Marquez vs. Alindog

The issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale is a ministerial function of the court after consolidation of title, and may not be restrained by preliminary injunction where the claimant is merely a successor-in-interest of the mortgagor lacking a right superior to the latter, or where the act sought to be enjoined has already been accomplished.

Petitioner Anita J. Marquez extended a loan of ₱500,000.00 to Benjamin Gutierrez in June 1998, secured by a real estate mortgage over a 660-square meter property in Tagaytay City covered by Transfer Certificate of Title No. T-13443 registered in the name of Spouses Gutierrez. Following Gutierrez's default, Anita foreclosed the mortgage extrajudicially and emerged as the highest bidder at a public auction held on January 19, 2000 for ₱1,171,000.00. After the redemption period expired without redemption, title was consolidated in Anita's name under TCT No. T-41939 on November 5, 2001, though annotated with an adverse claim filed by respondents Spouses Alindog on March 2, 2000. Respondents alleged they had purchased the property from Gutierrez in September 1989 but failed to register the transfer due to the deceit of an agent.

• The Loan and Mortgage: Sometime in June 1998, petitioner Anita J. Marquez extended a loan of ₱500,000.00 to Benjamin Gutierrez. As security, Gutierrez executed a Deed of Real Estate Mortgage dated June 16, 1998 over a 660-square meter parcel of land in Tagaytay City covered by TCT No. T-13443 registered under the name of Benjamin A. Gutierrez, married to Liwanag Camerin. The mortgage was duly annotated on the title, which petitioners had verified as clean prior to the transaction.
• Foreclosure and Consolidation: Upon Gutierrez's default, Anita sought extra-judicial foreclosure. At the public auction held on January 19, 2000, Anita emerged as the highest bidder for ₱1,171,000.00. Following Gutierrez's failure to redeem within the prescribed period, title was consolidated under TCT No. T-41939 on November 5, 2001 in the name of Anita J. Marquez, married to Nicasio C. Marquez. This title bore an annotation of adverse claim dated March 2, 2000 in the names of respondents Spouses Carlito and Carmen Alindog, which annotation was copied from an earlier annotation on TCT No. T-13443 made after the property's mortgage to petitioners.
• The Annulment Case: On March 21, 2000, respondents filed a civil case for annulment of real estate mortgage and certificate of sale with prayer for damages (Civil Case No. TG-1966) against petitioners and Agripina Gonzales. Respondents alleged they purchased the subject property from Gutierrez in September 1989 but were unable to secure a certificate of title because Gonzales, to whom they entrusted the task, deceived them by assuring them the certificate was being processed when it was not. They discovered the property had been mortgaged to petitioners and that Gutierrez was already dead when the mortgage was executed. Petitioners disputed respondents' ownership, arguing the purported sale was never registered and therefore not binding upon them, and that their title was already indefeasible.
• The Ex-Parte Petition for Writ of Possession: On March 16, 2005, Anita filed an ex-parte petition for the issuance of a writ of possession (LRC Case No. TG-05-1068) before the RTC, claiming entitlement as a matter of right following consolidation of title. Impleaded were Spouses Gutierrez and all persons claiming rights under them.
• Issuance and Implementation of Writ: In an Order dated August 1, 2005, the RTC granted the ex-parte petition and directed the issuance of a writ of possession. A notice to vacate dated September 23, 2005 was issued by Acting Sheriff Teodorico V. Cosare against Spouses Gutierrez and all persons claiming rights under them, and served on respondents on September 27, 2005.
• The Injunction Case: Claiming irreparable injury, respondents sought a TRO and/or writ of preliminary injunction with prayer for damages in a separate case docketed as SCA No. TG-05-2521. While the RTC issued a 72-hour TRO on September 29, 2005, it was not extended to a full 20-day TRO. The Sheriff's Return dated November 14, 2005 showed the writ of possession was implemented on November 11, 2005, turning over possession to petitioners.
• The Assailed Orders: In an Order dated November 14, 2005, the RTC issued a writ of preliminary injunction enjoining petitioners from taking possession of the subject property until the controversy was fully resolved on the merits, finding that respondents appeared to have a right to be protected and that dispossession would cause irreparable injury. In an Order dated January 17, 2007, the RTC denied petitioners' motion for reconsideration and granted respondents' motion to regain possession.

• Ministerial Duty: Petitioners maintained that as confirmed and registered owners of the subject property, they were entitled to possession as a matter of right. They argued that pursuant to Sections 7 and 8 of Act No. 3135, as amended by Act No. 4118, the RTC was legally bound to place them in possession pending resolution of the annulment case, and that the issuance of the writ of possession was merely ministerial.
• Mootness: Petitioners argued that the purpose for the issuance of the injunctive writ—to restrain the implementation of the writ of possession—had already been rendered moot and academic by its actual enforcement in the interim.

• Prima Facie Right: Respondents countered that they had adduced prima facie proof of their right to possess the subject property while the annulment case was pending, and that their right to remain in possession proceeded from the fact of the subject property's earlier sale to them.
• Exercise of Caution: Respondents argued that the RTC properly exercised caution in weighing the conflicting claims of the parties in issuing the writ of preliminary injunction.

• Grave Abuse of Discretion: Whether the Court of Appeals erred in finding no grave abuse of discretion on the part of the RTC when it issued the injunctive writ which enjoined petitioners from taking possession of the subject property.
• Ministerial Nature of Writ: Whether the issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale after consolidation of title constitutes a ministerial act.
• Third Party Exception: Whether respondents qualify as third parties actually holding the property adversely to the judgment obligor under Section 33, Rule 39 of the Rules of Court so as to prevent the ministerial issuance of the writ.

• Grave Abuse of Discretion: The RTC gravely abused its discretion when it issued the injunctive writ enjoining petitioners from taking possession. Grave abuse of discretion arises when a lower court patently violates the law or existing jurisprudence. By effectively rescinding the writ of possession it had initially issued—despite the ministerial nature of such issuance—the RTC defied established jurisprudence.
• Ministerial Nature of Writ: The issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale is a ministerial act, not a discretionary one. After consolidation of title in the buyer's name for failure of the mortgagor to redeem, the writ of possession becomes a matter of right. The trial court has no discretion on this matter; any question regarding the regularity and validity of the sale is left to be determined in a subsequent proceeding under Section 8 of Act No. 3135, not as a justification for opposing the issuance of the writ.
• Third Party Exception Inapplicable: Section 33, Rule 39 of the Rules of Court provides that possession may be awarded to the purchaser unless a third party is actually holding the property by adverse title or right. The phrase "third party who is actually holding the property adversely to the judgment obligor" contemplates a situation where the third party holds the property by adverse title or right superior to that of the original mortgagor, such as that of a co-owner, tenant, or usufructuary. Respondents, who claimed the property by virtue of a prior purchase from the mortgagor (Gutierrez), were merely successors-in-interest of the latter and did not possess a right superior to the mortgagor. Thus, the general rule—ministerial issuance of the writ—applied.
• Mootness: The issuance of the writ of preliminary injunction was improper because the act sought to be enjoined—the implementation of the writ of possession—had already been accomplished in the interim, rendering the matter moot. Injunction would not lie where the acts sought to be enjoined had already become fait accompli.

• Ministerial vs. Discretionary Acts — A purely ministerial act or duty is one which an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a legal authority, without regard to or the exercise of his own judgment upon the propriety or impropriety of the act done. If the law imposes a duty upon a public officer and gives him the right to decide how or when the duty shall be performed, such duty is discretionary and not ministerial. The use of discretion and the performance of a ministerial act are mutually exclusive.
• Writ of Possession in Extrajudicial Foreclosure — Under Section 7 of Act No. 3135, as amended, the purchaser at a public auction sale of an extrajudicially foreclosed real property may seek possession thereof during the redemption period by filing an ex parte motion under oath, upon approval of the appropriate bond. After the expiration of the redemption period without redemption, the purchaser becomes the absolute owner and is entitled to possession as a matter of right; the issuance of the writ of possession becomes a ministerial duty of the court requiring no bond.
• Third Party Exception (Section 33, Rule 39) — The exception to the ministerial issuance of a writ of possession applies only where a third party is actually holding the property by adverse title or right superior to that of the judgment obligor (original mortgagor), such as a co-owner, tenant, or usufructuary. A mere successor-in-interest or transferee of the mortgagor's rights does not qualify as a third party holding adversely; the property must be possessed by the third party in his own right, not merely as successor or transferee of the right of possession of another.
• Fait Accompli — Injunction will not lie to restrain an act that has already been fully accomplished or consummated; the remedy becomes moot when the irreparable injury sought to be prevented has already occurred.

• "The issuance of a writ of possession to a purchaser in a public auction is a ministerial act. After the consolidation of title in the buyer's name for failure of the mortgagor to redeem the property, the writ of possession becomes a matter of right. Its issuance to a purchaser in an extrajudicial foreclosure sale is merely a ministerial function. The trial court has no discretion on this matter."
• "The phrase 'a third party who is actually holding the property adversely to the judgment obligor' contemplates a situation in which a third party holds the property by adverse title or right, such as that of a co-owner, tenant or usufructuary. The co-owner, agricultural tenant, and usufructuary possess the property in their own right, and they are not merely the successor or transferee of the right of possession of another co-owner or the owner of the property."
• "Grave abuse of discretion arises when a lower court or tribunal patently violates the Constitution, the law or existing jurisprudence."
• "Injunction would not lie where the acts sought to be enjoined had already become fait accompli (meaning, an accomplished or consummated act)."

• China Banking Corp. v. Sps. Lozada, 579 Phil. 454 (2008) — Controlling precedent establishing that the issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale is ministerial after consolidation of title; followed and applied.
• De Gracia v. San Jose, 94 Phil. 623 (1954) — Cited in China Banking Corp., establishing that under Section 7 of Act No. 3135, the order for a writ of possession issues as a matter of course upon the filing of the proper motion and approval of the bond, leaving no discretion to the court.
• IFC Service Leasing and Acceptance Corporation v. Nera, 125 Phil. 595 (1967) — Cited for the proposition that if the court has power to issue a writ of possession during the redemption period, it has the same power after expiration where a new title has been issued.
• Spouses Espiridion v. CA, 523 Phil. 664 (2006) — Cited for the distinction between ministerial and discretionary acts.
• Rural Bank of Sta. Barbara (Iloilo), Inc. v. Centeno, G.R. No. 200667, March 11, 2013 — Recent precedent clarifying the "third party" exception under Section 33, Rule 39; followed.
• Villanueva v. Cherdan Lending Investors Corporation, G.R. No. 177881, October 13, 2010 — Cited for the rule that the third person must claim a right superior to that of the original mortgagor.
• Tagolino v. House of Representatives Electoral Tribunal, G.R. No. 202202, March 19, 2013 — Cited for the definition of grave abuse of discretion.
• Transfield Philippines, Inc. v. Luzon Hydro Corporation, G.R. No. 146717, November 22, 2004 — Cited for the principle that injunction will not lie where the act sought to be enjoined is fait accompli.

• Section 7, Act No. 3135 (The Mortgage Law), as amended by Act No. 4118 — Governs the procedure for extrajudicial foreclosure; provides that the purchaser may petition the court for possession during the redemption period by filing an ex parte motion under oath and posting a bond equivalent to twelve months' use of the property; mandates that the court shall, upon approval of the bond, order that a writ of possession issue.
• Section 8, Act No. 3135 — Provides that the debtor may petition to set aside the sale and cancel the writ of possession within thirty days after the purchaser was given possession, specifying damages suffered because the mortgage was not violated or the sale was not made in accordance with the provisions of the Act.
• Section 33, Rule 39 of the Rules of Court — Provides that upon expiration of the right of redemption, the purchaser shall be substituted to all rights of the judgment obligor, and possession shall be given to the purchaser unless a third party is actually holding the property adversely to the judgment obligor.
• Section 1, Rule 65 of the Rules of Court — Governs petitions for certiorari on the ground of grave abuse of discretion.

Antonio T. Carpio (Chairperson), Arturo D. Brion, Mariano C. Del Castillo, and Jose Portugal Perez.