Huerta Alba Resort, Inc. vs. Court of Appeals

534
SUPREMECOURTREPORTSANNOTATED
HuertaAlbaResort,Inc.vs.CourtofAppeals
G.R.No.128567.September1,2000.*
HUERTAALBARESORT,INC.,petitioner, vs. COURTOFAPPEALS
andSYNDICATEDMANAGEMENTGROUP,INC.,respondents.
Mortgages; Judicial Foreclosures of Mortgage; Redemption; Words and
Phrases;EquityofRedemptionandRightofRedemption,Distinguished.From
the various decisions, resolutions and orders a quo it can be gleaned that what
petitionerhasbeenadjudgedtohavewasonlytheequityofredemptionoversubject
properties. On the distinction between theequity of redemption and right of
redemption,thecaseofGregorioY.Limpinvs.IntermediateAppellateCourt,comes
tothefore.HeldtheCourtinthesaidcase:Theequityofredemptionis,tobesure,
differentfromandshouldnotbeconfusedwiththerightofredemption.Therightof
redemptioninrelationtoamortgageunderstoodinthesenseofaprerogativetore
acquiremortgagedpropertyafterregistrationoftheforeclosuresaleexistsonlyin
thecaseoftheextrajudicialforeclosureofthemortgage.Nosuchrightisrecognized
inajudicialforeclosureexceptonlywherethemortgageeisthePhilippineNational
Bank or a bank or banking institution. Where a mortgage is foreclosed
extrajudicially,Act3135grantstothemortgagortherightofredemptionwithinone
(1)yearfromtheregistrationofthesheriffscertificateofforeclosuresale.Wherethe
foreclosureisjudiciallyeffected,however,noequivalentrightofredemptionexists.
Thelawdeclaresthatajudicialforeclosuresale,whenconfirmedbyanorderofthe
court,xxshalloperatetodivesttherightsofallthepartiestotheactionandtovest
theirrightsinthepurchaser,subjecttosuchrightsofredemptionasmaybeallowed
bylaw.Suchrightsexceptionallyallowedbylaw(i.e.,evenafterconfirmationby
anorderofthecourt)arethosegrantedbythecharterofthePhilippineNationalBank
(ActsNo.2747and2938),andtheGeneralBankingAct(R.A.337). Theselaws
conferonthemortgagor,hissuccessorsininterestoranyjudgmentcreditorofthe
mortgagor,therighttoredeemthepropertysoldonforeclosureafterconfirmation
bythecourtoftheforeclosuresalewhichrightmaybeexercisedwithinaperiodof
one(1)year,countedfromthedateofregistrationofthecertificateofsaleinthe
RegistryofProperty.
Same; Same; Same; Banks and Banking; General Banking Act (R.A. 337);
WhereapartyfailedtoassertarighttoredeemundertheSection78ofR.A.337in
severalcrucialstagesoftheproceedingsinvoke,itistoolate
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*THIRDDIVISION.
535
VOL.339,SEPTEMBER1,2000
535
inthedayforittosubsequentlyinvokesuchrightinoppositiontoamotionfor
issuanceofawritofpossessionafterconfirmationbythecourtoftheforeclosure
saleandtheregistrationofthecertificateofsale.Petitioneraversinitspetitionthat
theIntercon,predecessorininterestoftheprivaterespondent,isacreditinstitution,
such that Section 78 of Republic Act No. 337 should apply in this case. Stated
differently,itisthesubmissionof petitionerthatitshouldbeallowedtoredeem
subjectpropertieswithinoneyearfromthedateofsaleasaresultoftheforeclosure
ofthemortgageconstitutedthereon.Thepivotofinquiryheretherefore,iswhether
thepetitionerseasonablyinvokeditsassertedrightunderSection78ofR.A.No.337
toredeemsubjectproperties.Petitionertheorizesthatitinvokeditsrightintimely
fashion,thatis,afterconfirmationbythecourtoftheforeclosuresale,andwithin
one(1)yearfromthedateofregistrationofthecertificateofsale.Indeed,thefacts
showthatitwasonlyonMay2,1995when,inoppositiontotheMotionforIssuance
ofWritofPossession,didpetitionerfileaMotiontoCompelPrivateRespondentto
Accept Redemption, invoking for the very first time its alleged right to redeem
subjectpropertiesundertoSection78ofR.A.No.337.Inlightoftheaforestated
facts,itwastoolateinthedayforpetitionertoinvokearighttoredeemunder
Section78ofR.A.No.337.Petitionerfailedtoassertarighttoredeeminseveral
crucialstagesoftheproceedings.
Same;Same;Same;Actions;PleadingsandPractice;Counterclaims;Theclaim
thatamortgagorisentitledtothebeneficialprovisionsofSection78ofRA.No.337
isinthenatureofacompulsorycounterclaimwhichshouldbeaverredintheanswer
tothecomplaintforjudicialforeclosure.Indeed,attheearliestopportunity,whenit
submitteditsanswertothecomplaintforjudicialforeclosure,petitionershouldhave
allegedthatitwasentitledtothebeneficialprovisionsofSection78ofR.A.No.337
butagain,itdidnotmakeanyallegationinitsanswerregardinganyrightthereunder.
ItbearsstressingthattheapplicabilityofSection78ofR.A.No.337hingesonthe
factualquestionofwhetherornotprivaterespondentspredecessorininterestwasa
creditinstitution.AswasheldinLimpin,ajudicialforeclosuresale,whenconfirmed
byanorderofthecourt,xxshalloperatetodivesttherightsofallthepartiestothe
actionandtovesttheirrightsinthepurchaser,subjecttosuchrightsofredemptionas
maybeallowedbylaw,whichconferonthemortgagor,hissuccessorsininterestor
anyjudgmentcreditorofthemortgagor,therighttoredeemthepropertysoldon
foreclosureafterconfirmationbythecourtofthejudicialforeclosuresale.Thus,the
claimthatpetitionerisentitledtothebeneficialprovisionsofSection78ofR.A.No.
337sinceprivaterespondentspredecessorininterestisacreditinstitutionisin
thenature
536
536
ofacompulsorycounterclaimwhichshouldhavebeenaverredinpetitioners
answertothecomplaintforjudicialforeclosure.
Counterclaims;Therulesofcounterclaimaredesignedtoenablethedisposition
ofawholecontroversyofinterestedpartiesconflictingclaims,atonetimeandin
oneaction,providedallpartiesbebroughtbeforethecourtandthematterdecided
withoutprejudicingtherightsofanyparty.Theverypurposeofacounterclaim
wouldhavebeenservedhadpetitionerallegedinitsansweritspurportedrightunder
Section78ofR.A.No.337:xxxTherulesofcounterclaimaredesignedtoenable
thedispositionofawholecontroversyofinterestedpartiesconflictingclaims,atone
timeandinoneaction,providedallpartiesbebroughtbeforethecourtandthematter
decidedwithoutprejudicingtherightsofanyparty.
Estoppel;Estoppelmaybesuccessfullyinvokedonlyifthepartyfailstoraise
the question in the early stages of the proceedings.The failure of petitioner to
seasonablyassertitsallegedrightunderSection78ofR.A.No.337precludesitfrom
sodoingatthislatestageofthecase.Estoppelmaybesuccessfullyinvokedifthe
partyfailstoraisethequestionintheearlystagesoftheproceedings.Thus,aparty
to a case who failed to invoke his claim in the main case, while having the
opportunitytodoso,willbeprecluded,subsequently,frominvokinghisclaim,even
ifitweretrue,afterthedecisionhasbecomefinal,otherwisethejudgmentmaybe
reducedtoamockeryandtheadministrationofjusticemaybeplacedindisrepute.
Courts;Itiserrorforatrialcourtinstillallowingapartytointroduceevidence
toaccomplishwhatthelatterfailedtodobeforetheCourtofAppeals,thatis,to
invokeitsallegedrightunderSection78ofR.A.No.337althoughthesaidappellate
courtalreadyfoundthatsaidquestionwasneverbroughtbeforeitsquarely.All
thingsviewedinproperperspective,itisdecisivelyclearthatthetrialcourterredin
stillallowingpetitionertointroduceevidencethatprivaterespondentspredecessor
ininterest was a credit institution, and to thereafter rule that the petitioner was
entitledtoavailoftheprovisionsofSection78ofR.A.No.337.Ineffect,thetrial
courtpermittedthepetitionertoaccomplishwhatthelatterfailedtodobeforethe
CourtofAppeals,thatis,toinvokeitsallegedrightunderSection78ofR.A.No.337
although the Court of Appeals in CAG.R. No. 35086 already found that the
questionofwhethertheSyndicatedManagementCouncilGroup,Inc.isabankor
creditinstitutionwasneverbroughtbefore(theCourtofAppeals)squarely.Thesaid
pronouncementbytheCourtofAppealsunerringlysignifiedthatpetitionerdidnot
make
537
537
atimelyassertionofanyrightunderSection78ofR.A.No.337inallthestages
oftheproceedingsbelow.
Actions;Judgments;LawoftheCase;Whetherornotthelawofthecaseis
erroneousisimmaterialit still remainstobethelawofthecase.Thereis,
therefore,meritinprivaterespondentscontentionthattoallowpetitionertobelatedly
invokeitsrightunderSection78ofR.A.No.337willdisturbthelawofthecase.
However,privaterespondentsstatementofwhatconstitutesthelawofthecaseis
notentirelyaccurate.Thelawofthecaseisnotsimplythatthedefendantpossesses
anequityofredemption.AstheCourthasstated,thelawofthecaseholdsthat
petitionerhastheequityoftheredemptionwithoutanyqualificationwhatsoever,that
is,withouttherightofredemptionaffordedbySection78ofR.A.No.337.Whether
ornotthelawofthecaseiserroneousisimmaterial,itstillremainsthelawofthe
case.Acontraryrulewillcontradictboththeletterandspiritoftherulingsofthe
CourtofAppealsinCAG.R.SPNo.35086,CAG.R.CVNo.39243,andCAG.R.
38747,whichclearlysawthroughtherepeatedattemptsofpetitionertoforestallso
simpleamatterasmakingthesecuritygivenforajustdebttoanswerforitspayment.
Mortgages;EquityofRedemption;WordsandPhrases;Equityofredemptionis
simplytherightofthemortgagortoextinguishthemortgageandretainownershipof
thepropertybypayingthesecureddebtwithinthe90dayperiodafterthejudgment
became final.In conformity with the ruling in Limpin, the sale of the subject
properties,asconfirmedbytheOrderdatedFebruary10,1995ofthetrialcourtin
CivilCaseNo.895424operatedtodivesttherightsofallthepartiestotheaction
andtovesttheirrightsinprivaterespondent.Therethenexistedonlywhatisknown
astheequityofredemption,whichissimplytherightofthepetitionertoextinguish
themortgageandretainownershipofthepropertybypayingthesecureddebtwithin
the90dayperiodafterthejudgmentbecamefinal.Therebeinganexplicitfindingon
thepartoftheCourtofAppealsinitsDecisionofSeptember30,1994inCAG.R.
No. 35086that the herein petitioner failed to exercise its equity of redemption
withintheprescribedperiod,redemptioncannolongerbeeffected.Theconfirmation
ofthesaleandtheissuanceofthetransfercertificatesoftitlecoveringthesubject
propertiestoprivaterespondentwasthen,inorder.Thetrialcourttherefore,hasthe
ministerialdutytoplaceprivaterespondentinthepossessionofsubjectproperties.
PETITIONforreviewoncertiorariofadecisionoftheCourtofAppeals.
538
538
ThefactsarestatedintheopinionoftheCourt.BenjaminC.Santos&
OfeliaCalcetasSantosLawOffices; Santos,Parungao,Aquino&Santos
andOben,Ventura,Defensor,Abola&Associatesforpetitioner.
Atienza, Tabora, Del Rosario & Castillo Law Office for private
respondent.
PURISIMA,J.:
Litigationmustatsometimebeterminated,evenattheriskofoccasional
errors. Public policy dictates that once a judgment becomes final,
executoryandunappealable,theprevailingpartyshouldnotbedeniedthe
fruits of his victory by some subterfuge devised by the losing party.
Unjustifieddelayintheenforcementofajudgmentsetsatnaughttherole
ofcourtsindisposingjusticiablecontroversieswithfinality.
TheCase
AtbarisapetitionassailingtheDecision,datedNovember14,1996,and
Resolution,datedMarch11,1997,oftheCourtofAppealsinCAG.R.No.
38747,whichsetasidetheOrder,datedJuly21,1995,andOrder,dated
September4,1997,oftheRegionalTrialCourtofMakatiCity,inCivil
Case No. 895424. The aforesaid orders of the trial court held that
petitionerhadtherighttoredeemsubjectpiecesofpropertywithinthe
oneyear period prescribed by Section 78 of Republic Act No. 337

otherwiseknownastheGeneralBankingAct.
Section78ofR.A.No.337providesthatincaseofaforeclosureofa
mortgage in favor of a bank, banking or credit institution, whether
judiciallyorextrajudicially,themortgagorshallhavetheright,withinone
yearafterthesaleoftherealestateasaresultoftheforeclosureofthe
respectivemortgage,toredeemtheproperty.
TheFacts
Thefactsthatmatterareundisputed:
Inacomplaintforjudicialforeclosureofmortgagewithpreliminary
injunctionfiledonOctober19,1989,docketedasCivilCaseNo.895424
beforetheRegionalTrialCourtofMakatiCity,the
539
539
hereinprivaterespondentsoughttheforeclosureoffour(4)parcelsofland
mortgagedbypetitionertoInterconFundResource,Inc.(Intercon).
Private respondent instituted Civil Case No. 895424 as mortgagee
assigneeofaloanamountingtoP8.5millionobtainedbypetitionerfrom
Intercon,inwhosefavorpetitionermortgagedtheaforesaidparcelsofland
assecurityforthesaidloan.
Initsanswerbelow,petitionerquestionedtheassignmentbyInterconof
itsmortgagerightthereovertotheprivaterespondent,onthegroundthat
thesamewas ultravires. Petitioneralsoquestionedduringthetrialthe
correctnessofthechargesandinterestonthemortgagedebtinquestion.
OnApril30,1992,thetrialcourt,throughthethenJudgenowCourtof
Appeals Justice Buenaventura J. Guerrero, came out with its decision
granting herein private respondent SMGIs complaint for judicial
foreclosureofmortgage,disposingasfollows:
WHEREFORE,judgmentisherebyrenderedorderingdefendanttopayplaintiffthe
following:
1. (1)
P8,500,000.00representingtheprincipaloftheamountdue;
2. (2)
P850,000.00aspenaltychargeswithinterestat6%perannum,untilfullypaid;
3. (3)
22%perannuminterestontheaboveprincipalfromSeptember6,1998,untilfully
paid;
4. (4)
5%ofthesumtotaloftheaboveamounts,asreasonableattorneysfees;and,
5. (5)
Costs.
Alltheabovemustbepaidwithinaperiodofnotlessthan150daysfromreceipt
hereofbythedefendant.Indefaultofsuchpayment,thefourparcelsoflandsubject
matterofthesuitincludingitsimprovementsshallbesoldtorealizethemortgage
debtandcosts,inthemannerandundertheregulationsthatgovernsalesofrealestate
underexecution.1
PetitionerappealedthedecisionofthetrialcourttotheCourtofAppeals,
theappealdocketedasCAG.R.CVNo.39243beforetheSixthDivision
oftheappellatecourt,whichdismissedthecaseonJune29,1993onthe
groundoflatepaymentofdocketfees.
_______________
1Rollo,pp.8788.
540
540
DissatisfiedwiththedismissalofCAG.R.No.39243,petitionercameto
thisCourtviaapetitionforcertiorari,docketedasG.R.No.112044,which
thiscourtresolvedtodismissonDecember13,1993,onthefindingthat
theCourtofAppealserrednotindismissingtheappealofpetitioner.
Petitionersmotionforreconsiderationofthedismissalofitspetitionin
G.R. No. 112044 was denied with finality in this Courts Resolution
promulgatedonFebruary16,1994.OnMarch10,1994,leavetopresenta
secondmotionforreconsiderationinG.R.No.112044ortosubmitthe
caseforhearingbytheCourtenbancwasfiled,buttonoavail.TheCourt
resolvedtodenythesameonMay11,1994.
OnMarch14,1994,theResolutiondatedDecember13,1993,inG.R.
No.112044becamefinalandexecutoryandwasenteredintheBookof
EntriesofJudgment.
OnJuly4,1994,privaterespondentfiledwiththetrialcourtoforigina
motionforexecutionoftheDecisionpromulgatedonApril30,1992in
CivilCaseNo.895424.ThesaidmotionwasgrantedonJuly13,1994.
Accordingly,onJuly15,1994awritofexecutionissuedand,onJuly
20, 1994, a Notice of Levy and Execution was issued by the Sheriff
concerned,whoissuedonAugust1,1994aNoticeofSheriffsSaleforthe
auctionofsubjectpropertiesonSeptember6,1994.
OnAugust23,1994,petitionerfiledwiththesametrialcourtanUrgent
MotiontoQuashandSetAsideWritofExecutionascribingtoitgrave
abuseofdiscretioninissuingthequestionedWritofExecution.Tosupport
itsmotion,petitionerinvitedattentionandarguedthattherecordsofthe
casewerestillwiththeCourtofAppealsandtherefore,issuanceofthe
writofexecutionwasprematuresincethe150dayperiodforpetitionerto
paythejudgmentobligationhadnotyetlapsedandpetitionerhadnotyet
defaultedinthepaymentthereofsincenodemandforitspaymentwas
madebytheprivaterespondent.Inpetitionersownwords,thedispute
betweenthepartieswasprincipallyontheissueastowhenthe150day
periodwithinwhichHuertaAlbamayexerciseitsequityofredemption
shouldbecounted.
541
541
In its Order of September 2, 1994, the lower court denied petitioners

urgentmotiontoquashthewritofexecutioninCivilCaseNo.895424,
opining that subject judgment had become final and executory and
consequently,executionthereofwasamatterofrightandtheissuanceof
thecorrespondingwritofexecutionbecameitsministerialduty.
Challenging the said order granting execution, petitioner filed once
more with the Court of Appeals another petition for certiorari and
prohibition with preliminary injunction, docketed as C.A.G.R. SP No.
35086,predicatedonthesamegroundsinvokedforitsMotiontoQuash
WritofExecution.
OnSeptember6,1994,thescheduledauctionsaleofsubjectpiecesof
propertiesproceededandtheprivaterespondentwasdeclaredthehighest
bidder.Thus,privaterespondentwasawardedsubjectbidded piecesof
property.ThecoveringCertificateofSaleissuedinitsfavorwasregistered
withtheRegistryofDeedsonOctober21,1994.
On September 7, 1994, petitioner presented an ExParte Motion for
Clarificationaskingthetrialcourttoclarifywhetherornotthetwelve
(12) month period of redemption for ordinary execution applied in the
case.
On September 26, 1994, the trial court ruled that the period of
redemptionofsubjectpropertyshouldbegovernedbytheruleonthesale
ofjudiciallyforeclosedpropertyunderRule68oftheRulesofCourt.
Thereafter, petitioner then filed an Exception to the Order dated
September26,1994andMotiontoSetAsideSaidOrder,contendingthat
thesaidOrdermateriallyalteredtheDecisiondatedApril30,1992which
declaredthatthesatisfactionofthejudgmentshallbeinthemannerand
undertheregulationthatgovernsaleofrealestateunderexecution.
Meanwhile, in its Decision of September 30, 1994, the Court of
AppealsresolvedtheissuesraisedbythepetitionerinC.A.G.R.SPNo.
35086, holding that the one hundredfifty day period within which
petitioner mayredeem subjectproperties should becomputed from the
datepetitionerwasnotifiedoftheEntryofJudgmentinG.R.No.112044;
andthatthe150dayperiodwithinwhich
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542
petitionermayexerciseitsequityofredemptionexpiredonSeptember11,
1994.Thus:
PetitionermusthavereceivedtheresolutionoftheSupremeCourtdatedFebruary
16,1994denyingwithfinalityitsmotionforreconsiderationinG.R.No.112044
beforeMarch14,1994,otherwisetheSupremeCourtwouldnothavemadeanentry
ofjudgmentonMarch14,1994. While,computingthe150dayperiod,petitioner
mayhaveuntilSeptember11,1994,withinwhichtopaytheamountscoveredbythe
judgment,suchperiodhasalreadyexpiredbythistime,andtherefore,thisCourthas
no more reason to pass upon the parties opposing contentions, the same having
becomemootandacademic.2(Italicssupplied).
Petitioner moved for reconsideration of the Decision of the Court of

AppealsinC.A.G.R.SPNo.35086.InitsMotionforReconsideration
datedOctober18,1994,petitionertheorizedthattheperiodofonehundred
fifty(150)daysshouldnotbereckonedwithfromEntryofJudgmentbut
fromreceiptonorbeforeJuly29,1994bythetrialcourtoftherecordsof
CivilCaseNo.895424fromtheCourtofAppeals.Soalso,petitioner
maintained that it may not be considered in default, even after the
expirationof150daysfromJuly29,1994,becausepriordemandtopay
wasnevermadeonitbytheprivaterespondent.Accordingtopetitioner,it
wastherefore,prematureforthetrialcourttoissueawritofexecutionto
enforcethejudgment.
ThetrialcourtdeferredactionontheMotionforConfirmationofthe
Certificate of Sale in view of the pendency of petitioners Motion for
ReconsiderationinCAG.R.SPNo.35086.
On December 23, 1994, the Court of Appeals denied petitioners
motionforreconsiderationinCAG.R.SPNo.35086.Absentanyfurther
actionwithrespecttothedenialofthesubjectmotionforreconsideration,
private respondent presented a Second Motion for Confirmation of
CertificateofSalebeforethetrialcourt.
AsregardstheDecisionrenderedonSeptember30,1994bytheCourt
ofAppealsinCAG.R.SPNo.35086itbecamefinalandexecutoryon
January25,1995.
________________
2Decision,p.5;Rollo,p.93.
543
543
On February 10, 1995, the lower court confirmed the sale of subject
propertiestotheprivaterespondent.ThepertinentOrderdeclaredthatall
pending incidents relating to the Order dated September 26, 1994 had
become moot and academic. Conformably, the Transfer Certificates of
Title to subject pieces of property were then issued to the private
respondent.
On February 27, 1995, petitioner filed with the Court of Appeals a
Motion for Clarification seeking clarification of the date of
commencement of the one (1) year period for the redemption of the
propertiesinquestion.
InitsResolutiondatedMarch20,1995,theCourtofAppealsmerely
noted such Motion for Clarification since its Decision promulgated on
September30,1994hadalreadybecomefinalandexecutory;ratiocinating
thus:
Weviewthemotionforclarificationfiledbypetitioner,purportedlysignedbyits
proprietor,butwhichwebelievewaspreparedbyalawyerwhowishestohideunder
thecloakofanonymity,asaveiledattempttobuytimeandtodelayfurtherthe
dispositionofthiscase.
Our decision of September 30, 1994 never dealt on the right and period of
redemptionofpetitioner,butwasmerelycircumscribedtothequestionofwhether
respondentjudgecouldissueawritofexecutioninitsCivilCaseNo.895424xxx.
Wefurtherruledthattheonehundredfiftydayperiodwithinwhichpetitioner
mayexerciseits equityofredemption shouldbecounted,notfromthereceiptof
respondentcourtoftherecordsofCivilCaseNo.895424butfromthedatepetitioner
wasnotifiedoftheentryofjudgmentmadebytheappellatecourt.
Butwenevermadeanypronouncementontheoneyear rightofredemption of
petitionerbecause,inthefirstplace, theforeclosureinthiscaseisjudicial,andas
such,themortgagorhasonlytheequity,nottherightofredemptionxxx.Whileit
maybetruethatunderSection78ofR.A.337asamended,otherwiseknownasthe
GeneralBankingAct,amortgagorofabank,bankingorcreditinstitution,whether
theforeclosurewasdonejudiciallyor extrajudicially,hasaperiodofoneyearfrom
the auction sale withinwhich toredeem theforeclosed property, the question of
whethertheSyndicatedManagementGroup,Inc.,isabankorcreditinstitutionwas
neverbroughtbeforeussquarely,anditisindeedoddand
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strangethatpetitionerwouldnowsarcasticallyaskarhetoricalquestioninitsmotion
forclarification.3(Italicssupplied).
Indeed,ifpetitionerdidreallyactingoodfaith,itwouldhaveventilated
beforetheCourtofAppealsinCAG.R.No.35086itspretendedright
underSection78ofR.A.No.337butitneverdidso.
Attheearliestopportunity,whenitfileditsanswertothecomplaintfor
judicialforeclosure,petitionershouldhaveaverredinitspleadingthatit
wasentitledtothebeneficialprovisionsofSection78ofR.A.No.337;but
again,petitionerdidnotmakeanysuchallegationinitsanswer.
FromthesaidResolution,petitionertooknofurtherstepsuchthaton
March31,1995,theprivaterespondentfiledaMotionforIssuanceofWrit
ofPossessionwiththetrialcourt.
DuringthehearingcalledonApril21,1995,thecounselofrecordof
petitionerenteredappearanceandaskedfortimetointerposeoppositionto
theMotionforIssuanceofWritofPossession.
On May 2, 1995, in opposition to private respondents Motion for
Issuance of Writ of Possession, petitioner filed a Motion to Compel
PrivateRespondenttoAcceptRedemption.Itwasthefirsttimepetitioner
everassertedtherighttoredeemsubjectpropertiesunderSection78of
R.A. No. 337, the General Banking Act; theorizing that the original
mortgagee,beingacreditinstitution,itsassignmentofthemortgagecredit
topetitionerdidnotremovepetitionerfromthecoverageofSection78of
R.A. No. 337. Therefore, it should have the right to redeem subject
propertieswithinoneyearfromregistrationoftheauctionsale,theorized
thepetitionerwhichconcludedthatinviewofitsrightofredemption,
the issuance of the titles over subject parcels of land to the private
respondentwasirregularandpremature.
InitsOrderofJuly21,1995,thetrialcourt,presidedoverbyJudge
Napoleon Inoturan, denied private respondents motion for a writ of
possession, opining that Section 78 of the General Banking Act was
applicableandtherefore,thepetitionerhaduntilOctober
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3Resolution,pp.12;Rollo,pp.366367.
545
545
21,1995toredeemthesaidparcelsofland,saidOrderruledasfollows:
ItisundisputedthatInterconisacreditinstitutionfromwhichdefendantobtaineda
loansecuredwitharealestatemortgageoverfour(4)parcelsofland.Assumingthat
themortgagedebthadnotbeenassignedtoplaintiff,thereisthennoquestionthat
defendant would have a right of redemption in case of foreclosure, judicially or
extrajudicially,pursuanttotheabovequotedSection78ofRA337,asamended.
However,thepivotalissuehereiswhetherornotthedefendantlostitsrightof
redemptionbyvirtueoftheassignmentofitsmortgagedebtbyIntercontoplaintiff,
whichisnotabankorcreditinstitution.Theissueisresolvedinthenegative.The
rightofredemptioninthiscaseisvestedbylawandisthereforeanabsoluteprivilege
whichdefendantmaynotloseeventhoughplaintiffassigneeisnotabankorcredit
institution(TolentinoversusCourtofAppeals, 106SCRA513).Indeed,acontrary
rulingwillleadtoapossiblecircumventionofSection78becauseallthatmaybe
neededtodepriveadefaultingmortgagorofhisrightofredemptionistoassignhis
mortgagedebtfromabankorcreditinstitutiontoonewhichisnot.Protectionof
defaultingmortgagors,whichistheavowedpolicybehindtheprovision,wouldnot
beachievediftherulingwereotherwise.Consequently,defendantstillpossessesits
rightofredemptionwhichitmayexerciseuptoOctober21,1995only,whichisone
yearfromthedateofregistrationofthecertificateofsaleofsubjectproperties(GSIS
versusIloilo,175SCRA19,citingLimpinversusIAC,166SCRA87).
Sincetheperiodtoexercisedefendantsrightofredemptionhasnotyetexpired,
thecancellationofdefendantstransfercertificatesoftitleandtheissuanceofnew
onesinlieuthereofinfavorofplaintiffarethereforeillegalforbeingpremature,
therebynecessitatingreconveyance(seeSec63[a],PD1529,asamended).
WHEREFORE,theCourtherebyrulesasfollows:
1. (1)
TheMotionforIssuanceofWritofPossessionisherebydenied;
2. (2)
PlaintiffisdirectedtoaccepttheredemptiononorbeforeOctober21,1995inan
amountcomputedaccordingtothetermsstatedintheWritofExecutiondated
July15,1994plusallotherrelatedcostsandexpensesmentionedunder
Section78,RA337,asamended;and
3. (3)
TheRegisterofDeedsofValenzuela,Bulacanisdirected(a)toreconveytothe
defendantthefollowingtitlesofthefour(4)parcelsofland,namelyTCTNos.
V38878,V38879,V38880,andV38881,nowinthenameofplaintiff,and
(b)toregisterthecertificateofsaledatedOctober7,1994andtheOrder
confirmingthesaledatedFebruary10,1995by
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1. abriefmemorandumthereofuponthetransfercertificatesoftitletobeissuedin
thenameofdefendant,pursuanttoSec.63(a)PD1529,asamended.
TheOmnibusMotiondatedJune5,1995,togetherwiththeOppositionthereto,is
nowdeemedresolved.SOORDERED.4
PrivaterespondentinterposedaMotionforReconsiderationseekingthe
reversaloftheOrderbuttonoavail.InitsOrderdatedSeptember4,1995,
thetrialcourtdeniedthesame.
To attack and challenge the aforesaid order of July 21, 1995 and
subsequent Order of September 4, 1995 of the trial court, the private
respondentfiledwiththiscourtaPetitionforCertiorari,Prohibitionand
Mandamus, docketed as G.R. No. 121893, but absent any special and
cogent reason shown for entertaining the same, the Court referred the
petitiontotheCourtofAppeals,forproperdetermination.
DocketedasG.R.No.387457onNovember14,1996,theCourtof
AppealsgaveduecoursetothepetitionandsetasidethetrialcourtsOrder
datedJuly21,1995andOrderdatedSeptember4,1995.
In its Resolution of March 11, 1997, the Court of Appeals denied
petitionersMotionforReconsiderationoftheDecisionpromulgatedon
November14,1996inCAG.R.No.38747.
Undaunted,petitionerhascometothisCourt via thepresentpetition,
placingrelianceontheassignmentoferrors,that:
I
THERESPONDENTCOURTOFAPPEALSERREDGRAVELYINHOLDING
THATTHECOURTOFAPPEALS(TWELFTHDIVISION)INCAG.R.SPNO.
35086 HAD RESOLVED WITH FINALITY THAT PETITIONER HUERTA
ALBA HAD NO RIGHT OF REDEMPTION BUT ONLY THE EQUITY OF
REDEMPTION.
________________
4Rollo,pp.1415.
547
547
II
THERESPONDENTCOURTOFAPPEALSERREDGRAVELYINIGNORING
THATPETITIONERHUERTAALBAPOSSESSESTHEONEYEARRIGHTOF
REDEMPTIONUNDERSECTION78,R.A.NO.337(THEGENERALBANKING
ACT).
III
THERESPONDENTCOURTOFAPPEALSERREDGRAVELYINHOLDING
THATPRIVATERESPONDENTSYNDICATEDMANAGEMENTGROUP,INC.
ISENTITLEDTOTHEISSUANCEOFAWRITOFPOSSESSIONOVERTHE
SUBJECTPROPERTY.5
Initscommentonthepetition,privaterespondentcounteredthat:
1. A.
THEHONORABLECOURTOFAPPEALSCORRECTLYHELD
THATITRESOLVEDWITHFINALITYINC.A.G.R.SPNO.
35086THATPETITIONERONLYHADTHERIGHTOF
REDEMPTIONINRESPECTOFTHESUBJECTPROPERTIES.
2. B.
THEPETITIONISANINSIDIOUSANDUNDERHANDED
ATTEMPTTOEVADETHEFINALITYOFVARIOUS
DECISIONS,RESOLUTIONSANDORDERSWHICHHELD
THATPETITIONERONLYPOSSESSESTHEEQUITYOF
REDEMPTIONINRESPECTOFTHESUBJECTPROPERTIES.
3. C.
PETITIONERISBARREDBYESTOPPELFROMBELATEDLY
RAISINGTHEISSUEOFITSALLEGEDRIGHTOF
REDEMPTION.
4. D.
INHOLDINGTHATTHEPETITIONERHADTHERIGHTOF
REDEMPTIONOVERTHESUBJECTPROPERTIES,THE
TRIALCOURTMADEAMOCKERYOFTHELAWOFTHE
CASE.6
AndbywayofReply,petitionerargued,that:
I.
THE COURT OF APPEALS IN CAG.R. SP NO. 35086 COULD NOT HAVE
POSSIBLYRESOLVEDTHEREINWHETHERWITHFINALITY
_______________
5Rollo,p.4.
6Rollo,p.390.
548
548
OROTHERWISETHEISSUEOFPETITIONERHUERTAALBASRIGHTOF
REDEMPTIONUNDERSECTION78,R.A.NO.337.
II.
THEREISNOESTOPPELHERE.PETITIONERHUERTAALBAINVOKED
ITSRIGHTOFREDEMPTIONUNDERSECTION78,R.A.NO.337INTIMELY
FASHION, i.e., AFTER CONFIRMATION BY THE COURT OF THE
FORECLOSURESALE,ANDWITHINONE(1)YEARFROMTHEDATEOF
REGISTRATIONOFTHECERTIFICATEOFSALE.
III.
THEPRINCIPLEOFTHELAWOFTHECASEHASABSOLUTELYNO
BEARINGHERE:
(1)
THE RIGHT OF REDEMPTION UNDER SECTION 78, R.A. NO. 337 IS IN FACT
PREDICATEDUPONTHEFINALITYANDCORRECTNESSOFTHEDECISIONIN
CIVILCASENO.895424.
(2)
THUS, THE RTCS ORDER RECOGNIZING PETITIONER HUERTA ALBAS
RIGHTOFREDEMPTIONUNDERSECTION78,R.A.NO.37DOESNOTINANY
WAYHAVETHEEFFECTOFAMENDING,MODIFYING,ORSETTINGASIDETHE
DECISIONINCIVILCASENO.895424.
Theaboveargumentsandcounterargumentsadvancedrelatetothepivotal
issueofwhetherornotthepetitionerhastheoneyearrightofredemption
ofsubjectpropertiesunderSection78ofRepublicActNo.337otherwise
knownastheGeneralBankingAct.
Thepetitionisnotvisitedbymerit.
Petitioners assertion of right of redemption under Section 78 of
RepublicActNo.337ispremisedonthesubmissionthattheCourtof
AppealsdidnotresolvesuchissueinCAG.R.SPNo.35086;contending
thus:
(1)
BYNOSTRETCHOFLOGICCANTHE20MARCH1995RESOLUTIONINCA
G.R.SPNO.35086BEINTERPRETEDTOMEANTHECOURT
549
549
OFAPPEALSHADRESOLVEDWITHFINALITYTHEISSUEOFWHETHER
PETITIONER HUERTA ALBA HAD THE RIGHT OF REDEMPTION WHEN
ALLTHATTHERESOLUTIONDIDWASTOMERELY NOTE THEMOTION
FORCLARIFICATION.
(2)
THE20MARCH1995RESOLUTIONINCAG.R.SPNO.35086ISNOTA
FINALJUDGMENT,ORDERORDECREE.ITISNOTEVENAJUDGMENTOR
ORDER TO BEGIN WITH; IT ORDERS NOTHING; IT ADJUDICATES
NOTHING.
(3)
PETITIONER HUERTA ALBAS RIGHT OF REDEMPTION UNDER
SECTION78,R.A.NO.37WASNOTANISSUE,ANDCOULDNOTHAVE
POSSIBLYBEENANISSUE,INCAG.R.SPNO.35086.
(4)
THE30SEPTEMBER1994DECISIONINCAG.R.SPNO.35086HAVING
ALREADYBECOMEFINALEVENBEFORETHEFILINGOFTHEMOTION
FORCLARIFICATION,THECOURTOFAPPEALSNOLONGERHADANY
JURISDICTIONTOACTOFTHEMOTIONORANYOTHERMATTERINCA
G.R.SPNO.35086,EXCEPTTOMERELYNOTETHEMOTION.
II.
IN STARK CONTRAST, THE ISSUE OF PETITIONER HUERTA ALBAS
RIGHT OF REDEMPTION UNDER SECTION 78, R.A. NO. 337 WAS
DIRECTLYRAISEDANDJOINEDBYTHEPARTIES,ANDTHESAMEDULY
RESOLVEDBYTHETRIALCOURT.
III.
THERIGHTOFREDEMPTIONUNDERSECTION78OFR.A.NO.337IS
MANDATORY AND AUTOMATICALLY EXISTS BY LAW. THE COURTS
AREDUTYBOUNDTORECOGNIZESUCHRIGHT.
IV.
EQUITABLE CONSIDERATIONS WEIGH HEAVILY IN FAVOR OF
PETITIONERHUERTAALBA,NOTTHELEASTOFWHICHISTHEWELL
SETTLED POLICY OF THE LAW TO AID RATHER THAN DEFEAT THE
RIGHTOFREDEMPTION.
550
550
V.
THEREFORETHE21JULY1995AND04SEPTEMBER1995ORDERSOFTHE
TRIAL COURT ARE VALID AND PROPER IN ACCORDANCE WITH THE
MANDATEOFTHELAW.
Fromthevariousdecisions,resolutionsandordersaquoitcanbegleaned
that what petitioner has been adjudged to have was only theequity of
redemptionoversubjectproperties.Onthedistinctionbetweentheequity
ofredemptionandrightofredemption,thecaseofGregorioY.Limpinvs.
IntermediateAppellateCourt,7 comestothefore.HeldtheCourtinthe
saidcase:
Theequityofredemptionis,tobesure,differentfromandshouldnotbeconfused
withtherightofredemption.
Therightofredemptioninrelationtoamortgageunderstoodinthesenseofa
prerogativetoreacquiremortgagedpropertyafterregistrationoftheforeclosuresale
existsonlyinthecaseofthe extrajudicial foreclosureofthemortgage.Nosuch
rightisrecognizedinajudicialforeclosureexceptonlywherethemortgageeisthe
PhilippineNationalBankorabankorbankinginstitution.
Whereamortgageisforeclosedextrajudicially,Act3135grantstothemortgagor
the right of redemptionwithinone (1) year from theregistrationof the sheriffs
certificateofforeclosuresale.
Where the foreclosure is judicially effected, however, no equivalent right of
redemptionexists.Thelawdeclaresthatajudicialforeclosuresale,whenconfirmed
byanorderofthecourt,xxshalloperatetodivesttherightsofallthepartiestothe
actionandtovesttheirrightsinthepurchaser,subjecttosuchrightsofredemption
asmaybeallowedbylaw. Suchrightsexceptionallyallowedbylaw(i.e.,even
afterconfirmationbyanorderofthecourt)arethosegrantedbythecharterofthe
PhilippineNationalBank(ActsNo.2747and2938),andtheGeneralBankingAct
(R.A.337). Theselawsconferonthemortgagor,hissuccessorsininterestorany
judgment creditor of the mortgagor, the right to redeem the property sold on
foreclosureafter confirmation bythe court ofthe foreclosure salewhich right
may be exercised within a period of one (1) year, counted from the date of
registrationofthecertificateofsaleintheRegistryofProperty.
_______________
7166SCRA87.
551
551
But,torepeat,nosuchrightofredemptionexistsincaseofjudicialforeclosureofa
mortgageifthemortgageeisnotthePNBorabankorbankinginstitution.Insucha
case,theforeclosuresale,whenconfirmedbyanorderofthecourt.xxshalloperate
todivest therights of all theparties tothe actionandtovesttheir rights inthe
purchaser.Therethenexistsonlywhatisknownastheequityofredemption.Thisis
simplytherightofthedefendantmortgagortoextinguishthemortgageandretain
ownershipofthepropertybypayingthesecureddebtwithinthe90dayperiodafter
thejudgmentbecomesfinal,inaccordancewithRule68,orevenaftertheforeclosure
salebutpriortoitsconfirmation.Section2,Rule68providesthat
xxIfuponthetrialxxthecourtshallfindthefactssetforthinthecomplaintto
betrue,itshallascertaintheamountduetotheplaintiffuponthemortgagedebtor
obligation,includinginterestandcosts,andshallrenderjudgmentforthesumso
founddueandorderthesametobepaidintocourtwithinaperiodofnotlessthan
ninety(90)daysfromthedateoftheserviceofsuchorder,andthatindefaultofsuch
paymentthepropertybesoldtorealizethemortgagedebtandcosts.
Thisisthemortgagors equity(notright)ofredemption which,asabovestated,
maybeexercisedbyhimevenbeyondthe90dayperiodfromthedateofserviceof
theorder,andevenaftertheforeclosuresaleitself,provideditbebeforetheorderof
confirmationofthesale.Aftersuchorderofconfirmation,noredemptioncanbe
effectedanylonger.8(Italicssupplied)
PetitionerfailedtoseasonablyinvokeitspurportedrightunderSection78
ofR.A.No.337.
PetitioneraversinitspetitionthattheIntercon,predecessorininterest
oftheprivaterespondent,isacreditinstitution,suchthatSection78of
RepublicActNo.337shouldapplyinthiscase.Stateddifferently,itisthe
submission of petitioner that it should be allowed to redeem subject
properties within one year from the date of sale as a result of the
foreclosureofthemortgageconstitutedthereon.
Thepivotofinquiryheretherefore,iswhetherthepetitionerseasonably
invokeditsassertedrightunderSection78ofR.A.No.337toredeem
subjectproperties.
________________
8Ibid.,pp.9395.
552
552
Petitionertheorizesthatitinvokeditsrightintimelyfashion,thatis,
afterconfirmationbythecourtoftheforeclosuresale,andwithinone(1)
yearfromthedateofregistrationofthecertificateofsale.Indeed,thefacts
showthatitwasonlyonMay2,1995when,inoppositiontotheMotion
forIssuanceofWritofPossession,didpetitionerfileaMotiontoCompel
PrivateRespondenttoAcceptRedemption,invokingfortheveryfirsttime
itsallegedrighttoredeemsubjectpropertiesundertoSection78ofR.A.
No.337.
Inlightoftheaforestatedfacts,itwastoolateinthedayforpetitioner
toinvokearighttoredeemunderSection78ofR.A.No.337.Petitioner
failed to assert a right to redeem in several crucial stages of the
proceedings.
Forinstance,onSeptember7,1994,whenitfiledwiththetrialcourtan
ExparteMotionforClarification,petitionerfailedtoallegeandprovethat
privaterespondentspredecessorininterestwasacreditinstitutionand
therefore,Section78ofR.A.No.337wasapplicable.Petitionermerely
askedthetrialcourttoclarifywhetherthesaleofsubjectpropertieswas
executionsaleorjudicialforeclosuresale.
Soalso,whenitpresentedbeforethetrialcourtanExceptiontothe
Order and Motion to Set Aside Said Order dated October 13, 1994,
petitioneragainwassilentonitsallegedrightunderSection78ofR.A.
No.337,evenasitfailedtoshowthatprivaterespondentspredecessorin
interest is a credit institution. Petitioner just argued that the
aforementionedOrdermateriallyalteredthetrialcourtsDecisionofApril
30,1992.
Then,too,nothingwasheardfrompetitioneronitsallegedrightunder
Section78ofR.A.No.337andofthepredecessorininterestofprivate
respondentasacreditinstitution,whenthetrialcourtcameoutwithan
orderonFebruary10,1995,confirmingthesaleofsubjectpropertiesin
favorofprivaterespondentanddeclaringthatallpendingincidentswith
respect to the Order dated September 26, 1994 had become moot and
academic.
Similarly, when petitioner filed on February 27, 1995 a Motion for
ClarificationwiththeCourtofAppeals,seekingclarificationofthedate
ofcommencementoftheone(1)yearredemptionperiod
553
553
for the subject properties, petitioner never intimated any alleged right
underSection78ofR.A.No.337nordiditinviteattentiontoitspresent
stance that private respondents predecessorininterest was a credit
institution. Consequently, in its Resolution dated March 20, 1995, the
CourtofAppealsruledonthesaidmotionthus:
But we never made any pronouncement on the oneyear right of redemptionof
petitionerbecause,inthefirstplace, theforeclosureinthiscaseisjudicial,andas
such,themortgagorhasonlytheequity,nottherightofredemptionxxx.Whileit
maybetruethatunderSection78ofR.A.337asamended,otherwiseknownasthe
GeneralBankingAct,amortgagorofabank,bankingorcreditinstitution,whether
theforeclosurewasdonejudiciallyorextrajudicially,hasaperiodofoneyearfrom
the auction sale withinwhich toredeem theforeclosed property, the question of
whethertheSyndicatedManagementGroup,Inc.,isbankorcreditinstitutionwas
neverbroughtbeforeussquarely, anditisindeedoddandstrangethatpetitioner
wouldnowsarcasticallyaskarhetoricalquestioninitsmotionforclarification. 9
(Italicssupplied).
If petitioner were really acting in good faith, it would have ventilated

beforetheCourtofAppealsinCAG.R.No.35086itsallegedrightunder
Section78ofR.A.No.337;butpetitionerneverdiddoso.
Indeed,attheearliestopportunity,whenitsubmitteditsanswertothe
complaintforjudicialforeclosure,petitionershouldhaveallegedthatit
wasentitledtothebeneficialprovisionsofSection78ofR.A.No.337but
again,itdidnotmakeanyallegationinitsanswerregardinganyright
thereunder.ItbearsstressingthattheapplicabilityofSection78ofR.A.
No. 337 hinges on the factual question of whether or not private
respondentspredecessorininterestwasacreditinstitution.Aswasheldin
Limpin, ajudicialforeclosuresale,whenconfirmedbyanorderofthe
court,xxshalloperatetodivesttherightsofallthepartiestotheaction
and to vest their rights in the purchaser, subject to such rights of
redemptionasmaybeallowedbylaw,10whichconferonthemortgagor,
________________
9Rollo,pp.366367.
10Limpinvs.IntermediateAppellateCourt,supra,p.94.
554
554
hissuccessorsininterestoranyjudgmentcreditorofthemortgagor,the
righttoredeemthepropertysoldonforeclosureafterconfirmationbythe
court ofthe judicial foreclosure sale. Thus, the claim that petitioner is
entitledtothebeneficialprovisionsofSection78ofR.A.No.337since
privaterespondentspredecessorininterestisacreditinstitutionisinthe
natureofacompulsorycounterclaimwhichshouldhavebeenaverredin
petitionersanswertothecomplaintforjudicialforeclosure.
xxxAcounterclaimis,mostbroadly,acauseofactionexistinginfavorofthe
defendantagainsttheplaintiff.Morenarrowly,itisaclaimwhich,ifestablished,will
defeator insomewayqualifyajudgmentorrelieftowhichplaintiffisotherwise
entitled.Itissometimesdefinedasanycauseofactionarisingincontractavailable
against any action also arising in contract and existing at the time of the
commencementofsuchanaction.Itisfrequentlydefinedbythecodesasacauseof
action arising out of the contract or transaction set forth inthe complaintas the
foundationoftheplaintiffsclaim,orconnectedwiththesubjectoftheaction. 11
(italicssupplied)
Thecounterclaimisinitselfadistinctandindependentcauseofaction,sothat
whenproperlystatedassuch,thedefendantbecomes,inrespecttothemattersstated
byhim,anactor,andtherearetwosimultaneousactionspendingbetweenthesame
parties, wherein each is at the same time both a plaintiff and a defendant.
Counterclaim is an offensive as well as a defensive plea and is not necessarily
confinedtothejusticeoftheplaintiffsclaim.Itrepresentstherightofthedefendant
tohavetheclaimsofthepartiescounterbalancedinwholeorinpart,andjudgment
tobeenteredinexcess,ifany.Acounterclaimstandsonthesamefooting,andisto
betestedbythesamerules,asifitwereanindependentaction.12(italicssupplied)
Theverypurposeofacounterclaimwouldhavebeenservedhadpetitioner
allegedinitsansweritspurportedrightunderSection78ofR.A.No.337:
xxxTherulesofcounterclaimaredesignedtoenablethedispositionofawhole
controversyofinterestedpartiesconflictingclaims,atone
________________
11TheRevisedRulesofCourtinthePhilippines,VolumeI,Francisco,VicenteJ.,p.462citing:
47Am.Jur.709710.
12Ibid.,p.464citing:47Am.Jur.717.
555
555
timeandinoneaction,providedallpartiesbebroughtbeforethecourtandthematter
decidedwithoutprejudicingtherightsofanyparty.13
ThefailureofpetitionertoseasonablyassertitsallegedrightunderSection
78ofR.A.No.337precludesitfromsodoingatthislatestageofthecase.
Estoppel may be successfully invoked if the party fails to raise the
questionintheearlystagesoftheproceedings.14Thus,apartytoacase
who failed to invoke his claim in the main case, while having the
opportunitytodoso,willbeprecluded,subsequently,frominvokinghis
claim,evenifitweretrue,afterthedecisionhasbecomefinal,otherwise
the judgment may be reduced to a mockery and the administration of
justicemaybeplacedindisrepute.15
Allthingsviewedinproperperspective,itisdecisivelyclearthatthe
trial court erred in still allowing petitioner to introduce evidence that
privaterespondentspredecessorininterestwasacreditinstitution,andto
thereafterrulethatthepetitionerwasentitledtoavailoftheprovisionsof
Section 78 of R.A. No. 337. In effect, the trial court permitted the
petitionertoaccomplishwhatthelatterfailedtodobeforetheCourtof
Appeals,thatis,toinvokeitsallegedrightunderSection78ofR.A.No.
337althoughtheCourtofAppealsinCAG.R.No.35086alreadyfound
thatthequestionofwhethertheSyndicatedManagementCouncilGroup,
Inc.isabankorcreditinstitutionwasneverbroughtbefore(theCourtof
Appeals) squarely. The said pronouncement by the Court of Appeals
unerringlysignifiedthatpetitionerdidnotmakeatimelyassertionofany
rightunderSection78ofR.A.No.337inallthestagesoftheproceedings
below.
Verily,thepetitionerhasonlyitselftoblamefornotallegingatthe
outsetthatthepredecessorininterestoftheprivaterespondentisacredit
institution.Thus,whenthetrialcourt,andtheCourtofAppealsrepeatedly
passedupontheissueofwhetheror
________________
13Ibid.,p.463citing:Kuenzelvs.UniversalCarloadingandDistributingCo.,(1939)29
F.Supp.407.
14Coronavs.CourtofAppeals,214SCRA378,392.
15ApplicationsofEstoppelinLitigation,216SCRA826,834citing:Tuazonvs.Arca,23
SCRA1308,1312.
556
556
notpetitionerhadtherightofredemptionorequityofredemptionover
subjectpropertiesinthedecisions,resolutionsandorders,particularlyin
CivilCaseNo.895424,CAG.R.CVNo.39243,CAG.R.SPNo.35086,
andCAG.R.SPNo.38747,itwasunmistakablethatthepetitionerwas
adjudgedtojusthavetheequityofredemptionwithoutanyqualification
whatsoever,thatis,withoutanyrightofredemptionallowedbylaw.
Thelawofthecaseholdsthatpetitionerhastheequityofredemptionwithoutany
qualification.
Thereis,therefore,meritinprivaterespondentscontentionthattoallow
petitionertobelatedlyinvokeitsrightunderSection78ofR.A.No.337
willdisturbthelawofthecase.However,privaterespondentsstatement
ofwhatconstitutesthelawofthecaseisnotentirelyaccurate.Thelaw
of the case is not simply that the defendant possesses an equity of
redemption. As the Court has stated, the law of the case holds that
petitioner has the equity of the redemption without any qualification
whatsoever,thatis,withouttherightofredemptionaffordedbySection78
ofR.A.No.337.Whetherornotthelawofthecaseiserroneousis
immaterial, it still remains the law of the case. A contrary rule will
contradictboththeletterandspiritoftherulingsoftheCourtofAppealsin
CAG.R.SPNo.35086,CAG.R.CV No.39243,andCAG.R.38747,
whichclearlysawthroughtherepeatedattemptsofpetitionertoforestall
sosimpleamatterasmakingthesecuritygivenforajustdebttoanswer
foritspayment.
Hence,inconformitywiththerulinginLimpin,thesaleofthesubject
properties,asconfirmedbytheOrderdatedFebruary10,1995ofthetrial
courtinCivilCaseNo.895424operatedtodivesttherightsofallthe
partiestotheactionandtovesttheirrightsinprivaterespondent.There
thenexistedonlywhatisknownasthe equityofredemption, whichis
simplytherightofthepetitionertoextinguishthemortgageandretain
ownershipofthepropertybypayingthesecureddebtwithinthe90day
periodafterthejudgmentbecamefinal.Therebeinganexplicitfindingon
thepartoftheCourtofAppealsinitsDecisionofSeptember30,1994in
CAG.R.No.35086thatthehereinpetitionerfailedtoexerciseitsequity
ofredemptionwithintheprescribedperiod,redemptioncan
557
557
nolongerbeeffected.Theconfirmationofthesaleandtheissuanceofthe
transfer certificates of title covering the subject properties to private
respondentwasthen,inorder.Thetrialcourttherefore,hastheministerial
dutytoplaceprivaterespondentinthepossessionofsubjectproperties.
WHEREFORE,thepetitionisDENIED,andtheassaileddecisionof
theCourtofAppeals,declaringnullandvoidtheOrderdated21July1995
andOrderdated4September1997oftheRegionalTrialCourtofMakati
CityinCivilCaseNo.895424,AFFIRMED.Nopronouncementasto
costs.
SOORDERED.
Melo (Chairman), Vitug, Panganiban and GonzagaReyes, JJ.,
concur.
Petitiondenied,judgmentaffirmed.
Notes.Amortgageewhoexercisesthepowerofsalecontainedina
mortgageisconsideredacustodianofthefund,and,beingboundtoapply
itproperly,isliabletothepersonsentitledtheretoifhefailstodosoas
far as concerns the unconsumed balance, the mortgagee is deemed a
trusteeforthemortgagororowneroftheequityofredemption.(Sulitvs.
CourtofAppeals,268SCRA441[1997])
Theissuanceofawritofpossessionisnotajudgmentonthemerits,
andtheissuanceofawritofpossessiontoapurchaserinanextrajudicial
foreclosure is merely a ministerial function. (A.G. Development
Corporationvs.CourtofAppeals,281SCRA155[1997])
Theissuanceofawritofpossessiontoapurchaserinanextrajudicial
foreclosureismerelyaministerialfunctiontheCourtneitherexercises
its official discretion nor judgment. (Suico Industrial Corporation vs.
CourtofAppeals,301SCRA212[1999])
o0o
558
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Huerta Alba Resort, Inc. vs. Court of Appeals

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534

oneyear period prescribed by Section 78 of Republic Act No. 337

In its Order of September 2, 1994, the lower court denied petitioners

Petitioner moved for reconsideration of the Decision of the Court of

If petitioner were really acting in good faith, it would have ventilated

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