Case Digest (G.R. No. 155206)
Facts:
Government Service Insurance System v. Eduardo M. Santiago, Substituted by His Widow Rosario Enriquez Vda. de Santiago, G.R. No. 155206, October 28, 2003, Supreme Court Second Division, Callejo, Sr., J., writing for the Court.The petition arises from long-continued mortgage loans made in 1956–1957 by petitioner Government Service Insurance System (GSIS) to spouses Jose C. Zulueta and Soledad Ramos, secured by real estate covered by TCT Nos. 26105, 37177 and 50365. The Zuluetas defaulted, and GSIS foreclosed the mortgages and conducted a public auction on August 14, 1974; GSIS submitted the winning bid. Not all lots were sold at that auction: the Certificate of Sale expressly excluded certain lots (ninety-one were initially excluded, later narrowed in the litigation to seventy-eight subject lots), and those exclusions were annotated on the affected titles.
On November 25, 1975, GSIS executed an Affidavit of Consolidation of Ownership covering the foreclosed parcels, including the lots that had been expressly excluded from the 1974 sale. In 1980 GSIS purported to sell the foreclosed properties to Yorkstown Development Corporation, but the sale was disapproved by the Office of the President and the Registry of Deeds later cancelled the Yorkstown titles; GSIS thereafter again disposed of foreclosed lots, including the excluded ones. In 1989–1990 respondent Eduardo M. Santiago (acting for Antonio Vic Zulueta, and later substituted by his widow Rosario Enriquez Vda. de Santiago after Santiago’s death) learned of the excluded lots; a demand was sent in May 1989 and an agreement of transfer from Zulueta to Santiago was executed April 7, 1990.
On May 7, 1990 Antonio Vic Zulueta, represented by Eduardo M. Santiago, filed in the Regional Trial Court (RTC) of Pasig City, Branch 71, a complaint for reconveyance against GSIS to recover the excluded lots. GSIS answered alleging prescription, laches, and absence of cause of action; several third parties intervened claiming interests in particular lots. After trial, the RTC rendered judgment ordering GSIS to reconvey the seventy-eight excluded lots (or pay their fair market value if reconveyance was impossible), to cancel existing titles in GSIS’s name and issue new titles in plaintiff’s name, and to cancel notices of lis pendens; costs were awarded to plaintiff.
GSIS appealed to the Court of Appeals in CA-G.R. CV No. 62309. The Court of Appeals, in a decision penned by Associate Justice Sergio L. Pestano (with Justices Conchita Carpio Morales and Martin S. Villanueva, Jr. concurring), affirmed the RTC’s judgment on February 22, 20...(Subscriber-Only)
Issues:
- Did the Court of Appeals err in finding that GSIS acted in bad faith in consolidating titles and causing issuance of certificates of title over the seventy-eight lots expressly excluded from the foreclosure sale?
- Was the action for reconveyance barred by prescription when filed on May 7, 1990?
- Did GSIS have a legal duty to return the excluded lots to the Zuluetas notwithst...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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