104.

LUISA GUANCO assisted by husband LEONARDO GUANCO

vs. ISIDRO ANTOLO (G.R. No. 150852, July 31, 2006)

Facts:

Respondent Antolo was the owner of a land used as security for a loan. After its maturity, he
made an inquiry of the status of the loan due to his absence in Antique. He was surprised
that his loan was already paid, the property was already auctioned, and that Petitioner
Guanco was the one who paid the loan directly to the bank. It was also made to appear
that Guanco was the highest bidder in an auction.

Antolo filed a complaint to annul the Sheriff’s sale. He alleged that it was made without due
notice, and without the requisite petition for foreclosure from the bank.

Issue: Whether the auction sale was valid despite absence of notice.

Ruling:

No, it is not. The absence of such notice has been held as sufficient cause to invalidate the
foreclosure and auction sale.

Under RA 720, the provincial sheriff is mandated to post a notice of the foreclosure of the
real estate mortgage in at least three of the most conspicuous public places, not only in the
municipality but also in the barrio where the land mortgaged is situated during the 60-day
period immediately preceding the public auction.

The foreclosure of mortgages covering loans granted by rural banks shall be exempt from
the publication in newspapers now required by law where the total amount of the loan,
including interests due and unpaid, does not exceed three thousand pesos. It shall be
sufficient publication in such cases if the notices of foreclosure are posted in at least three of
the most conspicuous public places in the municipality and barrio where the land
mortgaged is situated during the period of sixty days immediately preceding the public
auction.