GR 83498; (October, 1991) (Digest)
G.R. No. 83498 October 22, 1991
SPS. MIGUEL S. KHO and JUANITA KHO, petitioners, vs. COURT OF APPEALS and BANCO FILIPINO, respondents.
FACTS
Petitioners Spouses Kho obtained a loan from respondent Banco Filipino, secured by a real estate mortgage over their property. After defaulting on payments, the bank extrajudicially foreclosed the mortgage in May 1982, purchased the property as the highest bidder, and registered the certificate of sale on June 17, 1982. The one-year redemption period was set to expire on June 17, 1983. Just ten days before this expiration, on June 7, 1983, the spouses filed a complaint for annulment of the foreclosure (Civil Case No. CEB-759) and secured a writ of preliminary injunction from the Regional Trial Court (RTC). This injunction restrained the bank from obtaining a writ of possession or a final deed of sale and from collecting rentals from the property. The RTC subsequently denied the bank’s motion to lift this injunction.
ISSUE
Whether the Court of Appeals committed grave abuse of discretion in lifting the writ of preliminary injunction that restrained Banco Filipino from obtaining a writ of possession over the foreclosed property during the pendency of the suit for annulment of the foreclosure.
RULING
The Supreme Court ruled that the Court of Appeals did not commit grave abuse of discretion and properly lifted the injunction. The legal logic is clear under Act No. 3135 , as amended, governing extrajudicial foreclosures. The purchaser at a foreclosure sale is entitled to a writ of possession as a matter of right, both during the redemption period and after its expiration upon filing of a proper motion. This right is ministerial and proceeds independently of any pending action questioning the validity of the mortgage or the foreclosure sale itself. The pendency of an annulment case, such as the one filed by the Spouses Kho, does not bar the issuance of the writ. The remedy for the mortgagor is to seek the nullification of the sale in a separate proceeding, but this does not affect the purchaser’s immediate right to possession. Therefore, the preliminary injunction issued by the RTC, which prohibited the bank from obtaining the writ, was improperly granted as it contravened this established legal right. The Court affirmed the appellate court’s decision lifting the injunction and remanded the main annulment case to the RTC for further proceedings.