Perez vs. Perez

An extrajudicial foreclosure sale is valid where the notice of sale was posted in at least three public places and published once a week for three consecutive weeks in a newspaper of general circulation in the nearest city or province, when no newspaper is published in the locality where the mortgaged property is situated.

Petitioners Zosimo Perez, Pedrito Perez, Socorro Perez, and Pastora Perez-Vigo were co-owners of a parcel of land in Morong, Bataan, covered by Transfer Certificate of Title No. T-44603. Respondent Democrito Perez, later substituted by Erlinda M. Perez and Maria Cecilia M. Perez, was the winning bidder at the foreclosure auction sale. The Development Bank of the Philippines (DBP) Bataan Branch was the mortgagee that initiated the extrajudicial foreclosure proceedings under Act No. 3135, as amended by Act No. 4118, acting as duly constituted attorney-in-fact of the petitioners. The Provincial Sheriff of Bataan conducted the auction sale, and the Register of Deeds of Bataan registered the certificate of sale and later the affidavit of consolidation.

On May 25, 1973, petitioners Zosimo Perez, Pedrito Perez, Socorro Perez, and Pastora Perez-Vigo executed a deed of real estate mortgage in favor of the Development Bank of the Philippines (DBP) over their property covered by Transfer Certificate of Title No. T-44603 of the Registry of Deeds of Bataan, as security for an agricultural loan of ₱6,500.00. The mortgage contract was registered in the Registry of Deeds of Bataan on May 28, 1973. Petitioners subsequently defaulted on their loan obligations without paying a single amortization.

On November 14, 1978, DBP, acting as mortgagee and duly constituted attorney-in-fact of petitioners, instituted extrajudicial foreclosure proceedings under Act No. 3135, as amended by Act No. 4118, by filing an application with the Office of the Provincial Sheriff of Bataan. The deputy sheriff issued and posted the notice of sheriff's sale at three public places in Morong, Bataan, where the mortgaged property was located, and published the notice once a week for three consecutive weeks in the Olongapo News. On December 19, 1978, at 10:00 in the morning, the public auction sale was conducted at the municipal building in Morong, Bataan, where respondent Democrito Perez emerged as the winning bidder with a bid price of ₱11,000.00. A certificate of sale was issued in his favor and registered with the Register of Deeds on February 22, 1979.

Because petitioners failed to exercise their right to redeem the foreclosed property, Democrito Perez executed an affidavit of consolidation, resulting in the issuance of a new Transfer Certificate of Title No. T-82438 in his favor on February 22, 1980. On June 3, 1985, petitioners filed a civil case for Annulment of Public Auction Sale with Damages, coupled with a prayer for preliminary injunction and restraining order, before the Regional Trial Court of Balanga, Bataan. After trial, the RTC dismissed the complaint on August 11, 1993, finding no merit. The Court of Appeals affirmed the RTC decision on July 30, 1999, and denied reconsideration on June 15, 2000. Both lower courts found that the posting and publication requirements of Act No. 3135 had been satisfied, and that the Olongapo News was a newspaper of general circulation in Bataan at the time of the foreclosure proceedings.

• Factual Findings Contrary to Record: Petitioners maintained that the factual findings of the Court of Appeals were grossly contrary to the undisputed facts on record, invoking recognized exceptions to the rule that the Supreme Court is not a trier of facts.
• Non-Compliance with Posting Requirements: Petitioners argued that the deputy sheriff posted notices at only two public places, because the puericulture center and the municipal building — where two notices were posted — were in such close proximity as to constitute a single location. They further speculated that after posting, the notices may not have remained posted for the required twenty days, possibly having been removed by an act of man or nature.
• Lack of Publication in a Newspaper of General Circulation: Petitioners contended that the Olongapo News was not a newspaper of general circulation in Morong, Bataan, in 1978, and that the situs of its circulation was not where the subject property was located, the newspaper being published in Olongapo rather than in Bataan.

• Newspaper of General Circulation: Respondent Democrito Perez presented evidence that in other cases requiring publication in Morong, Bataan, publications were made in the Olongapo News and the legal requirements were deemed complied with, establishing that the Olongapo News was recognized as a newspaper of general circulation for Bataan.
• Nearest Locality Rule: Respondents argued that since no newspaper of general circulation was published in Morong, Bataan, in 1978, publication in the Olongapo News — the nearest newspaper of general circulation — satisfied the requirements of P.D. No. 1079.

• Factual Findings of the Court of Appeals: Whether the factual findings of the Court of Appeals are grossly contrary to the undisputed facts on record so as to warrant review by the Supreme Court.
• Posting of Notices: Whether the requirement on posting of notices under Section 3 of Act No. 3135, as amended, was complied with.
• Publication in a Newspaper of General Circulation: Whether the notice of auction sale was validly published in a newspaper of general circulation in the place where the mortgaged property is located, as required by law.

• Factual Findings of the Court of Appeals: No. The factual findings of the Court of Appeals are fully supported by the records and are in complete accord with the findings of the trial court; none of the recognized exceptions to the rule binding the Supreme Court by the appellate court's factual findings apply.
• Posting of Notices: Yes. The requirement on posting of notices under Section 3 of Act No. 3135 was complied with, the puericulture center and the municipal building being distinct public places, and the presumption of regular performance of official duty favoring the deputy sheriff having not been overcome.
• Publication in a Newspaper of General Circulation: Yes. The Olongapo News was a newspaper of general circulation, and since no newspaper was published in Morong, Bataan, publication in the Olongapo News — the nearest newspaper of general circulation — satisfied the requirements of P.D. No. 1079.

• Factual Findings of the Court of Appeals: The Supreme Court is not a trier of facts, and the factual findings of the Court of Appeals are generally binding, especially when in complete accord with those of the trial court. While exceptions exist — such as grave abuse of discretion, findings based on speculation, manifestly mistaken inference, misapprehension of facts, conflicting findings, going beyond the issues, overlooking relevant facts, or findings contrary to the trial court's — none of these exceptions was found to apply. The findings of fact of the trial court and the Court of Appeals were in complete unison, and the appellate court's factual findings were fully supported by the records.

• Posting of Notices: Section 3 of Act No. 3135, as amended by Act No. 4118, requires that notices of sale be posted for not less than twenty days in at least three public places of the municipality or city where the property is situated. Petitioners' contention that the puericulture center and the municipal building should be considered one and the same place was rejected as "pure fallacy and totally unacceptable for being contrary to the actual state of things." The two buildings, though proximate, are distinct public places. Petitioners' further speculation that the notices may not have remained posted for the required period, or may have been removed, was unsupported by any evidence. The deputy sheriff enjoyed the presumption of regular performance of official duty under Section 3(m), Rule 131 of the Revised Rules of Court, which petitioners failed to overturn at any level.

• Publication in a Newspaper of General Circulation: Section 1 of P.D. No. 1079 requires that notices of auction sales in extrajudicial foreclosure be published in a newspaper of general circulation in the same city and/or province where the property is situated, with the proviso that if no newspaper is published in the locality, publication may be made in the newspaper published, edited, and circulated in the nearest city or province. A newspaper of general circulation is one published for the dissemination of local news and general information, with a bona fide subscription list of paying subscribers, published at regular intervals, and not devoted to the interests of a particular class, profession, trade, calling, race, or religious denomination. The testimonies of Deputy Sheriff Renato Robles, Susana Curiano (presented by petitioners themselves), and Cesar De La Torre (the first editor of the Olongapo News) established that the Olongapo News was the only newspaper of general circulation in Bataan in 1978, with prepaid subscribers in Olongapo City, Zambales, and Bataan. Although the Olongapo News was published in Olongapo and not in Morong, Bataan, this did not invalidate the publication, because P.D. No. 1079 expressly allows publication in the nearest city or province when no newspaper is published in the locality. The trial court found the Olongapo News to be the nearest publication in Bataan. Respondent likewise presented evidence of other cases in Morong, Bataan, where publication in the Olongapo News was deemed to satisfy legal requirements. Being a newspaper of general circulation, publication therein gave petitioners constructive notice of the foreclosure proceedings, rendering the public auction sale valid.

• Presumption of Regular Performance of Official Duty — Under Section 3(m), Rule 131 of the Revised Rules of Court, there is a presumption that official duty has been regularly performed. The Court applied this presumption in favor of the deputy sheriff who posted the notices of auction sale, holding that absent any evidence to the contrary, the posting was presumed to have been regularly conducted and maintained for the period required by law. Petitioners' bare speculations about possible removal of notices were insufficient to overturn this presumption.

• Newspaper of General Circulation — A newspaper of general circulation is one published for the dissemination of local news and general information, with a bona fide subscription list of paying subscribers, published at regular intervals, and not devoted to the interests or entertainment of a particular class, profession, trade, calling, race, or religious denomination. The newspaper need not have the largest circulation so long as it is of general circulation. The Court relied on this definition, as articulated in Fortune Motors (Phils.), Inc. vs. Metropolitan Bank and Trust Company and Bonnevie vs. Court of Appeals, to conclude that the Olongapo News qualified as a newspaper of general circulation.

• Nearest Locality Rule for Publication — Under Section 1 of P.D. No. 1079, when no newspaper or periodical is published in the locality where the property is situated, publication of notices of auction sale may be made in a newspaper published, edited, and circulated in the nearest city or province. The Court applied this rule to validate the publication in the Olongapo News, since no newspaper of general circulation was published in Morong, Bataan, in 1978.

• Factual Findings of the Court of Appeals as Binding — The Supreme Court is not a trier of facts, and the factual findings of the Court of Appeals are generally binding, especially when in complete accord with the findings of the trial court. The Court enumerated the recognized exceptions — grave abuse of discretion, speculative findings, manifestly mistaken inference, misapprehension of facts, conflicting findings, going beyond the issues, overlooking relevant facts, and findings contrary to the trial court's — but found none applicable.

• "To be a newspaper of general circulation, it is enough that it is published for the dissemination of local news and general information; that it has a bona fide subscription list of paying subscribers; and that it is published at regular intervals. The newspaper must not also be devoted to the interests or published for the entertainment of a particular class, profession, trade, calling, race or religious denomination." — This passage sets out the controlling definition of a newspaper of general circulation, the central legal standard by which the validity of the publication of the notice of auction sale was measured.

• "P.D. No. 1079 is categorical that in the event there is no newspaper or periodical published in the locality, the same may be published in the newspaper or periodical published, edited and circulated in the nearest city or province." — This statement applies the nearest locality rule of P.D. No. 1079, resolving the objection that the Olongapo News was published in Olongapo rather than in Bataan.

• "Their position that the puericulture center and the municipal building should be considered one and the same place is pure fallacy and totally unacceptable for being contrary to the actual state of things." — The Court rejected petitioners' argument that two proximate buildings counted as a single posting location, thereby confirming that physical proximity alone does not collapse two distinct public places into one for purposes of the three-place posting requirement.

• Fortune Motors (Phils.), Inc. vs. Metropolitan Bank and Trust Company, G.R. No. 115068, November 28, 1996 — Followed for the definition of a newspaper of general circulation, itself citing Bonnevie vs. Court of Appeals and Basa vs. Mercado, 61 Phil. 632 (1935). The Court relied on this case to establish the elements constituting general circulation.

• Bonnevie vs. Court of Appeals, G.R. No. L-49101, October 24, 1983 — Cited through Fortune Motors for the proposition that a newspaper of general circulation need not have the largest circulation, citing in turn Banta vs. Pacheco, 74 Phil. 67 (1942).

• Philippine Airlines, Inc. vs. Court of Appeals, G.R. No. 127473, December 8, 2003 — Followed for the doctrine that the factual findings of the Court of Appeals are generally binding on the Supreme Court, especially when in complete accord with the trial court's findings.

• Ang Bagong Bayani-OFW Labor Party vs. Comelec, G.R. No. 147589, June 26, 2001 — Cited for the principle that the Supreme Court is not a trier of facts and for the enumeration of exceptions to the binding effect of the Court of Appeals' factual findings.

• Section 3, Act No. 3135, as amended by Act No. 4118 — Requires that notice of sheriff's sale be given by posting notices for not less than twenty days in at least three public places of the municipality or city where the property is situated, and if the property is worth more than four hundred pesos, publication once a week for at least three consecutive weeks in a newspaper of general circulation in the municipality or city. The Court found both posting and publication requirements satisfied.

• Section 1, Presidential Decree No. 1079 — Governs the publication of notices of auction sales in extrajudicial foreclosure, requiring publication in a newspaper of general circulation in the same city and/or province where the property is situated, with the proviso that if no newspaper is published in the locality, publication may be in the nearest city or province. The Court applied the nearest locality proviso to validate publication in the Olongapo News.

• Section 3(m), Rule 131, Revised Rules of Court — Establishes the presumption that official duty has been regularly performed. The Court applied this presumption in favor of the deputy sheriff's posting of notices, which petitioners failed to rebut.

Puno (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concurred.