Mallari v. Court of Appeals
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns agricultural tenants' right to redeem a sugarcane landholding. The land, originally owned by spouses Roberto and Asuncion Wijangco, was mortgaged to the Philippine National Bank (PNB). Following foreclosure due to non-payment, PNB became the highest bidder and was issued a certificate of sale. Subsequently, PNB executed a deed of conditional sale for the land to petitioners Eligio and Marcelina Mallari. 2. Procedural History: Private respondents, the agricultural tenants, filed a petition for redemption with the Court of Agrarian Relations (CAR) after learning of the sale to the Mallaris. They sought to redeem the land at P5,000.00 per hectare. The CAR dismissed their petition, finding that a certification from the Land Bank to finance the redemption did not constitute a valid tender or consignation of the redemption price, thus failing to meet jurisdictional requirements. Upon appeal, the Court of Appeals reversed the CAR's dismissal, remanding the case for further proceedings and ruling that the tenants had properly exercised their right of redemption by petitioning the court and that tender or consignation was not necessary. 3. The Petition: Petitioners, the Mallaris, seek review of the Court of Appeals' decision via a petition for review on certiorari. They argue that the private respondents have no cause of action because the deed of conditional sale in their favor was unregistered, and the redemption period had lapsed. They also contend that the private respondents failed to make a valid tender of payment or consignation of the redemption price. The petition raises the issues of whether the unregistered deed of conditional sale can be the basis for redemption and whether a Land Bank certification suffices for the redemption price.
Issue(s)
Whether private respondents have a cause of action against petitioners given the unregistered Deed of Conditional Sale and the alleged lapse of the redemption period. Whether private respondents made a valid tender of payment or consignation of the redemption price.
Ruling
The petition is dismissed. The Court of Appeals' decision reversing the CAR's dismissal and remanding the case for further proceedings is affirmed.
Ratio Decidendi
On the first issue (Cause of Action and Redemption Period): The Court held that petitioners' contention that private respondents have no cause of action because the deed of conditional sale was unregistered is without merit. The Court emphasized that the right of redemption under Republic Act No. 3844, as amended by R.A. No. 6389, is exercised within 180 days from written notice by the vendee upon registration of the sale. Crucially, the Court stated that "there is nothing in the law which provides that without such written notice, the agricultural lessees can not exercise their right of redemption." Since no written notice was given to the agricultural lessees, their right of redemption had not prescribed. Furthermore, petitioners, as transferees under an unregistered deed, cannot claim that the tenants have no cause of action against them simply because their deed was not yet registered. The PNB, as a party to the original sale, did not appeal the appellate court's finding that the private respondents had the right to redeem as agricultural lessees. On the second issue (Tender of Payment and Consignation): The Court affirmed the appellate court's ruling that it is not necessary for the lessee to make a tender of payment and/or consignation of the redemption price. The Court reasoned that while Section 11 of R.A. No. 3844 (on pre-emption) explicitly mentions a certification from the Land Bank as sufficient, Section 12 (on redemption) does not. However, the Court found that "within the context of the Code and in line with this Court's exhortation that a liberal interpretation of the Code's provisions is imperative, to give it full force and effect to its clear intent, the lessee-preemptioner and the lessee-redemptioner have the same rights and are in the same footing and category insofar as the availment of the facilities of the Land Bank and the Ministry of Agrarian Reform are concerned." Moreover, Section 12 explicitly states that "the Department of Agrarian Reform shall initiate while the Land Bank shall finance, said redemption as in the case of pre-emption." The Court concluded that a certification from the Land Bank to finance the redemption suffices, as the Land Bank is a solvent government agency mandated to finance farm lot acquisitions, and its obligations are government-guaranteed, making its commitment a reliable substitute for actual tender or consignation.
Main Doctrine
A certification from the Land Bank that it will finance the redemption of a landholding is sufficient to exercise the right of redemption by an agricultural lessee, and a formal tender of payment or consignation is not necessary, especially when the Land Bank is mandated to finance such redemptions.