the swindled. The
petitioners’ posture ignores the well-accepted meaning of the clause "equal protection of the
laws." The clause does not preclude classification of individuals, who may be accorded different
treatment under the law as long as the classification is not unreasonable or arbitrary.
Mortgages; Bonds; A Trial court cannot order that a real estate mortgage he substituted with a
surety bond.—Applying the principles underlying the nature of a mortgage, the real estate
mortgage constituted on Lot No. 1901-E-61-B-1F of the subdivision plan Psd-27482, located in
the District of Molo, Iloilo City covered by Transfer Certificate of Title No. T-50324 can not be
substituted by a surety bond as ordered by the trial court. The mortgage lien in favor of
petitioner Rodolfo Ganzon is inseparable from the mortgaged property. It is a right in rem, a
lien on the property. To substitute the mortgage with a surety bond would convert such lien
from a right in rem, to a right in personam. This conversion can not be ordered for it would
abridge the rights of the mortgagee under the mortgage contract.
Same; Same; Constitutional Law; Contracts, Court order for substitution by surety bond of a
mortgage lien would violate constitutional provision on non-impairment of contracts.—
Moreover,the questioned orders violate the non-impairment of contracts clause guaranteed
under the Constitution. Substitution of the mortgage with a surety bond to secure the payment
of the P40,000.00 note would in effect change the terms and conditions of the mortgage
contract. Even before trial on the very issues affecting the contract, the respondent court has
directed a deviation from its terms, diminished its efficiency, and dispensed with a primary
condition. Ganzon vs. Inserto, 123 SCRA 713, o. L-56450 July 25, 1983
SUMMARY:
Petitioner Ganzon loaned 40k to the Tajanlangits. The latter then executed a deed of mortgage
to secure the loan. CFI-Ilo-ilo granted the Tajanlangits’ motion to cancel the mortgage in
exchange of a surety bond they will put up. (e.g., surety bond will now secure the loan not the
mortgage land)
DOCTRINES:
The SC held that substitution of the mortgage with a surety bond to secure the payment of the
P40,000.00 note would in effect change the terms and conditions of the mortgage contract
hence violate the non-impairment of contracts clause guaranteed under the Constitution.
FACTS:
Petitioners version.
Rodolfo Ganzon loaned Php 40,000 to the respondents Randolph Tajanlangit and Esteban
Tajanlangit. The loan was evidenced by a promissory note (PN). The respondent-borrowers
executed a deed of real estate mortgage over their land in favor of the Ganzon as a security to
the above loan.
Respondents version.
Ganzon sold them a land evidenced by a deed of sale. They executed a PN for the balance of
the purchase price. They will pay such balance once the land is cleared of its current occupants.
Ganzon made them execute the deed of mortgage as security of the PN.
Petitioners answer.
Yes, there is a deed of sale but it covers a separate property. (i.e., not the same one covered by
the mortgage contract)
CFI Ilo-ilo.
Ganzon initiated a proceeding to extra-judicially foreclose the mortgaged land. The Tajanlangits
on the other hand, filed an action for specific performance, damages, prohibition w/ PI. They
also filed a “Motion For Release of Real Estate and for the Clerk of Court to Accept Bond or
Cash In Lieu Thereof”. The lower court granted the motion. It ordered the Register of Deeds of
Iloilo City to cancel the mortgage lien on the mortgaged land upon showing by the plaintiffs
that they have put up the surety bond in the sum of P80,000.00.
Hence, Ganzon filed this petition questioning the validity of the CFI’s order.
ISSUE:
WON the CFI – Ilo-ilo CAN order that a mortgage on real property be substituted by a surety
bond?  (NO)
RATIO:
The mortgage lien in favor of petitioner Rodolfo Ganzon is inseparable from the mortgaged
property. It is a right in rem, a lien on the property. To substitute the mortgage with a surety
bond would convert such lien from a right in rem, to a right in personam. This conversion
cannot be ordered for it would abridge the rights of the mortgagee under the mortgage
contract.
Moreover, the questioned orders violate the non-impairment of contracts clause guaranteed
under the Constitution. Substitution of the mortgage with a surety bond to secure the
payment of the P40,000.00 note would in effect change the terms and conditions of the
mortgage contract. Even before trial on the very issues affecting the contract, the respondent
court has directed a deviation from its terms, diminished its efficiency, and dispensed with a
primary condition.