G.R. No. L-41811 November 10, 1986 GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), Petitioner, vs.

THE HONORABLE COURT OF APPEALS, FELIPE T. ANG and EUFROCINA C. TOBY, Respondents.

FACTS: The records disclose that from 1958 to 1971 private respondents Ang obtained from petitioner GSIS several loans secured by real estate mortgages constituted over five parcels of land registered in the names of the spouses Ang. Upon the private respondents' failure to pay their loan on tune, the GSIS foreclosed on their property extra-judicially. Seeking to obtain possession of the property it bought at the foreclosure sale, petitioner GSIS filed a petition for the issuance of a writ of possession. ISSUE: Whether or not GSIS is entitled, during the period of redemption, to the possession of the property it purchased at the foreclosure sale? HELD: This issue is hardly of first impression. We had occassion to rule on it in Marcelo Steel Corp. v. Court of Appeals, 54 SCRA 89, citing De Gracia v. San Jose, 94 Phil. 623, where this Court said: As may be seen, the law expressly authorizes the purchase to petition for a writ of possession during the redemption period by filling an ex parte motion under oath for that purpose in the corresponding registration or cadastral proceeding in the case of property with Torrens title, and upon the filing of such motion and the approval of corresponding bond, the law also in express terms directs the court to issue the order for a writ of possession. The order for a writ of possession issues as a matter of course upon the filing of the proper motion and the approval of the corresponding bond. No discretion is left to the court. And any question regarding the regularity and validity of the sale (and the consequent cancellation of the writ) is left to be determined in a subsequent proceeding. Such question is not to be raised as a justification for opposing the issuance of the writ of possession, since, under the Act, the proceeding for this is ex parte. In the present case the period of redemption had already long lapsed with no redemption having been made. In fact, the titles to all the properties purchased at the auction sale were already transferred to and registered in the name of the GSIS. This being so, there is no justifiable ground whatsoever why the Writ of Possession would not be issued.

G.R. No. 164036

October 19, 2007

SPOUSES SANTIAGO and MA. CONSUELO CARLOS, petitioners, vs. THE COURT OF APPEALS, REGIONAL TRIAL COURT, BRANCH 204, at Muntinlupa City, and LAND BANK OF THE PHILIPPINES, respondents.

FACTS: Respondent Land Bank of the Philippines foreclosed petitioner-spouses mortgaged properties for their failure to pay their obligation. Land Bank was the highest bidder at the foreclosure sale. After the lapse of the redemption period and the consolidation of the properties title in its name, Land Bank filed an Ex Parte Petition for Issuance of Writ of Possession with the RTC of Muntinlupa City. The trial court issued an order requiring all interested parties to appear on the date of the hearing and to show cause why the petition should not be granted. A copy of the order was sent to petitioners. Petitioners filed a consolidated motion to intervene and to dismiss the petition on the grounds of lack of jurisdiction and forum shopping. Petitioners alleged that there is a pending case for the declaration of nullity of the mortgage and foreclosure sale. The trial court denied the motion to intervene and to dismiss. It held that there was no forum shopping because the resolution of the case would not amount to res judicata and that the petition for the issuance of the writ of possession to Land Bank could proceed independently of any action for annulment of the sale. Petitioners moved for reconsideration but it was denied. In the meantime, the trial court continued to hear the main petition. In the scheduled hearing Land Bank failed to appear thus the trial court dismissed the petition. Land Bank moved for reconsideration, which was set for hearing. Petitioners received a copy of the motion on the day of the hearing. Petitioners opposed the motion for being a mere scrap of paper since it failed to comply with the three-day prior notice required. However, the trial court granted reconsideration citing the policy of the Court to set aside technical rules of procedure in the interest of substantial justice and because a petition for a writ of possession may be granted ex parte. ISSUES: Whether or not the ex-parte proceeding denied the petitioner of due process? Whether or not the Rules on Motion and Service applicable to a proceeding for issuance of a writ of possession filed after a foreclosure? HELD: Petitioners assert that they were denied due process of law when they were not given a three-day prior notice, which is contrary to Section 1, Article III of the Constitution. Petitioners consider Land Banks motion for reconsideration a mere scrap of paper and contend that the filing thereof did not toll the running of the reglementary period. Hence, according to the petitioners, the denial of Land Banks petition for the issuance of a writ of possession had attained finality. Land Bank counters that due process was more than complied with when the trial court, despite the ex parte nature of the proceedings, allowed and entertained the petitioners. Land Bank contends that by the nature of the proceedings and the fact that the redemption period had lapsed, and that title over the property had already been consolidated in its name, the issuance of the writ had become a ministerial duty on the part of the trial court. This Court had consistently held that the pendency of a civil case for annulment of sale is not a sufficient ground to deny the issuance of a writ of possession. The motion for issuance of a writ of possession can proceed independently and its issuance does not bar a separate case for annulment of mortgage and foreclosure sale.

The law expressly authorizes the purchaser to petition for a writ of possession by filing an ex parte motion. That being so, there is no need for the Land Bank to notify the parties of the proceedings. The trial court correctly held that the motion for issuance of a writ of possession is an exception to the general three-day notice rule for motions. Nevertheless, the ex parte nature of the proceeding does not deny due process to the petitioners because, to repeat, the issuance of the writ of possession does not bar a separate case for annulment of mortgage and foreclosure sale. G.R. No. 137566 February 28, 2001

ROBERTO G. ROSALES, as successor-in-interest of NAPOLEON S. ROSALES and LUIS BUSTILLO,petitioners, vs. THE HON. COURT OF APPEALS and NATIONAL DEVELOMENT CORPORATION, as substituted plaintiff and the successor-in-interest of CONTINENTAL BANK, respondents. FACTS: On April 12, 1966, the Continental Bank a complaint alleging that Atlas Timber Company, through its Managing Partner Napoleon Rosales, and Luis Bustillo in his personal capacity, executed in favor of Continental Bank a promissory note, in the amount of P1,000,000.00 and as security for the payment of the note, Bustillo executed in favor of the bank a real estate mortgage over forty-four (44) parcels of land and likewise, Rosales executed a real estate mortgage over forty-nine (49) parcels of land. The defendants failed and refused to pay the first amortization on the loan, thus rendering the whole principal amount thereof due and demandable. Plaintiff bank prayed that defendants be ordered to pay the amount with interest and attorney's fees equivalent. In default thereof, that the real estate mortgages executed by defendants Rosales and Bustillo in favor of the bank be judicially foreclosed.1wphi1.nt After ascertaining that defendants have failed to pay the judgment debt within ninety (90) days from January 25, 1975, when service of the decision on them was deemed completed, the court issued the Writ of Execution, commanding the Branch Deputy Sheriff to sell at public auction the lands. At the foreclosure sale, Continental Bank was awarded the lands. Accordingly, the Branch Deputy Sheriff executed the Officer's Deed of Sale on September 25, 1975, conveying to Consolidated Bank the mortgaged parcels of land. Petitioners argued that the lower court amended the decision in its Order dated April 22, 1975, by adding TCT No. T-11839 to the properties to be sold at public auction, without prior notice to petitioners (defendants therein). The amendment was substantial because it included property which was not stated in the original decision; hence, the ninety-day period for petitioners to pay the judgment debt should be reckoned not from the date of service of the original decision but from the date of service of the amendment thereto. Consequently, plaintiff's motion for execution filed on May 3, 1975, or barely eleven days after the Order amending the decision, was premature inasmuch as the thirty-day reglementary period to appeal had not yet elapsed. More importantly, the lower court's Order for the issuance of a Writ of Execution was null and void, since this was done before the expiration of the ninety-day period for defendants to pay the judgment debt. Therefore, petitioners contend that they should be allowed another period of ninety (90) days within which to pay the judgment debt. Likewise, petitioners assail the validity of the order of confirmation issued by the lower court for having been issued without affording them notice and hearing. As mortgagors, they should have been afforded a hearing and an opportunity to show cause why the sale should not be confirmed, as by proof of irregularities therein or gross inadequacy of the price. The lack of such a notice vitiates the confirmation sale, which may be set aside anytime.

Finally, petitioners accused Consolidated Bank of laches and prescription for its failure to consolidate its title for twenty (20) years. HELD: Private respondent maintained that Napoleon Rosales was duly notified of all Orders of the trial court. In fact, petitioners wrote several letters to private respondent wherein they requested that they be allowed to repurchase the properties, and that they failed to pay the real estate taxes on the lands or perform any act consistent with ownership thereof. Based on these, petitioners are estopped from claiming ownership over the properties The Court of Appeals failed to address petitioners' primary argument that the issuance of the writ of execution was null and void for failure to afford petitioners the full ninety-day period within which to pay the judgment debt and avoid the sale of their properties at public auction. The court agree with petitioners that their period of appeal and the ninety days grace period within which they could have paid the judgment debt should have been counted from service of the Order dated April 22, 1975, which substantially amended the decision. Where a judgment is amended, the date of the amendment should be considered the date of the decision in the computation of the period for perfecting the appeal. The records reflect that a copy of the amendatory Order was sent to defense counsel by registered mail on April 23, 1975. Assuming there was constructive notice, service thereof must have been deemed completed sometime thereafter. Consequently, the motion for execution filed by Continental Bank on May 3, 1975 was premature, inasmuch as it was still within the reglementary period for petitioners to appeal, which under the Rules in force at that time was fixed at thirty days. The ninety-day period within which petitioners could have paid the judgment debt and thus avoided the sale of their properties at public auction should have commenced a few days from April 23, 1975. When the Writ of Execution was issued on July 14, 1975, the said ninety-day period had not yet expired. A judgment in an action for foreclosure of mortgage could only be executed in a manner prescribed in the Rules. Where the order of execution was not in conformity with the Rules, the same is null and void. The order for defendants to pay the judgment debt within ninety days, prior to the sale of the foreclosed properties at public auction, is a substantive requirement which cannot be omitted. This 90-day period given in the rule is not a procedural requirement merely; it is a substantive right granted to the mortgage debtor as the last opportunity to pay the debt and save his mortgaged property from final disposition at the foreclosure sale. It is one of the two steps necessary to destroy what in law is known as the mortgagor's equity of redemption, the other being the sale. It may not be omitted. As the writ of execution or the order allowing the sale of the mortgaged property was issued without granting the mortgage debtor said 90-day period, the order for the sale of the property would be a denial of a substantial right and void. The sale to Continental Bank of the subject real properties is likewise null and void because the action or defense for the declaration of inexistence of a contract does not prescribe. The court also said that there is no dispute that mere inadequacy of the price per se will not set aside a judicial sale of real property. In addressing the issue of laches, the court held that there is no absolute rule as to what constitutes laches or staleness of demand and each case is to be determined according to its particular circumstances. The question of laches is addressed to the sound discretion of the court and since laches is an equitable doctrine, its application is controlled by equitable considerations.

As far as petitioner Bustillo's land is concerned, the dispositive portion of the decision was not in accord with the findings as contained in the body thereof. While the dispositive portion prevails over the body of the decision in case of conflict, this rule does not apply where it is clear from the body of the decision that there was a glaring error made in the dispositive portion, in which case the body of the decision will control. The general rule is, where there is a conflict between the dispositive portion or the fallo and the body of the decision, the fallo controls. This rule rests on the theory that the fallo is the final order while the opinion in the body is merely a statement ordering nothing. However, where the inevitable conclusion from the body of the decision is so clear as to show that there was a mistake in the dispositive portion, the body of the decision will prevail. The trial court clearly found that Bustillo did not make or sign the promissory note, and thus declared that he should not be held liable for the loan and his property should not be sold at public auction, unless the properties included in petitioner Rosales' mortgage was not sufficient to satisfy the entire money judgment. In the dispositive portion, however, the trial court ordered that TCT No. T-11337, in the name of petitioner Bustillo, was to be sold at public auction, absolutely and without qualification. This part of the judgment, which subjected Bustillo's property primarily liable for the judgment debt notwithstanding the finding that the same should only be made to answer for the debt in a subsidiary manner, violated Bustillo's right against the deprivation of property without due process of law. Hence, the body of the decision should have prevailed over the dispositive portion, and Bustillo's property should not have been sold at public auction unless it was shown that the lands belonging to Napoleon Rosales were insufficient to satisfy the judgment debt. Therefore, the sheriff's sale of to Continental Bank is hereby declared null and void. Hence, petitioners are hereby granted a new period of one hundred twenty (120) days within which to pay the same, otherwise the lands covered shall be sold at public auction to satisfy the debt. Under the 1997 Rules of Civil Procedure, the period prescribed for that purpose in cases of judicial foreclosure is not less than ninety (90) days nor more than one hundred twenty (120) days, counted from entry of judgment.

G.R. No. 133876. December 29, 1999 BANK OF AMERICA, NT and SA, Petitioner, vs. AMERICAN REALTY CORPORATION and COURT OF APPEALS, Respondents.

FACTS: Petitioner Bank of America NT & SA (BANTSA) is an international banking and financing institution duly licensed to do business in the Philippines, organized and existing under and by virtue of the laws of the State of California, United States of America while private respondent American Realty Corporation (ARC) is a domestic corporation. Bank of America International Limited (BAIL), on the other hand, is a limited liability company organized and existing under the laws of England. BANTSA and BAIL on several occasions granted three major multi-million United States (US) Dollar loans to the following corporate borrowers: (1) Liberian Transport Navigation, S.A.; (2) El Challenger S.A. and (3) Eshley Compania Naviera S.A. (hereinafter collectively referred to as borrowers), all of which are existing under and by virtue of the laws of the Republic of Panama and are foreign

affiliates of private respondent. Due to the default in the payment of the loan amortizations, BANTSA and the corporate borrowers signed and entered into restructuring agreements. As additional security for the restructured loans, private respondent ARC as third party mortgagor executed two real estate mortgages. Eventually, the corporate borrowers defaulted in the payment of the restructured loans prompting petitioner BANTSA to file civil actions before foreign courts for the collection of the principal loan. In the civil suits instituted before the foreign courts, private respondent ARC, being a third party mortgagor, was not impleaded as party-defendant. Petitioner BANTSA filed before the Office of the Provincial Sheriff of Bulacan, Philippines, an application for extrajudicial foreclosure of real estate mortgage. After due publication and notice, the mortgaged real properties were sold at public auction in an extrajudicial foreclosure sale. Consequently, private respondent filed before the Pasig Regional Trial Court an action for damages against the petitioner for foreclosing extrajudicially the real estate mortgages despite the pendency of civil suits before foreign courts for the collection of the principal loan. In its answer petitioner alleged that the rule prohibiting the mortgagee from foreclosing the mortgage after an ordinary suit for collection has been filed, is not applicable in the present case. Private respondent then filed a motion for suspension of the redemption period and such was granted. On 07 February 1994, ICCS, the purchaser of the mortgaged properties at the foreclosure sale, consolidated its ownership over the real properties in its name. After the consolidation of ownership in its favor, ICCS sold the real properties to Stateland Investment Corporation. After trial, the lower court rendered a decision in favor of private respondent ARC. On appeal, the Court of Appeals affirmed the assailed decision of the lower court prompting petitioner to file a motion for reconsideration which the appellate court denied. ISSUE: Does a mortgage-creditor waive its remedy to foreclose the real estate mortgage constituted over a third party mortgagors property situated in the Philippines by filing an action for the collection of the principal loan before foreign courts? HELD: Petitioner submits that a waiver of the remedy of foreclosure requires the concurrence of two requisites: an ordinary civil action for collection should be filed and subsequently a final judgment be correspondingly rendered therein. In the absence of express statutory provisions, a mortgage creditor may institute against the mortgage debtor either a personal action for debt or a real action to foreclose the mortgage. In other words, he may pursue either of the two remedies, but not both. By such election, his cause of action can by no means be impaired, for each of the two remedies is complete in itself. Thus, an election to bring a personal action will leave open to him all the properties of the debtor for attachment and execution, even including the mortgaged property itself. And, if he waives such personal action and pursues his remedy against the mortgaged property, an unsatisfied judgment thereon would still give him the right to sue for a deficiency judgment, in which case, all the properties of the defendant, other than the mortgaged property, are again open to him for the satisfaction of the deficiency. In either case, his remedy is complete, his cause of action undiminished, and any advantages attendant to the pursuit of one or the other remedy are purely accidental and are all under his right of election. On the other hand, a rule that would authorize the plaintiff to bring a personal action against the debtor and simultaneously or successively another action against the mortgaged property, would result not only in multiplicity of suits so offensive to justice (Soriano vs. Enriques, 24 Phil. 584) and obnoxious to law and equity (Osorio vs.

San Agustin, 25 Phil., 404), but also in subjecting the defendant to the vexation of being sued in the place of his residence or of the residence of the plaintiff, and then again in the place where the property lies. In Danao vs. Court of Appeals, reiterating jurisprudence enunciated in Manila Trading and Supply Co. vs. Co Kim and Movido vs. RFC, invariably held: The rule is now settled that a mortgage creditor may elect to waive his security and bring, instead, an ordinary action to recover the indebtedness with the right to execute a judgment thereon on all the properties of the debtor, including the subject matter of the mortgage, subject to the qualification that if he fails in the remedy by him elected, he cannot pursue further the remedy he has waived. Anent real properties in particular, the Court has laid down the rule that a mortgage creditor may institute against the mortgage debtor either a personal action for debt or a real action to foreclose the mortgage. In our jurisdiction, the remedies available to the mortgage creditor are deemed alternative and not cumulative. Notably, an election of one remedy operates as a waiver of the other. A remedy is deemed chosen upon the filing of the suit for collection or upon the filing of the complaint in an action for foreclosure of mortgage, pursuant to the provision of Rule 68 of the 1997 Rules of Civil Procedure. As to extrajudicial foreclosure, such remedy is deemed elected by the mortgage creditor upon filing of the petition not with any court of justice but with the Office of the Sheriff of the province where the sale is to be made, in accordance with the provisions of Act No. 3135, as amended by Act No. 4118. Private respondent ARC constituted real estate mortgages over its properties as security for the debt of the principal debtors. By doing so, private respondent subjected itself to the liabilities of a third party mortgagor. Under the law, third persons who are not parties to a loan may secure the latter by pledging or mortgaging their own property. In Cerna vs. Court of Appeals, we agreed with the petitioner in said case, that the filing of a collection suit barred the foreclosure of the mortgage: A mortgagee who files a suit for collection abandons the remedy of foreclosure of the chattel mortgage constituted over the personal property as security for the debt or value of the promissory note when he seeks to recover in the said collection suit. When the mortgagee elects to file a suit for collection, not foreclosure, thereby abandoning the chattel mortgage as basis for relief, he clearly manifests his lack of desire and interest to go after the mortgaged property as security for the promissory note. Contrary to petitioners arguments that the mere act of filing of an ordinary action for collection operates as a waiver of the mortgage-creditors remedy to foreclose the mortgage. By the mere filing of the ordinary action for collection against the principal debtors, the petitioner in the present case is deemed to have elected a remedy, as a result of which a waiver of the other necessarily must arise. Corollarily, no final judgment in the collection suit is required for the rule on waiver to apply. Hence, in Caltex Philippines, Inc. vs. Intermediate Appellate Court, a case relied upon by petitioner, supposedly to buttress its contention, this Court had occasion to rule that the mere act of filing a collection suit for the recovery of a debt secured by a mortgage constitutes waiver of the other remedy of foreclosure. Petitioner BANTSA only has one cause of action which is non-payment of the debt. Nevertheless, alternative remedies are available for its enjoyment and exercise. Petitioner then may opt to exercise only one of two remedies so as not to violate the rule against splitting a cause of action.

In the present case, however, we shall not follow this rule to the letter but declare that it is the collection suit which was waived and/or abandoned. It is of no moment that the collection suit was filed ahead, what is determinative is the fact that the foreclosure proceedings ended even before the decision in the collection suit was rendered. This argument shows desperation on the part of petitioner to rivet its crumbling cause. Philippine law shall apply notwithstanding the evidence presented by petitioner to prove the English law on the matter. In a long line of decisions, this Court adopted the well-imbedded principle in our jurisdiction that there is no judicial notice of any foreign law. A foreign law must be properly pleaded and proved as a fact. Thus, if the foreign law involved is not properly pleaded and proved, our courts will presume that the foreign law is the same as our local or domestic or internal law. This is what we refer to as the doctrine of processual presumption. Thus, when the foreign law, judgment or contract is contrary to a sound and established public policy of the forum, the said foreign law, judgment or order shall not be applied. Additionally, prohibitive laws concerning persons, their acts or property, and those which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country. The public policy sought to be protected in the instant case is the principle imbedded in our jurisdiction

G.R. No. 160479

June 8, 2005

SPOUSES GODOFREDO V. ARQUIZA and REMEDIOS D. ARQUIZA, petitioners, vs. COURT OF APPEALS and EQUITABLE PCIBANK, respondents. FACTS: The petitioners, spouses Godofredo V. Arquiza and Remedios D. Arquiza, obtained a loan from private respondent Equitable PCIBank and to secure the payment thereof, the petitioners executed a Real Estate Mortgage over their parcel of land. When the spouses defaulted in the payment of their loan, the private respondent filed a petition for extrajudicial foreclosure of the real estate mortgage. A public auction was held during which the mortgaged property, together with all the improvements existing thereon, was sold to the private respondent as the highest bidder. Accordingly, a Certificate of Sale over the property was issued in favor of the private respondent and was registered subsequently. Following the expiry date of the redemption period without the petitioners having exercised their right to redeem the property, the private respondent consolidated its ownership over the subject property. As a consequence, the Registry of Deeds issued a new one in the name of the private respondent, canceling the petitioners former title. The petitioners filed a complaint against the private respondent and the sheriffs for the declaration of the nullity of the promissory note, real estate mortgage and the foreclosure sale and damages with a plea for injunctive relief for the suspension redemption period.

The private respondent demanded that the petitioners vacate and surrender possession of the subject property, but the latter refused to do so. This compelled the private respondent to file an Ex Parte Petition for Issuance of a Writ of Possession. On February 22, 2002, the trial court rendered a Decision granting the petition for Issuance of a Writ of Possession. The petitioners appealed the decision to the CA and the CA affirmed the judgment rendered. ISSUES: Firstly, is it right, proper and just for the Court below to completely ignore and disregard a related prior and pending action between the same parties where the very basis of the right of possession over the subject property sought to be enforced as a result of the foreclosure of a "mortgage" is being assailed in court for being null and void ab initio or inexistent? Secondly, is it right, proper and just for the Court below to summarily close its eyes to the patent and obvious flaw or irregularity of the "mortgage" in the appreciation of the evidence offered in support of the Ex-Parte Petition For the Issuance of a Writ of Possession? Thirdly, does the application of Section 7 of Act 3135, as amended by Act 4118, as the Court below did, exclude or preclude the effectivity or applicability of the mandate against forum shopping, of the requirement for certification in pleadings against forum shopping, of the principle of "litis pendentia," and of due process of law? HELD: The certification against forum shopping is required only in a complaint or other initiatory pleading. The ex parte petition for the issuance of a writ of possession filed by the respondent is not an initiatory pleading. Although the private respondent denominated its pleading as a petition, it is, nonetheless, a motion. What distinguishes a motion from a petition or other pleading is not its form or the title given by the party executing it, but rather its purpose. The office of a motion is not to initiate new litigation, but to bring a material but incidental matter arising in the progress of the case in which the motion is filed. A motion is not an independent right or remedy, but is confined to incidental matters in the progress of a cause. It relates to some question that is collateral to the main object of the action and is connected with and dependent upon the principal remedy. An application for a writ of possession is a mere incident in the registration proceeding. Hence, although it was denominated as a "petition," it was in substance merely a motion. Thus, the CA correctly made the following observations: Such petition for the issuance of a writ of possession is filed in the form of an ex parte motion, inter alia, in the registration or cadastral proceedings if the property is registered. Apropos, as an incident or consequence of the original registration or cadastral proceedings, the motion or petition for the issuance of a writ of possession, not being an initiatory pleading, dispels the requirement of a forum-shopping certification. Axiomatic is that the petitioner need not file a certification of non-forum shopping since his claims are not initiatory in character (Ponciano vs. Parentela, Jr., 331 SCRA 605 [2000]) SEC. 7. In any sale made under the provisions of this Act, the purchaser may petition the Court of First Instance of the province or place where the property or any part thereof is situated, to give him possession thereof during the redemption period, furnishing bond in an amount equivalent to the use of the property for a period of twelve months, to indemnify the debtor in case it be shown that the sale was made without violating the mortgage or without complying with the requirements of this Act. Such petition shall be made under oath and filed in form of an ex parte motion in the registration or cadastral proceedings if the property is registered, or in special proceedings in the case of property registered

under the Mortgage Law or under Sec. 194 of the Administrative Code, or of any other real property encumbered with a mortgage duly registered in the office of any register of deeds in accordance with any existing law, and in each case the clerk of court shall, upon the filing of such petition, collect the fees specified in par. 11 of Sec. 114 of Act No. 496, and the court shall, upon the filing of the bond, order that a writ of possession issue, addressed to the sheriff of the province in which the property is situated, who shall execute said order immediately. Indeed, it is well-settled that an ordinary action to acquire possession in favor of the purchaser at an extrajudicial foreclosure of real property is not necessary. There is no law in this jurisdiction whereby the purchaser at a sheriffs sale of real property is obliged to bring a separate and independent suit for possession after the one-year period for redemption has expired and after he has obtained the sheriffs final certificate of sale. The basis of this right to possession is the purchasers ownership of the property. The mere filing of an ex parte motion for the issuance of the writ of possession would suffice, and no bond is required. The Court rejects the contention of the petitioners that the RTC erred in not dismissing the petition of the private respondent on the grounds of forum shopping and litis pendentia. As heretofore ruled by the Court, the petition of the private respondent for a writ of possession was not an ordinary action. After the consolidation of title in the buyers name for failure of the mortgagor to redeem, the writ of possession becomes a matter of right. Its issuance to a purchaser in an extrajudicial foreclosure is merely a ministerial function. The issuance of the writ of possession being a ministerial function, and summary in nature, it cannot be said to be a judgment on the merits, but simply an incident in the transfer of title. Hence, a separate case for annulment of mortgage and foreclosure sale cannot be barred by litis pendentia or res judicata.

G.R. No. 128567

September 1, 2000

HUERTA ALBA RESORT INC., petitioner, vs. COURT OF APPEALS and SYNDICATED MANAGEMENT GROUP INC., respondents. FACTS: In a complaint for judicial foreclosure of mortgage with preliminary injunction filed by herein private respondent, they seek the foreclosure of four (4) parcels of land mortgaged by petitioner to Intercon Fund Resource, Inc. ("Intercon"). Private respondent instituted an action as mortgagee-assignee of a loan obtained by petitioner from Intercon, in whose favor petitioner mortgaged the aforesaid parcels of land as security for the said loan. Later on, the trial court rendered its decision in favor of the private respondent. Petitioner appealed the decision of the trial court to the Court of Appeals which dismissed the case on the ground of late payment of docket fees. Petitioner's motion for reconsideration of the dismissal of its petition denied with. A second motion for reconsideration was filed to submit the case for hearing by the Court en banc was filed, but to no avail. The Court resolved to deny the same. ISSUE: Whether or not the defendant lost its right of redemption by virtue of the assignment of its mortgage debt by Intercon to plaintiff, which is not a bank or credit institution?

HELD: "It is undisputed that Intercon is a credit institution from which defendant obtained a loan secured with a real estate mortgage over four (4) parcels of land. Assuming that the mortgage debt had not been assigned to plaintiff, there is then no question that defendant would have a right of redemption in case of foreclosure, judicially or extrajudicially, pursuant to Section 78 of RA 337, as amended. However, the pivotal issue here is whether or not the defendant lost its right of redemption by virtue of the assignment of its mortgage debt by Intercon to plaintiff, which is not a bank or credit institution. The issue is resolved in the negative. The right of redemption in this case is vested by law and is therefore an absolute privilege which defendant may not lose even though plaintiffassignee is not a bank or credit institution (Tolentino versus Court of Appeals, 106 SCRA 513). Indeed, a contrary ruling will lead to a possible circumvention of Section 78 because all that may be needed to deprive a defaulting mortgagor of his right of redemption is to assign his mortgage debt from a bank or credit institution to one which is not. Protection of defaulting mortgagors, which is the avowed policy behind the provision, would not be achieved if the ruling were otherwise. Consequently, defendant still possesses its right of redemption which it may exercise up to October 21, 1995 only, which is one year from the date of registration of the certificate of sale of subject properties (GSIS versus Iloilo, 175 SCRA 19, citing Limpin versus IAC, 166 SCRA 87). Since the period to exercise defendant's right of redemption has not yet expired, the cancellation of defendant's transfer certificates of title and the issuance of new ones in lieu thereof in favor of plaintiff are therefore illegal for being premature, thereby necessitating reconveyance. From the various decisions, resolutions and orders a quo it can be gleaned that what petitioner has been adjudged to have was only the equity of redemption over subject properties. On the distinction between the equity of redemption and right of redemption, the case of Gregorio Y. Limpin vs. Intermediate Appellate Court, comes to the fore. Held the Court in the said case: "The equity of redemption is, to be sure, different from and should not be confused with the right of redemption. The right of redemption in relation to a mortgage understood in the sense of a prerogative to reacquire mortgaged property after registration of the foreclosure sale exists only in the case of the extrajudicial foreclosure of the mortgage. No such right is recognized in a judicial foreclosure except only where the mortgagee is the Philippine National Bank or a bank or banking institution. Where a mortgage is foreclosed extrajudicially, Act 3135 grants to the mortgagor the right of redemption within one (1) year from the registration of the sheriff's certificate of foreclosure sale. Where the foreclosure is judicially effected, however, no equivalent right of redemption exists. The law declares that a judicial foreclosure sale when confirmed be an order of the court shall operate to divest the rights of all the parties to the action and to vest their rights in the purchaser, subject to such rights of redemption as may be allowed by law.' Such rights exceptionally 'allowed by law, and the General Banking Act (R.A. 337). These laws confer on the mortgagor, his successors in interest or any judgment creditor of the mortgagor, the right to redeem the property sold on foreclosure after confirmation by the court of the foreclosure sale which right may be exercised within a period of one (1) year, counted from the date of registration of the certificate of sale in the Registry of Property. But, to repeat, no such right of redemption exists in case of judicial foreclosure of a mortgage if the mortgagee is not the PNB or a bank or banking institution. In such a case, the foreclosure

sale, when confirmed by an order of the court shall operate to divest the rights of all the parties to the action and to vest their rights in the purchaser. There then exists only what is known as the equity of redemption. This is simply the right of the defendant mortgagor to extinguish the mortgage and retain ownership of the property by paying the secured debt within the 90-day period after the judgment becomes final, in accordance with Rule 68, or even after the foreclosure sale but prior to its confirmation. Section 2, Rule 68 provides that '. . If upon the trial . . the court shall find the facts set forth in the complaint to be true, it shall ascertain the amount due to the plaintiff upon the mortgage debt or obligation, including interest and costs, and shall render judgment for the sum so found due and order the same to be paid into court within a period of not less than ninety (90) days from the date of the service of such order, and that in default of such payment the property be sold to realize the mortgage debt and costs.' This is the mortgagor's equity (not right) of redemption which, as above stated, may be exercised by him even beyond the 90-day period 'from the date of service of the order,' and even after the foreclosure sale itself, provided it be before the order of confirmation of the sale. After such order of confirmation, no redemption can be effected any longer."