Case Summary (G.R. No. 162757)
Petitioner and Respondents
Petitioner: United Coconut Planters Bank (UCPB)
Respondents: Christopher Lumbo and Milagros Lumbo
Key Dates
- November 11, 1998: UCPB applied for extrajudicial foreclosure of the mortgage.
- January 12, 1999: The property was sold at a foreclosure auction.
- February 18, 1999: Certificate of sale was registered in UCPB's name.
- March 19, 2002: RTC denied the respondents' application for a writ of preliminary injunction.
- November 27, 2003: Court of Appeals issued a decision reversing the RTC's order.
Applicable Law
The principal law applicable involves Act No. 3135, as amended by Act No. 4118, governing the extrajudicial foreclosure of mortgages and the issuance of writs of possession.
Background and Proceedings
The Lumbo couple borrowed PHP 12 million from UCPB, securing their obligation through a real estate mortgage on their resort property. After failing to repay, UCPB conducted an extrajudicial foreclosure, registered the title in its name after the redemption period ended, and subsequently sought a writ of possession. The RTC granted this writ, and while UCPB was placed in partial possession, the Lumbo couple contested the foreclosure, filing an action for annulment and seeking injunctive relief to halt the writ of possession based on their claims.
Ruling of the Court of Appeals
The Court of Appeals determined that the RTC had erred in its denial of the Lumbo's request for a preliminary injunction, concluding that their claim for cancellation was viable and not premature, as per Section 8 of Act 3135. The appellate court granted an injunction, halting the implementation of the writ of possession pending resolution of the annulment case.
Supreme Court's Analysis
The Supreme Court criticized the Court of Appeals for misunderstanding the nature of a writ of possession, which is typically a matter of right for the purchaser post-foreclosure. It established that the issuance of the writ is a ministerial act of the court and that a pending annulment action does not prevent its enforcement. The Court reiterated that once UCPB's title was consolidated due to non-redemption, the Lumbo couple lost rights to the property, including its possession.
Key Findings of the Supreme Court
- Writ of Possession as a Right: The issuance of a writ of possession upon the consolidation of title confers a right to the purchaser regardless of concurrent litigation regarding the foreclosure.
- Absence of Right in Esse: The respondents lacked any right to possess the property as they had failed to redeem it within the stipulated period. They could not establish a prima facie case necessary for obtaining an injunctive relief since their rights in the property had been extinguished.
- Jurisdiction and Error of Judgment: While t
Case Syllabus (G.R. No. 162757)
Case Overview
- This case involves an appeal by United Coconut Planters Bank (UCPB) against Christopher Lumbo and Milagros Lumbo concerning the issuance of a writ of possession following a foreclosure sale.
- The Supreme Court reviewed the decision made by the Court of Appeals (CA) which reversed the Regional Trial Court (RTC) of Kalibo's order denying the respondents' request for a preliminary injunction against the writ of possession.
Background Facts
- Respondents Lumbo borrowed P12,000,000.00 from UCPB, secured by a mortgage on a parcel of land in Boracay, Aklan, used as a beach resort.
- After respondents defaulted, UCPB initiated an extrajudicial foreclosure, emerging as the highest bidder on January 12, 1999.
- UCPB registered the sale on February 18, 1999, and subsequently consolidated the title in its name after the redemption period lapsed without action from the respondents.
- On January 7, 2000, the Lumbo respondents filed an action for annulment of the foreclosure and other related claims against UCPB.
Legal Proceedings
- UCPB filed an ex parte petition for a writ of possession, which the RTC granted on September 5, 2000, leading to a writ issued on December 4, 2001.
- The writ was served on January 23, 2002, with a demand for respondents to vacate by January 31, 2002. Possession was eventually turned over to UCPB on February 1, 2002, albeit tempo