GR 121943; (March, 2003) (Digest)
G.R. No. 121943 ; March 24, 2003
CHINA BANKING CORPORATION, petitioner, vs. SPOUSES OSCAR and LOLITA ORDINARIO, respondents.
FACTS
Petitioner China Banking Corporation (CBC) extrajudicially foreclosed three real estate mortgages constituted by Jesus Garcia on forty-five parcels of land to secure loans granted to TransAmerican Sales and Exposition, Inc. The properties were sold at public auction to CBC as the highest bidder. Subsequently, CBC filed an ex parte petition for a writ of possession with the Regional Trial Court (RTC), which was granted. The RTC ordered CBC’s possession upon posting a bond.
Respondents Spouses Ordinario, claiming to have purchased one of the mortgaged lots (covered by TCT No. 7637) in November 1989, filed a motion for reconsideration to exclude that property from the writ. They asserted they were indispensable parties who were not notified, that their rights as buyers were superior, and that CBC should have filed an ordinary action for recovery of possession. The RTC denied their motion, but the Court of Appeals reversed, ordering the exclusion of TCT No. 7637 from the writ.
ISSUE
Whether the Court of Appeals erred in granting the respondents’ motion for reconsideration and excluding their property from the writ of possession issued to the foreclosure sale purchaser.
RULING
Yes. The Supreme Court reversed the Court of Appeals and reinstated the RTC orders. The issuance of a writ of possession to a purchaser in an extrajudicial foreclosure sale is a ministerial duty of the court under Act No. 3135 . The trial court has no discretion to deny it. The writ is issued as a matter of course upon the filing of the proper ex parte petition and the posting of the required bond.
Any challenge to the validity of the sale or claims of superior right by third parties, like the respondents, cannot be litigated in the same ex parte proceeding for the writ. The proper remedies for a third-party claimant are either to file a terceria (third-party claim) with the sheriff executing the writ or to institute a separate and independent action to assert ownership or possession. A motion for reconsideration in the land registration case is an improper procedural recourse. Since the respondents did not avail themselves of the correct remedies, the writ of possession must be enforced in its entirety, covering all properties sold at the foreclosure sale, including the lot claimed by the respondents.