Tagle v. Carandang
REITERATIONFacts
The Antecedents: Spouses Carandang mortgaged properties to Philippine Banking Corporation (PBC). Unable to pay, they executed a Dacion En Pago with Right to Repurchase, allowing them to repurchase within two years, later extended to February 16, 1990. On January 26, 1989, Spouses Tagle and Carandang executed a Contract to Sell for ₱4.5 million, with the Tagles issuing a ₱1 million check to the Carandangs, who then delivered it to PBC as partial payment and surrendered possession of the property to the Tagles. On March 31, 1989, the Carandangs executed a Deed of Assignment, selling their right to repurchase the property to the Tagles, which PBC accepted. The sale was delayed due to title reconstitution after a fire. On March 20, 1992, PBC and the Tagles executed a Deed of Absolute Sale for ₱2,934,884.96, omitting any reference to the Deed of Assignment at the Tagles' insistence. The Tagles then refused to honor their obligation to the Carandangs under the Deed of Assignment. Procedural History: The Carandangs filed a complaint for rescission of contract against the Tagles. The RTC ruled in favor of the Tagles, ordering reimbursement of the down payment. The CA reversed the RTC, holding the Tagles bound by the Deed of Assignment and ordering them to pay the Carandangs ₱445,115.04 with legal interest. The Tagles' petition for review to the Supreme Court was denied, and the decision became final and executory. Upon motion of the Carandangs, the RTC ordered the execution of the judgment. Personal properties of the Tagles (paintings and artworks) were sold at public auction on August 9, 2000, for ₱62,000.00, and on September 27, 2000, for ₱189,500.00. The Tagles filed a motion for return of artworks and to accept ₱400,000.00 as satisfaction, which was denied. The RTC fixed the judgment debt at ₱558,461.00 and denied the Tagles' motion to set aside/annul the auction sales. The CA dismissed the Tagles' petition for certiorari, upholding the validity of the auction sales. The Petition: The Tagles filed a petition for certiorari with the Supreme Court, assailing the CA's decision which upheld the RTC's orders denying their motion to set aside/annul public auctions. They argued that they did not receive written notice of the auctions as required by Section 15, Rule 39 of the Rules of Civil Procedure and that the proceeds of the sales were shockingly inadequate.
Issue(s)
Whether the Tagles were duly notified of the August 9, 2000 and September 27, 2000 public auction sales. Whether the proceeds of the auction sales were grossly inadequate, thereby invalidating the sales.
Ruling
The Supreme Court dismissed the petition, upholding the validity of the public auction sales. The Court found that the Tagles were duly notified of the auction sales and that their claim of inadequate proceeds was unsubstantiated.
Ratio Decidendi
On the issue of notice of sale: The Court held that Section 15(d) of Rule 39, requiring written notice to the judgment obligor, must be read in relation to Section 6 of Rule 13. Section 6 allows service by delivering a copy to the party or his counsel, or by leaving it in his office with his clerk or a person having charge thereof. Therefore, service on the Tagles' private secretary was valid. Furthermore, the presence of their son, Eric Tagle, during the August 9, 2000 auction, and the fact that Ernesto Tagle himself signed the notice for the September 27, 2000 auction, further belied their claim of lack of notice. The Sheriff's Report is prima facie evidence of the facts stated therein, and the sheriff enjoys the presumption of regularity in the performance of official duties, which was not overcome by bare allegations. On the issue of inadequate proceeds: The Court reiterated the principle that he who alleges a fact has the burden of proving it. The Tagles failed to discharge this burden. Their mere allegation of inadequacy of proceeds was not sufficient evidence. While Ernesto Tagle is a known artist, his reputation alone does not prove the high value of the auctioned artworks or the inadequacy of the sale price. The receipts presented by the Tagles were not sufficient proof as they did not show that the auctioned artworks were of the same kind or worth as those sold in the past. The Court emphasized the need for independent, competent, and credible valuations or appraisals to substantiate such a claim, which was absent in this case.
Main Doctrine
Service of written notice of sale on a judgment obligor's clerk or person in charge of their office is valid, and the inadequacy of the proceeds of an execution sale, without sufficient proof, does not invalidate the sale.