Spouses Montano Tolosa and Merlinda Tolosa v United Coconut Planters Bank

Date: April 3 2013

Ponente: J Perez

Facts:
 Sps Tolosa entered into a credit agreement with UCPB
 To secure credit availments, the SPS tolosa executed deeds of real estate
mortgage over 4 properties in Brgy Caticlan, Malay, Aklan, which were
registered and or declared for taxation purposes in their names under TCT OCT
and tax declaration
 For failure of the sps to pay their oblig which amounted to 13.3 M pesos
exclusive of interests, penalties and other charges, UCP foreclosed the
mortgages and filed a petition for the extrajudicial sale with the Office of the
Clerk of Court
 After due notice and publication, the mortgaged properties were sold at public
auction with UCPB having the highest bid of 17.240 M pesos
 The proceeds were credited towards the partial satisfaction of Sps Tolosa’s
mortgage obligation which, inclusive of interests, penalties and other charges,
was pegged at 24,253,847.64
 UCPB now registers with the office of the register of deeds of Aklan on 5 Jan
2000
 For failure of the Sps TOlosa to exercise their right of Redemption within the
prescrived one year period, UCPB went on to consolidate its ownership over the
subject realities on Jan 22 2001
 UCPB now files an ex-parte petition for issuance of a writ of possession in the
cadastral case before RTC Aklan
 Sps Tolosa opposed and called the attention of RTC to the pendency of the
complaint for declaration of nullity of promissory notes, foreclosure of mortgage
and certificate of sale due to misleading the SPS to sign the credit agreement
 Claiming that there was a prima facie showing of invalidity of their mortgage
obligation, the foreclosure of the mortgage and the sale of their properties, the
Sps Tolosa prayed that the issuance of the writ of possession be held in
abeyance
 RTC held in abeyance the writ of possession by UCPN
 CA reversed
ISSUE: WON a purchaser at an extrajudicial foreclosure sale is entitled to a writ of
possession as a matter of right after consolidation of ownership for failure of the
mortgagor to redeem the property

Held:
 Writ of possession is an order by which the sheriff is commanded by the court to
place a person in possession of a real or personal property
 A writ of possession may be issued in favor of a purchaser in a foreclosure sale
either
o Within the 1 year redemption period, upon the filing of a bond OR
o After the lapse of the redemption period, without need of a bond
 Within the 1 year redemption period, the purchaser may apply for a writ of
possession by filing a petition in the form of an ex parte motion under oath, in
the registration or cadastral proceedings of the registered property
 The law requires only that the proper motion be filed, the bond approved and no
3rd person is invoved
  After the consolidation of title in the buyer’s name for failure of the mortgagor
to redeem the property, entitlement to the writ of possession becomes a matter
of right
 The lapse of the redemption period, right of possession becomes absolute
because the basis thereof is the purchaser’s ownership of the property
 The rule is likewise settled that the proceeding in a petition for a writ of
possession is ex parte and summary in nature
o No notice needed to the adverse party and without giving opportunity to
be heard
 The issuance of writ of possession becomes a ministerial function and court not
granted with any discretion
 The judge need not look into the validity of the mortgage or the manner of its
foreclosure
 Any question regarding the validity of the extrajudicial foreclosure sale and the
resulting cancellation of the writ may, likewise be determined in a subsequent
proceedings
 CA committed no reversible error as
o UCPb caused the extrajudicial foreclosure of the mortgage on the subject
realities as a consequence of the Sps Tolosa’s default on their mortgage
obligation
o Highest bidder at Jan 4 2000 foreclosure
o UCPB consolidated its ownership Jan 22 2001 upon failure of SPS to
exercise right of redemption
o Since UCPB had already become the absolute and registered owner of said
properties , CA correctly ruled that it was the ministerial duty of the RTC to
issue the writ of possession in favor of the former
o Questioning the validity and regularity of the mortgage or its foreclosure
cannot be raised as justification for opposing the issuance of the writ
 Exceptions
o Cometa v IAC: unusually low price in the auction, The Court upheld the
deferment of the issuance of the writ of possession
o Barican v IAC: ministerial duty to issue writ ceases when the property
mortgaged had been, in the meantime, sold to 3rd parties who had
assumed the mortgagor’s indebtedness and took possession of the
property
o Sulit v CA: The mortgagee’s failure to deliver the surplus from the
proceeds of the foreclosure sale equivalent to at least 40% of the
mortgage debt = valid justification for non issuance of the writ of
possession
 Barican not applicable as Sps TOlosa appear to have remained in possession of
the subject realties, no 3rd person acquired
 Cometa not applicable as No unusually low price present
 Sulit not applicable as no surplus. In fact 17 M was the sale and Debt was 24M.
It was argued that if the interest and penalty will not be applied, the sale is
enough. However, the Court held that the pendency of another case with
respect to the mortgage cannot justify the writ of possession.
 Furthermore, Sulit cannot be applied in this case as the period to redeem has
already expired or when the ownership over the property expired or when th
ownership over the property had already been consolidated in favor of the
purchaser
DENIED