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Brion, J.:: Title 165. Nagtalon vs. United Coconut Planters Bank, G.R. No. 172504, 31 July 2013 Ponente Topic: Facts

1) Spouses Nagtalon entered into a credit agreement with UCPB and mortgaged several properties to secure the agreement. When they failed to comply, UCPB foreclosed on the properties. 2) After the one-year redemption period lapsed, UCPB applied for a writ of possession as the new owner of the properties. Spouses Nagtalon challenged the foreclosure's validity. 3) The Supreme Court ruled that issuing a writ of possession is a ministerial duty once redemption lapses. Challenging the foreclosure's validity is not a bar to possession, as that is a separate legal question.

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266 views3 pages

Brion, J.:: Title 165. Nagtalon vs. United Coconut Planters Bank, G.R. No. 172504, 31 July 2013 Ponente Topic: Facts

1) Spouses Nagtalon entered into a credit agreement with UCPB and mortgaged several properties to secure the agreement. When they failed to comply, UCPB foreclosed on the properties. 2) After the one-year redemption period lapsed, UCPB applied for a writ of possession as the new owner of the properties. Spouses Nagtalon challenged the foreclosure's validity. 3) The Supreme Court ruled that issuing a writ of possession is a ministerial duty once redemption lapses. Challenging the foreclosure's validity is not a bar to possession, as that is a separate legal question.

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© © All Rights Reserved
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Title 165. Nagtalon vs. United Coconut Planters Bank, G.R. No.

172504, 31
July 2013
Ponente BRION, J.:
TOPIC:
Facts Spouses Nagtalon entered into a credit agreement with respondent
United Coconut Planters Bank (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 of the credit agreement and the mortgage, the respondent
filed with the Ex-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 P3,215,880.30 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 of Kalibo, Aklan 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.

UCPB filed an ex parte petition for the issuance of a writ of possession


with the RTC.In the petition, the respondent alleged 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.

Spouses Nagtalon sought the nullification of the foreclosure and the sale
that followed. They argued 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 Ruled in favor of petitioner.

CA Reversed. Ruled 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.

The equitable and peculiar circumstances must first be shown to exist


before the issuance of a writ of possession may be deferred.
Issue W/N 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.
SC No.
Ruling

1) The issuance of a writ of possession is a ministerial function of


the court. Once title to the property has been consolidated in the
buyer’s name upon failure of the mortgagor to redeem the property
within the one-year redemption period, the writ of possession becomes a
matter of right belonging to the buyer. Consequently, the buyer can
demand possession of the property at anytime. Its right to possession
has then ripened into the right of a confirmed absolute owner and the
issuance of the writ becomes a ministerial function that does not admit of
the exercise of the court’s discretion. The court, acting on an application
for its issuance, should issue the writ as a matter of course and without
any delay.

In Spouses Ruben and Violeta Sagun v. Philippine Bank of


Communications and Court of Appeals,19 the Court laid down the
established rule on the issuance of a writ of possession, pursuant to Act
3135, as amended. The Court said that a writ of possession may be
issued either (1) within the one-year redemption period, upon the filing
of a bond, or (2) after the lapse of the redemption period, without need
of a bond.

During the one-year redemption period, as contemplated by Section 7 of


the above-mentioned law, a purchaser may apply for a writ of possession
by filing an ex parte motion under oath in the registration or cadastral
proceedings if the property is registered, or in special proceedings in case
the property is registered under the Mortgage Law. In this case, a bond is
required before the court may issue a writ of possession.

On the other hand, upon the lapse of the redemption period, a writ of
possession may be issued in favor of the purchaser in a foreclosure sale,
also upon a proper ex parte motion. This time, no bond is necessary for
its issuance; the mortgagor is now considered to have lost any interest
over the foreclosed property. The purchaser then becomes the owner of
the foreclosed property, and he can demand possession at any time
following the consolidation of ownership of the property and the issuance
of the corresponding TCT in his/her name. It is at this point that the right
of possession of the purchaser can be considered to have ripened into the
absolute right of a confirmed owner. The issuance of the writ, upon
proper application, is a ministerial function that effectively forbids the
exercise by the court of any discretion. This second scenario is governed
by Section 6 of Act 3135, in relation to Section 35, Rule 39 of the Revised
Rules of Court.

2) Pendency of a civil case questioning the mortgage and


foreclosure not a bar to the issuance of a writ of execution

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.

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 

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