G.R. No. 72306 - Fornilda vs. Branch 164, Regional Trial Court, 4th Judicial Region, Pasig

Petitioners: David P. Fornilda, Juan P. Fornilda, Emilia P. Fornilda Olili, Leocadia P. Fornilda Labayen and Angela P. Fornilda Guiterrez (heirs/claimants of contested parcels).
Respondents: Branch 164, Regional Trial Court, 4th Judicial Region, Pasig; Joaquin C. Antonil, Deputy Sheriff, RTC, 4th JR Tanay, Rizal; Atty. Sergio I. Amonoy (private respondent and opposing party in foreclosure and subsequent proceedings).

On 5 October 1988 the Supreme Court rendered a Decision (dispositive portion quoted in the record) granting certiorari, setting aside the RTC Order dated 25 July 1985 which had granted a writ of possession, and setting aside RTC Orders dated 25 April 1986 and 16 May 1986 that directed and authorized the sheriff to demolish the houses of petitioners Angela and Leocadia. The Supreme Court made permanent the Temporary Restraining Order and ordered the six (6) parcels returned to petitioners unless some were conveyed to innocent third persons. The Court also ordered that respondent Amonoy be required to answer the petition for disbarment within fifteen (15) days and assigned a separate docket (AC No. 3277) for the disbarment case. Costs were assessed against Amonoy.
Following the Decision, on 25 October 1988 respondent Amonoy filed a Motion for Reconsideration and on 8 November 1988 filed Supplemental Arguments in Support of the Motion for Reconsideration.
The disbarment matter mentioned in the Decision was handled separately in AC No. 3277 by separate Resolution of even date.

Project of Partition covering the contested parcels was signed by the intestate heirs and approved by the lower court on 12 January 1965.
A mortgage contract in favor of respondent Amonoy was executed on 20 January 1965 over the contested parcels.
The estate was declared closed and terminated only on 6 August 1969, after all charges against the estate were paid.
Respondent Amonoy had acted as counsel for the estate/parties from 1959 until 1968 (by his own admission), establishing a fiduciary lawyer-client relationship during the period when the mortgage was executed.
The controversy involved foreclosure proceedings arising from the asserted mortgage and subsequent possession/demolition orders issued by the RTC.

Whether Article 1491[5] of the Civil Code (prohibiting an attorney from acquiring, directly or indirectly, the property in litigation) applies to a mortgage executed by an attorney on property that was still part of an estate in litigation at the time of the mortgage.
Whether mortgages are excluded from the prohibition in Article 1491[5], i.e., whether an attorney may validly take a mortgage on property in litigation and later foreclose thereon.

Whether Article 1491[5] applies to foreclosure sales in favor of judgment creditors such that a judgment creditor who forecloses may be treated differently.
Whether the petition filed before the Supreme Court is barred by res judicata given prior rulings (specifically the Court of Appeals Decision in CA-G.R. No. 63214-R dated 22 July 1981).
Whether the jurisdiction of the foreclosing court depends on the validity of the mortgage being foreclosed such that alleged invalidity would oust jurisdiction.
Whether under Batas Pambansa Blg. 129 (BP 129) the Court of Appeals has exclusive original jurisdiction over annulment of judgments of lower courts, thereby limiting the Supreme Court’s authority to take cognizance of this case.