Case Digest (G.R. No. 232522)
Facts:
In the case Isabel Jael Marquez, et al. v. The Presiding Judge, RTC Br. 58, Lucena City, et al., G.R. No. 141849 decided on February 13, 2007, the petitioners, heirs of Marcial M. Marquez, challenged the denial of a writ of preliminary injunction by the Regional Trial Court (RTC) and the subsequent affirmance by the Court of Appeals (CA). Marcial M. Marquez was an incorporator and officer of Lucena Entrepreneur and Agri-Industrial Development Corporation (LEAD), which was organized to engage in commercial deep-sea fishing. LEAD obtained loans from the Development Bank of the Philippines (DBP) in the amount of PhP 2,105,000 in 1977 and an additional loan of PhP 714,600 in 1981. Marquez and other principals were jointly and severally liable for these loans. To secure these loans, several Real Estate Mortgages (REM) were executed over various parcels of land, including one on the property covered by TCT No. T-24506 registered in the names of Marquez and his wife.
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Case Digest (G.R. No. 232522)
Facts:
- Parties and Nature of the Case
- Petitioners: Isabel Jael Marquez, Celia M. Idea, Luisita M. Eclavea, Melvira M. Villasante, Ruel Marquez, Zaida M. Saracena, and Eloisa M. Penamora (heirs and/or affiliates of Marcial M. Marquez).
- Respondents: Presiding Judge Hon. Ismael B. Sanchez of RTC Branch 58, Lucena City; Executive Judge of RTCS of Lucena City; Development Bank of the Philippines (DBP); Provincial Sheriff of Quezon Province.
- Case involved a Petition for Review on Certiorari assailing:
- The November 5, 1998 CA Decision affirming RTC orders dated October 29 and December 23, 1992 denying a writ of preliminary injunction;
- The January 31, 2000 Resolution of the CA denying a Motion for Reconsideration.
- Subject matter: propriety of denial of a writ of preliminary injunction to prevent an extra-judicial foreclosure sale by DBP of properties mortgaged by Marquez and others, securing loans of Lucena Entrepreneur and Agri-Industrial Development Corporation (LEAD).
- Background and Events
- LEAD was incorporated on November 26, 1975 to engage in commercial deep-sea (purse seine) fishing. Marcial M. Marquez was an incorporator and officer.
- LEAD applied for and was granted an agricultural loan by the DBP on November 9, 1977, amounting to PhP 2,105,000.00 for vessel construction and equipment procurement;
- Required equity capitalization by LEAD’s principals;
- Principals, including Marquez, were jointly and severally liable with LEAD.
- Some principals, including Mr. and Mrs. Venuso Bibit and Mr. and Mrs. Eduardo Murallon, mortgaged two properties as collateral (TCT Nos. T-136995 and T-140765).
- The vessel construction and equipment procurement were subjected to local competitive bidding per DBP policies; Trigon Engineering and Shipbuilding Corporation won and executed contract with LEAD on June 2, 1978 (PhP 1,955,000.00 contract price, 150 days completion period).
- Implementation problems included:
- Withheld loan releases due to non-compliance with capitalization;
- Defects in vessel construction requiring corrections;
- Delay and cost overruns;
- The vessel was only 77.14% complete after over two years.
- Agreement reached for LEAD to receive vessel as-is, complete the rest by itself; DBP granted additional loan of PhP 714,600.00 on July 29, 1981 consolidated with first loan;
- Marquez and wife entered into second mortgage on property (TCT No. T-24506) to secure additional loan.
- Loan fully released on February 8, 1982; vessel “F/B LEAD 1” completed and insured with GSIS Property Insurance Fund for DBP and LEAD’s benefit.
- DBP notified LEAD of arrearages (PhP 906,887.58 plus interest) on September 3, 1982; collection committee formed with negative results.
- F/B LEAD 1 sank off Unisan, Quezon during typhoon nights of June 21-22, 1985; DBP collected insurance proceeds of PhP 1,186,145.00 applied to loan account on December 9, 1986.
- DBP demanded settlement on July 21, 1992 and threatened legal action including foreclosure.
- DBP filed foreclosure application on August 25, 1992 of properties under the real estate mortgages; Notice of Extra-Judicial Sale issued for October 6, 1992 scheduled sale of properties including Marquez’s mortgaged property (TCT No. T-24506).
- Spouses Bibit and Murallon did not contest the sale; Marquez filed a Civil Case No. 92-150 on October 5, 1992, praying for:
- Damages;
- Cancellation of mortgage;
- Certiorari;
- Writ of preliminary injunction/restraining order to prevent the foreclosure sale and other reliefs.
- Trial court issued Temporary Restraining Order on October 6, 1992; hearing held on October 14, 1992 on injunction.
- DBP filed answer with counterclaims on October 16, 1992.
- Trial court denied injunction on October 29, 1992; petitioners filed motion for reconsideration and urgent motion to restrain extra-judicial sale scheduled December 28, 1992.
- DBP issued second notice of extra-judicial sale on November 24, 1992; trial court denied motions on December 23, 1992; sale conducted December 28, 1992.
- CA granted TRO on certiorari petition filed by Marquez against orders denying injunction pending resolution; later affirmed RTC decisions on November 5, 1998; denied motion for reconsideration on January 31, 2000.
- Marcial M. Marquez died January 24, 1995; substituted by heirs in 1999.
Issues:
- Whether the trial court committed grave abuse of discretion amounting to lack or excess of jurisdiction by denying the writ of preliminary injunction against the extra-judicial foreclosure sale by DBP.
- Applicability of Presidential Decree No. 385 (P.D. 385) on mandatory foreclosure by government financial institutions.
- Alleged denial of due process to Marcial M. Marquez during hearing for issuance of injunctive relief.
- Whether the mortgage constituted on property covered by TCT No. T-24506 (Marquez’s family home) was valid and could be foreclosed.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)