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Doctrinal Updates

Civil Law
Michael Vernon Guerrero Mendiola 2008 Shared under Creative Commons AttributionNonCommercial-ShareAlike 3.0 Philippines license.

Some Rights Reserved.

This document was prepared by Michael Vernon M. Guerrero for the Project Phoenix (2008) of the Arellano University School of Law (AUSL) under the direction of Atty. Jaime N. Soriano. Compiled as PDF, July 2011. Berne Guerrero entered AUSL in June 2002 and eventually graduated from AUSL in 2006. He passed the Philippine bar examinations immediately after (April 2007).

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Doctrines declared and reiterated by the Supreme Court Samples from January September 2007 Preliminary Provisions Publication As regards the implementing guidelines of Republic Act No. 6758, i.e., DBM CCC No. 10, it is already settled in De Jesus v. Commission on Audit,[355 Phil. 584, 590 (1998)] that the same is in the nature of an administrative circular, because the purpose is to enforce or implement an existing law, which is Republic Act No. 6758; hence, it must be published in the Official Gazette or in a newspaper of general circulation in the country, as required by law. (Magno vs. Commission on Audit, GR 149941, 28 August 2007; En Banc,ChicoNazario J.) Unjust enrichment The principle that no person may unjustly enrich himself at the expense of another (Nemo cum alterius detrimento locupletari potest) is embodied in Article 22 of the New Civil Code. [T]here is unjust enrichment when (1) a person is unjustly benefited, and (2) such benefit is derived at the expense of or with damages to another. The main objective of the principle of unjust enrichment is to prevent one from enriching oneself at the expense of another. It is commonly accepted that this doctrine simply means that a person shall not be allowed to profit or enrich himself inequitably at anothers expense. One condition for invoking this principle is that the aggrieved party has no other action based on contract, quasi-contract, crime, quasi-delict or any other provision of law. (Chieng vs. Spouses Santos, GR 169647, 31 August 2007; Third Division, ChicoNazario J.) Persons Name The subject of rights must have a fixed symbol for individualization which serves to distinguish him from all others; this symbol is his name. Understandably, therefore, no person can change his name or surname without judicial authority. This is a reasonable requirement for those seeking such change because a persons name necessarily affects his identity, interests and interactions. The State must be involved in the process and decision to change the name of any of its citizens. (Republic vs. Capote, GR 157043, 2 February 2007; First Division, Corona J.) [The] ruling in the case of In Re: Petition for Change of Name and/or Correction/Cancellation of Entry in Civil Registry of Julian Lin Carulasan Wang [G.R. No. 159966, 30 March 2005, 454 SCRA 155] is enlightening: Our laws on the use of surnames state that legitimate and legitimated children shall principally use the surname of the father. The Family Code gives legitimate children the right to bear the surnames of the father and the mother, while illegitimate children shall use the surname of their mother, unless their father recognizes their filiation, in which case they may bear the fathers surname. Applying these laws, an illegitimate child whose filiation is not recognized by the father bears only a given name and his mother surname, and does not have a middle name. The name of the unrecognized illegitimate child therefore identifies him as such. It is only when the illegitimate child is legitimated by the subsequent marriage of his parents or acknowledged by the father in a public document or private handwritten instrument that he bears both his mothers surname as his middle name and his fathers surname as his surname, reflecting his status as a legitimated child or an acknowledged child. (Republic vs. Capote, GR 157043, 2 February 2007; First Division, Corona J.) Family Relations Family, Requisites The marriage involved haing been solemnized prior to the effectivity of the Family Code, the applicable law to determine its validity is the Civil Code which was the law in effect at the time of its celebration. A valid
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marriage license is a requisite of marriage under Article 53 of the Civil Code, the absence of which renders the marriage void ab initio pursuant to Article 80(3) in relation to Article 58 of the same Code. The requirement and issuance of a marriage license is the States demonstration of its involvement and participation in every marriage, in the maintenance of which the general public is interested. (Alcantara vs. Alcantara, GR 167746, 28 August 2007; Third Division, Chico-Nazario J.) [T]o be considered void on the ground of absence of a marriage license, the law requires that the absence of such marriage license must be apparent on the marriage contract, or at the very least, supported by a certification from the local civil registrar that no such marriage license was issued to the parties. (Alcantara vs. Alcantara, GR 167746, 28 August 2007; Third Division, Chico-Nazario J.) Issuance of a marriage license in a city or municipality, not the residence of either of the contracting parties, and issuance of a marriage license despite the absence of publication or prior to the completion of the 10-day period for publication are considered mere irregularities that do not affect the validity of the marriage. An irregularity in any of the formal requisites of marriage does not affect its validity but the party or parties responsible for the irregularity are civilly, criminally and administratively liable. (Alcantara vs. Alcantara, GR 167746, 28 August 2007; Third Division, Chico-Nazario J.) The authority of the officer or clergyman shown to have performed a marriage ceremony will be presumed in the absence of any showing to the contrary. Moreover, the solemnizing officer is not duty-bound to investigate whether or not a marriage license has been duly and regularly issued by the local civil registrar. All the solemnizing officer needs to know is that the license has been issued by the competent official, and it may be presumed from the issuance of the license that said official has fulfilled the duty to ascertain whether the contracting parties had fulfilled the requirements of law. (Alcantara vs. Alcantara, GR 167746, 28 August 2007; Third Division, Chico-Nazario J.) Semper praesumitur pro matrimonio. The presumption is always in favor of the validity of the marriage. Every intendment of the law or fact leans toward the validity of the marriage bonds. The Courts look upon this presumption with great favor. It is not to be lightly repelled; on the contrary, the presumption is of great weight. (Alcantara vs. Alcantara, GR 167746, 28 August 2007; Third Division, Chico-Nazario J.) Severance of marital relationship Divorce by foreign spouse [In the] case of Van Dorn v. Romillo, Jr. [G.R. No. L-68470, October 8, 1985, 139 SCRA 139], [t]he Court recognized the validity of the divorce and held that the alien spouse had no interest in the properties acquired by the Filipino wife after the divorce. As to the effect of the divorce on the Filipino wife, the Court ruled that she should no longer be considered married to the alien spouse. Further, she should not be required to perform her marital duties and obligations. This principle was thereafter applied in Pilapil v. Ibay-Somera [G.R. No. 80116, June 30, 1989, 174 SCRA 653] where the Court recognized the validity of a divorce obtained abroad. In the said case, it was held that the alien spouse is not a proper party in filing the adultery suit against his Filipino wife. The Court stated that the severance of the marital bond had the effect of dissociating the former spouses from each other, hence the actuations of one would not affect or cast obloquy on the other. Likewise, in Quita v. Court of Appeals,[G.R. No. 124862, December 22, 1998, 300 SCRA 406] the Court stated that where a Filipino is divorced by his naturalized foreign spouse, the ruling in Van Dorn applies. The significance of the Van Dorn case to the development of limited recognition of divorce in the Philippines cannot be denied. The ruling has long been interpreted as severing marital ties between parties in a mixed marriage and capacitating the Filipino spouse to remarry as a necessary consequence of upholding the validity of a divorce obtained abroad by the alien spouse. As such, the Van Dorn case is sufficient basis in resolving a situation where a divorce is validly obtained abroad by the alien spouse. With the enactment of the Family Code and paragraph 2, Article 26 thereof, our lawmakers codified the law already established through judicial precedent. (San Luis vs. San Luis, GR 133743, 6 February 2007; Third Division, Ynares-Santiago J.) [W]hen the object of a marriage is defeated by rendering its continuance intolerable to one of the parties and
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productive of no possible good to the community, relief in some way should be obtainable. Marriage, being a mutual and shared commitment between two parties, cannot possibly be productive of any good to the society where one is considered released from the marital bond while the other remains bound to it. Such is the state of affairs where the alien spouse obtains a valid divorce abroad against the Filipino spouse. (San Luis vs. San Luis, GR 133743, 6 February 2007; Third Division, Ynares-Santiago J.) Declaration of Absolute Nullity of Marriages The Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages as contained in A.M. No. 02-11-10-SC (Section 1. Scope) is explicit in its scope, to wit: This Rule shall govern petitions for declaration of absolute nullity of void marriages and annulment of voidable marriages under the Family Code of the Philippines. The Rules of Court shall apply suppletorily. The categorical language of A.M. No. 02-11-10-SC leaves no room for doubt. The coverage extends only to those marriages entered into during the effectivity of the Family Code which took effect on 3 August 1988. [T]here is no need to reconcile the provisions of A.M. No. 02-11-10-SC with the ruling in Nial vs. Bayadog (384 Phil. 661, 672-675 [2000]), because they vary in scope and application. As has been emphasized, A.M. No. 02-11-10-SC covers marriages under the Family Code of the Philippines, and is prospective in its application. (Enrico vs. Heirs of Spouses Medinaceli, GR 173614, 28 September 2007; Third Division, Chico-Nazario J.) The Rationale of the Rules on Annulment of Voidable Marriages and Declaration of Absolute Nullity of Void Marriages, Legal Separation and Provisional Orders explicates on Section 2(a) in the following manner, viz: [1] Only an aggrieved or injured spouse may file petitions for annulment of voidable marriages and declaration of absolute nullity of void marriages. Such petitions cannot be filed by the compulsory or intestate heirs of the spouses or by the State. [Section 2; Section 3, paragraph a] Only an aggrieved or injured spouse may file a petition for annulment of voidable marriages or declaration of absolute nullity of void marriages. Such petition cannot be filed by compulsory or intestate heirs of the spouses or by the State. The Committee is of the belief that they do not have a legal right to file the petition. Compulsory or intestate heirs have only inchoate rights prior to the death of their predecessor, and hence can only question the validity of the marriage of the spouses upon the death of a spouse in a proceeding for the settlement of the estate of the deceased spouse filed in the regular courts. On the other hand, the concern of the State is to preserve marriage and not to seek its dissolution. (Enrico vs. Heirs of Spouses Medinaceli, GR 173614, 28 September 2007; Third Division, Chico-Nazario J.) Psychological incapacity It is true that the case of Santos v. CA [310 Phil. 21 (1995)] did not specifically mention that the presentation of expert opinion is a vital and mandatory requirement in filing a petition for the declaration of nullity of marriage grounded on psychological incapacity referred to under Article 36 of the Family Code. Even in the subsequent case of Republic v. Court of Appeals [G.R. No. 108763, February 13, 1997, 268 SCRA 198] (also known as the Molina case), wherein the Court laid down the guidelines in the interpretation and application of the aforementioned article, examination of the person by a physician in order for the former to be declared psychologically incapacitated was likewise not considered a requirement. What is important, however, as stated in Marcos v. Marcos, [G.R. No. 136490, October 19, 2000, 343 SCRA 755, 764] is the presence of evidence that can adequately establish the partys psychological condition. If the totality of evidence presented is enough to sustain a finding of psychological incapacity, then actual medical examination of the person concerned need not be resorted to. (Zamora vs. Court of Appeals, GR 141917, 7 February 2007; First Division, Azcuna J.) [O]nes unfitness as a lawyer does not automatically mean ones unfitness as a husband or vice versa. The yardsticks for such roles are simply different. This is why the disposition in a disbarment case cannot be conclusive on an action for declaration of nullity of marriage. (Yap-Paras vs. Paras, GR 147824, 2 August 2007; First Division, Sandoval-Gutierrez J.) [T]he New Rules on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages,[A.M. No. 01-11-10-SC] promulgated by this Court on March 15, 2003, geared towards the
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relaxation of the requirement of expert opinion. Section 2, paragraph (d) states: (d) What to allege.- A petition under Article 36 of the Family Code shall specifically allege the complete facts showing that either or both parties were psychologically incapacitated from complying with the essential marital obligations of marriage at the time of the celebration of marriage even if such incapacity becomes manifest only after its celebration. The complete facts should allege the physical manifestations, if any, as are indicative of psychological incapacity at the time of the celebration of the marriage but expert opinion need not be alleged. In Barcelona v. Court of Appeals,[G.R. No. 130087, September 24, 2003, 412 SCRA 41] this Court categorically explained that under the New Rules, a petition for declaration of nullity under Article 36 of the Family Code need not allege expert opinion on the psychological incapacity or on its root cause. What must be alleged are the physical manifestations indicative of said incapacity. The Court further held that the New Rules, being procedural in nature, apply to actions pending and unresolved at the time of their adoption. Later, in 2005, the Court reiterated the Marcos doctrine in Republic v. Iyoy.[G.R. No. 152577, September 21, 2005, 470 SCRA 508] Thus: A later case, Marcos v. Marcos, further clarified that there is no requirement that the defendant/respondent spouse should be personally examined by a physician or psychologist as a condition sine qua non for the declaration of nullity of marriage based on psychological incapacity. Accordingly, it is no longer necessary to allege expert opinion in a petition under Article 36 of the Family Code of the Philippines. Such psychological incapacity, however, must be established by the totality of the evidence presented during the trial. (Yap-Paras vs. Paras, GR 147824, 2 August 2007; First Division, Sandoval-Gutierrez J.) [A]s early as 1995, in Santos v. Court of Appeals,[G.R. No. 112019, January 4, 1995, 240 SCRA 20, 33] we categorically said that psychological incapacity required by Art. 36 must be characterized by (a) gravity, (b) juridical antecedence, and (c) incurability. Psychological incapacity should refer to no less than a mental (not physical) incapacity that causes a party to be truly incognitive of the basic marital covenants that concomitantly must be assumed and discharged by the parties to the marriage. These include the obligations to live together, observe mutual love, respect and fidelity, and render mutual help and support. (Navarro Jr. vs. Cecillo-Navarro, GR 162049, 13 April 2007; Second Division, Quisumbing J.) [The Court has] repeatedly reminded that the intention of the law is to confine the meaning of psychological incapacity to the most serious cases of personality disorders clearly demonstrative of an utter insensitivity or inability to give meaning and significance to the marriage. In Republic v. Court of Appeals,[ G.R. No. 108763, February 13, 1997, 268 SCRA 198] the Court gave the guidelines in the interpretation and application of Art. 36. (Navarro Jr. vs. Cecillo-Navarro, GR 162049, 13 April 2007; Second Division, Quisumbing J.) Psychological incapacity must be more than just a difficulty, refusal or neglect in the performance of some marital obligations, it is essential that they must be shown to be incapable of doing so, due to some psychological illness existing at the time of the celebration of the marriage. [The spouses] bickerings and arguments even before their marriage and respondents scandalous outbursts in public, at most, show their immaturity, and immaturity does not constitute psychological incapacity. (Navarro Jr. vs. Cecillo-Navarro, GR 162049, 13 April 2007; Second Division, Quisumbing J.) Conjugal property Parties to a bigamous marriage As [a] bigamous marriage, the property regime of the spouses in the subsequent bigamous marriage] is covered by Article 148 of the Family Code providing that all properties acquired by the parties out of their actual joint contribution of money, property, or industry shall be governed by the rules on co-ownership. Hence, if there is no contribution from either or both of the spouses, there can be no co-ownership. (Acre vs. Yuttikki, GR 153029, 27 September 2007; First Division, Sandoval Gutierrez, J.) Paternity and Filiation [T]he due recognition of an illegitimate child in a record of birth, a will, a statement before a court of record, or in any authentic writing is, in itself, a consummated act of acknowledgement of the child, and no further
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court action is required. In fact, any authentic writing is treated not just a ground for compulsory recognition; it is in itself a voluntary recognition that does not require a separate action for judicial approval. (Verceles vs. Posada, GR 159785, 27 April 2007; Second Division, Quisumbing J.) Guardianship The legal guardian only has the plenary power of administration of the minors property. It does not include the power of alienation which needs judicial authority. (Cabales vs. Court of Appeals, GR 162421, 31 August 2007; First Division, Puno CJ.) Property and Land Registration Builders in Good Faith Good faith is an intangible and abstract quality with no technical meaning or statutory definition, and it encompasses, among other things, an honest belief, the absence of malice and the absence of design to defraud or to seek an unconscionable advantage. It implies honesty of intention, and freedom from knowledge of circumstances which ought to put the holder upon inquiry. The essence of good faith lies in an honest belief in the validity of ones right, ignorance of a superior claim and absence of intention to overreach another. Applied to possession, one is considered in good faith if he is not aware that there exists in his title or mode of acquisition any flaw which invalidates it. (Ochoa vs. Apeta, GR 146259, 13 September 2007; First Division, Sandoval-Gutierrez J.) [T]o be entitled to reimbursement for improvements introduced on the property, the petitioner must be considered a builder in good faith. Further, Articles 448 and 546 of the Civil Code, which allow full reimbursement of useful improvements and retention of the premises until reimbursement is made, apply only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner thereof. A builder in good faith is one who is unaware of any flaw in his title to the land at the time he builds on it. In Geminiano v. Court of Appeals, 328 Phil. 682, 689-690 (1996), [the Supreme] Court was emphatic in declaring that lessees are not possessors or builders in good faith: Article 448 of the Civil Code, in relation to Article 546 of the same Code, which allows full reimbursement of useful improvements and retention of the premises until reimbursement is made, applies only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner thereof. It does not apply where ones only interest is that of a lessee under a rental contract; otherwise, it would always be in the power of the tenant to improve his landlord out of his property. (Florentino vs. Supervalue Inc., GR 172384, 12 September 2007; Third Division, Chico-Nazario J.) Ownership Elementary is the rule that simple possession of a certificate of title is not necessarily conclusive to a holders genuine ownership of property. If a person obtains title that includes land to which he has no legal right, that person does not, by virtue of said certificate alone, become the owner of the land illegally or erroneously included. This Court has held time and again that the rule on indefeasibility of title cannot be used for the perpetration of fraud against the legal owner. Hence, registration proceedings could not be used as a shield for fraud. To hold otherwise would be to put a premium on land-grabbing and transgress the broader principle in human relations that no person shall unjustly enrich himself at the expense of another. (Heirs of Salonga Bituin, GR 157567, 10 August 2007; First Division, Azcuna J.) [I]t is well-established that ownership and possession are two entirely different legal concepts. Just as possession is not a definite proof of ownership, neither is non-possession inconsistent with ownership. The first paragraph of Article 1498 of the Civil Code states that when the sale is made through a public instrument, the execution thereof shall be equivalent to the delivery of the thing which is the object of the contract, if from the deed the contrary does not appear or cannot clearly be inferred. Possession, along with ownership, is transferred to the vendee by virtue of the notarized deed of conveyance. (Tating vs. Marcella , GR 155208, 27 March 2007; Third Division, Austria-Martinez J.) Co-ownership
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Co-owners in estate [T]he law and jurisprudence have categorically held that even while an estate remains undivided, co-owners have each full ownership of their respective aliquots or undivided shares and may therefore alienate, assign or mortgage them. The co-owner, however, has no right to sell or alienate a specific or determinate part of the thing owned in common, because such right over the thing is represented by an aliquot or ideal portion without any physical division. In any case, the mere fact that the deed purports to transfer a concrete portion does not per se render the sale void. The sale is valid, but only with respect to the aliquot share of the selling co-owner. Furthermore, the sale is subject to the results of the partition upon the termination of the coownership. (Santos vs. Lumbao, GR 169129, 28 March 2007; Third Division, Chico-Nazario J.) Legal Redemption In Paulmitan vs. Court of Appeals [215 SCRA 867 (1992), the Court] held that a co-owner who redeemed the property in its entirety did not make her the owner of all of it. The property remained in a condition of coownership as the redemption did not provide for a mode of terminating a co-ownership. But the one who redeemed had the right to be reimbursed, holds a lien upon the subject property for the amount due. (Cabales vs. Court of Appeals, GR 162421, 31 August 2007; First Division, Puno CJ.) Legal redemption can only be exercised by the co-owner who did not part with his or their pro indiviso share in the property held in common. (Cabales vs. Court of Appeals, GR 162421, 31 August 2007; First Division, Puno CJ.) Partition There are two stages in every action for partition. The first phase is the determination of whether a coownership in fact exists and a partition is proper, i.e., not otherwise legally proscribed, and may be made by voluntary agreement of all the parties interested in the property. This phase may end either: (a) with a declaration that plaintiff is not entitled to have a partition either because a co-ownership does not exist, or partition is legally prohibited; or (b) with a determination that a co-ownership does in truth exist, partition is proper in the premises, and an accounting of rents and profits received by the defendant from the real estate in question is in order. In the latter case, the parties may, if they are able to agree, make partition among themselves by proper instruments of conveyance, and the court shall confirm the partition so agreed upon. The second phase commences when it appears that the parties are unable to agree upon the partition directed by the court. In that event, partition shall be done for the parties by the court with the assistance of not more than three (3) commissioners. This second stage may well also deal with the rendition of the accounting itself and its approval by the court after the parties have been accorded opportunity to be heard thereon, and an award for the recovery by the party or parties thereto entitled of their just share in the rents and profits of the real estate in question. (Austria vs. Lichauco, GR 170080, 3 April 2007; Second Division, Tinga J.) Possession The Civil Code states that possession is the holding of a thing or the enjoyment of a right. In the grammatical sense, to possess means to have, to actually and physically occupy a thing, with or without right Possession always includes the idea of occupation x x x. It is not necessary that the person in possession should himself be the occupant. The occupancy can be held by another in his name. Without occupancy, there is no possession. Two things are paramount in possession. First, there must be occupancy, apprehension or taking. Second, there must be intent to possess (animus possidendi). (Yu vs. Pacleb, GR 130316, 24 January 2007; First Division, Corona J.) Under the law, possession is acquired by the material occupation of a thing or the exercise of a right, or by the fact that it is subject to the action of our will, or by the proper acts and legal formalities established for acquiring such right. In short, possession can be either actual or merely constructive. Actual possession consists in the manifestation of acts of dominion over property of such a nature as a party would naturally exercise over his own as when respondent himself is physically in occupation of the property, or even when another person who recognizes the formers rights as owner is in occupancy. Constructive possession on the
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other hand, may be had through succession, donation, execution of public instruments, or the possession by a sheriff by virtue of a court order. (Remington Industrial Sales Corporation vs. Chinese Young Mens Christian Association of the Phil. Islands, GR 171858, 22 January 2007; Third Division, Ynares-Santiago J.) Easement To be entitled to an easement of right of way, the following requisites should be met: [1] the dominant estate is surrounded by other immovables and has no adequate outlet to a public highway (Art. 649, par. 1); [2] there is payment of proper indemnity (Art. 649, par. 1); [3] the isolation is not due to the acts of the proprietor of the dominant estate (Art. 649, last par.); and [4] the right of way claimed is at the point least prejudicial to the servient estate; and insofar as consistent with this rule, where the distance from the dominant estate to a public highway may be the shortest (Art. 650). (Lee vs. Spouses Carreon, GR 149023, 27 September 2007; First Division, Sandoval-Gutierrez, J.) [S]ince a right-of-way is an interest in the land, any agreement creating it should be drawn and executed with the same formalities as a deed to a real estate, and ordinarily must be in writing. (Obra vs. Badua, GR 149125, 9 August 2007; Second Division, Velasco Jr. J.) Estoppel, Prescription and Laches Estoppel The doctrine of estoppel is not only that which prohibits a party from assuming inconsistent positions, based on the principle of election, but that which precludes him from repudiating an obligation voluntarily assumed after having accepted benefits therefrom. To countenance such repudiation would be contrary to equity, and would put a premium on fraud or misrepresentation. (Escueta vs. Lim, GR 137162, 24 January 2007; First Division, Azcuna J.) Estoppel cannot give validity to an act that is prohibited by law or one that is against public policy. Clearly, the collection of interests without any stipulation therefor in writing is prohibited by law. (Ching vs. Nicdao, GR 141181, 27 April 2007; Third Division, Callejo Sr. J.) Prescription Civil Interruption Article 1123 of the Civil Code is categorical. Civil interruption is produced by judicial summons to the possessor. Moreover, even with the presence of judicial summons, Article 1124 sets limitations as to when such summons shall not be deemed to have been issued and shall not give rise to interruption, to wit: 1) if it should be void for lack of legal solemnities; 2) if the plaintiff should desist from the complaint or should allow the proceedings to lapse; or 3) if the possessor should be absolved from the complaint. Both Article 1123 and Article 1124 of the Civil Code underscore the judicial character of civil interruption. For civil interruption to take place, the possessor must have received judicial summons. (Heirs of Arzadon-Crisologo vs. Ranon, GR 171068, 5 September 2007; Third Division, Chico-Nazario J.) Registered Land [N]o title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession. Neither can prescription be allowed against the hereditary successors of the registered owner, because they step into the shoes of the decedent and are merely the continuation of the personality of their predecessor-in-interest. (Ochoa vs. Apeta, GR 146259, 13 September 2007; First Division, SandovalGutierrez J.) Action for annulment of Title / Reconveyance [A]n action for annulment of title or reconveyance based on fraud is imprescriptible where the plaintiff is in possession of the property subject of the acts. (Llemos vs. Llemos, GR 150162, 26 January 2007; Third Division, Austria-Martinez J.)
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Action for Reconveyance Well entrenched is the rule that an action for reconveyance prescribes in ten years, the reckoning point of which is the date of registration of the deed or the date of issuance of the certificate of title over the property. In an action for reconveyance, the decree of registration is highly regarded as incontrovertible. What is sought instead is the transfer of the property or its title, which has been erroneously or wrongfully registered in another persons name to its rightful or legal owner, or to one who has a better right. However, in a number of cases in the past, the Court declared that if the person claiming to be the owner of the property is in actual possession thereof, the right to seek reconveyance, which in effect seeks to quiet title to the property, does not prescribe. The reason for this is that one who is in actual possession of a piece of land claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, the rationale for the rule being that his undisturbed possession provides him a continuing right to seek the aid of a court of equity to ascertain and determine the nature of the adverse claim of a third party and its effect on his own title, which right can be claimed only by the one who is in possession. (Heirs of Salonga Bituin, GR 157567, 10 August 2007; First Division, Azcuna J.) Laches While jurisprudence is settled on the imprescriptibility and indefeasibility of a Torrens title, there is equally an abundance of cases where we unequivocally ruled that registered owners may lose their right to recover possession of property through the equitable principle of laches. [Laches means:] x x x the failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to assert a right within a reasonable time, warranting the presumption that the party entitled to assert it either has abandoned or declined to assert it. The defense of laches is an equitable one and does not concern itself with the character of the defendants title, but only with whether or not by reason of plaintiffs long inaction or inexcusable neglect, he should be barred from asserting his claim at all, because to allow him to do so would be inequitable and unjust to defendant. Laches is poles apart from prescription. Laches has been defined as such neglect or omission to assert a right, taken in conjunction with lapse of time and other circumstances causing prejudice to an adverse party, as will operate as a bar in equity. It is a delay in the assertion of a right which works disadvantage to another because of the inequity founded on some change in the condition or relations of the property or parties. It is based on public policy which, for the peace of society, ordains that relief will be denied to a stale demand which otherwise could be a valid claim. It is different from and applies independently of prescription. While prescription is concerned with the fact of delay, laches is concerned with the effect of delay. Prescription is a matter of time; laches is principally a question of inequity of permitting a claim to be enforced, this inequity being founded on some change in the condition of the property or the relation of the parties. Prescription is statutory; laches is not. Laches applies in equity, whereas prescription applies at law. Prescription is based on a fixed time, laches is not. (Vda. de Tirona vs. Encarnacion, GR 168902, 28 September 2007; Third Division, Nachura J.) The four (4) elements of laches first prescribed by [the Supreme] Court in Go Chi Gun, et al v. Co Cho, et al, as subsequently reiterated, are as follows: [1] conduct on the part of the defendant, or of one under whom he claims, giving rise to the situation of which complaint is made for which the complaint seeks a remedy; [2] delay in asserting the complainants rights, the complainant having had knowledge or notice, of the defendants conduct and having been afforded an opportunity to institute a suit; [3] lack of knowledge or notice on the part of the defendant that the complainant would assert the right on which he bases his suit; and [4] injury or prejudice to the defendant in the event relief is accorded to the complainant, or the suit is not held to be barred. (Vda. de Tirona vs. Encarnacion, GR 168902, 28 September 2007; Third Division, Nachura J.; Note that these requisites were also reiterated in Fangonil-Herrera vs, Fangonil, GR 159356, 28 August 2007; Third Division, Chico-Nazario J.) It is a well-settled doctrine that laches cannot be used to defeat justice or perpetuate fraud and injustice. Neither should its application be used to prevent the rightful owners of a property from recovering what has been fraudulently registered in the name of another. (Llemos vs. Llemos, GR 150162, 26 January 2007; Third
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Division, Austria-Martinez J.) The doctrine of laches or of stale demands is based upon grounds of public policy which requires, for the peace of society, the discouragement of stale claims and, unlike the statute of limitation, is not merely a question of time but is principally a question of the inequity or unfairness of permitting a right or claim to be enforced or asserted. There is no absolute rule as to what constitutes laches or staleness of demand; each case is to be determined according to its particular circumstances. Ultimately, however, the question of laches is addressed to the sound discretion of the court and, since it is an equitable doctrine, its application is controlled by equitable consideration. (United Overseas Bank vs. Ros, GR 171532, 7 August 2007; Third Division, Chico-Nazario J.) Mortgagee in good faith> In Cavite Development Bank v. Spouses Lim, [81 Phil. 355, 368 (2000) as cited in Erea v. QuerrerKauffman, G.R. No. 165853, 22 June 2006, 492 SCRA 298, 319] the Court explained the doctrine of mortgagee in good faith, thus: There is, however, a situation where, despite the fact that the mortgagor is not the owner of the mortgaged property, his title being fraudulent, the mortgage contract and any foreclosure sale arising there from are given effect by reason of public policy. This is the doctrine of the mortgagee in good faith based on the rule that all persons dealing with property covered by the Torrens Certificates of Title, as buyers or mortgagees, are not required to go beyond what appears on the face of the title. The public interest in upholding the indefeasibility of a certificate of title, as evidence of lawful ownership of the land or of any encumbrance thereon, protects a buyer or mortgagee who, in good faith, relied upon what appears on the face of the certificate of title. Indeed, a mortgagee has a right to rely in good faith on the certificate of title of the mortgagor of the property given as security, and in the absence of any sign that might arouse suspicion, the mortgagee has no obligation to undertake further investigation. This doctrine pre-supposes, however, that the mortgagor, who is not the rightful owner of the property, has already succeeded in obtaining Torrens title over the property in his name and that, after obtaining the said title, he succeeds in mortgaging the property to another who relies on what appears on the title. (Bank of Commerce vs. San Pablo Jr., GR 167848, 27 April 2007; Third Division, Chico-Nazario J.) Quieting of Title As a general rule, a cloud which may be removed by suit to quiet title is not created by mere verbal or parol assertion of ownership of or an interest in property. This rule is subject to qualification, where there is a written or factual basis for the asserted right. Thus, a claim of right based on acquisitive prescription or adverse possession has been held to constitute a removable cloud on title. (Tandog vs. Macapagal, GR 144208, 11 September 2007; First Division, Sandoval-Gutierrez J.) Land Registration Torrens system,/p> The issue of the validity of title (e.g. whether or not it was issued fraudulently or in breach of trust) can only be assailed in an action expressly instituted for that purpose. A certificate of title cannot be attacked collaterally. (Ingusan vs. Heirs of Reyes, GR 142938, 28 August 2007; First Division, Corona J.) The rationale behind the Torrens System is that the public should be able to rely on a registered title. The Torrens System was adopted in this country because it was believed to be the most effective measure to guarantee the integrity of land titles and to protect their indefeasibility once the claim of ownership is established and recognized. In Fil-estate Management, Inc. v. Trono, [G.R. No. 130871, 17 February 2006, 482 SCRA 578, the Court] explained: It has been invariably stated that the real purpose of the Torrens System is to quiet title to land and to stop forever any question as to its legality. Once a title is registered, the owner may rest secure, without the necessity of waiting in the portals of the court, or sitting on the mirador su casa to avoid the possibility of losing his land. (Ingusan vs. Heirs of Reyes, GR 142938, 28 August 2007; First Division, Corona J.)

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[An OCT] which was registered under the Torrens System on the basis of a free patent became indefeasible and incontrovertible after the lapse of one year as provided in Section 32 [Review of decree of registration; Innocent purchaser for value] of PD 1529: The decree of registration shall not be reopened or revised by reason of absence, minority, or other disability of any person adversely affected thereby, nor by any proceeding in any court for reversing judgment, subject, however, to the right of any person, including the government and the branches thereof, deprived of land or of any estate or interest therein by such adjudication or confirmation of title obtained by actual fraud, to file in the proper Court of First Instance a petition for reopening and review of the decree of registration not later than one year from and after the date of the entry of such decree of registration, but in no case shall such petition be entertained by the court where an innocent purchaser for value has acquired the land or an interest therein whose rights may be prejudiced. Whenever the phrase innocent purchaser for value or an equivalent phrase occurs in this Decree, it shall be deemed to include an innocent lessee, mortgagee, or other encumbrancer for value. Upon the expiration of said period of one year, the decree of registration and the certificate of title issued shall become incontrovertible. Any person aggrieved by such decree of registration in any case may pursue his remedy by action for damages against the applicant or any other person responsible for the fraud. (Ingusan vs. Heirs of Reyes, GR 142938, 28 August 2007; First Division, Corona J.) [E]very person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way oblige him to go beyond the certificate to determine the condition of the property. Where there is nothing in the certificate of title to indicate any cloud or vice in the ownership of the property, or any encumbrance thereon, the purchaser is not required to explore further than what the Torrens Title upon its face indicates in quest for any hidden defects or inchoate right that may subsequently defeat his right thereto. However, when a person who deals with registered land through someone who is not the registered owner, he is expected to look behind the certificate of title and examine all the factual circumstances, in order to determine if the vendor has the capacity to transfer any interest in the land. He has the duty to ascertain the identity of the person with whom he is dealing and the latters legal authority to convey. The law requires a higher degree of prudence from one who buys from a person who is not the registered owner, although the land object of the transaction is registered. While one who buys from the registered owner does not need to look behind the certificate of title, one who buys from one who is not the registered owner is expected to examine not only the certificate of title but all factual circumstances necessary for him to determine if there are any flaws in the title of the transferor, or in his capacity to transfer the land. (Spouses Chua vs. Soriano, GR 150066, 13 April 2007; Third Division, Austria-Martinez J.) A person who deliberately ignores a significant fact that could create suspicion in an otherwise reasonable person is not an innocent purchaser for value. (Bank of Commerce vs. San Pablo Jr., GR 167848, 27 April 2007; Third Division, Chico-Nazario J.) Reconstituted titles Under section 7 of Republic Act No. 26, Reconstituted titles shall have the same validity and legal effect as the originals thereof unless the reconstitution was made extrajudicially. In this case, TCTs No. 200629 and 200630 were reconstituted administratively, hence, extrajudicially. In contrast to the judicial reconstitution of a lost certificate of title which is in rem, the administrative reconstitution is essentially ex-parte and without notice. The reconstituted certificates of title do not share the same indefeasible character of the original certificates of title for the following reason: x x x The nature of a reconstituted Transfer Certificate Of Title of registered land is similar to that of a second Owners Duplicate Transfer Certificate Of Title. Both are issued, after the proper proceedings, on the representation of the registered owner that the original of the said TCT or the original of the Owners Duplicate TCT, respectively, was lost and could not be located or found despite diligent efforts exerted for that purpose. Both, therefore, are subsequent copies of the originals thereof. A cursory examination of these subsequent copies would show that they are not the originals. Anyone dealing with such copies are put on notice of such fact and thus warned to be extra-careful. (Barstowe Philippines Corporation vs. Republic, GR 133110, 28 March 2007; Third Division, Chico-Nazario J.) Alienable land
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To be entitled to registration of a land, the applicant must prove that (a) the land applied for forms part of the disposable and alienable agricultural lands of the public domain; and (b) he has been in open, continuous, exclusive, and notorious possession and occupation of the same under a bona fide claim of ownership either since time immemorial or since June 12, 1945. All lands not otherwise appearing to be clearly within private ownership are presumed to belong to the State, and unless it has been shown that they have been reclassified by the State as alienable or disposable to a private person, they remain part of the inalienable public domain. To prove that a land is alienable, an applicant must conclusively establish the existence of a positive act of the government, such as a presidential proclamation or an executive order, or administrative action, investigation reports of the Bureau of Lands investigator or a legislative act or statute. (Domingo vs. Landicho, GR 170015, 29 August 2007; Second Division, Carpio-Morales J.) Very evident from Republic v. Manna Properties, Inc. [G.R. No. 146527, 450 SCRA 247 (31 January 2005)] is that the reckoning date under the Public Land Act for the acquisition of ownership of public lands is June 12, 1945 or earlier, and that evidence of possession from that date or earlier is essential for a grant of an application for judicial confirmation of imperfect title. (Republic vs. Lorenzo Development Corp., GR 170724, 29 January 2007; First Division, Garcia J.) Possession of lands of the public domain must be from at least June 12, 1945 for the same to be acquired through judicial confirmation of imperfect title. Through the years, Section 48(b), supra, of the Public Land Act has been amended several times. The case of Republic v. Doldol [G.R. No. 132963, September 10, 1998, 295 SCRA 359, 364] provides a summary of these amendments. As the law now stands, a mere showing of possession for thirty years or more is not sufficient. It must be shown, too, that possession and occupation had started on June 12, 1945 or earlier. (Republic vs. Lorenzo Development Corp., GR 170724, 29 January 2007; First Division, Garcia J.) Homestead patent Settled in this jurisdiction is the rule that the rights of a holder of a homestead patent are superior over the rights of the tenants guaranteed by the Agrarian Reform Law, as enunciated in [Alita vs. Court of Appeals, G.R. No. 78517, February 27, 1989, 170 SCRA 709]: The Homestead Act has been enacted for the welfare and protection of the poor. The law gives a needy citizen a piece of land where he may build a modest house for himself and family and plant what is necessary for subsistence and for the satisfaction of lifes other needs. The right of the citizens to their homes and to the things necessary for their subsistence is as vital as the right to life itself. They have a right to live with a certain degree of comfort as x x x human beings, and the State which looks after the welfare of the peoples happiness is under a duty to safeguard the satisfaction of this vital right. (Patricio v. Bayog, 112 SCRA 45) (Taguinod vs. Court of Appeals, GR 154654, 14 September 2007; Second Division, Velasco Jr. J.) Registration proper It is elementary that a court must render judgment confirming the title of the applicant only if it finds that the latter has sufficient title proper for registration. An application for land registration may include two or more parcels of land, but the court may at any time order an application to be amended by striking out one or more of the parcels or order a severance of the application. (Herce Jr. vs. Municipality of Cabuyao Laguna, GR 166645, 23 January 2007; Special First Division, Ynares-Santiago J.) Maceda Law R.A. No. 6552, otherwise known as the Realty Installment Buyer Protection Act, recognizes in conditional sales of all kinds of real estate (industrial, commercial, residential) the right of the seller to cancel the contract upon non-payment of an installment by the buyer, which is simply an event that prevents the obligation of the vendor to convey title from acquiring binding force. However, the cancellation of the contract by the seller must be in accordance with Sec. 3 (b) of R.A. No. 6552, which requires a notarial act of rescission and the refund to the buyer of the full payment of the cash surrender value of the payments on the property. Actual cancellation of the contract takes place after 30 days from receipt by the buyer of the notice of cancellation or
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the demand for rescission of the contract by a notarial act and upon full payment of the cash surrender value to the buyer. (Pagtalunan vs. dela Cruz vda. de Manzano, GR 147695, 13 September 2007; First Division, Azcuna J.) The demand letter [to vacate the premises] is not the same as the notice of cancellation or demand for rescission by a notarial act required by R.A No. 6552. [Layug v. Intermediate Appellate Court, No. L-75364, November 23, 1988, 167 SCRA 627, 635, cannot be relied on] to support [the] contention that the demand letter was sufficient compliance. Layug held that the additional formality of a demand on [the sellers] part for rescission by notarial act would appear, in the premises, to be merely circuitous and consequently superfluous since the seller therein filed an action for annulment of contract, which is a kindred concept of rescission by notarial act. Evidently, the case of unlawful detainer filed by petitioner does not exempt him from complying with the said requirement. (Pagtalunan vs. dela Cruz vda. de Manzano, GR 147695, 13 September 2007; First Division, Azcuna J.) Succession Wills Before any will can have force or validity it must be probated. This cannot be dispensed with and is a matter of public policy. Article 838 of the Civil Code mandates that [n]o will shall pass either real or personal property unless it is proved and allowed in accordance with the Rules of Court. As the will was not probated, the Partition Agreement which was executed pursuant thereto can not be given effect. Thus, the fact that petitioner was a party to said agreement becomes immaterial in the determination of the issue of possession. (Rodriguez vs. Rodriguez, GR 175720, 11 September 2007; Third Division, Ynares-Santiago J.) Obligations and Contracts Obligations When the service has become so difficult as to be manifestly beyond the contemplation of the parties, total or partial release from a prestation and from the counter-prestation is allowed. Under the theory of rebus sic stantibus, the parties stipulate in the light of certain prevailing conditions, and once these conditions cease to exist, the contract also ceases to exist. (Osmena III vs. SSS, GR 165272, 13 September 2007; En Banc, Garcia J.) Contracts Requisites In general, the cause is the why of the contract or the essential reason which moves the contracting parties to enter into the contract. For the cause to be valid, it must be lawful such that it is not contrary to law, morals, good customs, public order or public policy. (Camacho vs. Court of Appeals, GR 127520, 9 February 2007; Third Division, Callejo Sr. J.) The failure of the parties to state its exact location in the contract is of no moment; this is a mere error occasioned by the parties failure to describe with particularity the subject property, which does not indicate the absence of the principal object as to render the contract void. (Camacho vs. Court of Appeals, GR 127520, 9 February 2007; Third Division, Callejo Sr. J.) Bilateral Contracts The elementary principle is that it is perfectly legitimate for a bilateral contract to be embodied in two or more separate writings, and that in such an event the writings should be read and interpreted together in such a way as to eliminate seeming inconsistencies and render the intention of the parties effectual. In construing a written contract, the reason behind and the circumstances surrounding its execution are of paramount importance to place the interpreter in the situation occupied by the parties concerned at the time the writing was executed. Construction of the terms of a contract, which would amount to impairment or loss of right, is not favored. Conservation and preservation, not waiver, abandonment or forfeiture of a right, is the rule. In
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case of doubts in contracts, the same should be settled in favor of the greatest reciprocity of interests. (Constantino vs. Sandiganbayan, GR 140656, 13 September 2007; Second Division, Tinga J.) Stipulations The law states that if the terms of a contract are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its stipulations shall control.[56] When the language of the contract is explicit, leaving no doubt as to the intention of the drafters, the courts may not read into it any other intention that would contradict its plain import. The clear terms of the contract should never be the subject matter of interpretation. Neither abstract justice nor the rule of liberal interpretation justifies the creation of a contract for the parties which they did not make themselves, or the imposition upon one party to a contract or obligation to assume simply or merely to avoid seeming hardships. Their true meaning must be enforced, as it is to be presumed that the contracting parties know their scope and effects. (Roberts vs. Papio, GR 166714, 9 February 2007; Third Division, Callejo Sr. J.) If some stipulations of any contract should admit of several meanings, it shall be understood as bearing that import which is most adequate to render it effectual. The various stipulations of a contract shall be interpreted together, attributing to the doubtful ones that sense which may result from all of them taken jointly. When it is impossible to settle doubts by the rules established in the preceding articles, and the doubts refer to incidental circumstances of an onerous contract, the doubt shall be settled in favor of the greatest reciprocity of interests. (Security Bank Corp. vs. Court of Appeals, GR 141733, 8 February 2007; First Division, Puno CJ.) [Article 1370 of the Civil Code] is akin to the plain meaning rule applied by Pennsylvania courts, which assumes that the intent of the parties to an instrument is embodied in the writing itself, and when the words are clear and unambiguous the intent is to be discovered only from the express language of the agreement. It also resembles the four corners rule, a principle which allows courts in some cases to search beneath the semantic surface for clues to meaning. A courts purpose in examining a contract is to interpret the intent of the contracting parties, as objectively manifested by them. The process of interpreting a contract requires the court to make a preliminary inquiry as to whether the contract before it is ambiguous. A contract provision is ambiguous if it is susceptible of two reasonable alternative interpretations. Where the written terms of the contract are not ambiguous and can only be read one way, the court will interpret the contract as a matter of law. If the contract is determined to be ambiguous, then the interpretation of the contract is left to the court, to resolve the ambiguity in the light of the intrinsic evidence. (Abad vs. Goldloop Properties Inc., GR 168108, 13 April 2007; Third Division, Callejo Sr. J.) A contract is simulated if the parties do not intend to be bound at all (absolutely simulated) or if the parties conceal their true agreement (relatively simulated). The primary consideration in determining the true nature of a contract is the intention of the parties. Such intention is determined from the express terms of their agreement as well as from their contemporaneous and subsequent acts. In Suntay v. Court of Appeals,[321 Phil. 809, 831-832 (1995)] the Court ruled that the most protuberant index of simulation is the complete absence, on the part of the vendee, of any attempt in any manner to assert his rights of ownership over the disputed property. (Tating vs. Marcella , GR 155208, 27 March 2007; Third Division, Austria-Martinez J.) Penal clause A penal clause is an accessory undertaking to assume greater liability in case of breach. It is attached to an obligation in order to insure performance and has a double function: (1) to provide for liquidated damages, and (2) to strengthen the coercive force of the obligation by the threat of greater responsibility in the event of breach. The obligor would then be bound to pay the stipulated indemnity without the necessity of proof of the existence and the measure of damages caused by the breach. (Florentino vs. Supervalue Inc., GR 172384, 12 September 2007; Third Division, Chico-Nazario J.) As a general rule, courts are not at liberty to ignore the freedoms of the parties to agree on such terms and conditions as they see fit as long as they are not contrary to law, morals, good customs, public order or public policy. Nevertheless, courts may equitably reduce a stipulated penalty in the contracts in two instances: (1) if
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the principal obligation has been partly or irregularly complied with; and (2) even if there has been no compliance if the penalty is iniquitous or unconscionable in accordance with Article 1229 of the Civil Code. (Florentino vs. Supervalue Inc., GR 172384, 12 September 2007; Third Division, Chico-Nazario J.) In ascertaining whether the penalty is unconscionable or not, this court set out the following standard in Ligutan v. Court of Appeals, 427 Phil. 42, 52 (2002), to wit:The question of whether a penalty is reasonable or iniquitous can be partly subjective and partly objective. Its resolution would depend on such factor as, but not necessarily confined to, the type, extent and purpose of the penalty, the nature of the obligation, the mode of breach and its consequences, the supervening realities, the standing and relationship of the parties, and the like, the application of which, by and large, is addressed to the sound discretion of the court. xxx. (Florentino vs. Supervalue Inc., GR 172384, 12 September 2007; Third Division, Chico-Nazario J.) Interests The payment of regular interest constitutes the price or cost of the use of money and thus, until the principal sum due is returned to the creditor, regular interest continues to accrue since the debtor continues to use such principal amount. It has been held that for a debtor to continue in possession of the principal of the loan and to continue to use the same after maturity of the loan without payment of the monetary interest, would constitute unjust enrichment on the part of the debtor at the expense of the creditor. (Frias vs. San Diego-Sison, GR 155223, 3 April 2007; Third Division, Austria-Martinez J.) [A]lthough the Usury Law was suspended by Central Bank Circular No. 905, s. 1982, effective on 1 January 1983, and consequently parties are given a wide latitude to agree on any interest rate, nothing in the said Circular grants lenders carte blanche authority to raise interest rates to levels which will either enslave their borrowers or lead to a hemorrhaging of their assets. Stipulation authorizing iniquitous or unconscionable interests are contrary to morals, if not against the law. Under Article 1409 of the Civil Code, these contracts are inexistent and void from the beginning. They cannot be ratified nor the right to set up their illegality as a defense be waived. The nullity of the stipulation on the usurious interest does not, however, affect the lenders right to recover the principal of the loan. Nor would it affect the terms of the real estate mortgage. The right to foreclose the mortgage remains with the creditors, and said right can be exercised upon the failure of the debtors to pay the debt due. The debt due is to be considered without the stipulation of the excessive interest. A legal interest of 12% per annum will be added in place of the excessive interest formerly imposed. (Heirs of Espiritu vs. Spouss Landrito, GR 169617, 3 April 2007; Third Division, Chico-Nazario J.) Statute of Limitations The statute of limitations was devised to operate primarily against those who slept on their rights and not against those desirous to act but could not do so for causes beyond their control. (Antonio vs. Morales, GR 165552, 23 January 2007; First Division, Sandoval-Gutierrez J.) Estoppel The principle of estoppel in pais applies wherein by ones acts, representations or admissions, or silence when one ought to speak out intentionally or through culpable negligence, induces another to believe certain facts to exist and to rightfully rely and act on such belief, so as to be prejudiced if the former is permitted to deny the existence of those facts. (Lopez vs. Bodega City, GR 155731, 3 September 2007; Third Division, Austria-Martinez J.) Pari Delicto In pari delicto is a universal doctrine which holds that no action arises, in equity or at law, from an illegal contract; no suit can be maintained for its specific performance, or to recover the property agreed to be sold or delivered, or the money agreed to be paid, or damages for its violation; and where the parties are in pari delicto, no affirmative relief of any kind will be given to one against the other. This rule, however, is subject to exceptions that permit the return of that which may have been given under a void contract to: (a) the innocent party (Arts. 1411-1412, Civil Code); (b) the debtor who pays usurious interest (Art. 1413, Civil
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Code); (c) the party repudiating the void contract before the illegal purpose is accomplished or before damage is caused to a third person and if public interest is subserved by allowing recovery (Art. 1414, Civil Code); (d) the incapacitated party if the interest of justice so demands (Art. 1415, Civil Code); (e) the party for whose protection the prohibition by law is intended if the agreement is not illegal per se but merely prohibited and if public policy would be enhanced by permitting recovery (Art. 1416, Civil Code); and (f) the party for whose benefit the law has been intended such as in price ceiling laws (Art. 1417, Civil Code) and labor laws (Arts. 1418-1419, Civil Code). (Hulst vs. PR Builders Inc., GR 156364, 3 September 2007; Third Division,AustriaMartinez J.) Torts / Quasi-delict Fortuitous event Jurisprudence defines the elements of a fortuitous event as follows: (a) the cause of the unforeseen and unexpected occurrence must be independent of human will; (b) it must be impossible to foresee the event which constitutes the caso fortuito, or if it can be foreseen, it must be impossible to avoid; (c) the occurrence must be such as to render it impossible for the debtor to fulfill his obligation in a normal manner; and (d) the obligor must be free from any participation in the aggravation of the injury resulting to the creditor. Article 1174 of the Civil Code provides that no person shall be responsible for a fortuitous event which could not be foreseen, or which, though foreseen, was inevitable. In other words, there must be an entire exclusion of human agency from the cause of injury or loss. (Real vs. Belo, GR 146224, 26 January 2007; Third Division, Austria-Martinez J.) Res Ipsa Loquitur Literally, res ipsa loquitur means the thing speaks for itself. It is the rule that the fact of the occurrence of an injury, taken with the surrounding circumstances, may permit an inference or raise a presumption of negligence, or make out a plaintiffs prima facie case, and present a question of fact for defendant to meet with an explanation. Stated differently, where the thing which caused the injury, without the fault of the injured, is under the exclusive control of the defendant and the injury is such that it should not have occurred if he, having such control used proper care, it affords reasonable evidence, in the absence of explanation that the injury arose from the defendants want of care, and the burden of proof is shifted to him to establish that he has observed due care and diligence. From the foregoing statements of the rule, the requisites for the applicability of the doctrine of res ipsa loquitur are: (1) the occurrence of an injury; (2) the thing which caused the injury was under the control and management of the defendant; (3) the occurrence was such that in the ordinary course of things, would not have happened if those who had control or management used proper care; and (4) the absence of explanation by the defendant. Of the foregoing requisites, the most instrumental is the control and management of the thing which caused the injury. (Professional Services Inc. vs. Agana, GR 126297, 31 January 2007; First Division, Sandoval-Gutierrez J.) In this jurisdiction, res ipsa loquitur is not a rule of substantive law, hence, does not per se create or constitute an independent or separate ground of liability, being a mere evidentiary rule. In other words, mere invocation and application of the doctrine does not dispense with the requirement of proof of negligence. (Professional Services Inc. vs. Agana, GR 126297, 31 January 2007; First Division, Sandoval-Gutierrez J.) Arbitration Arbitration, as an alternative mode of settling disputes, has long been recognized and accepted in our jurisdiction. The Civil Code is explicit on the matter. R.A. No. 876 also expressly authorizes arbitration of domestic disputes. Foreign arbitration, as a system of settling commercial disputes of an international character, was likewise recognized when the Philippines adhered to the United Nations Convention on the Recognition and the Enforcement of Foreign Arbitral Awards of 1958, under the 10 May 1965 Resolution No. 71 of the Philippine Senate, giving reciprocal recognition and allowing enforcement of international arbitration agreements between parties of different nationalities within a contracting state. The enactment of R.A. No. 9285 on 2 April 2004 further institutionalized the use of alternative dispute resolution systems,
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including arbitration, in the settlement of disputes. (Gonzales vs. Climax Mining Ltd., GR 161957, 22 January 2007; Special Second Division, Tinga J.) Disputes do not go to arbitration unless and until the parties have agreed to abide by the arbitrators decision. Necessarily, a contract is required for arbitration to take place and to be binding. R.A. No. 876 recognizes the contractual nature of the arbitration agreement. [As held] in Manila Electric Co. v. Pasay Transportation Co. [57 Phil. 600 (1932)] that a submission to arbitration is a contract. A clause in a contract providing that all matters in dispute between the parties shall be referred to arbitration is a contract, and in Del Monte Corporation-USA v. Court of Appeals[404 Phil. 192 (2001)] that [t]he provision to submit to arbitration any dispute arising therefrom and the relationship of the parties is part of that contract and is itself a contract. As a rule, contracts are respected as the law between the contracting parties and produce effect as between them, their assigns and heirs. (Gonzales vs. Climax Mining Ltd., GR 161957, 22 January 2007; Special Second Division, Tinga J.) The special proceeding under Sec. 6 of R.A. No. 876 recognizes the contractual nature of arbitration clauses or agreements. This special proceeding is the procedural mechanism for the enforcement of the contract to arbitrate. (Gonzales vs. Climax Mining Ltd., GR 161957, 22 January 2007; Special Second Division, Tinga J.) The doctrine of separability, or severability as other writers call it, enunciates that an arbitration agreement is independent of the main contract. The arbitration agreement is to be treated as a separate agreement and the arbitration agreement does not automatically terminate when the contract of which it is part comes to an end. The separability of the arbitration agreement is especially significant to the determination of whether the invalidity of the main contract also nullifies the arbitration clause. Indeed, the doctrine denotes that the invalidity of the main contract, also referred to as the container contract, does not affect the validity of the arbitration agreement. Irrespective of the fact that the main contract is invalid, the arbitration clause/agreement still remains valid and enforceable. (Gonzales vs. Climax Mining Ltd., GR 161957, 22 January 2007; Special Second Division, Tinga J.) Sale Contract of sale / Contract to Sell The following are the differences between a Contract OF Sale and a Contract TO Sell: (a) In a Contract OF Sale, the non-payment of the price is a resolutory condition which extinguishes the transaction that, for a time, existed and discharges the obligations created thereunder; in a Contract TO Sell, full payment of the purchase price is a positive suspensive condition, failure of which is not a breach but an event that prevents the obligation of the vendor to convey title from becoming effective; (b) In the first, title over the property generally passes to the buyer upon delivery; in the second, ownership is retained by the seller, regardless of delivery and is not to pass until full payment of the price; and (c) In the first, after delivery has been made, the seller has lost ownership and cannot recover it unless the contract is resolved or rescinded; in the second, since the seller retains ownership, despite delivery, he is enforcing and not rescinding the contract if he seeks to oust the buyer for failure to pay. (Vidad vs. Tayamen, GR 160554, 24 August 2007; Second Division, Quisumbing J.) The Contract to Sell is not void merely because it does not bear the signature of the [vendee]. (Oesmer s. Paraiso Development Corp., GR 157493, 5 February 2007; Third Division, Chico-Nazario J.) Double Sale Art. 1544 of the Civil Code, which provides the rule on double sale, applies only to a situation where the same property is validly sold to different vendees. In Remalante v. Tibe, [No. L-59514, 25 February 1988, 158 SCRA 138, the Supreme] Court ruled that the Civil Law provision on double sale is not applicable where there is only one valid sale, the previous sale having been found to be fraudulent. Likewise, in Espiritu and Apostol v. Valerio, [119 Phil. 69 (1963)] where the same parcel of land was purportedly sold to two different parties, the Court held that despite the fact that one deed of sale was registered ahead of the other, Art. 1544 of the Civil Code will not apply where said deed is found to be a forgery, the result of this being that the right of
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the other vendee should prevail. (Fudot vs. Cattleya Land, Inc., GR 171008, 13 September 2007; Second Division, Tinga J.) The law is clear that when the thing sold twice is an immovable, the one who acquires it and first records it in the Registry of Property shall be deemed the owner. Primus tempore, potior jure. First in time, stronger in right. However, the act of registration must be coupled with good faith. That is, the registrant must have no knowledge of any defect in the title of the vendor or must not have been aware of facts which should have put him upon such inquiry and investigation as might be necessary to acquaint him with any such defect. (Bernardez vs. Court of Appeals, GR 165888, 14 September 2007; Second Division, Quisumbing J.) In interpreting [Art. 1544], the Court declared that the governing principle is primus tempore, potior jure (first in time, stronger in right). Knowledge gained by the first buyer of the second sale cannot defeat the first buyers rights, except where the second buyer registers in good faith the second sale ahead of the first as provided by the aforequoted provision of the Civil Code. Such knowledge of the first buyer does not bar him from availing of his rights under the law, among them to register first his purchase as against the second buyer. However, knowledge gained by the second buyer of the first sale defeats his rights even if he is first to register the second sale, since such knowledge taints his prior registration with bad faith. It is thus essential, to merit the protection of Art. 1544, second paragraph, that the second realty buyer must act in good faith in registering his deed of sale. (Fudot vs. Cattleya Land, Inc., GR 171008, 13 September 2007; Second Division, Tinga J.) In China Airlines, Ltd. v. Court of Appeals,[ G.R. No. 129988, July 14, 2003, 406 SCRA 113, 126, citing Ford Philippines, Inc. v. Court of Appeals, 267 SCRA 320 (1997), the Supreme Court] held that bad faith does not simply connote bad judgment or negligence. It imports a dishonest purpose or some moral obliquity and conscious doing of a wrong. It means breach of a known duty through some motive, interest or ill will that partakes of the nature of fraud. (Dauz vs. Echavez, GR 152407, 21 September 2007; First Division, SandovalGutierrez J.) The registration contemplated in [Article 1544 of the New Civil Code] refers to registration under the Torrens System, which considers the act of registration as the operative act that gives validity to the transfer or creates a lien upon the land. This rule precisely applies to cases involving conflicting rights over registered property and those of innocent transferees who relied on the clean title of the properties. [R]egistration must be done in the proper registry in order to bind the same. Act 3344 provides for the system of recording of transactions or claims over unregistered real estate without prejudice to a third party with a better right. But if the land is registered under the Land Registration Act (and therefore has a Torrens Title), and it is sold and the sale is registered not under the Land Registration Act but under Act 3344, as amended, such sale is not considered registered, as the term is used under Art. 1544 of the New Civil Code. The fact that the certificate of title over the registered land is lost does not convert it into unregistered land. After all, a certificate of title is merely an evidence of ownership or title over the particular property described therein. [T]he Torrens system was adopted in this country because it was believed to be the most effective measure to guarantee the integrity of land titles and to insure their indefeasibility once the claim of ownership is established and recognized. If a person purchases a piece of land on the assurance that the sellers title thereto is valid, he should not run the risk of losing his acquisition. If this were permitted, public confidence in the system would be eroded and land transactions would have to be attended by complicated and not necessarily conclusive investigations and proof of ownership. (Amodia vs. de Melencion vs. Court of Appeals, GR 148846, 25 September 2007; Third Division, Nachura J.) Sale through Auction Article 1476, paragraph 2 of the Civil Code provides [that] In the case of a sale by auction: x x x (2) A sale by auction is perfected when the auctioneer announces its perfection by the fall of the hammer, or in other customary manner. Until such announcement is made, any bidder may retract his bid; and the auctioneer may withdraw the goods from the sale unless the auction has been announced to be without reserve. Considering that the auction sale had already been perfected [since the sheriff declared petitioner the highest bidder], a
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supplemental sale with higher consideration at the instance of only one party could no longer be validly executed. (Dizon vs. Dizon, GR 156539, 5 September 2007; First Division, Sandoval-Gutierrez J.) Equitable mortgage An equitable mortgage is one that, although lacking in some formality, form or words, or other requisites demanded by a statute, nevertheless reveals the intention of the parties to change a real property as security for a debt and contain nothing impossible or contrary to law. A contract between the parties is an equitable mortgage if the following requisites are present: (a) the parties entered into a contract denominated as a contract of sale; and (b) the intention was to secure an existing debt by way of mortgage. The decisive factor is the intention of the parties. (Roberts vs. Papio, GR 166714, 9 February 2007; Third Division, Callejo Sr. J.) In an equitable mortgage, the mortgagor retains ownership over the property but subject to foreclosure and sale at public auction upon failure of the mortgagor to pay his obligation. In contrast, in a pacto de retro sale, ownership of the property sold is immediately transferred to the vendee a retro subject only to the right of the vendor a retro to repurchase the property upon compliance with legal requirements for the repurchase. The failure of the vendor a retro to exercise the right to repurchase within the agreed time vests upon the vendee a retro, by operation of law, absolute title over the property. (Roberts vs. Papio, GR 166714, 9 February 2007; Third Division, Callejo Sr. J.) One repurchases only what one has previously sold. The right to repurchase presupposes a valid contract of sale between the same parties. (Roberts vs. Papio, GR 166714, 9 February 2007; Third Division, Callejo Sr. J.) As the Court held in Villarica, et al. v. Court of Appeals:[ 135 Phil. 166 (1968)] The right of repurchase is not a right granted the vendor by the vendee in a subsequent instrument, but is a right reserved by the vendor in the same instrument of sale as one of the stipulations of the contract. Once the instrument of absolute sale is executed, the vendor can no longer reserve the right to repurchase, and any right thereafter granted the vendor by the vendee in a separate instrument cannot be a right of repurchase but some other right like the option to buy xxx. (Roberts vs. Papio, GR 166714, 9 February 2007; Third Division, Callejo Sr. J.) In Ramos v. Icasiano,[51 Phil. 343 (1927), the Court] held that an agreement to repurchase becomes a promise to sell when made after the sale because when the sale is made without such agreement the purchaser acquires the thing sold absolutely; and, if he afterwards grants the vendor the right to repurchase, it is a new contract entered into by the purchaser as absolute owner. An option to buy or a promise to sell is different and distinct from the right of repurchase that must be reserved by means of stipulations to that effect in the contract of sale. (Roberts vs. Papio, GR 166714, 9 February 2007; Third Division, Callejo Sr. J.) Lease It is the duty of the lessor to place the lessee in the legal possession of the premises and to maintain the peaceful possession thereof during the entire term of the lease. To fully appreciate the importance of [Article 1654 of the Civil Code], the comment of Manresa on said article is worth mentioning: The lessor must see that the enjoyment is not interrupted or disturbed, either by others acts x x x or by his own. By his own acts, because, being the person principally obligated by the contract, he would openly violate it if, in going back on his agreement, he should attempt to render ineffective in practice the right in the thing he had granted to the lessee; and by others acts, because he must guarantee the right he created, for he is obligated to give warranty in the manner we have set forth in our commentary on article 1553, and, in this sense, it is incumbent upon him to protect the lessee in the latters peaceful enjoyment. The obligation of the lessor arises only when acts, termed as legal trespass (perturbacion de derecho), disturb, dispute, object to, or place difficulties in the way of the lessees peaceful enjoyment of the premises that in some manner or other cast doubt upon the right of the lessor by virtue of which the lessor himself executed the lease, in which case the lessor is obligated to answer for said act of trespass. The lessee has the right to be respected in his possession and should he be disturbed therein, he shall be restored to said possession by the means established by the law or by the Rules of Court. Possession is not protection against a right but against the exercise of a right by ones own authority.
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(Bercero vs. Capitol Development Corporation, GR 154765, 29 March 2007; Third Division, AustriaMartinez J.) Work and Labor [Article 1729] imposes a direct liability on an owner of a piece of work in favor of suppliers of materials (and laborers) hired by the contractor up to the amount owing from the [owner] to the contractor at the time the claim is made. Thus, to this extent, the owners liability is solidary with the contractor, if both are sued together. By creating a constructive vinculum between suppliers of materials (and laborers), on the one hand, and the owner of a piece of work, on the other hand, as an exception to the rule on privity of contracts, Article 1729 protects suppliers of materials (and laborers) from unscrupulous contractors and possible connivance between owners and contractors. (JL Investment & Development Inc. vs. Sta. Maria Jr., GR 148596, 22 January 2007; Second Division, Carpio J.) Although Article 1729 protects suppliers, it is no license to oppress owners. (JL Investment & Development Inc. vs. Sta. Maria Jr., GR 148596, 22 January 2007; Second Division, Carpio J.) Agency [A] power of attorney must be strictly construed; the instrument will be held to grant only those powers that are specified, and the agent may neither go beyond nor deviate from the power of attorney. However, the rule is not absolute and should not be applied to the extent of destroying the very purpose of the power. If the language will permit, the construction that should be adopted is that which will carry out instead of defeat the purpose of the appointment. Clauses in a power of attorney that are repugnant to each other should be reconciled so as to give effect to the instrument in accordance with its general intent or predominant purpose. Furthermore, the instrument should always be deemed to give such powers as essential or usual in effectuating the express powers. (Olaguer vs. Purugganan Jr., GR 158907, 12 February 2007; Third Division, Chico-Nazario J.) Article 1882 of the Civil Code provides that the limits of an agents authority shall not be considered exceeded should it have been performed in a manner more advantageous to the principal than that specified by him. (Olaguer vs. Purugganan Jr., GR 158907, 12 February 2007; Third Division, Chico-Nazario J.) [A] person who undertakes to act as agent for another cannot be permitted to deal in the agency matter on his own account and for his own benefit without the consent of his principal, freely given, with full knowledge of every detail known to the agent which might affect the transaction. The prohibition against agents purchasing property in their hands for sale or management is, however, clearly, not absolute. It does not apply where the principal consents to the sale of the property in the hands of the agent or administrator. (Olaguer vs. Purugganan Jr., GR 158907, 12 February 2007; Third Division, Chico-Nazario J.) Article 1897 reinforces the familiar doctrine that an agent, who acts as such, is not personally liable to the party with whom he contracts. The same provision, however, presents two instances when an agent becomes personally liable to a third person. The first is when he expressly binds himself to the obligation and the second is when he exceeds his authority. In the last instance, the agent can be held liable if he does not give the third party sufficient notice of his powers. (Eurotech Industrial Technologies Inc. vs. Cuison, GR 167552, 23 April 2007; Third Division, Chico-Nazario J.) Trust It is already settled in jurisprudence that an implied trust, as opposed to an express trust, is subject to prescription and laches. (Pilapil vs. Briones, GR 150175, 5 February 2007; Third Division, Chico-Nazario J.) [A]n action for reconveyance of real property based on implied trust prescribes ten years from registration and/or issuance of the title to the property, not only because registration under the Torrens system is a constructive notice of title, but also because by registering the disputed properties exclusively in [the registrants] name, [the registrant] had already unequivocally repudiated any other claim to the same. (Pilapil vs. Briones, GR 150175, 5 February 2007; Third Division, Chico-Nazario J.)
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Suretyship Article 2080 of the Civil Code does not apply in a contract of suretyship. Art. 2047 of the Civil Code states that if a person binds himself solidarily with the principal debtor, the provisions of Section 4, Chapter 3, Title I, Book IV of the Civil Code must be observed. Accordingly, Articles 1207 up to 1222 of the Code (on joint and solidary obligations) shall govern the relationship. (Ang vs. Associated Bank, GR 146511, 5 September 2007; First Division, Azcuna J.) The extent of a suretys liability is determined by the language of the suretyship contract or bond itself. It cannot be extended by implication, beyond the terms of the contract. (Garon v. Project Movers Realty & Development Corp., GR 166058, 3 April 2007; Third Division, Callejo Sr. J.) Mortgage Nature [A] mortgage contract is, by nature, indivisible. Consequent to this feature, a debtor cannot ask for the release of any portion of the mortgaged property or of one or some of the several properties mortgaged unless and until the loan thus secured has been fully paid, notwithstanding the fact that there has been partial fulfillment of the obligation. Hence, it is provided that the debtor who has paid a part of the debt cannot ask for the proportionate extinguishments of the mortgage as long as the debt is not completely satisfied. (Metropolitan Bank and Trust Company Inc. vs. SLGT Holdings Inc., GR 175181-82, 14 September 2007; First Division, Garcia J.) Indivisibility It may be that Section 18 of PD 957 allows partial redemption of the mortgage in the sense that the buyer is entitled to pay his installment for the lot or unit directly to the mortgagee so as to enable him - the said buyer to obtain title over the lot or unit after full payment thereof. Such accommodation statutorily given to a unit/lot buyer does not, however, render the mortgage contract also divisible. Generally, the divisibility of the principal obligation is not affected by the indivisibility of the mortgage. (Metropolitan Bank and Trust Company Inc. vs. SLGT Holdings Inc., GR 175181-82, 14 September 2007; First Division, Garcia J.) Remedies A mortgage-creditor may, in the recovery of a debt secured by a real estate mortgage, institute against the mortgage-debtor either a personal action for debt or a real action to foreclose the mortgage. These remedies available to the mortgage-creditor are deemed alternative and not cumulative. An election of one remedy operates as a waiver of the other. In sustaining the rule that prohibits a mortgage-creditor from pursuing both remedies of a personal action for debt or a real action to foreclose the mortgage, we held in Bachrach Motor Co., Inc. v. Icarangal,[68 Phil. 287, 293-294 (1939)] that a rule which would authorize the mortgage-creditor to bring a personal action against the mortgage-debtor and simultaneously or successively another action against the mortgaged property, would result not only in multiplicity of suits so offensive to justice and obnoxious to law and equity, but would also subject the mortgage-debtor to the vexation of being sued in the place of his residence or of the residence of the mortgage-creditor, and then again in the place where the property lies. Hence, a remedy is deemed chosen upon the filing by the mortgage-creditor of the suit for collection or upon his filing of the complaint in an action for foreclosure of mortgage, pursuant to the provisions of Rule 68 of the Rules of Court. (Chieng vs. Spouses Santos, GR 169647, 31 August 2007; Third Division, Chico-Nazario J.) When [the mortgage-creditor] filed Criminal Cases for violation of Batas Pambansa Blg. 22 against [the mortgage-debtor], [the mortgage-creditor]s civil action for the recovery of the amount of the dishonored checks was impliedly instituted therein pursuant to Section 1(b) of Rule 111 of the 2000 Rules on Criminal Procedure. [Hence,] he was deemed to have already availed himself of the remedy of collection suit. Following the rule on the alternative remedies of a mortgage-creditor, petitioner is barred from subsequently resorting to an action for foreclosure. (Chieng vs. Spouses Santos, GR 169647, 31 August 2007; Third
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Division, Chico-Nazario J.) Notice of Foreclosure [S]tatutory provisions governing publication of notice of mortgage foreclosure sales must be strictly complied with, and that even slight deviations therefrom will invalidate the notice and render the sale at least voidable. Nonetheless, we must not also lose sight of the fact that the purpose of the publication of the Notice of Sheriffs Sale is to inform all interested parties of the date, time and place of the foreclosure sale of the real property subject thereof. Logically, this not only requires that the correct date, time and place of the foreclosure sale appear in the notice, but also that any and all interested parties be able to determine that what is about to be sold at the foreclosure sale is the real property in which they have an interest. (Spouses Suico vs. PNB, GR 170215, 28 August 2007; Third Division, Chico-Nazario J.) Notices are given for the purpose of securing bidders and to prevent a sacrifice of the property. If these objects are attained, immaterial errors and mistakes will not affect the sufficiency of the notice; but if mistakes or omissions occur in the notices of sale, which are calculated to deter or mislead bidders, to depreciate the value of the property, or to prevent it from bringing a fair price, such mistakes or omissions will be fatal to the validity of the notice, and also to the sale made pursuant thereto. (Spouses Suico vs. PNB, GR 170215, 28 August 2007; Third Division, Chico-Nazario J.) Redemption [T]he mortgagor or his successor-in-interest may redeem the foreclosed property within one year from the registration of the sale with the Register of Deeds. After the one-year redemption period, the mortgagor loses all interest over the foreclosed property. The purchaser, who has a right to possession that extends after the expiration of the redemption period, becomes the absolute owner of the property when no redemption is made. In such a situation, the bond required under Section 7 of Act No. 3135, as amended, is no longer needed. The possession of land becomes an absolute right of the purchaser as confirmed owner. The purchaser can demand possession at any time following the consolidation of ownership in his name and the issuance to him of a new TCT. After the consolidation of title in the purchasers name for failure of the mortgagor to redeem the property, the writ of possession becomes a matter of right. Its issuance to a purchaser in an extrajudicial foreclosure sale becomes merely a ministerial function. As such, the court cannot exercise its discretion. (Spouses Oliveros vs. Presiding Judge, RTC, Branch 24, Binan Laguna, GR 165963, 3 September 2007; Third Division, Chico-Nazario J.)

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