G.R. No. 163117 - Equitable PCI Bank vs. Ferdez

From 1998 to 2000, EPCIB extended several loans to the respondents totaling P26,200,000.
The loans were evidenced by multiple promissory notes executed by the respondents, including:

Promissory Note No. 000471 for P1,260,000 (due November 11, 2000)
Promissory Note No. 990294 for P2,000,000 (due December 31, 2001)
Promissory Note No. 1072595 for P740,000 (due January 31, 2001)
Promissory Note No. 990439 for P18,000,000 (due June 9, 2000)
Promissory Note No. 990440 for P4,200,000 (due October 12, 2000)

The loans were secured by real estate mortgages over five parcels of land with the following Transfer Certificate of Title (TCT) numbers:

TCT Nos. 182321, 182866, and 182867 registered in the name of the respondents
TCT Nos. 224062 and 224063 registered in the name of Alice Sison Vda. de Fernandez

After the promissory notes matured, respondents failed to repay the loans despite EPCIB’s demands.
On October 22, 2002, EPCIB filed a petition for the extra-judicial foreclosure of the mortgaged properties, pursuant to the provisions of the Deeds of Real Estate Mortgage.
After due notice and required publication, the foreclosure sale was scheduled for December 16, 2002.

On December 11, 2002, respondents filed a complaint with the trial court seeking:

Annulment of the real estate mortgages
Annulment of the notice of extra-judicial sale and foreclosure proceedings
A temporary restraining order or writ of injunction against EPCIB and Sheriff IV Crisanto M. Parajas

On December 16, 2002, the trial court issued a 20-day temporary restraining order to enjoin the foreclosure sale.
The trial court set a hearing for the respondents’ application for a writ of preliminary injunction on January 6, 2003.

On January 28, 2003, the trial court issued a writ of preliminary injunction, enjoining the foreclosure of the respondents’ properties pending final disposition of the case.
The Order mandated:

Ceasing all actions on conducting the extrajudicial foreclosure sale of the properties identified by TCT Nos. 224062, 224063, 182321, 182866, and 182867.
Submission of an injunction bond amounting to P200,000 by the respondents within fifteen (15) days of receipt of the order, pursuant to Section 4, Rule 58 of the New Rules of Court.
Setting the pre-trial conference on March 3, 2003.

EPCIB filed a motion for reconsideration before the trial court regarding the issuance of the preliminary injunction, which was denied on July 16, 2003.
On October 10, 2003, EPCIB elevated the issue by filing a petition for certiorari before the Court of Appeals, arguing that the trial court’s order was issued without proper factual or legal basis.
The Court of Appeals dismissed EPCIB’s petition in its October 29, 2003 Resolution for lack of merit and later denied EPCIB’s motion for reconsideration in its April 1, 2004 Resolution.

The trial court’s writ of preliminary injunction was based on its sound discretion, emphasizing that the foreclosure would adversely affect the respondents’ rights — who claimed that their properties were worth far more than the amount of the loan.
The objective was to hold the foreclosure proceedings in abeyance pending a determination on the underlying merits of the case.

Whether the trial court committed grave abuse of discretion amounting to lack of jurisdiction when it issued the writ of preliminary injunction.

Whether the injunction was proper, considering that respondents failed to establish a clear and unmistakable right that necessitated its protection.
Whether respondents demonstrated that foreclosure would cause grave and irreparable injury not compensable by ordinary legal remedies.

Whether an interlocutory order granting a preliminary injunction, typically not appealable, can be challenged via a petition for certiorari in cases of manifest error.
Whether the ordinary appeal remedy, integrated with the grounds to attack the interlocutory order, would provide adequate and expeditious relief.