G.R. No. 73573 . May 23, 1991.
SPOUSES TRINIDAD AND EPIFANIO NATINO, petitioners, vs. THE INTERMEDIATE APPELLATE COURT, THE RURAL BANK OF AGUILAR, INC. AND THE PROVINCIAL SHERIFF EX-OFFICIO OF PANGASINAN, respondents.

FACTS

Petitioners executed a real estate mortgage in favor of respondent Rural Bank of Aguilar to secure a loan. Upon default, the bank extrajudicially foreclosed the property. The certificate of sale, registered on January 29, 1975, provided a two-year redemption period expiring on January 29, 1977. No redemption was made, and the sheriff issued a final deed of sale on February 15, 1977. The bank later obtained a writ of possession.
Petitioners filed a complaint to annul the final deed of sale, alleging the bank granted them an oral extension of the redemption period. The trial court ruled in their favor, finding an implied extension from the bank’s delay in executing the final deed and accepting the testimony that the bank’s president assured them they could redeem when they had the means. The Intermediate Appellate Court (IAC) reversed this decision, prompting this petition.

ISSUE

Whether the IAC correctly reversed the trial court’s finding that there was a valid extension of the redemption period.

RULING

The Supreme Court affirmed the IAC’s decision, dismissing the petition. The legal logic is anchored on the statutory nature of the redemption period in extrajudicial foreclosure and the requirements for a binding agreement to extend it. The two-year redemption period under Act No. 3135 is mandatory and cannot be extended by mere implication or oral agreement without clear proof. The Court found no credible evidence of a valid extension granted within the original redemption period. The alleged assurance from the bank’s president occurred in May 1978, which was after the redemption period had already expired on January 29, 1977. Such a post-expiration promise could only pertain to a possible resale of the property, not a legal redemption. For a promise to resell to be binding, it must be supported by a consideration distinct from the price, pursuant to Article 1479 of the Civil Code. No such separate consideration was proven. Furthermore, the president’s alleged assurance, even if made, could not bind the bank without proof of approval or ratification by its Board of Directors. The delay in the sheriff’s issuance of the final deed did not legally extend the redemption period, as the period is fixed by law and counted from the registration of the certificate of sale. Therefore, the final deed of sale was validly issued after the expiration of the unextended statutory period.