Metropolitan Bank v. Cristobal
REITERATIONFacts
1. The Antecedents: Respondents Spouses Edgardo M. Cristobal and Ma. Teresita S. Cristobal obtained a loan of P4,500,000.00 from petitioner Metropolitan Bank and Trust Company, secured by real estate mortgages. Upon respondents' failure to pay, petitioner foreclosed the mortgaged properties and emerged as the highest bidder in the subsequent auction sale. A Certificate of Sale was issued and registered in petitioner's name. 2. Procedural History: Petitioner filed a petition for a Writ of Possession with the Regional Trial Court (RTC) after respondents failed to vacate the foreclosed properties. The RTC denied the petition, citing petitioner's failure to post the required bond as mandated by Section 7 of Act 3135, as the 12-month redemption period had not yet expired. The RTC later denied petitioner's motion for reconsideration. Petitioner appealed to the Court of Appeals (CA) via a Petition for Certiorari, arguing that the bond was no longer necessary as the redemption period had expired. The CA affirmed the RTC's denial, stating that even with the expiration of the redemption period, ownership must first be consolidated and a new transfer certificate of title issued in the petitioner's name, which had not occurred. 3. The Petition: This is a Rule 45 appeal assailing the CA's decision and resolution. Petitioner argues that consolidation of title is not a prerequisite for the issuance of a writ of possession and that, in any event, consolidation had occurred with the issuance of new transfer certificates of title in its name. The respondents contend that the consolidated titles were not presented to the trial court and thus cannot be raised for the first time on appeal. The Supreme Court, considering the issue of whether consolidation of title is necessary before possession may be automatically given, found that the issue of consolidation is a question of fact best left to the determination of the lower court and remanded the case for further proceedings.
Issue(s)
Whether consolidation of title is necessary before possession may be automatically given to the petitioner, considering the expiration of the redemption period and the dispensing with the need for a bond. Whether the Supreme Court can take cognizance of the alleged supervening event of consolidation of title, as evidenced by new Transfer Certificates of Title, which were allegedly not presented before the lower courts.
Ruling
The Supreme Court ruled that a remand of the case to the trial court is necessary for the reception of evidence to determine if consolidation of ownership has taken place, as this is a necessary requisite to the issuance of a writ of possession.
Ratio Decidendi
On the necessity of consolidation of ownership for a writ of possession: The Court reiterated that jurisprudence clearly articulates that a purchaser can demand possession at any time following the consolidation of ownership in his name and the issuance to him of a new transfer certificate of title. After the consolidation of title in the buyer's name for failure of the mortgagor to redeem the property, the writ of possession becomes a matter of right. The bond is no longer needed at this point, and the purchaser's right to possession ripens into the absolute right of a confirmed owner. The issuance of a writ of possession, upon proper application and proof of title, becomes a ministerial function of the court, wherein the court cannot exercise discretion. Therefore, for petitioner to be issued a writ of possession, it must first clearly show that it has consolidated ownership of the subject properties in its name. On the issue of whether the Supreme Court can take cognizance of the alleged supervening event of consolidation: The Court agreed with the respondents that the alleged consolidation of ownership, as evidenced by the new Transfer Certificates of Title, is a question of fact that cannot be automatically acceded to by the appellate court. The Court reiterated the distinction between a question of law and a question of fact, emphasizing that a question of fact arises when the doubt pertains to the truth or falsity of alleged facts and requires a review of the probative value of the evidence presented. Since consolidation is factual in nature and requires the presentation of evidence, it is best left to the determination of the lower court. Consequently, in the interest of substantial justice, a remand of the case to the lower court is necessary to receive evidence on whether consolidation has indeed taken place before a writ of possession can be issued.
Main Doctrine
For a purchaser in an extrajudicial foreclosure sale to be entitled to a writ of possession, consolidation of ownership in its name and the issuance of a new transfer certificate of title are necessary requisites, and the determination of whether consolidation has occurred is a question of fact requiring reception of evidence by the lower court.