A.M. No. RTJ-07-2069 - Espina and Madarang Co. vs. Indar

In 1929, Olarte Hermanos y Cia entered into a contract of loan and mortgage with El Hogar Filipino by mortgaging a parcel of land in Makar, Cotabato City (covered by OCT No. 12) to secure a loan of P160,000.00.
Upon default on the loan, El Hogar Filipino filed for judicial foreclosure, which resulted in the foreclosure order on August 17, 1932, becoming final on January 6, 1933.

On August 21, 1933, Olarte Hermanos filed a petition for voluntary insolvency and was declared insolvent on August 28, 1933; the sheriff was ordered to take possession of all the insolvent’s properties.
The mortgaged property was sold at public auction on October 14, 1933, with El Hogar Filipino as the highest bidder. The sale was confirmed on December 24, 1933.
Afterwards, El Hogar Filipino sold the land to the Espina sisters, who later sold it to Makar Agricultural Corporation, with a portion eventually transacting to Espina and Madarang Company.

On November 18, 1983, Alberto Olarte, Sr. filed a motion for receiver appointment, which Judge Eduardo P. Singayao granted, leading to the re-docketing as Special Proceeding No. 2004-074.
Receivers Olarte and Rodolfo Pascual took possession of the insolvent corporation’s assets, including the disputed land, although a portion of this land was already in the name of the complainants.
Judge Singayao issued an order on December 7, 1983, directing sheriffs to secure possession of the property and compile an inventory of the insolvent’s assets.

Complainants filed a petition for certiorari before the Court of Appeals (CA-G.R. SP No. 02613) challenging the December 7, 1983, order.
On November 21, 1985, the Court of Appeals nullified and set aside Judge Singayao’s order, emphasizing grave abuse of discretion for not affording a hearing and for nullifying long-standing mortgage proceedings.
The Supreme Court dismissed the petition for review on certiorari in G.R. No. 73457 on August 13, 1986, rendering the CA decision final and executory.

In February 2005, Judge Cader P. Indar (then Presiding Judge of RTC, Branch 14, Cotabato City) granted an ex parte petition for issuance of a writ of possession, reviving Judge Singayao’s December 7, 1983, order.
The Order dated February 14, 2005 directed the Register of Deeds and sheriffs to execute the revived order, encompassing annotations on the titles and possession directives for the property.
Despite the existence of motions for reconsideration and motions to withdraw or revoke the Certificate of Finality, procedural issues arose regarding notice and the nullification of the earlier order.

Complainants (Espina & Madarang Company and Makar Agricultural Corporation), represented by Rodrigo A. Adtoon, filed an administrative case charging Judge Indar and OIC Clerk of Court Abie M. Amilil with serious misconduct, grave abuse of discretion, oppression, evident bad faith, manifest partiality, and gross ignorance of the law.
Complainants argued that the respondents flagrantly violated the permanent writ of injunction that had enjoined the execution of the December 7, 1983, order by reviving a null and void order in 2005.
Respondents, in their respective manifestations, denied the allegations, asserting either lack of notice of the nullification or attributing errors to the voluminous records involved.
Hearings were scheduled and rescheduled between October and November 2007, with motions to withdraw the complaint and counter-complaint filings complicating the process.
Eventually, an Investigating Justice (Justice YbaAez) rendered a report recommending disciplinary measures against both respondents while noting that the charges did not warrant severe sanctions beyond administrative penalties.

Whether the revival of the December 7, 1983, order for execution is permissible after the lapse of the prescribed five-year (or ten-year) period under Rule 39, Section 6.
Whether Section 6 of Rule 39 of the Rules on Civil Procedure, which governs the execution of final and executory orders, is applicable to special proceedings involving land registration.
Whether the issuance and later revival of the nullified order violated the permanent writ of preliminary injunction issued by the intermediate appellate court and affirmed by the Supreme Court, thereby prejudicing the rights of third parties in possession of the property.
Whether Judge Indar and OIC Clerk Amilil committed acts of gross misconduct, neglect of duty, and breaches of the Code of Judicial Conduct by failing to ascertain the existence of nullifying CA and SC decisions and by improperly reviving and executing a void order.
The appropriateness of the disciplinary sanctions imposed on Judge Indar and Clerk Amilil given the gravity of their lapses in judicial and administrative responsibility.