Leong v. Tanguanco
REITERATIONFacts
The Antecedents: Hermosa Savings and Loan Bank, Inc. (Hermosa Bank) filed an Ex-Parte Petition for the Issuance of Writ of Possession against petitioners after purchasing three parcels of land at an extra-judicial foreclosure sale, alleging the redemption period had elapsed and ownership had been consolidated. Petitioners opposed, asserting the nullity of the foreclosure and sale due to simulated mortgage contracts, loan agreements, and promissory notes executed without consideration to cover up third-party loans, pointing to a pending Civil Case No. LP-99-0072 in the RTC of Las Piñas for Declaration of Nullity of Contracts, Annulment of Extra-judicial Foreclosure Sales, Reconveyance, Damages, and Injunction. Procedural History: The Regional Trial Court (RTC) of Bacoor, Cavite, denied petitioners' motions to dismiss/suspend proceedings and for consolidation, deeming the issuance of a writ of possession ministerial and the Las Piñas case insufficient grounds to refuse it, while asserting its jurisdiction over the Cavite properties. Petitioners filed a Petition for Certiorari with the Court of Appeals (CA). While the petition was pending, the RTC issued the writ of possession. The CA subsequently dismissed the petition as moot and academic, stating the case was terminated with finality. Petitioners then filed the instant petition for review on certiorari. The Petition: Petitioners seek the reversal of the CA's decision, arguing the CA erred in dismissing their petition as moot and academic. They contend that the validity of the mortgage contracts and foreclosure must be resolved first, and that the consolidation of ownership and transfer of titles are void because the redemption period was tolled by the pendency of their civil action. They invoke cases such as Cometa, Barican, Active Wood Products Co., Inc., and Consolidated Bank and Trust Corporation to support their claims that courts possess discretion to stay writs of possession, order consolidation, and consider pending actions as tolling the redemption period.
Issue(s)
Whether the Court of Appeals erred in dismissing the petition for certiorari as moot and academic. Whether the issues as to the validity of the real estate mortgage contracts, loan agreements, promissory notes, extrajudicial foreclosure, and auction sale must first be resolved before a writ of possession can be issued. Whether the consolidation of ownership and transfer of titles in favor of Hermosa Bank are null and void due to the alleged tolling of the redemption period by the pendency of Civil Case No. LP-99-0072. Whether the RTC of Bacoor, Cavite, erred in denying the motion to dismiss/suspend proceedings and for consolidation.
Ruling
The petition is DENIED. The Court of Appeals did not commit reversible error in dismissing the petition as moot and academic. The issuance of the writ of possession by the RTC of Bacoor, Cavite, rendered the petition for consolidation moot. However, petitioners are not precluded from pursuing appropriate remedies depending on the outcome of the case pending before the RTC of Las Piñas.
Ratio Decidendi
On the mootness of the petition for certiorari: The Court of Appeals correctly found that the RTC of Bacoor, Cavite, had already granted the writ of possession sought by Hermosa Bank. Consequently, the petition to consolidate the case before the RTC of Bacoor with the case pending before the RTC of Las Piñas had become moot and academic. The CA's dismissal was therefore proper, as the primary relief sought by the petitioners in their certiorari petition before the CA was rendered moot by subsequent events. This does not, however, preclude petitioners from availing themselves of appropriate remedies depending upon the outcome in the RTC of Las Piñas case. On the issuance of the writ of possession: The Court reiterated the established rule that the issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale is a ministerial duty of the court. The RTC of Bacoor, Cavite, correctly held that the mere pendency of Civil Case No. LP-99-0072, which questioned the validity of the mortgage and foreclosure, was not a sufficient legal ground to justify the non-issuance of the writ of possession. The factual circumstances in Cometa and Barican, which petitioners relied upon, were found to be vastly different from the present case, lacking the equitable circumstances that would justify an exception to the ministerial rule. The Court cited Spouses Eduardo Vaca and Ma. Luisita Pilar v. Court of Appeals and other cases to underscore that a separate civil suit questioning the validity of the mortgage or its foreclosure cannot legally prevent the issuance of a writ of possession. The Court did not delve deeply into the merits of the alleged simulated contracts or contracts of adhesion, as the primary issue before it concerned the issuance of the writ of possession and the procedural aspects of consolidation and mootness. The Court's focus remained on the ministerial duty of the RTC to issue the writ once the conditions under Act No. 3135 were met. The petitioners' claims regarding the simulated nature of the agreements and their status as individuals with limited resources against a bank were matters to be fully ventilated in the civil case pending before the RTC of Las Piñas, not in the summary proceeding for a writ of possession. On the tolling of the redemption period and consolidation of cases: The Court noted that petitioners did not deny failing to exercise their right of redemption. While they argued that redemption would be inconsistent with their claim of invalidity and that the pendency of an action tolls the redemption period, this argument was not given weight in the context of the issuance of a writ of possession. The Court's ruling on the ministerial nature of the writ of possession implicitly means that the proceedings for the writ are distinct from the main case questioning the validity of the foreclosure, and the latter does not automatically suspend the former or the redemption period in the absence of a clear legal basis or equitable circumstances. The RTC of Bacoor, Cavite, correctly denied the prayer for consolidation. Pursuant to Section 7 of Act No. 3135, the court where the subject parcels of land are situated has jurisdiction over the case for the issuance of a writ of possession. Since the subject properties are located in Bacoor, Cavite, the RTC of Bacoor, Cavite, was the proper venue. Consolidation with the Las Piñas RTC, which was handling a case for declaration of nullity of contracts, was not warranted under the circumstances, especially given the ministerial nature of the writ of possession proceeding. On the denial of the motion to dismiss/suspend proceedings: The Court's rulings on the ministerial nature of the writ of possession, the lack of legal basis to suspend proceedings based on the pending case in Las Piñas, and the propriety of the RTC of Bacoor's jurisdiction implicitly support the denial of the motion to dismiss/suspend proceedings. The Court's focus on the procedural aspects and the ministerial duty of the RTC indicates that the RTC did not err in proceeding with the writ of possession despite the pending case in Las Piñas.
Main Doctrine
The issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale is a ministerial duty of the court, and the pendency of a separate civil suit questioning the validity of the mortgage or its foreclosure cannot be a legal ground for refusing its issuance, unless equitable circumstances warrant an exception.