Case Summary (G.R. No. 74851)
Applicable Law
The case is governed by the provisions of the 1987 Philippine Constitution as it was decided after 1990. The primary statute referenced is Presidential Decree No. 902-A, which outlines the SEC's powers regarding rehabilitation and suspension of payments of distressed corporations.
Facts of the Case
On September 28, 1984, BF Homes filed a petition for rehabilitation with the SEC, listing RCBC as a creditor. Shortly thereafter, on October 26, 1984, RCBC initiated an extrajudicial foreclosure of its mortgage on BF Homes' properties. A notice of auction was issued, but a temporary restraining order (TRO) was granted by the SEC on November 28, 1984, to halt proceedings. Despite the SEC’s intervention, the auction sale occurred on January 29, 1985, resulting in RCBC being the highest bidder.
Trial Court and Intermediate Appellate Court Proceedings
Subsequently, BF Homes filed a motion to annul the auction sale in SEC proceedings, and RCBC sought a mandamus in the Regional Trial Court to compel the sheriff to issue a certificate of sale. The trial court favored RCBC, leading to BF Homes’ appeal to the Intermediate Appellate Court (IAC), which annulled the trial court's decision on April 8, 1986, asserting that the SEC holds exclusive jurisdiction over the rehabilitation matter.
Issues on Appeal
RCBC challenged the IAC's decision on grounds including that BF Homes should not have been considered an indispensable party to the mandamus case, that the SEC's jurisdiction was improperly invoked to suspend the trial court's ruling, and that the trial court had rightful authority to handle the matter.
SEC Resolutions
On October 16, 1986, the SEC denied BF Homes’ motion to annul the auction and indicate contempt against RCBC and the sheriff. This resolution, although significant, did not resolve the legal question of the validity of the auction sale under the context of ongoing SEC rehabilitation proceedings.
Court Ruling
The Supreme Court dismissed the petition from RCBC and affirmed the IAC's decision with modifications. The Court held that RCBC and the Pasay City Register of Deeds acted in contempt for proceeding with the registration of the property titles despi
...continue readingCase Syllabus (G.R. No. 74851)
Case Overview
- The case involves a petition for review regarding a decision made by the Intermediate Appellate Court (IAC) dated April 8, 1986, annulling a prior ruling by a trial court.
- The decision directed the Register of Deeds to suspend the issuance of owners' copies of land titles to Rizal Commercial Banking Corporation (RCBC), which had purchased foreclosed properties from BF Homes, Inc. (BF Homes), until the resolution of SEC Case No. 002693.
Background of the Case
- Filing of SEC Case No. 002693: On September 28, 1984, BF Homes filed a petition for rehabilitation and declaration of suspension of payments with the Securities and Exchange Commission (SEC).
- RCBC's Foreclosure Action: On October 26, 1984, RCBC requested the provincial sheriff to foreclose its real estate mortgage on properties owned by BF Homes. A notice for the foreclosure sale was issued for November 29, 1984.
- Temporary Restraining Order: On November 28, 1984, the SEC issued a temporary restraining order (TRO) to prevent RCBC from proceeding with the auction sale.
Developments Leading to the Auction Sale
- Rescheduling of Sale: The auction sale was rescheduled to January 29, 1985. A writ of preliminary injunction was ordered by the SEC but was not filed in time by BF Homes.
- Conduct of Auction: The auction took place on January 29, 1985, with RCBC emerging as the highest bidder despite the SEC's pending actions.
Judicial Proceedings
- B.F. Homes' Motion Post-Auction: On February 5, 1985, BF Homes filed a motion with the SEC to annul the auction sale and hold RCBC and the sheriff in contempt.
- SEC's Response: On Februar