G.R. No. 126773 - Rubberworld , Inc. vs. National Labor Relations Commission

Respondent Rodolfo Bacani was the registered owner of a 618-square meter parcel of land in Centro East, Santiago, Isabela, covered by Transfer Certificate of Title (TCT) No. 114296.
Rodolfo and his wife, Nellie Bacani (collectively the Spouses Bacani), obtained a loan of Php 80,000.00 from Philippine National Bank (PNB) on July 16, 1980, using the property as collateral.

Following the Spouses Bacani's failure to pay their loan, PNB extrajudicially foreclosed the property on September 9, 1986.
PNB was the highest bidder at Php 148,960.74 and was awarded the property.
The Spouses Bacani failed to redeem the property within the prescribed one-year period.
On June 6, 1989, Rodolfo’s title was canceled, and TCT No. T-185028 was issued in PNB's name.

PNB issued SEL Circular No. 8-7/89 on November 29, 1989, prioritizing former owners or their heirs for re-acquisition of foreclosed assets through negotiated sales without public bidding, subject to specific conditions.

The Spouses Bacani manifested interest to repurchase the property as early as August 26, 1991, through written offers.
Initial offers were Php 150,000.00 (1991), then increased to Php 220,000.00 (November 1991), and later to Php 300,000.00 (May 1992) with partial installment arrangements.
PNB advised the Bacanis to raise their offer due to low bids.
On December 10, 1992, PNB formally refused their offer, citing it was below the fair market value and PNB’s total claim, and announced the property would be sold by public auction.
Property's fair market value was appraised at Php 494,000.00.
Despite increased offers (Php 350,000 in 1993) and continuous negotiation, the Spouses Bacani's repurchase attempts failed.

On January 30, 1996, PNB sold the property through a negotiated sale to Renato de Leon for Php 1,500,000.00.
Rick title in PNB’s name was canceled, and TCT No. 261643 was issued in Renato’s name.
Renato filed an ejectment case against the respondents, which was granted, leading to their eviction and demolition of their houses.
On March 19, 1997, respondents filed a complaint for annulment of sale and Renato’s title, asserting fraudulent sale and bad faith by PNB to prevent their repurchase.

The Regional Trial Court (RTC) ruled in favor of respondents, nullified Renato's title, and ordered PNB to convey the property to the Bacanis upon payment of Php 217,646.50.
RTC found PNB’s sale to Renato fraudulent for pre-empting the scheduled public bidding after notifying Bacanis otherwise.
Philippine National Bank appealed to the Court of Appeals (CA), contesting the legally enforceable right of the Bacanis under PNB Circular, and emphasizing PNB's prerogative to dispose of property.
The CA affirmed the RTC ruling.
PNB's motion for reconsideration was denied.
PNB filed a petition with the Supreme Court.

Whether or not the Spouses Bacani had a legally enforceable right to repurchase the foreclosed property based on PNB SEL Circular No. 8-7/89.

Whether the sale of the property by PNB to Renato de Leon was fraudulent and whether Renato was an innocent purchaser for value.

Whether PNB was bound by an invitation to bid and the schedule of public auction in disposing of the foreclosed property.

Whether the cancellation of Renato’s title and reconveyance to the Spouses Bacani is justified.