Navarra v. Court of Appeals
REITERATIONFacts
1. The Antecedents: The petitioners, spouses Jorge and Carmelita Navarra, along with RRRC Development Corporation, executed a real estate mortgage in favor of Planters Development Bank to secure a loan of P1,200,000.00. Upon the petitioners' failure to repay the loan, Planters Development Bank initiated an extra-judicial foreclosure of the mortgage. A public auction was held, and Planters emerged as the highest bidder. After the one-year redemption period expired without redemption, ownership of the five parcels of land was transferred to Planters Development Bank. 2. Procedural History: Following the transfer of ownership, Planters Development Bank demanded that the petitioners vacate the premises, which was refused. Planters then filed a petition for a writ of possession with the RTC-Makati, Branch 137 (LRC Case No. M-1201). The petitioners filed an opposition, alleging ownership based on a contract of sale and a pending civil case (Civil Case No. 16917) where Planters had allegedly been declared in default. The trial court granted the petition for a writ of possession, and a motion for reconsideration was denied. The petitioners then filed a special civil action for certiorari with the Court of Appeals, which was dismissed. Their motion for reconsideration was also denied, leading to the present petition for review. 3. The Petition: The petitioners are seeking review under Rule 45 of the Rules of Court, faulting the Court of Appeals for sustaining the trial court's orders. While acknowledging the general rule that a writ of possession should be issued to the highest bidder in a foreclosure sale, the petitioners argue that this rule should not apply here because they claim to be the owners of the property due to a perfected contract of sale with Planters. They presented exchange of letters as evidence of this repurchase, which they also sought to present as newly-discovered evidence to this Court. However, the Court found that these letters were not newly-discovered evidence as they came into existence after the appellate court's decision and that the issue of ownership should be resolved in the separate civil case.
Issue(s)
Whether the Court of Appeals erred in sustaining the trial court's order granting the writ of possession despite the petitioners' claim of ownership based on a perfected contract of sale. Whether the four letters presented by the petitioners qualify as newly-discovered evidence.
Ruling
The Supreme Court affirmed the decision of the Court of Appeals, upholding the issuance of the writ of possession. The Court ruled that the issuance of a writ of possession is a ministerial duty of the court in extra-judicial foreclosure cases after the redemption period has expired without redemption. Issues concerning ownership or the validity of a contract of sale are separate matters that must be litigated in a different civil action and cannot be used to defeat the purchaser's right to possession. The Court also found that the presented letters did not qualify as newly-discovered evidence.
Ratio Decidendi
On the issuance of the writ of possession and the claim of ownership: The Court reiterated that under Act No. 3135, as amended, the purchaser at an extra-judicial foreclosure sale has a right to the possession of the property, which becomes absolute after the expiration of the redemption period without redemption. The issuance of the writ of possession by the land registration court is a ministerial duty upon mere motion by the purchaser. The Court emphasized that any question regarding the validity of the mortgage or its foreclosure, or claims of ownership based on a perfected contract of sale, cannot be raised as a ground for refusing the issuance of the writ of possession. These issues must be resolved in a separate civil case, such as Civil Case No. 16917 filed by the petitioners for specific performance. The Court noted that the petitioners failed to present evidence to substantiate their claim of ownership during the proceedings for the writ of possession, opting instead to rely on a legal argument based on Zaragoza vs. Diaz and later on letters that were not presented in the trial court. The Court found that the circumstances in the cited cases of Cometa vs. IAC and Barican vs. IAC, where the issuance of the writ was deferred, were not present in the instant case, as the controversy was confined only to the mortgagee and mortgagors, and no third parties with competing claims were involved. The Court agreed with the Court of Appeals' observation that until ownership is finally adjudicated in Civil Case No. 16917, Planters cannot be deprived of its right of possession, which springs from the failure to redeem and the subsequent issuance of new titles in its name. The Court concluded that the trial judge's order granting the petition was conformable to law because the question of ownership could not be raised in the petition for the issuance of a writ of possession. On the admissibility of the letters as newly-discovered evidence: The Court held that the four letters presented by the petitioners did not qualify as newly-discovered evidence. The definition of newly-discovered evidence requires that it could not have been discovered prior to the trial by the exercise of due diligence and that it is of such a character as would probably change the result. The letters in question were dated October 24, 1988, and November 12, 1988, which were after the promulgation of the Court of Appeals' decision on September 12, 1988. Therefore, they could not have been discovered during the trial or prior to the decision by any diligence. Furthermore, the Rules of Court allow motions for new trial based on newly-discovered evidence to be filed only with the trial court (Rule 37) or the Court of Appeals (Rule 53), but never with the Supreme Court, which is not a trier of facts. The Court reiterated its stance that it does not analyze or weigh evidence already considered in lower courts, its jurisdiction being limited to reviewing errors of law.
Main Doctrine
The issuance of a writ of possession in extra-judicial foreclosure is a ministerial duty of the court, and issues regarding ownership or the validity of a contract of sale cannot be raised as grounds to refuse its issuance, as these matters must be threshed out in a separate civil action.