Title
BPI Family Savings Bank vs. Golden Power Diesel Sales Center, Inc.
Case
G.R. No. 176019
Decision Date
Jan 12, 2011
CEDEC mortgaged properties to BPI Family, defaulted, and the properties were foreclosed. Respondents, claiming rights via a deed of sale, contested possession. Supreme Court ruled in favor of BPI Family, affirming the writ of possession, stating respondents are not adverse third parties and pending annulment does not bar the writ.
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Case Digest (G.R. No. 176019)

Facts:

Mortgage and Loan Transactions

  • On 26 October 1994, CEDEC Transport, Inc. (CEDEC) mortgaged two parcels of land (TCT Nos. 134327 and 134328) in Malibay, Pasay City, to BPI Family Savings Bank, Inc. (BPI Family) to secure a loan of P6,570,000. The mortgage was annotated on the titles.
  • On 5 April and 27 November 1995, CEDEC obtained additional loans of P2,160,000 and P1,140,000, respectively, and mortgaged the same properties. These mortgages were also annotated on the titles.

Default and Foreclosure

  • CEDEC defaulted on its mortgage obligations despite demand. On 12 October 1998, BPI Family filed a petition for extrajudicial foreclosure of the real estate mortgage.
  • On 10 December 1998, the properties were sold at public auction, with BPI Family as the highest bidder for P13,793,705.31. The Certificate of Sheriff’s Sale was annotated on the titles on 14 May 1999.
  • The one-year redemption period expired on 15 May 1999 without CEDEC redeeming the properties. BPI Family consolidated the titles, and new titles (TCT Nos. 142935 and 142936) were issued in its name on 13 September 2000.

Dispute Over Possession

  • Despite demand, CEDEC refused to vacate the properties. On 31 January 2002, BPI Family filed an Ex-Parte Petition for Writ of Possession, which was granted by the trial court on 27 June 2002. A Writ of Possession was issued on 12 July 2002.
  • On 29 July 2002, respondents Golden Power Diesel Sales Center, Inc. and Renato C. Tan filed a Motion to Hold Implementation of the Writ of Possession, claiming they acquired the properties from CEDEC on 10 September 1998 via a Deed of Absolute Sale with Assumption of Mortgage. They argued they were third parties with adverse rights and had filed a complaint (Civil Case No. 99-0360) to cancel the Sheriff’s Certificate of Sale.
  • The trial court denied the motion on 12 September 2002 and issued an alias writ of possession. However, the writ expired without implementation. BPI Family filed an Urgent Ex-Parte Motion for an alias writ, which was granted on 27 January 2003.
  • Before implementation, respondent Renato C. Tan filed an Affidavit of Third Party Claim. The sheriff referred the matter to the trial court, which suspended the writ’s implementation on 7 March 2003, citing respondents’ adverse claims and actual possession of the properties.

Appeal to the Court of Appeals

  • BPI Family filed a petition for mandamus and certiorari with the Court of Appeals, arguing the trial court acted with grave abuse of discretion in suspending the writ. The Court of Appeals denied the petition on 13 March 2006 and affirmed the trial court’s suspension of the writ. BPI Family’s motion for reconsideration was also denied on 19 December 2006.

Issue:

  1. Whether the Court of Appeals erred in upholding the trial court’s finding that respondents, as vendees of the properties, are third parties in possession claiming rights adverse to CEDEC.
  2. Whether the Court of Appeals erred in sustaining the suspension of the writ of possession due to the pendency of Civil Case No. 99-0360, despite established rulings that such pendency cannot bar the issuance or implementation of a writ of possession.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Conclusion:

The Supreme Court ruled in favor of BPI Family, holding that respondents are not third parties with adverse rights and that the pendency of an annulment case does not bar the issuance of a writ of possession. The trial court’s suspension of the writ was improper, and the sheriff was ordered to implement the writ without prejudice to the outcome of Civil Case No. 99-0360.


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