Verzosa vs. Court of Appeals

An amended complaint that merely supplements the original allegations without introducing a new or different cause of action or demand relates back to the date of filing of the original complaint, so the status quo ante to be preserved by preliminary injunction is reckoned from the original filing.

Fe Giron Uson was the registered owner of a 19,955-square-meter parcel in Baquioen, Sual, Pangasinan, covered by O.C.T. No. 12783. She mortgaged the land to Wilfredo P. Verzosa to secure a P25,000 obligation. Pilar Martinez later became involved as a subsequent purchaser claiming title derived from Verzosa’s foreclosure.

Fe Giron Uson owned a 19,955-square-meter parcel in Baquioen, Sual, Pangasinan, covered by O.C.T. No. 12783, which she mortgaged to Wilfredo P. Verzosa. Upon her alleged failure to pay the entire obligation, Verzosa caused the Provincial Sheriff of Pangasinan to schedule a foreclosure sale, with notice on July 21, 1988 setting the sale on August 17, 1988. To stop the sale, Uson filed on August 12, 1988 a complaint for annulment of mortgage with prayer for preliminary injunction against Verzosa and the Provincial Sheriff, alleging the mortgage secured P25,000 of which only P915.75 remained unpaid and which she was willing to consign.

After Verzosa moved to dismiss on August 22, 1988, the trial court dismissed the complaint on June 8, 1989 for lack of personal verification, but granted Uson’s June 27, 1989 motion for reconsideration. Uson filed a verified amended complaint on June 29, 1989. In the interim Verzosa wrote the Provincial Sheriff to proceed with foreclosure, while Uson’s counsel requested discontinuance in deference to the pending case. Nevertheless, the sheriff conducted the foreclosure sale on July 4, 1989, selling the property to Verzosa as highest bidder, with the Sheriff’s Certificate of Sale approved by Executive Judge Antonio Belen.

The trial court admitted the amended complaint on September 5, 1989, which Verzosa challenged in CA-G.R. SP No. 18898. While that petition was pending, the Sheriff’s Certificate of Sale was registered on June 20, 1990, and after the one-year redemption period expired, the Sheriff issued a Final Deed of Sale on July 5, 1990. O.C.T. No. 12783 was cancelled and T.C.T. No. 11087 was issued to Verzosa, who on July 12, 1990 sold the land to Pilar Martinez, resulting in T.C.T. No. 11107 in her name. On October 16, 1990 the Court of Appeals dismissed Verzosa’s certiorari petition.

Thereafter Uson filed on May 20, 1991 a second amended complaint impleading Martinez and the Register of Deeds of Alaminos, Pangasinan and seeking annulment of T.C.T. No. 11107, with an application for preliminary injunction. Over opposition, the trial court on August 20, 1991 ordered Verzosa and Martinez to cease entering, constructing, and exercising possession or ownership, upon a P10,000 bond; denied Martinez’s motion for reconsideration on September 18, 1991; reiterated the order on October 30, 1991 after hearing and posting of bond; and clarified on November 22, 1991 that the status quo maintained was Uson’s possession, not Martinez’s registered ownership. The trial and appellate courts found that when Civil Case No. 16590 was commenced, the property was still titled and possessed by Uson, and that Martinez’s entry and title arose only during pendency by virtue of the contested sheriff’s sale and subsequent sale.

• Amendment of Pleadings: Petitioner argued that the original complaint was deemed abandoned and expunged upon amendment, so the controversy commenced only upon filing of the amended complaint, invoking Ruymann vs. Director of Lands, Waje vs. Court of Appeals, and Paradise vs. Ng.
• Status Quo Ante: Petitioner maintained that the status quo should be reckoned at the time before the second amended complaint when Pilar Martinez was already the registered owner under T.C.T. No. 11107, not at the filing of the original complaint two years earlier.
• Effect of Foreclosure and Sale: Petitioner argued that the foreclosure sale, expiration of the one-year redemption period, consolidation of ownership in Verzosa, and sale to Martinez must be given legal effect and preclude restoration to Uson.
• Consummated Acts: Petitioner maintained that injunction could not restrain already consummated acts and could not transfer possession from Martinez, the titled possessor, to Uson who had not shown a clear right, citing Reyes vs. Harty.

• Issuance of Preliminary Injunction: Whether private respondent was entitled to a writ of preliminary injunction to protect her title to and possession of the mortgaged property.
• Status Quo Ante and Amendment: Whether the status quo to be preserved is reckoned from the filing of the original complaint where the amended complaints introduced no new cause of action, notwithstanding the intervening foreclosure and sale to a third party.

• Issuance of Preliminary Injunction: Yes. All requisites for preliminary injunction were present, Uson having a clear and unmistakable right as titled possessor claiming near-full payment with willingness to consign the small balance.
• Status Quo Ante and Amendment: Yes. The suit was deemed commenced on the original filing and the status quo was Uson’s title and possession then, the amendments having merely cured verification and impleaded the subsequent purchaser without new causes of action.

• Issuance of Preliminary Injunction: A writ may issue when (1) the invasion of the right is material and substantial, (2) the complainant’s right is clear and unmistakable, and (3) there is urgent and permanent necessity to prevent serious damage. Applied here, Uson was the undisputed owner in title and possession who immediately sued to annul the mortgage upon learning of the scheduled foreclosure, asserting payment of the P25,000 debt except P915.75 to be consigned. Enjoining the foreclosure was thus necessary to protect that asserted ownership and possession.
• Status Quo Ante and Amendment: Defined as the last actual peaceful uncontested situation preceding the controversy, the status quo is preserved by injunction. Reliance on Ruymann vs. Director of Lands was misplaced because that amendment introduced a new or different cause of action and demand over a larger tract, equivalent to a fresh suit for limitations purposes. Where, as here, the amendment merely supplements and amplifies facts originally alleged — curing verification and impleading Martinez who bought during pendency — it relates back to commencement, with actual filing controlling over formal admission per Republic vs. Marsman. Waje vs. Court of Appeals and Paradise vs. Ng were likewise inapplicable for involving new causes of action. Acts completed after suit was brought do not defeat injunction; a defendant proceeding with the very act sought to be restrained acts at his peril and may be compelled by mandatory injunction to restore the former condition, so Verzosa’s foreclosure during pendency and sale to Martinez one week after the redemption period could not create a new status quo.

• Requisites of preliminary injunction — A writ may issue when the invasion of the right is material and substantial, the complainant’s right is clear and unmistakable, and there is urgent and permanent necessity to prevent serious damage. The requisites were found satisfied by Uson’s titled possession and claim of substantial payment with offer to consign the balance, justifying restraint of foreclosure.
• Status quo ante — The status quo is the last actual peaceful uncontested situation preceding the controversy, whose preservation is the office of an injunctive writ. It was fixed at the filing of the original complaint when O.C.T. No. 12783 and possession were still with Uson, not when Martinez later acquired T.C.T. No. 11107 during litigation over that very title.
• Relation-back of amendments — An amendment introducing a new or different cause of action or demand is equivalent to a fresh suit, with limitations running until amendment; an amendment merely supplementing and amplifying facts originally alleged relates back to commencement. Because Uson’s amendments only cured verification and impleaded the subsequent buyer, the suit was deemed commenced on August 12, 1988, with actual filing controlling for substantive purposes.
• Consummated acts performed pendente lite — While consummated acts done before suit generally cannot be restrained and possession should not be transferred where title is disputed, a defendant who completes after suit begins the act sought to be restrained proceeds at his peril and may be compelled to restore the former condition. Verzosa’s proceeding with the mortgage sale despite the pending injunction suit and later sale to Martinez therefore did not bar restoration of Uson’s prior title and possession.

• "The 'status quo' is the last actual peaceful uncontested situation which precedes a controversy, and its preservation is the office of an injunctive writ." — States the controlling definition used to fix the protected situation as Uson’s ownership and possession at original filing.
• "an amendment to a complaint which introduces a new or different cause of action, making a new or different demand, is equivalent to a fresh suit upon a new cause of action, and the statute of limitations continues to run until the amendment is filed." — Recites the Ruymann rule that was held inapplicable because no new cause of action was introduced here.
• "If one in the face of a pending suit for injunction, does the thing sought to be enjoined, he cannot thus outwit equity and the court, but must restore the status quo. . . . Even where an injunction has not been issued, if the suit is one for injunction, the defendant, if he does the thing sought to be enjoined does so at his peril." — Provides the basis for holding that Verzosa’s foreclosure and sale during pendency could be undone by injunction.
• "Succinctly put, petitioners have failed to show any grave abuse of discretion, or any act without or in excess of jurisdiction, on the part of respondent judge in issuing the assailed orders." — Affirms the Court of Appeals dismissal of certiorari for failure to meet the grave-abuse standard.

• Ruymann vs. Director of Lands, 34 Phil. 428 — Distinguished; its fresh-suit rule applies only where amendment introduces a new or different cause of action or demand over matter not in the original complaint.
• Waje vs. Court of Appeals, 176 SCRA 564 — Held inapplicable because the amended complaint therein alleged new causes of action, unlike Uson’s amendments.
• Paradise vs. Ng, 181 SCRA 719 — Held inapplicable on the same ground of new causes of action in the amendment.
• Republic vs. Marsman, 44 SCRA 418 — Followed for the rule that an amended complaint is considered filed for substantive purposes like prescription on its actual filing date, retroacting upon admission.
• Reyes vs. Harty, 21 Phil. 422 — Distinguished because the injunction applicant there had already been completely dispossessed before suit, whereas Uson still owned and possessed the land when she sued.

Davide, Jr., Bellosillo, Vitug and Quisumbing, JJ., concur.