Non-litigious

Lack of due process usually means that a person has been deprived of his right to be heard. But in this case of Manolo the court ruled that there was no denial of due process even if he was not afforded the opportunity to be heard.

The case arose from a loan obtained from a bank (MBTC) by a realty company (LRDC) thru its president Jimmy. The loan was secured by a real estate mortgage (REM) over three parcels of land with all its buildings and improvements thereon situated in Quezon City.

When LRDC failed to pay the loan on due date, MBTC extra-judicially foreclosed the REM in accordance with Act 3135 as amended. In the public auction sale conducted by the Sheriff, MBTC emerged as the highest bidder. After the certificate of sale issued by the Sheriff was registered with the Register of Deeds on December 13, 2000, MBTC tried to take over possession of the mortgaged properties. But LRDC refused. So on March 17, 2001, MBTC filed before the Regional Trial Court (RTC) an ex parte petition for the issuance of a writ of possession. The RTC granted the petition on July 5, 2001 after the presentation of evidence ex parte by the bank.

On October 9, 2001 a writ of possession was issued by the RTC upon the filing of the required bond by MBTC. But before it could be implemented, or on March 25, 2002, LRDC thru its president Jimmy executed a Deed of Assignment of the three foreclosed properties in favor of Manolo. At the time of the assignment Manolo already knew that the subject real properties were already foreclosed, sold and bought by MBTC as highest bidder. And so on April 3, 2002, Manolo filed a complaint with the RTC against MBTC for nullification of the REM and the Extrajudicial Foreclosure.

Nevertheless, MBTC was able to gain possession of all the foreclosed properties by implementing the writs of possession on December 13, 2002 and December 3, 2003.

This prompted Manolo to file another petition with the Court of Appeals (CA) for Annulment of Judgment granting the writs of possession on the ground of absolute lack of due process. Manolo alleged that his predecessor LRDC was not notified of the proceedings on the writ of possession and that Section 7, Act 3135 allowing ex parte issuance of the writ is unconstitutional. Was Manolo correct?

No. There was also no violation of Manolo’s right to constitutional due process. The issuance of a writ of possession in favor of a purchaser in a foreclosure sale of the mortgaged property under Section 7, Act 3135 as amended, is a ministerial duty of the court. The purchaser of the foreclosed property has the right to acquire possession thereof even during the 12 month period of redemption upon an ex parte application and posting of the required bond; and with more reason after the expiration of the redemption period.

The ex parte petition for the issuance of a writ of possession is not, strictly speaking, a “judicial process” as contemplated by Article 433 of the Civil Code for the recovery of the possession of a property under a claim of ownership. It is not an ordinary suit filed in court by which one party “sues another for the enforcement or protection of a right or the redress or prevention of a wrong”. It is a non-litigious proceeding authorized in an extra-judicial foreclosure of mortgage under Act 3135 and is brought for the benefit of one party only, without notice to, or consent of any person adversely interested. It is a relief granted without affording the person against whom the relief is sought, an opportunity to be heard (Rayo vs. Metropolitan Bank et. al. G.R. 165142, December 10, 2007).

Note: Books containing compilation of my articles on Labor Law and Criminal Law (Vols. I and II) are now available. Call Tel. 7249445.

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