Bayan v. Bayan
REITERATIONFacts
1. The Antecedents: Petitioners Angelina A. Bayan and Jaime A. Bayan, along with their now deceased sister Celia A. Bayan, were co-owners of three parcels of land in Cubao, Quezon City. Celia, allegedly acting with fraudulent Special Powers of Attorney (SPAs) and forging her siblings' signatures, obtained loans totaling P4,500,000.00 from respondents Edward Dy and Ma. Luisa Tanghal. To secure these loans, Celia executed deeds of real estate mortgage and an amendment thereof, covering the co-owned properties. Angelina and Jaime maintained that these transactions were done without their knowledge or consent, prompting them to file a complaint for annulment of mortgage with damages. During the pendency of the case, Dy and Tanghal proceeded with the foreclosure of the mortgages. 2. Procedural History: The Regional Trial Court (RTC) of Quezon City ruled in favor of the petitioners, declaring the SPAs, deeds of mortgage, and amendment thereof, as well as the foreclosure proceedings, null and void. The RTC ordered the cancellation of the annotations on the titles and awarded damages and attorney's fees. On appeal, the Court of Appeals (CA) partially granted the appeal, affirming the RTC's decision with modifications. The CA declared the mortgage documents and foreclosure proceedings void only with respect to the interests of Angelina and Jaime. The case was remanded to the RTC for determination of the parties' respective rights and for partition. The CA also ordered the cancellation of the certificates of sale and the issuance of new ones. The CA subsequently denied all motions for partial reconsideration filed by the parties. 3. The Petition: Petitioners filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to reverse the CA's decision and resolution. Their primary argument on appeal was that the CA erred in denying their right of legal redemption over Celia's share, which they raised for the first time in their motion for reconsideration with the CA. They contended that the issue of redemption became relevant only on appeal when the CA partially upheld the mortgage. The petitioners also argued that the mortgagees were not mortgagees-in-good-faith, which should have entitled them to the right of legal redemption. The Supreme Court, however, denied the petition, agreeing with the CA that the issue of legal redemption was not raised before the lower courts and could not be raised for the first time on appeal or in a motion for reconsideration.
Issue(s)
Whether the Honorable Court of Appeals erred in ruling that the petitioners cannot raise their right of legal redemption for the first time on appeal even though it was not relevant to raise the same before the trial court's level. Whether the Honorable Court of Appeals erred in not considering the fact that the mortgagees are not mortgagees-in-good-faith in denying petitioners the right of legal redemption.
Ruling
The Supreme Court denied the Petition for Review on Certiorari, affirming the Decision and Resolution of the Court of Appeals. The Court held that the issue of legal redemption was not raised before the trial court and was only brought up for the first time in the petitioners' motion for reconsideration with the appellate court, which is impermissible.
Ratio Decidendi
On the issue of raising the right of legal redemption for the first time on appeal: The Court affirmed the CA's ruling that the petitioners could not raise the issue of legal redemption for the first time in their motion for reconsideration with the appellate court. The Court reiterated the well-settled rule that points of law, theories, issues, and arguments not adequately brought to the attention of the lower court need not be considered by the reviewing court. Raising a new theory or matter in a motion for reconsideration with the appellate court is considered a "pernicious practice" that violates basic rules of fair play, justice, and due process. The Court emphasized that the right of redemption accrues upon written notice of the foreclosure sale, and the petitioners' allegation of the foreclosure sale and annotation of the Sheriff's Certificate of Sale on their TCTs conclusively showed they had notice. Therefore, their right of redemption had already accrued, and they should have included this issue in their initial complaint. Not having raised it with the lower court, it could not be entertained for the first time in the appellate court's motion for reconsideration. The Court clarified that petitioners need not wait for a definitive ruling on the validity of the mortgage to exercise their right of redemption, as any co-owner can mortgage their undivided share, and notice of the foreclosure sale triggers the accrual of the redemption right. On the issue of mortgagees not being mortgagees-in-good-faith: This issue was implicitly resolved by the denial of the right of redemption based on procedural grounds. The Court did not delve into the merits of whether the mortgagees were in good faith, as the primary reason for denying the redemption claim was the procedural bar of raising the issue for the first time on appeal. The Court's focus remained on the procedural impropriety of introducing a new claim at such a late stage of the proceedings, thereby precluding any substantive discussion on the good faith of the mortgagees in relation to the redemption right.
Main Doctrine
The right of legal redemption of co-owners accrues upon written notice of the foreclosure sale, and failure to raise this issue before the trial court or in the initial stages of appeal bars its consideration for the first time in a motion for reconsideration with the appellate court, as it violates basic rules of fair play, justice, and due process.