Cassion v. Banco Nacional Filipino
REITERATIONFacts
The Antecedents: Plaintiffs Filomeno B. Cassion and Lorenza B. Cassion mortgaged two parcels of land, acquired as homesteads, to the Philippine National Bank (PNB) on April 8, 1932, to secure a P600 promissory note. Upon default, PNB extrajudicially foreclosed the mortgage, with PNB being the highest bidder at the auction sale held on November 19, 1934. Over a year later, PNB sold the lands to Angel C. Cabatingan. Before the expiration of five years from the auction sale date, the plaintiffs offered to repurchase the lands, but PNB refused. This led to the filing of the present suit against PNB and Cabatingan. Procedural History: The court below rendered judgment in favor of the plaintiffs. The Philippine National Bank appealed, but Cabatingan did not, despite filing a counterclaim and cross-complaint against PNB. The Petition: The appellant (PNB) argued that the redemption period for property sold under mortgage foreclosure, whether judicial or extrajudicial, is only one year, as provided by Section 32 of Act No. 2938 and Section 6 of Act No. 3135. The plaintiffs, however, relied on Section 117 of Act No. 2874 (Public Land Act), as amended, which provides a five-year period for repurchase of homestead lands from the date of conveyance.
Issue(s)
Whether the five-year repurchase period for homesteads under Section 117 of Act No. 2874 prevails over the one-year redemption period provided under Act No. 2938 and Act No. 3135.
Ruling
The Supreme Court affirmed the decision of the lower court, holding that Act No. 2874 (Public Land Act) is controlling in this case. The Court ordered that the appealed decision be affirmed with costs against the appellant.
Ratio Decidendi
On Issue 1: The Court held that the five-year repurchase period under Section 117 of the Public Land Act (Act No. 2874) is the controlling provision. Applying the principle of statutory construction found in Section 288 of Act No. 190, the Court emphasized that a particular provision controls a general one when they are inconsistent. While Act No. 2938 and Act No. 3135 are wider in scope and comprehend all properties mortgaged to the Philippine National Bank (PNB) or subject to extrajudicial foreclosure, Act No. 2874 specifically relates only to lands acquired under free patent or homestead provisions. The Court reasoned that Act No. 2874 manifests a 'particular intent' by the State to promote small land ownership and protect the underprivileged. Relying on the doctrine in Lichauco & Co. vs. Apostol and Corpus, the Court clarified that a special provision controls a general law regardless of the dates of passage. Therefore, homesteads are a specific exception to the general one-year redemption rule found in the PNB Charter and the general foreclosure law.
Main Doctrine
In cases of conflict between the Public Land Act (Act No. 2874) and laws authorizing extrajudicial foreclosure of mortgages (Act No. 2938, Act No. 3135), the Public Land Act, being a special law pertaining to homesteads, prevails over the general provisions of the other acts, granting a five-year period for repurchase of homestead lands.