Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 172504 July 31, 2013
DONNA C. NAGTALON, Petitioner,
vs.
UNITED COCONUT PLANTERS BANK, Respondent.
Doctrine: In the case of Spouses Montano T. Tolosa and Merlinda Tolosa v. United Coconut
Planters Bank, a case closely similar to the present petition, the Court explained that a pending
action for annulment of mortgage or foreclosure (where the nullity of the loan documents and
mortgage had been alleged) does not stay the issuance of a writ of possession. It reiterated the
well-established rule that as a ministerial function of the court, the judge need not look into the
validity of the mortgage or the manner of its foreclosure, as these are the questions that should
be properly decided by a court of competent jurisdiction in the pending case filed before it. It
added that questions on the regularity and the validity of the mortgage and foreclosure cannot be
invoked as justification for opposing the issuance of a writ of possession in favor of the new owner.
Facts: Spouses Nagtalon entered into a credit accommodation agreement (credit agreement)
with respondent UCPB. In order to secure the credit agreement, Spouses Nagtalon, together with
the Spouses Vicente and Rosita Lao, executed deeds of real estate mortgage over several
properties in Kalibo, Aklan. After the Spouses Nagtalon failed to abide and comply with the terms
and conditions Officio Provincial Sheriff a verified petition for extrajudicial foreclosure of the
mortgage, pursuant to Act 3135, as amended.
The mortgaged properties were consequently foreclosed and sold at public auction for the sum
of ₱3,215,880.30 to the respondent which emerged as the sole and highest bidder. After the
issuance of the sheriff’s certificate of sale, the respondent caused the entry of the sale in the
records of the Registry of Deeds and its annotation on the TCTs. With the lapse of the one year
redemption period and the petitioner’s failure to exercise her right to redeem the foreclosed
properties, the respondent consolidated the ownership over the properties, resulting in the
cancellation of the titles in the name of the petitioner and the issuance of TCTs in the name of the
respondent.
Respondent filed an ex parte petition for the issuance of a writ of possession with the RTC alleging
that it had been issued the corresponding TCTs to the properties it purchased, and has the right
to acquire the possession of the subject properties as the current registered owner of these
properties.
Petitioner opposed the petition, citing mainly the pendency of Civil Case No. 660210. In this civil
case, the petitioner challenged the alleged nullity of the provisions in the credit agreement,
particularly the rate of interest in the promissory notes. She also sought the nullification of the
foreclosure and the sale that followed. Hence, she alleged that the issuance of a writ of
possession was no longer a ministerial duty on the part of the court in view of the pendency of
the case.
RTC - held in abeyance the issuance of the writ of possession of the properties due to the
pendency of Civil Case No. 6602. The obligation of the court to issue a writ of possession in favor
of the purchaser in a foreclosure of mortgage property ceases to be ministerial.
CA - reversed the RTC, noting that while it is the ministerial duty of the court to issue a writ of
possession after the lapse of the one-year period of redemption, the rule admits of exceptions
and the present case at bar was not one of them.
Issue: WON the pendency of a civil case challenging the validity of the credit agreement, the
promissory notes and the mortgage can bar the issuance of a writ of possession after the
foreclosure and sale of the mortgaged properties and the lapse of the one-year redemption period.
Ruling:
Pendency of a civil case questioning the mortgage and foreclosure not a bar to the
issuance of a writ of execution.
We have ruled in the past that any question regarding the validity of the mortgage or its foreclosure
is not a legal ground for refusing the issuance of a writ of execution/writ of possession.
Exceptions to the rule that issuance of a writ of possession is a ministerial function.
(1) Gross inadequacy of purchase price .
(2) Third party claiming right adverse to debtor/mortgagor
(3) Failure to pay the surplus proceeds of the sale to mortgagor
We stress that the petitioner’s present case is not analogous to any of the above-mentioned
exceptions.
