Case Summary (G.R. No. 173976)
Background of the Case
On August 1, 1991, the PeAafiel spouses mortgaged their properties to the Petitioner. Following defaults on payment, an extrajudicial foreclosure proceeding was initiated by the Petitioner on July 14, 1999. A Notice of Sale was sent to Erlinda PeAafiel and was published in Maharlika Pilipinas, a newspaper claimed to be of general circulation. The auction was held, with the Petitioner emerging as the highest bidder for the properties, ultimately acquiring them for P6,144,000.00.
Procedural History
Respondent Erlinda PeAafiel filed a complaint on August 8, 2000, seeking to nullify the foreclosure sale, claiming improper publication of the notice. The Regional Trial Court ruled in favor of the Petitioner, declaring the foreclosure valid. The Respondents appealed to the Court of Appeals, which found in their favor, decreeing that the publication did not meet the legal requirements stipulated by Act No. 3135.
Applicable Law
The central statute in this case is Act No. 3135, which governs extrajudicial foreclosure sales and outlines the requirements for proper notice. Specifically, Section 3 mandates that notices of sale must be published in a newspaper of general circulation in the municipality where the property is located and posted in at least three public places for a minimum of twenty days.
Court of Appeals’ Rationale
The Court of Appeals held that the publication in Maharlika Pilipinas did not fulfill the requirement of being a newspaper of general circulation within Mandaluyong City. Testimonies and documentation provided by the Respondents demonstrated that Maharlika Pilipinas lacked subscribers in Mandaluyong City and did not have a valid business permit there. The appellate court stressed that the essence of the publication requirement is to ensure broad public awareness of the foreclosure sale to prevent the sacrifice of property.
Argumentation by the Petitioner
The Petitioner contended that Maharlika Pilipinas qualified as a newspaper of general circulation due to its regular publication and existing bona fide subscription list. Additionally, the Petitioner argued that the Executive Judge's prior accreditation of the newspaper for participation in the raffle of judicial notices implied compliance with legal standards. However, the Court noted that the mere accreditation does not definitively establish its status as a newspaper of general circulation.
Supreme Court’s Findings
Upon review, the Supreme Court affirmed the decision of the Court of Appeals. It upheld the latter’s conclusion that Maharlika Pilipinas did not meet the necessary criteria for general circulation within Mandaluyong City. The Court emphasized that successful publi
...continue readingCase Syllabus (G.R. No. 173976)
Case Overview
- This case involves a petition for review on certiorari filed by Metropolitan Bank and Trust Company, Inc. (petitioner) against Eugenio PeAafiel, acting on behalf of Erlinda PeAafiel (respondents).
- The case stems from a decision by the Court of Appeals (CA) which nullified an extrajudicial foreclosure sale due to improper publication of the notice of sale.
Factual Background
- Erlinda PeAafiel and her late husband, Romeo PeAafiel, were the registered owners of two parcels of land in Mandaluyong City, covered by Transfer Certificate of Title (TCT) No. 6195 and TCT No. 0085.
- On August 1, 1991, the PeAafiel spouses mortgaged their properties to the petitioner. The mortgage was amended several times as the loan amount increased.
- The spouses defaulted on their loan obligations, prompting the petitioner to initiate extrajudicial foreclosure proceedings on July 14, 1999, under Act No. 3135.
- Notice of Sale was sent to Erlinda PeAafiel, indicating an auction set for September 7, 1999, with the notice published in Maharlika Pilipinas on August 5, 12, and 19, 1999, and posted in three public places in Mandaluyong City.
- At the auction, the petitioner was the sole and highest bidder, acquiring the properties for P6,144,000.00.
Procedural History
- On August 8, 2000, Erlinda PeAafiel, through her attorney-in-fact, filed a complaint seeking to nullify the extrajudicial foreclosure, which included requests for injunctions against the petitioner and the Register of Deeds, as well as attorney's fees.
- The Regional Trial Court (RTC) ruled in favor of the petiti