G.R. No. 107075 September 1, 1994
Armando S. Olizon and Iluminada C. Olizon, petitioners, vs. Court of Appeals and Prudential Bank, respondents.

FACTS

In 1967, spouses Armando and Iluminada Olizon obtained a loan from Prudential Bank secured by a real estate mortgage over their property in Kalookan City. Due to non-payment, the bank extrajudicially foreclosed the mortgage. The property was sold at a public auction on March 11, 1975, with the bank as the highest bidder. The certificate of sale was annotated on the title the following day. The spouses failed to redeem the property, leading to the consolidation of title in the bank’s name in 1978. In 1986, the bank successfully petitioned for the reconstitution of the lost title, and a new title was issued in its name in 1987.
In 1989, the bank filed a petition for a writ of possession, which was granted by the trial court in 1990. The Olizon spouses then filed an opposition, seeking to cancel the writ and nullify the foreclosure sale. They alleged lack of personal notice and non-compliance with the posting requirements under Section 3 of Act No. 3135 . The trial court ruled in their favor, declaring the foreclosure null and void. The Court of Appeals reversed this decision, upholding the validity of the foreclosure sale and the writ of possession.

ISSUE

Whether the extrajudicial foreclosure sale is valid despite the alleged lack of personal notice to the mortgagors and non-compliance with statutory posting requirements.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. The legal logic is twofold. First, personal notice to the mortgagor in extrajudicial foreclosure proceedings is not required by law. Section 3 of Act No. 3135 , as amended, only mandates posting in three public places and publication in a newspaper of general circulation. Therefore, the lack of personal notice is not a valid ground to annul the sale.
Second, the Court rejected the claim of non-compliance with posting requirements based on the doctrines of laches and estoppel. The Olizon spouses took no action to challenge the foreclosure sale for over twenty years. Their prolonged inaction, despite knowledge of the auction and the subsequent consolidation of title, constitutes laches, which bars them from belatedly asserting technical defects. Furthermore, their active participation in the reconstitution proceedings, where documents from the foreclosure were submitted, estops them from impugning the validity of the same sale. The Court emphasized that while statutory requirements must generally be strictly complied with, equitable principles like laches and estoppel can preclude a party from raising such objections after an unreasonable delay that prejudices the other party.