G.R. No. 162757 - United Coconut Planters Bank vs. Lumbo

The respondents, Christopher Lumbo and Milagros Lumbo, borrowed a total of ₱12,000,000.00 from United Coconut Planters Bank (UCPB).
To secure the loan, the respondents constituted a real estate mortgage on a parcel of land in Boracay, Aklan, including all improvements, which operated as Titayas South Beach Resort.

Following the respondents’ failure to pay, UCPB initiated an extrajudicial foreclosure on November 11, 1998.
UCPB emerged as the highest bidder at the foreclosure sale held on January 12, 1999, with the certificate of sale issued on the same day and registration completed on February 18, 1999.
The title over the mortgaged property consolidated in the name of UCPB after the respondents failed to redeem within the statutory redemption period.

While a separate action (Civil Case No. 5920) was pending for the annulment of the foreclosure sale and related relief, UCPB filed an ex parte petition for issuance of a writ of possession (Special Proceedings No. 5884).
On September 5, 2000, the Regional Trial Court (RTC) granted UCPB’s petition, and on December 4, 2001, a writ of possession was issued directing the sheriff to turn over the property.
The writ was effected on January 23, 2002, with an order for the respondents to vacate by January 31, 2002; however, the respondents were allowed temporary occupancy due to humanitarian considerations.

On February 14, 2002, the respondents filed a petition in the RTC to cancel the writ of possession and set aside the foreclosure sale. They also sought a writ of preliminary injunction and temporary restraining order to halt the implementation of the writ.
The RTC denied the application for a writ of preliminary injunction on March 19, 2002.
Dissatisfied with the RTC’s decision, the respondents elevated the matter to the Court of Appeals (CA) via a petition for certiorari and/or mandamus (C.A.-G.R. SP No. 70261).

On November 27, 2003, the CA granted the respondents’ petition, setting aside the RTC’s orders and enjoining the implementation of the writ of possession pending final adjudication of the cancellation and annulment petition.
Key errors noted by the CA included misinterpretation of Section 8 of Act No. 3135 as amended, particularly regarding the timing for filing a petition to cancel the writ and questioning the respondents’ possession status.

Whether the CA correctly granted the respondents’ petition for certiorari and/or mandamus by enjoining the RTC from implementing the writ of possession.
Whether the issuance of the writ of possession by the RTC—an ex parte and summary proceeding—is a matter that falls within the proper exercise of jurisdiction.

Whether the respondents’ petition to cancel the writ of possession was filed within the permissible thirty-day period after the purchaser was given possession, irrespective of whether such possession was full or temporary.
Whether the respondent judge erred by deeming the petition premature and, thereby, misapplying Section 8 of Act No. 3135, as amended by Act No. 4118.

Whether the respondents possess a right in esse to warrant injunctive relief to restrain the implementation of the writ of possession.
Whether their non-redemption of the property within the set redemption period forfeited any right to challenge the foreclosure sale or the issuance of the writ.

Whether the CA, by granting injunctive relief, effectively pre-judged the merits of the respondents’ petition for cancellation and annulment of the foreclosure sale.
Whether the CA’s act of enjoining the writ of possession contradicts established jurisprudence on extrajudicial foreclosure under Act No. 3135 and the procedural nature of the writ.