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METROPOLITAN
BANK AND TRUST COMPANY, Petitioner, |
G.R.
No. 167280
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- versus - |
Present: QUISUMBING,
J., Chairperson, CARPIO MORALES, TINGA, VELASCO,
JR., and
BRION, JJ. |
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SPS. ELMOR V. BANCE AND ROSARIO J. BANCE, Respondents. |
Promulgated: April
30, 2008 |
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QUISUMBING, J.:
Challenged in
this petition for review are the Decision[1]
and Resolution[2] dated
The
antecedent facts, as culled from the records, are as follows:
Respondents
Elmor and Rosario Bance obtained several loans in the amount of P24,150,954.84
from petitioner Metropolitan Bank and Trust Company, Tutuban Branch.[4] As security for the loans, respondents mortgaged their
properties in Binondo and Tondo,
During
the public auction held on
In the meantime, respondents, on May 2, 2000, instituted
Civil Case No. 00-97252 in the RTC of Manila, Branch 32, and sought the
declaration of nullity of promissory notes, real estate mortgages, agreements,
continuing surety agreement, extrajudicial foreclosure proceedings, notices,
publications, certificates of sales and the corresponding entries on titles to
the subject properties with prayer
for temporary restraining order (TRO) and issuance of writs of preliminary
injunction and damages.[9] RTC Branch 32 immediately issued a TRO[10]
dated
On
Meanwhile,
RTC Branch 32, on
On
WHEREFORE, the petition is hereby GRANTED.
The
Order of respondent court dated
SO ORDERED.[20]
Petitioner sought reconsideration, but it was
denied. Hence, this petition,
ascribing the following errors to the Court of Appeals:
I.
…THE
COURT OF APPEALS ERRED IN GIVING DUE COURSE TO RESPONDENTS SPOUSES
BANCE’S PETITION FOR ANNULMENT OF THE SEPTEMBER 11, 2000 ORDER OF THE
REGIONAL TRIAL COURT OF MANILA BRANCH IV (04) INSTITUTED UNDER RULE 47 OF THE
1997 REVISED RULES OF CIVIL PROCEDURE CONSIDERING THAT A WRIT OF POSSESSION
CASE FILED UNDER ACT NO. 3135, AS AMENDED, IS NOT AN ORDINARY ACTION.
II.
…THE COURT OF APPEALS
ERRED IN ANNULLING THE SEPTEMBER 11, 2000 ORDER OF THE REGIONAL TRIAL COURT OF
MANILA BRANCH IV (04) GRANTING THE WRIT OF POSSESSION TO PETITIONER METROBANK
ON THE GROUND THAT PETITIONER METROBANK COMMITTED EXTRINSIC OR COLLATERAL FRAUD
UNDER SECTION 2, RULE 47 OF THE 1997 REVISED RULES OF CIVIL PROCEDURE.
III.
…THE COURT OF APPEALS
ERRED IN NOT DISMISSING RESPONDENTS SPOUSES BANCE’S PETITION FOR
ANNULMENT OF THE ORDER DATED SEPTEMBER 11, 2000 OF THE REGIONAL TRIAL COURT OF
MANILA BRANCH IV (04) GRANTING THE WRIT OF POSSESSION (LRC CAD. RECORD NO. 278)
CONSIDERING THAT IT IS AN EX PARTE PROCEEDING AND ITS ISSUANCE IS
MINISTERIAL UNDER ACT NO. 3135, AS AMENDED, AND THERE IS A PENDING CIVIL CASE
NO. 00-97252 FILED BY RESPONDENTS SPOUSES BANCE AGAINST PETITIONER METROBANK
BEFORE THE REGIONAL TRIAL COURT OF MANILA BRANCH XXXII (32) FOR “DECLARATION
OF NULLITY OF PROMISSORY NOTES, REAL ESTATE MORTGAGES, AGREEMENTS, CONTINUING
SURETY AGREEMENT, EXTRAJUDICIAL FORECLOSURE PROCEEDINGS, ETC.”[21]
IV.
…THE COURT OF APPEALS
ERRED IN FINDING PETITIONER BANK GUILTY OF FORUM SHOPPING WHEN IT FILED A PETITION
FOR ISSUANCE OF A WRIT OF POSSESSION BEFORE [THE] REGIONAL TRIAL COURT OF
MANILA BRANCH IV WHEN THERE WAS A PENDING ACTION ON THE SAME SUBJECT MATTER
BEFORE REGIONAL TRIAL COURT OF MANILA, BRANCH XXXII.[22]
Simply,
the issues are: (1) Did the Court
of Appeals err in annulling the writ of possession issued by RTC Branch 4? (2) Is petitioner guilty of forum
shopping?
The
petition has merit.
Anent
the first issue, petitioner contends that the Court of Appeals erred in
annulling the writ of possession on the ground of extrinsic fraud. It avers that a petition for the
issuance of the writ is ex parte in
nature; hence, respondents need not be notified of the proceedings
therein. It further argues that
since there is already a pending civil case for declaration of nullity of
mortgage, etc., the Court of Appeals should not have ruled on the validity of
the loan documents and foreclosure proceedings. It adds that respondents, in instituting
the annulment of judgment case, failed to pursue the proper remedy provided
under Section 8[23]
of Act No. 3135,[24]
as amended.
Respondents counter that petitioner employed
extrinsic fraud when it secured the writ because it deliberately withheld from
them the foreclosure of the mortgage and institution of the petition for the issuance
of the writ. They add that a
petition for the issuance of the writ is an ordinary action, hence, they must
be notified of the true nature of petitioner’s claims against them. They also contend that the writ was
irregularly issued because petitioner was not required to post the bond
mandated in Section 7[25] of Act No. 3135, as amended.
First,
no extrinsic fraud was employed by petitioner in not informing respondents of
the institution of the writ of possession case. A petition for the issuance of the writ,
under Section 7 of Act No. 3135, as amended, is not an ordinary action filed in
court, by which one party “sues another for the enforcement or protection
of a right, or prevention or redress of a wrong.”[26] It is in the nature of an ex parte motion which the court hears
only one side. It is taken or
granted at the instance and for the benefit of one party, and without notice to
or consent by any party adversely affected.[27] Accordingly, upon the filing of a proper
motion by the purchaser in a foreclosure sale, and the approval of the
corresponding bond, the writ of possession issues as a matter of course and the
trial court has no discretion on this matter.[28]
Second,
the writ of possession was not irregular despite the fact that petitioner did
not post a bond. The posting of a bond as a condition for the issuance of
the writ of possession becomes necessary only if it is applied for within one
year from the registration of the sale with the register of deeds, i.e.,
during the redemption period inasmuch as ownership has not yet vested on the
creditor-mortgagee. After the
one-year period, and no redemption was made, the mortgagor loses all interest
over it.[29] In this case, respondents were
already stripped of their rights over the properties when they failed to redeem
the same within one year from
Third, the Court of Appeals, in CA-G.R. SP No. 78162,
need not delve on any alleged defect or irregularity in the foreclosure,
inasmuch as the only issue therein was the propriety of the issuance of the
writ.[31] Any question regarding the validity of
the mortgage or its foreclosure cannot be a legal ground for refusing the
issuance of the writ.[32] If only to stress the
writ’s ministerial character, we have, in several cases,[33] disallowed injunctions prohibiting
its issuance, just as we have held that the issuance of the writ may not be
stayed by a pending action for annulment of mortgage or the foreclosure itself.
Fourth, respondents failed to pursue the proper
remedy. Under Section 8 of Act No.
3135, as amended, in case it is disputed that the writ of possession was
irregularly issued, the mortgagor may file with the trial court that issued the
writ a petition to set aside the sale and to cancel the writ of possession
within 30 days after the purchaser-mortgagee was given possession.[34] Based on the records, the subject
properties were turned over to petitioner on
On
the issue of forum shopping, respondents contend that petitioner’s filing
of the petition for the issuance of a writ of possession constitutes forum
shopping because there is already a pending case in RTC Branch 32 involving the
subject properties. Petitioner, on
the other hand, avers that it was not duty bound to disclose to respondents the
pendency of the writ of possession case and a certificate of non-forum shopping
is not required in a petition for the issuance of the writ under Section 7 of
Act No. 3135, as amended because it is not a complaint or initiatory pleading.
Petitioner
is correct. Insofar as LRC Cad.
Record No. 278 and Civil Case No. 00-97252 are concerned, there is no forum
shopping. The essence of forum
shopping is the filing of multiple suits involving the same parties for the
same cause of action, either simultaneously or successively, for the purpose of
obtaining favorable judgment. It
exists where the elements of litis pendentia are present or where a
final judgment in one case will amount to res judicata in another. Since the issuance of a writ of possession is a ministerial
function and summary in nature, it cannot be said to be a judgment on the
merits but simply an incident in the transfer of title.[35] Hence, regardless of whether or not
there is a pending suit for annulment of the mortgage or the foreclosure
itself, petitioner is entitled to the writ, subject however to the final outcome of the case.[36]
Moreover, a certificate of non-forum shopping, as provided in Section 5,[37] Rule 7 of
the 1997 Rules of
Civil Procedure, is
required only in complaints or other initiatory
pleadings, and a petition or motion for the issuance of the writ under Section
7 of Act No. 3135, as amended, is not a complaint or an initiatory pleading.[38] Indeed, any insignificant lapse in the
certification of non-forum shopping filed by petitioner does not render the
writ irregular for no verification and certification on non-forum shopping need
be attached to the motion at all.[39]
WHEREFORE, the instant petition is GRANTED. The challenged Decision and
Resolution dated
SO ORDERED.
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LEONARDO A. QUISUMBING Associate Justice |
WE CONCUR:
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CONCHITA CARPIO MORALES Associate Justice |
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DANTE O. TINGA Associate Justice |
PRESBITERO J. VELASCO, JR. Associate Justice |
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ARTURO D. BRION Associate Justice |
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A T T E S T A T I O N
I
attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
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LEONARDO A. QUISUMBING Associate Justice Chairperson |
C E R T I F I C A T I O N
Pursuant
to Section 13, Article VIII of the Constitution, and the Division
Chairperson’s Attestation, I certify that the conclusions in the above
Decision had been reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
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REYNATO S. PUNO Chief Justice |
[1] Rollo, pp. 31-42. Penned by Associate Justice Eloy R. Bello, Jr., with Associate Justices Regalado E. Maambong and Lucenito N. Tagle concurring.
[2]
[3]
[4] Records, pp. 24-27.
[5]
[6]
[7] Rollo, p. 71.
[8] Records, pp. 67-69.
[9]
[10]
[11] Rollo, pp. 68-73.
[12]
[13]
[14] Records, pp. 161-163.
[15]
[16]
[17]
[18] CA rollo, pp. 2-15.
[19] Rollo, pp. 39-42.
[20]
[21]
[22]
[23] SEC. 8.
The debtor may, in the proceedings in which possession was requested,
but not later than thirty days after the purchaser was given possession,
petition that the sale be set aside and the writ of possession cancelled,
specifying the damages suffered by him, because the mortgage was not
violated or the sale was not made in accordance with the provisions hereof,
and the court shall take cognizance of this petition in accordance with the
summary procedure provided for in section one hundred and twelve of Act
Numbered four hundred and ninety-six and if it finds the complaint of the
debtor justified, it shall dispose in his favor of all or part of the bond
furnished by the person who obtained possession. Either of the parties may appeal from
the order of the judge in accordance with section fourteen of Act Numbered Four
hundred and ninety-six; but the order of possession shall continue in effect
during the pendency of the appeal.
(Emphasis supplied.)
[24] An Act to Regulate the Sale of Property under Special Powers Inserted in or Annexed to Real Estate Mortgages, approved on March 6, 1924 (as amended by Act No. 4118, approved on December 7, 1933).
[25] SEC. 7. In any sale made under the provisions of this Act, the purchaser may petition the Court of First Instance of the province or place where the property or any part thereof is situated, to give him possession thereof during the redemption period, furnishing bond in an amount equivalent to the use of the property for a period of twelve months, to indemnify the debtor in case it be shown that the sale was made without violating the mortgage or without complying with the requirements of this Act. Such petition shall be made under oath and filed in form of an ex parte motion in registration or cadastral proceedings if the property is registered, or in special proceedings in the case of property registered under the Mortgage Law or under section one hundred and ninety-four of the Administrative Code, or of any other real property, encumbered with a mortgage duly registered in the office of any register of deeds in accordance with any existing law, and in each case the clerk of the court shall, upon the filing of such petition, collect the fees specified in paragraph eleven of section one hundred and fourteen of Act Numbered Four hundred and ninety-six, as amended by Act Numbered Twenty-eight hundred sixty-six, and the court shall, upon approval of the bond, order that a writ of possession issue, addressed to the sheriff of the province in which the property is situated, who shall execute said order immediately. (Emphasis supplied.)
[26] De Vera v. Agloro, G.R.
No. 155673,
[27] Arquiza v. Court of
Appeals, G.R. No. 160479,
[28] Yulienco v. Court of Appeals, G.R. No. 141365,
[29] Espiridion v. Court of
Appeals, G.R. No. 146933,
[30] See Yulienco v. Court of Appeals, supra at 152.
[31] See Vda. de Zaballero v. Court of Appeals, G.R. No. 106958, February 9, 1994, 229 SCRA 810, 814.
[32] De Vera v. Agloro, supra.
[33] Chailease Finance Corporation v. Ma, G.R. No. 151941, August 15, 2003, 409 SCRA 250, 253; Yulienco v. Court of Appeals, supra at 154.
[34] Ong v. Court of Appeals,
G.R. No. 121494,
[35]
[36]
[37] SEC. 5. Certification against forum shopping. – The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon motion and after hearing. The submission of a false certification or non-compliance with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions.
[38] Ancheta v. Metropolitan Bank & Trust Company, Inc., G.R. No. 163410, September 16, 2005, 470 SCRA 157, 164.
[39] See Arquiza v. Court of
Appeals, supra note 27, at 762-763.