Case No.

57

Bodiongan vs. CA, 248 SCRA 496

Topic

Right & Equity of Redemption

Facts

Lea Simeon obtained from petitioner Estanislao Bodiongan and his wife a loan of P219,117·39 secured
by a mortgage on three (3) parcels of land with a four-storey hotel building and personal properties
located at Gango, Ozamiz City.

Having failed to pay the loan. Bodiongan thus instituted against her Civil Case No. OZ-1177 with the
Regional Trial Court, Branch 15, Ozamiz City for collection of sum of money or foreclosure of mortgage.

The RTC judged in favor of Bodiongan to be paid P220,459.71, at the legal rate of interest and P5,000.00
as attorney's fees, and in case of non-payment, to foreclose the mortgage on the properties.

Simeon again failed to pay the judgment debt, hence, the mortgaged properties were foreclosed and
sold on execution on January 12, 1987. At the auction sale, petitioner submitted to the sheriff a written
bid of P309,000.00 and at the same time reserved in said bid a deficiency claim of P439,710.57.2 The
properties were awarded to petitioner as sole bidder and a certificate of sale was issued in his name and
registered with the Register of Deeds of Ozamiz City.

Bodiongan then took possession of the properties after filing, per order of the trial court, a guaranty
bond of P350,000.00 to answer for any damage thereon during the redemption period.

On January 8, 1988, Simeon offered to redeem her properties and tendered to the Provincial Sheriff a
check in the amount of P337,580.00. But Bodiongan, claiming additional interest at 38% per annum,
moved to correct the computation of the redemption price and to suspend the issuance of a writ of
possession pending computation. The 38% claim was dismissed by the court and the writ was issued to
Simeon.

Bodiongan files another case for annulment of redemption and confirmation of the foreclosure sale on
the ground of insufficiency of the redemption price. The RTC dismissed the complaint but reduced the
12% interest rate on the purchase price to 6%, and thus, on the counterclaim, ordered petitioner to
refund private respondent the excess 6% plus P10,000.00 and P5,000.00 for moral damages and
attorney's fees. The CA upheld the RTC decision except for the refund of the 6% interest.

Issue

Was the redemption complete and valid?

Ruling

No, the redemption was incomplete, but the Court gave Simeon the opportunity to complete the
redemption of her properties within fifteen days from the time this decision becomes final.
In order to effect a redemption, the judgment debtor must pay the purchaser the redemption price
composed of the following: (1) the price which the purchaser paid for the property; (2) interest of 1%
per month on the purchase price; (3) the amount of any assessments or taxes which the purchaser may
have paid on the property after the purchase; and (4) interest of 1% per month on such assessments and
taxes. The redemption price must be for the full amount, otherwise the offer to redeem will be
ineffectual. And if the tender is for less than the entire amount, the purchaser may justly refuse
acceptance thereof.

In the instant case, the redemption price covers the purchase price of P309,000.00 plus 1% interest
thereon per month for twelve months at P37,080.00. Petitioner does not claim any taxes or assessments
he may have paid on the property after his purchase. Due to the overzealousness of the sheriff in issuing
the certificate of redemption, and to avoid further injustice, the Court gave Simeon the opportunity to
complete the redemption of her properties within fifteen days from the time this decision becomes
final.

It would be highly unjust to deprive a private respondent of her right to redeem by a strict application of
the Rules of Court. The policy of the law is to aid rather than defeat the right of redemption.