Previsora Filipina v. Ledda
REITERATIONFacts
The Antecedents: The underlying dispute concerns a mortgage deed executed by Felix Z. Ledda in favor of La Previsora Filipina, Mutual Building and Loan Association, on July 21, 1928, securing an indebtedness. An additional loan was acknowledged by Ledda on January 23, 1929. The mortgage deed stipulated that La Previsora Filipina was authorized to sell the mortgaged land at public auction should Ledda fail to meet his payment obligations or comply with other stipulated conditions. Ledda defaulted on his payments and violated the agreement, prompting La Previsora Filipina to exercise its right to an extrajudicial sale. Procedural History: Following Ledda's default, La Previsora Filipina initiated an extrajudicial public auction of the mortgaged property, which was conducted by the sheriff. The property was sold on May 24, 1935, with La Previsora Filipina emerging as the highest bidder for P5,336.05 and receiving the corresponding deed of transfer. Subsequently, on June 28, 1935, La Previsora Filipina filed a motion with the trial court seeking immediate possession of the property, even though the statutory one-year redemption period had not yet elapsed. The trial court granted this motion ex parte on July 12, 1935, conditioned upon the filing of a P600 bond. Ledda was notified of this order when the sheriff demanded possession. He promptly filed a motion for reconsideration, seeking to set aside the sale and deny the possession order. After a trial, the court denied his motion on September 10, 1935. Ledda excepted to this denial, filed his bill of exceptions, which was approved and certified, leading to this appeal. The Petition: The appeal raises several questions of law, primarily concerning the applicability and constitutionality of Act No. 4118, which amended Act No. 3135. Specifically, the appellant questions whether Act No. 3135, under which the contracts were executed, permits the mortgagee to take possession of the property during the redemption period. He also challenges the applicability of Act No. 4118, enacted after the contracts were made, to this case. Furthermore, the appellant questions the constitutionality of Act No. 4118's provision allowing possession through ex parte summary proceedings rather than an ordinary action. The appellant also contests the trial court's denial of his motion for reconsideration and his claim for P1,000 in indemnity.
Issue(s)
Whether Act No. 3135, under which the mortgage deeds were executed, authorized the petitioner to take possession of the mortgaged property during the redemption period. Whether Act No. 4118, which amended Act No. 3135 to allow possession during the redemption period, is applicable to contracts executed before its enactment. Whether Act No. 4118, in allowing possession through summary ex parte proceedings, is valid and constitutional. Whether the trial court erred in granting the writ of possession ex parte. Whether the respondent is entitled to indemnity for damages.
Ruling
The order appealed from is reversed. The petitioner is not entitled to take possession of the mortgaged real property during the period for redemption. Costs are against the petitioner-appellee.
Ratio Decidendi
On the issue of whether Act No. 3135 authorized possession during the redemption period: Act No. 3135, as it stood at the time the mortgage contracts were executed, did not authorize the purchaser to take possession of the mortgaged property during the one-year period fixed for redemption. The law sanctioned only the extrajudicial public sale of the property if stipulated by the parties. Therefore, under Act No. 3135 alone, the trial court could not have validly issued a writ of possession in favor of the petitioner during the redemption period. On the applicability of Act No. 4118: Act No. 4118, which amended Act No. 3135 to allow a purchaser to petition for possession during the redemption period, was approved on December 7, 1933. However, the mortgage contracts in question were executed on July 21, 1928, and January 23, 1929, when only Act No. 3135 was in effect. It is a fundamental principle that civil laws have no retroactive effect unless expressly provided. Since Act No. 4118 does not state that its provisions shall have retroactive effect, it cannot be applied to contracts entered into prior to its enactment. The contention that the law is applicable because the sale occurred after its effectivity is untenable, as the date of contract execution is the determining factor for the law's applicability, not the date of the sale which is merely an incident of the contract. On the constitutionality and validity of Act No. 4118: The constitutionality and validity of Act No. 4118 need not be decided because the Court has already found it inapplicable to the present case due to its non-retroactive nature. The issue of whether the law permits possession through summary ex parte proceedings is therefore moot in this instance. On the ex parte granting of the writ of possession: Having ruled that Act No. 4118 is not applicable to the contracts in question, the assignment of error concerning the ex parte granting of the motion for a writ of possession, which is predicated on the validity of Act No. 4118, is rendered unnecessary to discuss. The trial court erred in issuing the writ under the circumstances. On the claim for indemnity: The respondent claimed indemnity of P1,000. However, the Court found no ground to award such indemnity. It was admitted that the respondent never lost possession of the real property because he timely filed a motion for reconsideration of the order directing the petitioner to be placed in possession. Since the respondent did not lose possession, he is not entitled to be indemnified.
Main Doctrine
Act No. 4118, which amended Act No. 3135 to allow a purchaser to petition for possession of mortgaged property during the redemption period, is not applicable to mortgage contracts executed prior to its effectivity. This is based on the general principle that civil laws do not have retroactive effect unless explicitly stated, and the date of contract execution, not the date of sale, governs the applicability of laws.