Parents-Teachers Association v. Metropolitan Bank
REITERATIONFacts
The Antecedents: The underlying dispute originated from a loan granted by Metropolitan Bank and Trust Co. (MBTC) to spouses Denivin and Josefina Ilagan, secured by a real estate mortgage over several parcels of land. Upon the spouses' default, MBTC conducted an extrajudicial foreclosure, becoming the highest bidder and receiving a Certificate of Sale. During the redemption period, MBTC filed an ex-parte petition for a writ of possession. Procedural History: The St. Mathew Christian Academy (SMCA) filed a Petition for Injunction to prevent the issuance of the writ, arguing it was a third party in possession. The trial court, in a Joint Decision, found that SMCA was not a third party, that the lease agreement was not binding on third parties, and that the spouses Ilagan were practically the owners of SMCA, thus piercing the corporate veil. The court affirmed the writ of possession and dismissed SMCA's injunction case. Petitioners, the Parents-Teachers Association (PTA) of SMCA and certain teachers and students, sought to intervene but were initially allowed, then denied. They filed a Petition for Certiorari and Prohibition with the Court of Appeals (CA), which was dismissed for lack of merit, holding that a motion for reconsideration should have been filed first and that certiorari was not the proper remedy. The CA's denial of their motion for reconsideration led to the present petition. The Petition: The petitioners, representing the PTA of SMCA and certain teachers and students, filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court. They argue that the CA erred in dismissing their petition, in ruling that a motion for reconsideration was necessary before filing a certiorari petition, and in failing to consider the merits of their case based on justice and equity rather than technicalities. They contend that their remedy was indeed a petition for certiorari and that the trial court's order denying their intervention and directing the implementation of the writ of possession violated their rights and due process.
Issue(s)
Whether the Court of Appeals committed reversible error in failing to consider the petitioners' grounds regarding their status as third parties and the nature of the writ of possession. Whether the Court of Appeals committed reversible error in ruling that the remedy available to petitioners was not a special civil action of certiorari and in requiring a motion for reconsideration. Whether the Court of Appeals committed reversible error in not considering the alleged violation of the right to quality education and academic freedom, and the alleged lack of authority to sign the certificate of non-forum shopping. Whether the Court of Appeals committed reversible error in not holding that considerations of justice and equity should prevail over technicality.
Ruling
The petition is bereft of merit. The Court of Appeals did not commit reversible error. The petition for review on certiorari is denied, and the CA's decision and resolution are affirmed. The temporary restraining order is lifted and set aside.
Ratio Decidendi
On the nature of the writ of possession and the status of petitioners as third parties: The Court reiterated the general rule that the issuance of a writ of possession after foreclosure sale is ministerial, with an exception for adverse third parties. The Court found that the petitioners, as teachers and students of SMCA, were not adverse third parties because their possession was based on contracts with SMCA, which was practically owned by the mortgagors. Therefore, their possession was not adverse to the judgment debtor or mortgagor. The Court also noted that the RTC had already ruled that SMCA was not a third party. On the proper remedy and the requirement of a motion for reconsideration: The Court held that the CA correctly ruled that a petition for certiorari was not the proper remedy. According to Section 8 of Act No. 3135, the proper remedy for issues regarding the regularity and validity of the sale is a separate, distinct, and independent suit, not a petition for certiorari. Furthermore, the Court affirmed the general rule that a motion for reconsideration must be filed before resorting to certiorari, unless exceptions apply. The petitioners failed to sufficiently substantiate any urgent or compelling reasons to bypass the motion for reconsideration requirement. On the alleged violation of the right to quality education and academic freedom, and the alleged lack of authority to sign the certificate of non-forum shopping: The Court found no violation of the students' right to quality education or academic freedom, noting that the constitutional mandate to protect education is directed at the State, not private schools, and that academic freedom pertains to institutions of higher learning. The petitioners failed to show how these rights were violated by the issuance of the writ. The Court also dismissed the contention regarding the certificate of non-forum shopping, citing jurisprudence that an application for a writ of possession is considered a motion, not an initiatory pleading, and thus does not require such a certificate. Even if it were considered a petition, any insignificant lapse in the certification did not render the writ irregular. On the application of equity: The Court held that equity cannot prevail over a clear statutory mandate. Justice requires adherence to the positive provisions of Act No. 3135. Equity is applied only in the absence of law and never against it. Therefore, the petitioners' plea for equity could not supplant the legal requirements and procedures established by law.
Main Doctrine
The issuance of a writ of possession after foreclosure sale is ministerial, unless a third party is in possession claiming adversely to the judgment debtor. Petitioners, as teachers and students of the school, are not considered adverse third parties as their possession stems from contractual relations with the school, which is practically owned by the mortgagors.