G.R. No. 195445 - De Guzman vs. Chico

Case Summary (G.R. No. 195445)

Factual Background: Tax Delinquency Sale and Consolidation of Title

On May 24, 2006, the City Government of Makati City sold the subject property at a public auction of tax delinquent properties conducted pursuant to the Local Government Code provisions on tax delinquency sales (cited in the record as Sections 254 to 260). Chico emerged as the winning bidder, and the City Government executed a Certificate of Sale in her favor on the same date.

Petitioners did not redeem the property within the one-year redemption period. Consequently, on July 12, 2007, Chico filed with the RTC an application for new certificate of title under Section 75 in relation to Section 107 of PD No. 1529 (the Property Registration Decree), docketed as LRC Case No. M-4992. After hearing, the RTC issued an order on December 28, 2007 directing consolidation and transfer of the title to Chico. The Register of Deeds cancelled petitioners’ TCT No. 164900 and issued a new title in Chico’s name, TCT No. T-224923.

Afterward, in the same court, Chico moved for issuance of a writ of possession, but the RTC denied the motion for failure to set it for hearing. On January 14, 2009, Chico filed an ex parte petition for issuance of a writ of possession regarding the same property, docketed as LRC Case No. M-5188 and raffled to RTC Branch 59.

RTC Orders in LRC Case No. M-5188: Grant of the Ex Parte Petition and Issuance of the Writ

On April 1, 2009, the RTC issued an Order granting Chico’s ex parte petition and ordering issuance of a writ of possession in her favor. The writ was thereafter issued on August 7, 2009.

On August 28, 2009, petitioners filed an urgent motion to cite Chico in contempt and to nullify the proceedings. Petitioners anchored their motion on the claim that LRC Case No. M-5188 contained a defective/false verification/certification of non-forum shopping. Chico filed her comment/opposition on September 11, 2009, asserting that petitioners waived any objection by failing to timely challenge the forum shopping certification. She also argued that forum shopping did not exist.

On January 19, 2010, the RTC denied petitioners’ motion. It ruled that the pleading in LRC Case No. M-5188, although denominated as a petition, was not an initiatory pleading, and therefore did not require a certificate of non-forum shopping. In the same order, the RTC ruled that petitioners’ motion to present Chico and her counsel as witnesses was without merit. Petitioners’ motion for reconsideration was denied through an Order dated April 19, 2010.

Court of Appeals Proceedings and Rationale

Petitioners filed a special civil action for certiorari with the Court of Appeals seeking annulment of the RTC orders dated January 19, 2010 and April 19, 2010, claiming grave abuse of discretion.

The Court of Appeals dismissed the petition on January 31, 2011 and affirmed the RTC orders. It held that there was no forum shopping, noting that prior to the ex parte petition in LRC Case No. M-5188, RTC Branch 62 had already denied Chico’s earlier motion for writ of possession in LRC Case No. M-4992. The Court of Appeals further reasoned that the issuance of a writ of possession is a ministerial function and is summary in nature; thus, it does not represent a final judgment on the merits but only an incident in the transfer of title.

The Court of Appeals also held that a certificate of non-forum shopping is required only in complaints or other initiatory pleadings, and that a petition or motion for issuance of a writ of possession is not such a complaint or initiatory pleading. Finally, the Court of Appeals rejected petitioners’ argument that the tax auction sale proceeding was governed by Sections 246 to 270 of the Local Government Code rather than Act No. 3135, on the ground that petitioners raised the issue for the first time on appeal and because the decision recognizing Chico as lawful registered owner of the property by virtue of the tax sale had already become final and executory, beyond judicial review in that proceeding.

Petitioners’ Arguments Before the Supreme Court

Petitioners appealed by way of a petition for review on certiorari. They contended that the Court of Appeals committed reversible error in ruling that, by virtue of Section 7 of Act No. 3135, the certification against forum shopping was unnecessary for the ex parte petition, and in refusing to examine Chico and her counsel on the supposed certification. Petitioners also invoked Article 433 of the Civil Code and decisions including Factor v. Martel, Jr., Serra Serra v. Court of Appeals, and Maglente v. Baltazar-Padilla, asserting that: (i) the certification of non-forum shopping was required in the ex parte petition; (ii) all proceedings in LRC Case No. M-5188 should have been in the nature of an accion reivindicatoria; and (iii) the proceedings were void because they were summary and akin to an ex parte motion.

Respondent’s Contentions

Chico maintained that no certification against forum shopping was required because an ex parte petition for issuance of a writ of possession is not an action, complaint, or initiatory pleading. Although denominated a petition, she argued that the ex parte petition was in substance a motion that addressed an incidental matter in the progress of registration proceedings. She likewise denied forum shopping and instead claimed petitioners were guilty of forum shopping, asserting that petitioners’ objections in the present case concerned the alleged nullity of the writ of possession, which was also the subject of another petition before the Court of Appeals docketed as CA-G.R. SP No. 110654.

On the Civil Code issue, Chico argued that Article 433 did not apply to a buyer at a tax delinquency sale. She further asserted that the cases relied upon by petitioners did not involve tax delinquency sales, and that petitioners could not point to a specific legal provision or jurisprudence requiring a tax delinquency sale purchaser to file an independent action in order to take possession.

Supreme Court Ruling: Denial of the Petition

The Supreme Court denied the petition and affirmed the Court of Appeals. The Court’s ruling centered on the nature of the ex parte petition and the consequence of finality of the registration judgment.

Legal Basis and Reasoning on the Forum Shopping Certification

The Court held that a certificate against forum shopping is not required in a petition or motion for issuance of a writ of possession. It affirmed the Court of Appeals that an ex parte petition for issuance of a writ of possession is not a complaint or other initiatory pleading contemplated in Section 5, Rule 7 of the 1997 Rules of Civil Procedure.

The Court explained that the character of a pleading depends on its purpose, not its title. Relying on Arquiza v. Court of Appeals, the Court held that a pleading denominated as a petition but filed as an ex parte application for a writ of possession is, in substance, a motion. Such a request does not seek to initiate new litigation. It functions as an incident or consequence of the original registration or cadastral proceedings. As an incident, the requirement for a forum shopping certification does not apply.

The Court also rejected petitioners’ narrow view that the dispensation from a forum shopping certification applied only to situations covered by Act No. 3135. The Court noted that writs of possession may be issued in multiple recognized instances, including land registration proceedings under Section 17 of Act No. 496, judicial foreclosure where the debtor remains in possession absent intervening rights, extrajudicial foreclosure under Section 7 of Act No. 3135 as amended, and in execution sales. It found no legal or jurisprudential basis for conditioning the certification requirement on the particular statute invoked in the underlying proceeding. It described the writ of possession as a mere incident in the transfer of title and as an incident of ownership rather than a separate judgment. Requiring a certification for an incident of ownership would, in the Court’s view, be illogical.

Reasoning on the Alleged Improper Remedy and Alleged Need for an Accion Reivindicatoria

The Court did not sustain petitioners’ argument that respondent pursued the wrong remedy and that all proceedings in LRC Case No. M-5188 should have been in the nature of an accion reivindicatoria. The Court held that the cases cited by petitioners—Factor v. Martel, Jr., Serra Serra v. Court of Appeals, and Maglente v. Baltazar-Padilla—did not fit the controversy.

The Court observed that Factor involved issuance of a writ of possession connected with an original action for registration; Serra Serra concerned a petition for reconstitution; and Maglente involved an action for interpleader. It emphasized that none of these rulings contemplated the situation here, which involved disputes between the previous registered owner and the buyer in a tax delinquency sale, particularly with respect to the purchaser’s right to seek issuance of a writ of possession after the redemption period.

In support of the propriety of a writ of possession in this context, the Court cited St. Raphael Montessori School, Inc. v. Bank of the Philippine Islands, which recognized that the writ of possession may be justified ultimately by the right to possess as an incident of ownership. The Court explained that the right to possess follows the right of ownership and that it would be illogical to bar the owner from seeking possession. The Court then grounded the issuance of the writ in respondent’s ownership by virtue of a tax delinquency sale and the ensuing expiration of the redemption period.

The Court further relied on Cloma v. Court of Appeals. In Cloma, the Court rejected a challenge to a trial court’s issuance of a writ of possession in a tax delinquency context, citing Section 2 of PD No. 1529 on the trial court’s jurisdiction over applications and questions arising from registration petitions. The Supreme Cou

Case Syllabus (G.R. No. 195445)

Parties and Procedural Posture

Petitioners, Angelina De Guzman, Gilbert De Guzman, Virgilio De Guzman, Jr., and Anthony De Guzman, sought review under Rule 45 of the Rules of Court of a January 31, 2011 Decision of the Court of Appeals (CA).
The CA affirmed the January 19, 2010 and April 19, 2010 orders of the Regional Trial Court (RTC), Branch 59, Makati City, which denied petitioners’ motion to cite respondent in contempt and to nullify proceedings, and denied petitioners’ motion for reconsideration.
Respondent, Gloria A. Chico, was the winning bidder in a tax delinquency public auction and became the registered owner after consolidation in the corresponding land registration proceeding.
Petitioners filed a special civil action for certiorari before the CA, alleging grave abuse of discretion in the RTC orders issued in LRC Case No. M-5188.

Key Factual Background

The controversy involved a parcel of property at 7-A 32 A. Bonifacio Street, Bangkal, Makati City, previously registered in petitioners’ name under TCT No. 164900.
On May 24, 2006, the property was sold at a public auction of tax delinquent properties by the City Government of Makati City pursuant to Sections 254 to 260 of the Local Government Code.
Respondent was the winning bidder and the City Government executed a Certificate of Sale in her favor on the same date.
Petitioners failed to redeem the property within the one-year redemption period, prompting respondent’s application for a new certificate of title under Section 75 in relation to Section 107 of Presidential Decree (PD) No. 1529.
On December 28, 2007, after hearing, the RTC ordered consolidation and transfer to respondent, and the Register of Deeds canceled TCT No. 164900 and issued TCT No. T-224923 to respondent.
Respondent later moved for a writ of possession, but the RTC denied the motion due to failure to set it for hearing.
On January 14, 2009, respondent filed an ex parte petition for issuance of a writ of possession for the same property in LRC Case No. M-5188, raffled to Branch 59.
On April 1, 2009, the RTC granted the ex parte petition and ordered issuance of the writ of possession, which was issued on August 7, 2009.
On August 28, 2009, petitioners filed an urgent motion to cite respondent in contempt and to nullify the proceedings, claiming that LRC Case No. M-5188 contained a defective/false verification/certification of non-forum shopping.
The RTC denied petitioners’ motion on January 19, 2010, holding that the ex parte petition for writ of possession was not an initiatory pleading and therefore did not require a forum shopping certification.

Claims of Petitioners

Petitioners contended that the CA erred in ruling that a certification against forum shopping was unnecessary based on Section 7 of Act No. 3135, and that respondent and counsel should not be examined regarding the certification.
Petitioners further argued that the RTC proceedings in LRC Case No. M-5188 should have been in the nature of an accion reivindicatoria.
Petitioners maintained that because an ex parte petition allegedly required a non-forum shopping certification, the lack of a compliant certification rendered the proceedings void.
Petitioners also asserted that the tax auction sale proceeding was governed by Sections 246 to 270 of the Local Government Code, and not by Act No. 3135.
Petitioners invoked Article 433 of the Civil Code and cited Factor v. Martel, Jr., Serra Serra v. Court of Appeals, and Maglente v. Baltazar-Padilla to support their theory that the wrong remedy was used and the proceedings were void.

Respondent’s Position

Respondent argued that no forum shopping certification was necessary because the ex parte petition for issuance of a writ of possession was not an action, a complaint, or an initiatory pleading.
Respondent asserted that, despite its label as a petition, the pleading served as a motion and had the function of resolving an incident arising in the progress of existing registration/cadastral proceedings.
Respondent denied committing forum shopping and contended that petitioners were effectively attacking the writ of possession, which was also the subject of another CA petition docketed as CA-G.R. SP No. 110654.
Respondent disputed the applicability of Article 433 of the Civil Code, asserting it did not govern a buyer at a tax delinquency sale.
Respondent argued that petitioners failed to identify a controlling provision or jurisprudence requiring a buyer in a tax delinquency sale to file an independent action to obtain possession.
Respondent emphasized that her ownership was already established and affirmed by the final and executory judgment in LRC Case No. M-4992.

Issues Presented

The Court had to determine whether an ex parte petition for the issuance of a writ of possession requires a certification against forum shopping under Rule 7, Sec. 5 of the 1997 Rules of Civil Procedure.
The Court had to decide whether petitioners’ attack on the alleged defect in the non-forum shopping certification could nullify the proceedings in LRC Case No. M-5188.
The Court had to address whether the CA erred in treating the writ of possession as a proper incident of ownership arising from tax delinquency sale and consolidation under PD No. 1529, instead of requiring an independent accion reivindicatoria.
The Court had to address whether petitioners’ reliance on cases involving other factual and procedural settings could invalidate the RTC’s issuance of a writ of possession in a tax delinquency sale context.

Statutory and Rule Framework

The petition for new title after redemption period expiration was anchored on Section 75 of PD No. 1529, and the mechanism of compelling surrender of duplicate certificates involved Section 107 of PD No. 1529.
The forum shopping rule relied upon Rule 7, Sec. 5 of the 1997 Rules of Civil Procedure, which requires certification against forum shopping in a complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed.
Rule 7, Sec. 5