Case Digest (G.R. No. 97973)
Facts:
This is Spouses Gauvain and Bernardita Benzonan v. Court of Appeals, Benito Salvani Pe and Development Bank of the Philippines, G.R. Nos. 97973 and 97998, January 27, 1992, Supreme Court Third Division, Gutierrez, Jr., J., writing for the Court.
Respondent Benito Salvani Pe obtained a free patent (Free Patent No. 46128, issued October 29, 1969) and Original Certificate of Title No. P-2404 (issued November 24, 1969) to a 26,064 sq. m. agricultural parcel. Three months after acquisition (February 24, 1970) he mortgaged the lot (together with another parcel and chattels) to the Development Bank of the Philippines (DBP) to secure a commercial loan of P978,920.00 and used the proceeds to construct commercial-industrial improvements (ricemill, warehouses, solar drier, office/residence, roadways, etc.).
When Pe failed to pay his loan, DBP foreclosed the mortgage in June 1977; DBP was the highest bidder and certificates of sale were issued in its favor, and the certificate covering the disputed lot was registered in January 1978. Pe did not redeem within the one-year redemption period. DBP then sold the lot to petitioners Gauvain and Bernardita Benzonan on September 24, 1979 for P1,650,000.00; the Benzonans occupied the lot and added improvements worth about P970,000.00. DBP also leased the property and its improvements to Pe and to the National Grains Authority for periods.
On July 12, 1983 Pe offered in writing to repurchase the lot for P327,995.00. Failing agreement with DBP (which asserted preservation, maintenance and improvement costs exceeding P3,056,739.52), Pe filed on October 4, 1983 a complaint for repurchase under Section 119 of Commonwealth Act No. 141 with the Regional Trial Court (RTC) of General Santos City. On November 27, 1986 the RTC ordered reconveyance to Pe upon payment of P327,995.00 plus limited interest, expenses and damages, and awarded other reliefs. The Court of Appeals affirmed with modification on August 31, 1990, directing DBP to reimburse the Benzonans amounts they paid (minus interest) and permitting the Benzonans to remove improvements without damage. A motion ...(Pro-only)
Issues:
- Did respondent Benito Salvani Pe retain the right to repurchase the free-patented agricultural lot under Section 119 of Commonwealth Act No. 141 despite converting it to commercial/industrial use and having speculative motives?
- For purposes of Section 119, when did the five-year repurchase period run — from the date of conveyance/foreclosure sale or from the day after the one-year redemption period expired?
- Should the Court apply Belisario v. Intermediate Appellate Court (1988) retroactively so as to revive Pe’s repurcha...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)