Facts:

This case involves petitioners Eduardo and Leticia MontaAo (hereinafter referred to as “the MontaAos”) who brought a petition for review on certiorari against respondents Rosalina Francisco, the City Government of Iloilo, City Treasurer Romeo V. Manikan, and Erlinda C. Zarandin, Head of the Treasurer's Enforcement Group. The events leading to the case unfolded when the MontaAos executed a Deed of Conditional Sale with the Government Service Insurance System (GSIS) regarding a parcel of land located at Block 2, Lot 6, Maharlika Homes, Jaro, Iloilo City, covered by Transfer Certificate of Title (TCT) No. T-41681. They commenced amortization payments in January 1979, occupying the house on that lot by 1980.

In the summer of 1994, the couple was informed by Atty. Salvador Paja I that the lot had been sold to Rosalina Francisco due to tax delinquency. Upon investigation, Leticia discovered an annotation on the TCT indicating that a Certificate of Sale of Delinquent Real Property

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Facts:

Background of the Case

• Spouses Eduardo and Leticia MontaAo entered into a Deed of Conditional Sale with the Government Service Insurance System (GSIS) on April 13, 1977, for a parcel of land situated at Block 2, Lot 6, Maharlika Homes, Jaro, Iloilo City, including the house and improvements thereon.
• The property was registered under Transfer Certificate of Title (TCT) No. T-41681.
• The MontaAos began paying the amortization in January 1979 and took up occupancy of the property in 1980.

Emergence of the Dispute

• In the summer of 1994, an attorney, Salvador Paja I, visited the MontaAo residence asserting that the lot was already owned by respondent Rosalina Francisco.
• In response, Leticia MontaAo made inquiries at the Register of Deeds and discovered annotations on the back of TCT No. T-41681:
• Entry No. 170334 (dated July 17, 1991) showing the Certificate of Sale of Delinquent Real Property in favor of Rosalina Francisco for a sum collected for taxes, penalties, and the cost of sale pursuant to Section 76 of P.D. No. 464.
• Entry No. 201610 (dated July 16, 1993) featuring an order by Judge Quirico Defensor of the RTC of Iloilo City, Branch 36, directing the issuance of a new owner’s duplicate copy of the title in the name of GSIS while declaring the lost copy as null and void.
• On June 13, 1994, Leticia MontaAo requested an annotation of a Notice of Adverse Claim on the TCT to protect her interest stemming from the conditional sale contract.

Tax Delinquency and Auction Sale Proceedings

• It was revealed that on June 27, 1991, respondent Rosalina Francisco had purchased the subject property via a public auction sale for delinquent real property taxes.
• The MontaAos contended that they:
• Were not given any notice regarding the tax delinquency or the scheduled auction sale.
• Were not furnished a copy of the sale certificate.
• Did not receive any notice of their right to redeem the property.
• In response, on July 11, 1994, the MontaAos filed an action for declaration of nullity of sale and for damages before the RTC of Iloilo City, Branch 23.
• They initiated protective measures by recording a Notice of Lis Pendens and paying the tax due by consignation under Section 267 of the Local Government Code of 1991.

Procedural Developments and Evidentiary Submissions

• The trial court records included various documents such as:
• Notice of Sale of Delinquent Real Property.
• Certificate of Posting.
• Certifications regarding the conduct of the auction sale.
• Proof of service and other documentary evidence related to the sale and notifications.
• Public respondents, including the City Treasurer (Romeo Manikan) and the head of the Treasurer’s Enforcement Group (Erlinda Zarandin), filed an Answer with Counterclaim asserting that:
• The MontaAos had no inherent right to be notified since GSIS, as the registered owner, was duly notified.
• The petitioners lacked the necessary legal personality to sue regarding the matter.
• Evidence by respondent Rosalina Francisco demonstrated that:
• She, through a Special Power of Attorney executed in favor of attorney Salvador Paja I, acquired the property at the public auction.
• The auction sale and subsequent annotations on TCT No. T-41681 were carried out according to established procedures, culminating in the issuance of a new owner’s duplicate copy in favor of GSIS (via an RTC order dated April 29, 1993).

Appellate Review and Final Determination

• The trial court initially ruled (January 12, 2001) that the failure of Iloilo City Treasurer to comply with publication and notice requirements rendered the auction sale illegal and without force and effect, thereby declaring in favor of the MontaAos.
• On appeal, the Court of Appeals reversed the trial court decision in its April 24, 2003 ruling, holding that:
• The tax delinquency proceedings and auction sale were legal and with force and effect.
• GSIS, as the registered owner (and hence the taxpayer), had been duly notified.
• The alleged defect in publication (even if notice had been published only twice instead of three times) was immaterial as personal notice had been served.
• The petitioners’ motion for reconsideration was denied in a Resolution dated August 20, 2003.

Issue:

Whether the tax delinquency proceedings, including the public auction sale of the subject property covered by TCT No. T-41681, were regular and legal.

• The central question was if the requirements under Section 73 of P.D. No. 464, particularly concerning the publication of the auction sale and the notice of tax delinquency, were complied with.

Whether the proper party (the registered owner, GSIS) had been duly notified in accordance with the provisions of the Real Property Tax Code and relevant jurisprudence.

• The dispute also encompassed whether the failure to notify the MontaAos (who had a contractual interest) affected the legality of the proceedings, as they contended that notice should have been served to both the conditional vendee and the registered owner.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)