Spouses Verceles v. Court of First Instance of Rizal
REITERATIONFacts
1. The Antecedents: Spouses Teofisto and Eulalia Verceles obtained a loan of P250,000.00 from Banco de Oro Savings & Mortgage Bank, secured by a mortgage on their property in Pasig, Metro Manila. Upon their failure to pay installments despite demands, the bank initiated extrajudicial foreclosure proceedings. The property was sold at public auction to the bank for P389,367.74, representing the outstanding obligation, after several postponements at the petitioners' request. The sheriff's certificate of sale was registered on May 12, 1980. 2. Procedural History: Following the expiration of the redemption period and the petitioners' failure to redeem, the respondent bank consolidated its ownership, with the petitioners' attorney-in-fact executing a deed of absolute sale on August 1, 1981. The Register of Deeds then issued a new title in the bank's name. Subsequently, the respondent bank filed a petition for a writ of possession with the Court of First Instance of Rizal, which was granted on September 14, 1981, despite the petitioners' failure to appear at the hearing. The petitioners later filed a petition to set aside the sheriff's certificate of sale and the writ of possession, which was denied by the trial court on October 13, 1982. The property was turned over to the respondent bank on October 28, 1982. 3. The Petition: The petitioners filed a petition for certiorari with the Supreme Court, challenging the trial court's orders dated September 14, 1981, and October 13, 1982. They raised two main grounds: (1) that the respondent bank was not represented by an authorized representative during the auction sale, and (2) that the writ of possession was issued without a required bond. The petitioners argued that the one-year redemption period should be reckoned from the registration of the final deed of sale, not just the certificate of sale, and that the bank's failure to provide a statement of assessments and taxes interrupted the redemption period.
Issue(s)
Whether the respondent bank was duly represented during the auction sale. Whether the issuance of a writ of possession without a bond is in accordance with law. Whether the period of redemption had expired.
Ruling
The petition is dismissed for lack of merit. The orders of the trial court dated September 14, 1981, and October 13, 1982, are affirmed.
Ratio Decidendi
On the representation of the respondent bank during the auction sale: The Court found the first ground untenable. The minutes of the public auction showed that the respondent bank was represented by its assistant vice president, who was also its legal counsel and secretary. The Court held that this official did not need to present a special power of attorney to establish his authority under the circumstances. The bank's subsequent actions, such as registering the sheriff's certificate of sale, consolidating ownership, and securing a writ of possession, further confirmed the authority of its representative. On the issuance of a writ of possession without a bond: The Court ruled that the second ground was also without merit. The sheriff's certificate of sale was duly registered on May 12, 1980. The one-year period of redemption in extrajudicial foreclosure sales commences from the date of registration of the sheriff's certificate of sale with the Register of Deeds, as provided by law and jurisprudence. The Court clarified that the certificate of sale is a memorandum of purchase registered and annotated on the title, while the deed of absolute sale is executed after the expiration of the redemption period. The issuance of a writ of possession to the purchaser after the redemption period has expired and ownership has been consolidated is a ministerial duty of the trial court and does not require the posting of a bond, as it is a right granted by law. On whether the period of redemption had expired: The Court found no merit in the petitioners' contention that the period of redemption had not yet expired due to the respondent bank's alleged non-compliance with a condition in the certificate of sale regarding the submission of assessments or taxes paid. The Court held that there was no stipulation in the certificate of sale, nor any law, that would interrupt the running of the one-year redemption period due to such non-compliance. The Court noted that the petitioners had not paid any amount on their account nor demonstrated any effort to redeem the property, and that the respondent bank had correctly applied the rules on extrajudicial foreclosure, redemption, and writs of possession.
Main Doctrine
The one-year period for redemption in an extrajudicial foreclosure sale commences from the date of registration of the sheriff's certificate of sale with the Register of Deeds. The issuance of a writ of possession to the purchaser after the expiration of the redemption period and consolidation of ownership is a ministerial duty of the court and does not require a bond.