FIRST DIVISION

[G.R. No. 70987. September 29, 1988.]

GREGORIO Y. LIMPIN, and ROGELIO M. SARMIENTO , petitioners, vs.

INTERMEDIATE APPELLATE COURT and GUILLERMO PONCE ,
respondents.

Danilo A. Basa for petitioner Gregorio Y. Limpin, Jr.

Angara, Abello, Concepcion, Regala & Cruz Law O ces for petitioner Rogelio
Sarmiento.
Sycip, Salazar, Hernandez & Gatmaitan Law O ces and Eugenio C. Lindo for
respondent Guillermo Ponce.

SYLLABUS

1. CIVIL LAW; CIVIL CODE; CREDIT TRANSACTIONS; MORTGAGE RIGHT OF

REDEMPTION EXISTS IN EXTRAJUDICIAL FORECLOSURE. — Under Act 3135, after an
extrajudicial foreclosure, a mortgager has the right of redemption which he may
exercise within one year from the registration of the sheriff's certificate of sale.
2. SPECIAL LAW; SPECIAL CIVIL ACTION; FORECLOSURE OF MORTGAGE; NO
RIGHT OF REDEMPTION EXISTS; EXCEPTION. — There is no right of redemption in
judicial foreclosure, except where the mortgagee is the Philippine National Bank, or a
bank or banking institution (Rule 68, Sec. 3, Rules of Court; Acts Nos. 2747 and 2938;
Republic Act No. 337).
3. ID.; ID.; ID.; ID.; EQUITY REDEMPTION, IN JUDICIAL FORECLOSURE; PERIOD TO
REDEEM. — While there is no right of redemption in judicial foreclosure, there is in favor
of the mortgagor an equity of redemption. An equity of redemption is the right of the
mortgagor to extinguish the mortgage and retain ownership of the property by paying
the secured debt within the 90-day period after the judgment becomes nal, in
accordance with Rule 68, or even after the foreclosure sale but prior to its confirmation.
4. ID.; ID.; ID.; ID.; JUNIOR ENCUMBRANCES HAVE RIGHT OF EQUITY OF
REDEMPTION. — The equity of redemption pertaining to the mortgagor is the same
right that may be exercised by the mortgagor's successor in interest or third persons
acquiring rights over the mortgaged property subordinate to the mortgagee's lien.
5. ID.; ID.; ID.; ID.; ID.; UNFORECLOSED EQUITY OF REDEMPTION, RETAINED BY
PARTIES NOT IMPLEADED. — Where a subsequent or junior lienholder is not impleaded
in the foreclosure proceedings, any judgment in favor of the mortgagee is not binding
upon him, he retains what is known as an unforeclosed equity of redemption and a
separate foreclosure proceeding should be brought to require him to redeem from the
rst mortgagee or the party acquiring title to the mortgaged property at the
foreclosure sale within 90 days under penalty of losing said prerogative.
6. ID.; ID.; ID.; EQUITY OF REDEMPTION; GRANT OF EXTENSION MUST BE CLEAR
AND UNEQUIVOCAL. — The fact that private respondent recognized petitioners' equity
of redemption does not prevent the redemption from lapsing where such recognition
was made when there was as yet no order con rming the sale and private respondent's
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 equity of redemption still existed. Moreover, even assuming that a period to redeem
may be extended by the act of the party who would have been bene ted by the
expiration, the grant of such extension must be clear and unequivocal.
7. CONSTITUTIONAL LAW; BILL OF RIGHTS; DUE PROCESS; PETITIONER WHO
APPEALED THE QUESTIONED DECISION CANNOT CLAIM DENIAL OF DUE PROCESS. —
Since petitioner has appealed to this court the decision of the court of appeals ordering
the trial court to con rm the judicial foreclosure, he cannot now claim that he was
denied due process for alleged lack of notice. The denial of the appeal su ciently
alerted him that con rmation could come at any time after the nality of this Court's
decision.

RESOLUTION

NARVASA , J : p

Once again the parties are before this Court; this time, for a determination of
whether or not the equity of redemption recognized in favor of petitioner Rogelio M.
Sarmiento in this Court's judgment promulgated on January 30, 1987, still subsists and
may be exercised, more than a year after that judgment had become nal and
executory. LLjur

The proceedings concern two (2) lots, then covered by TCTs Nos. 92836 and
92837, which, together with two (2) others, were originally mortgaged in 1973 to herein
private respondent Ponce by their former owners, the Spouses Jose and Marcelina
Aquino. These two lots were afterwards sold in 1978 by the same Aquino Spouses to
Butuan Bay Wood Export Corporation. Against this corporation herein petitioner Limpin
obtained a money judgment in 1979; and to satisfy the judgment, the two lots were
levied on and sold at public auction in 1980, Limpin being the highest bidder. Limpin
later sold the lots to his co-petitioner, Sarmiento.
Earlier however — or a day before levy was made on the two lots in execution of
the judgment against Butuan Bay Wood Export Corporation — Ponce had initiated
judicial proceedings for the foreclosure of the mortgage over said two (2) lots
(together with the two (2) others mortgaged to him). Judgment was rendered in his
favor and became nal; and at the ensuing foreclosure sale, the lots were acquired by
Ponce himself as highest bidder. Ponce then moved for con rmation of the foreclosure
sale, but the Court con rmed the sale of only two lots, refusing to do so as regards the
two which had been subject of the execution sale in Limpin's favor (i.e., those covered
by TCTs Nos. 92836 and 92837). LLphil

It was to resolve the resulting dispute that Ponce instituted a special civil action
in the Intermediate Appellate Court, impleading Limpin and Sarmiento as indispensable
parties respondents. That Court rendered judgment on February 28, 1985 in Ponce's
favor; Limpin and Sarmiento appealed; this Court denied their appeal.
The judgment of this Court of January 30, 1987 dismissed Sarmiento's and
Limpin's petition for review on certiorari of the Appellate Court's decision of February
28, 1985. It in effect a rmed the latter's decision which inter alia ordered the Trial
Court "to con rm the sale (of the lots formerly covered by TCT Nos. 92836 and 92837)
and issue a writ of possession to . . . (Guillermo Ponce) with respect to the aforesaid
lots, subject to the equity of redemption of the respondent Rogelio V. Sarmiento, " 1
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 Applying the doctrine laid down in Santiago v. Dionisio, a 1953 decision of this Court, 2
the Intermediate Appellate Court's decision declared that "the sale to Ponce, as the
highest bidder in the foreclosure sale of the two lots in question should have been
confirmed, subject to Limpin's (and now Sarmiento's) equity of redemption."
This Court's aforesaid judgment also clearly and categorically sustained the
exercise by the Appellate Court of jurisdiction over the persons of Rogelio M. Sarmiento
and Gregorio Limpin. 3 There can thus be no question that the petitioners herein, said
Rogelio Sarmiento and Gregorio Limpin, were affected and are bound by the decision of
the Intermediate Appellate Court, and that of this Court affirming it.
cdrep

Rogelio M. Sarmiento, particularly, was aware that the Trial Court had the
ministerial duty to execute the Appellate Court's decision, i.e., to con rm the sale and
issue a writ of possession as regards the aforesaid lots, subject to the equity of
redemption explicitly recognized in his favor in the decisions mentioned. He knew that
he had the prerogative to exercise his equity of redemption, if not from the moment
that the judgment of this Court became nal and executory, 4 at least until the Court a
quo, presided over by Hon. Antonio Solano, subsequently con rmed the sale and issued
a writ of possession in favor of Guillermo Ponce in June, 1987. 5
He did not try to exercise that right before, at or about the time of the
con rmation of the foreclosure sale by Judge Solano. Instead, he instituted no less
than two (2) actions in the same Regional Trial Court — which were assigned to another
branch, presided over by Hon. Teodoro Beltran — attempting to relitigate precisely the
same issues which this Court and the Intermediate Appellate Court had already passed
upon and resolved adversely to him. For doing so — for tri ing with and abusing the
processes of the courts, and thus unwarrantedly delaying execution of the nal and
executory judgment against him — he and his counsel were both found guilty of
contempt and correspondingly punished by this Court, by Resolution dated May 5,
1988. The same resolution also decreed the dismissal of the complaints in both cases
and the nulli cation and setting aside of the restraining or injunctive orders of Judge
Beltran. LibLex

It was not until March 11, 1988 — nine months or so after entry of the judgment
recognizing his equity of redemption as successor-in-interest of the original
mortgagors — that Sarmiento nally bestirred himself to attempt to exercise his
unforeclosed equity of redemption. On that day he led a motion with the Court
presided over by Hon. Judge Antonio Solano, manifesting that he would exercise the
right and asked the Court to x the redemption price. 6 The Court opined that "this
should be the subject of the agreement between Ponce and Sarmiento." 7
Sarmiento then wrote to Ponce on March 23, 1988 offering "P2.6 million as
redemption price for the two lots originally covered by TCTs Nos. 92836 and 92837,
now 307100 and 307124." 8 Ponce's answer, dated March 25, 1988, rejected the offer
and averred "that the period within which x x (Sarmiento) could have exercised such
right . . . (had) lapsed." 9 Sarmiento reacted by ling a motion with the Solano Court,
dated March 29, 1988, asking it to " x the redemption price . . . and that the
implementation of the writ of possession be provisionally deferred." 1 0 An opposition
was promptly led by Ponce under date of May 4, 1988 1 1 in which he argued that
"Sarmiento's right to exercise his equity of redemption over those lots had long
expired," the opportunity to exercise it having presented itself but not availed of "(i)
after . . . default in the performance of the conditions of the mortgage and (ii) before
the Sheriff's sale of the property and the judicial con rmation thereof" According to
Ponce, "from October 17, 1982, . . . (when) Sarmiento's predecessors-in-interest
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 defaulted in their obligations over the mortgaged properties, up to June 17, 1987, when
this . . . (Trial) Court con rmed the auction sale of those properties, Sarmiento could
(and should) have exercised his 'equity of redemption.'" Judge Solano did not share this
view, and ruled accordingly. 1 2
The issue has been brought to this Court for resolution by Ponce's "Motion for
Clari cation" dated May 27, 1988 and "Supplemental Motion . ." dated June 13, 1988, as
to which Sarmiento has submitted a Comment dated June 17, 1988. To the comment a
reply has been presented by Ponce under date of August 3, 1988.
Ponce states 1 3 that the term, equity of redemption, means "the right of the
mortgagor to redeem the mortgaged property after his default in the performance of
the conditions of the mortgage but before the sale of the property or the (judicial)
con rmation of the (Sheriff's) sale," citing Top Rate International Services, Inc. v. I.A.C.,
142 SCRA 473 [1976], or "the right to redeem mortgaged property by paying the
amount ordered by the court within a period of ninety days, or, even thereafter but
before the con rmation of the sale, invoking Sun Life Assurance Co. of Canada v. Diez,
52 Phil. 275 [1928]. 1 4 On this premise, he postulates that "from October 17, 1982, the
date Sarmiento's predecessors-in-interest defaulted in their obligations over the
mortgaged properties, up to June 17, 1987, when the lower court confirmed the auction
sale of those properties, Sarmiento could have exercised his 'equity of redemption." Not
having done so within that time, his equity of redemption had been extinguished;
indeed, by opting to le "new suits against Ponce . . . seeking to annul Ponce's titles
over those properties" instead of redeeming the same, he had "waived his equity of
redemption (assuming such right existed at the time the suits were commenced)."
It is Sarmiento's position, on the other hand, 1 5 that the "17 June 1987
con rmation of the sale of the two lots could not have cut off . . . (his) equity of
redemption;" in fact, "Ponce himself, in his 'Urgent Motion' dated 1 June 1987, precisely
prayed for the issuance of a writ of possession 'subject to the equity of redemption of
Rogelio M. Sarmiento' thereby recognizing Sarmiento's equity of redemption beyond
confirmation date," 1 8
T h e equity of redemption is, to be sure, different from and should not be
confused with the right of redemption. 1 9
The right of redemption in relation to a mortgage — understood in the sense of a
prerogative to re-acquire mortgaged property after registration of the foreclosure sale
— exists only in the case of the extrajudicial foreclosure of the mortgage. No such right
is recognized in a judicial foreclosure except only where the mortgagee is the Philippine
National Bank or a bank or banking institution.
Where a mortgage is foreclosed extrajudicially, Act 3135 grants to the
mortgagor the right of redemption within one (1) year from the registration of the
sheriff's certificate of foreclosure sale. 2 0
Where the foreclosure is judicially effected, however, no equivalent right of
redemption exists. The law 2 1 declares that a judicial foreclosure sale, "when con rmed
by an order of the court, . . . shall operate to divest the rights of all the parties to the
action and to vest their rights in the purchaser, subject to such rights of redemption as
may be allowed by law." 2 3 These laws confer on the mortgagor, his successors in
interest or any judgment creditor of the mortgagor, the right to redeem the property
sold on foreclosure — after con rmation by the court of the foreclosure sale — which
right may be exercised within a period of one (1) year, counted from the date of
registration of the certificate of sale in the Registry of Property.
LLphil

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 But, to repeat, no such right of redemption exists in case of judicial foreclosure
of a mortgage if the mortgagee is not the PNB or a bank or banking institution. In such
a case, the foreclosure sale, "when con rmed by an order of the court . . . shall operate
to divest the rights of all the parties to the action and to vest their rights in the
purchaser." There then exists only what is known as the equity of redemption. This is
simply the right of the defendant mortgagor to extinguish the mortgage and retain
ownership of the property by paying the secured debt within the 90-day period after the
judgment becomes nal, in accordance with Rule 68, or even after the foreclosure sale
but prior to its confirmation.
Section 2, Rule 68 provides that —
". . . If upon the trial . . . the court shall nd the facts set forth in the
complaint to be true, it shall ascertain the amount due to the plaintiff upon the
mortgage debt or obligation, including interest and costs, and shall render
judgment for the sum so found due and order the same to be paid into court
within a period of not less than ninety (90) days from the date of the service of
such order, and that in default of such payment the property be sold to realize the
mortgage debt and costs." 2 4

This is the mortgagor's equity (not right) of redemption which, as above stated,
may be exercised by him even beyond the 90-day period "from the date of service of the
order," and even after the foreclosure sale itself, provided it be before the order of
con rmation of the sale. 2 5 After such order of con rmation, no redemption can be
effected any longer.
It is this same equity of redemption that is conferred by law on the mortgagor's
successors-in-interest, or third persons acquiring rights over the mortgaged property
subsequent, and therefore subordinate, to the mortgagee's lien. 2 6 If these subsequent
or junior lien-holders be not joined in the foreclosure action, the judgment in the
mortgagor's favor is ineffective as to them, of course. In that case, they retain what is
known as the "unforeclosed equity of redemption," and a separate foreclosure
proceeding should be brought to require them to redeem from the rst mortgagee, or
the party acquiring title to the mortgaged property at the foreclosure sale, within 90
days, 2 7 under penalty of losing that prerogative to redeem. In the case at bar, however,
there is no occasion to speak of any "unforeclosed equity of redemption" in Sarmiento's
favor since he was properly impleaded in the judicial proceeding where his and Ponce's
rights over the mortgaged property were ventilated and specifically adjudicated. prcd

Under the circumstances obtaining in this case, the plain intendment of the
Intermediate Appellate Court was to give to Sarmiento, not the unforeclosed equity of
redemption pertaining to a stranger to the foreclosure suit, but the same equity of
redemption possessed by the mortgagor himself. The judgment cannot be construed
as contemplating or requiring the institution of a separate suit by Ponce to compel
Sarmiento to exercise his unforeclosed equity of redemption, or as granting Sarmiento
the option to redeem at any time that he pleases, subject only to prescription. This
would give rise to that multiplicity of proceedings which the law eschews. The
judgment plainly intended that Sarmiento exercise his option to redeem, as successor
of the mortgagor.
Upon the facts on record, Sarmiento cannot be heard to complain of denial of
due process for alleged lack of notice of any motion or hearing for con rmation of sale.
The Decision of the Intermediate Appellate Court which he and his predecessor, Limpin,
had appealed to this Court specifically ordered the Trial Court to con rm 2 8 the judicial
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 foreclosure sale in favor of Ponce over the two lots, in these terms: 2 9
"WHEREFORE, the orders dated October 16, 1983 and December 19, 1983
of the respondent court, so far as they deny the con rmation of the sale of the
lots formerly covered by TCT Nos. 92836 and 92837, are SET ASIDE, and the
respondent court is hereby ORDERED to con rm the sale and issue a writ of
possession to the petitioner with respect to the aforesaid lots, subject to the
equity of redemption of the respondent Rogelio V. Sarmiento. Without costs."

Given the fact that said appealed orders of the Trial Court had been issued upon
motion for con rmation earlier made by Ponce — which was duly served and heard —
the aforecited Decision of the Intermediate Appellate Court can be construed in no wise
than as a peremptory command to the Trial Court to con rm the sale as directed, motu
proprio, and without the need of any further motion or other action on the part of
Ponce. The rejection by this Court of Sarmiento's and Limpin's appeal in its own
Decision of January 30, 1987, which imported nothing less than a total a rmance of
the Decision of the Appellate Court, should therefore have sufficiently alerted Sarmiento
that con rmation could come at any time after this Court's Decision became nal, with
or without any action from Ponce. He cannot, in the circumstances, claim unfair
surprise. He should, upon being noti ed of this Court's Decision, have taken steps to
redeem the properties in question or, at the very least, served the Trial Court and Ponce
with notice of his intention to exercise his equity of redemption. There was certainly
time enough to do this — the order con rming the foreclosure sale issuing only on June
17, 1987 — had he not occupied himself with the fruitless maneuverings to re-litigate
the issues already recounted. Indeed, had he made an attempt to redeem, even
belatedly but within a reasonable period of time after learning of the order of
con rmation (the record shows he did learn of it within three [3] days after its
issuance), 3 0 he might perhaps have given the Court some reason to consider his bid on
equitable grounds. He did not. He let nine (9) months pass, to repeat, in carrying out
improper (and contumacious) stratagems to negate the judgments against him, before
making any such move. LLpr

Neither can Sarmiento acceptably claim that Ponce, by moving for a writ of
possession subject to his (Sarmiento's) equity of redemption, recognized the existence
and enforceability of that prerogative beyond the prescribed cut-off date of
con rmation of the sale. Such an interpretation of the motion is totally unwarranted,
given the fact that said motion was made at a time (June 1, 1987) when there was as
yet no order con rming the sale and, since Sarmiento's equity of redemption then still
unquestionably existed, there was hardly occasion or for that matter, any reason as far
as Ponce was concerned, to provide against its lapsing. Moreover, assuming for the
sake of argument that a resolutory period xed by law may be extended by act of the
party in whose favor its expiration would operate, that act must bespeak a clear and
unequivocal intent to grant such an extension. No such clear grant can be inferred from
the terms of Ponce's motion, which can, and in fact should be, read as a mere
a rmation that there existed at the time an equity of redemption in Sarmiento's favor.
LexLib

WHEREFORE, the Court hereby rules that the equity of redemption claimed and
invoked by Rogelio M. Sarmiento over the properties originally covered by Transfer
Certi cates of Title Nos. 92836 and 92837 (now by TCTs Numbered 307100 and
307124), Registry of Deeds of Quezon City, subject of this case, lapsed and ceased to
exist without having been properly exercised, on June 17, 1987, with the issuance by the
Trial Court of the Order con rming the sheriff's sale (on judicial foreclosure) of said,
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 properties in favor of Guillermo Ponce.
SO ORDERED.
Cruz, Gancayco, Griño-Aquino and Medialdea, JJ., concur.

Footnotes
1. At p. 1; emphasis supplied.
2. 92 Phil. 495.
3. At pp. 7-8; and p. 4, Resolution, May 5, 1988.

4. The petitioners' motion for reconsideration of the judgment was denied with nality by the
Court's Resolution dated April 27, 1987 (Rollo, p. 363), and entry of judgment was made
on June 1, 1987 (Rollo, p. 364).
5. The writ of possession was issued, more precisely, on June 17, 1987 (Rollo, p. 386).
6. "Motion (Ex Abundanti Cautela)," Annex 1 of Sarmiento's Comment dated 17 June 1988.

7. Order, March 17, 1988, Annex 2 of same Comment.

8. Annex 3 of Sarmiento Comment.
9. Annex 4, id.
10. Annex 6, id.

11. Annex 7, id.

12. In his Order of April 8, 1988, he declared that Ponce's theory "would render nugatory and
empty the decision of the Appellate Court on this issue" (Annex 8, Comment of June 17,
1988, supra); and in his Order dated July 8, 1988, His Honor denied Ponce's motion for
reconsideration dated May 4, 1988.
13. Reply to Comment, Aug. 3, 1988.
14. Drawing attention, too, to Quimson v. PNB , 36 SCRA 265; Villar v. Javier de Paderanga, 97
Phil. 604; Anderson v. Reyes, 54 Phil. 944.
15. Comment, June 17, 1988.
16. Emphasis supplied.

17. Citing Tiglao v. Botones, 90 Phil. 275.

18. Invoking Pascua v. Perez , 10 SCRA 198; Doronila v. Basquez , 72 Phil. 572; de Castro v.
Olondriz, 50 Phil. 725; La Urbana v. Belando, 54 Phil. 930.
19. Top Rate International Services v. IAC, et al., 142 SCRA 467, supra.
20. Salazar v. Meneses , 8 SCRA 495; General v. Barrameda , 69 SCRA 182; Gorospe v. Santos ,
69 SCRA 191; PNB v. CA, 94 SCRA 357.
21. Sec. 3, Rule 68, Rules of Court.
22. Emphasis supplied.
23. SEE Moran, Comments on the Rules, 1970 ed., Vol. 3, p. 273, citing Gonzales v. PNB, 48 Phil.
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 824, 828; and Martin, Rules of Court, etc., 3rd ed., Vol. 3, p. 289, citing Villar v. Javier de
Paderanga, 97 Phil. 64; Piano v. Cayanong, 7 SCRA 397.
24. Emphasis supplied.
25. Anderson v. Reyes, 54 Phil. 944; Grimalt v. Velasquez, 36 Phil. 936; La Urbana v. Belando, 54
Phil. 930; Villar v. Paderanga, 51 O.G. 5162, cited in Moran, op cit., at p. 273.
26. E.g., by second mortgage or subsequent attachment or judgment.
27. The period fixed in Section 2, Rule 68 for the mortgagor himself to redeem.

28. Something which it had earlier refused to do.

29. Rollo, p. 26.
30. Rollo, p. 382.

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