Facts:
Sun Life Assurance Company of Canada filed a proceeding supplemental to a prior
mortgage foreclosure case, also instituted by the same plaintiff as assignee of the original first mortgagee, against
Joaquin Serna et al. in
civil case No. 28009 of the Court of First Instance of Manila. That earlier proceeding had already been concluded by the
sale of the mortgaged property and the purchase of the property by the plaintiff as mortgage creditor. The present defendant,
Florencio Gonzalez Diez, held a
second mortgage on the same property, but he had not been named as a defendant in the earlier foreclosure suit. After the first foreclosure had been completed, the plaintiff brought the present action to
foreclose the equity of redemption vested in Gonzalez Diez by virtue of the second mortgage. The background of the mortgages showed that on
May 17, 1920, Serna mortgaged the property to the
Shanghai Life Insurance Company, Ltd. to secure a promissory note for
P20,000. On the same date, Serna executed a second mortgage on the same property in favor of Gonzalez Diez to secure a debt of
P6,000. The note and the rights of the original first mortgagee were later transferred to
Sun Life Assurance Company of Canada, the plaintiff. After the mortgaged property was transferred for a valuable consideration to
Paulino Francisco, the first mortgage note remained unpaid at maturity, and Sun Life initiated the foreclosure case (
No. 28009) naming only Serna and Paulino Francisco as defendants, without joining Gonzalez Diez. The property was then sold in regular course and bought by the plaintiff. The present action began as a supplemental motion in the original foreclosure case, but after objection the trial court required the plaintiff to pay the
filing fee, thereby giving the proceeding the status of an
independent action. Upon hearing, the trial court declared the indebtedness under the first mortgage in the same total amount stated in the original foreclosure decree, with added interest and costs, and ordered that if Gonzalez Diez did not redeem within
three months from the date of the decision by paying the amount fixed, he would be
debarred of all right as second mortgagee, with provision for the
cancellation of the second mortgage. Gonzalez Diez appealed, questioning the right of the first mortgage creditor to maintain the action against him.
Issues:
Whether the first mortgage creditor could maintain an
independent foreclosure proceeding against the second mortgagee after the senior mortgage had already been foreclosed without joining the second mortgagee as a party.
Ruling:
Ratio:
Doctrine: