GR 133079; (August, 2005) (Digest)
G.R. No. 133079. August 9, 2005.
SPS. MAXIMO LANDRITO, JR. and PACITA EDGALANI, Petitioners, vs. THE HONORABLE COURT OF APPEALS; SPS. BENJAMIN SAN DIEGO and CARMENCITA SAN DIEGO; The EX-OFFICIO SHERIFF and CLERK OF COURT of the Regional Trial Court, Makati City; and the REGISTER OF DEEDS, Makati City, Respondents.
FACTS
Petitioners obtained loans from respondent Carmencita San Diego, secured by a real estate mortgage and later an amendment thereto. Upon petitioners’ default, the mortgage was extrajudicially foreclosed, and the property was sold at a public auction to San Diego as the highest bidder on August 11, 1993. The Sheriff’s Certificate of Sale was registered on October 29, 1993. Petitioners failed to redeem the property within the one-year redemption period provided by Act No. 3135. After title was consolidated in the respondents’ names, petitioners filed a complaint for annulment of the foreclosure and auction sale, alleging defects in notice and publication, an inflated foreclosure amount, and a purported extension of the redemption period.
ISSUE
Whether the Court of Appeals erred in affirming the dismissal of the complaint for annulment of the extrajudicial foreclosure and auction sale.
RULING
The Supreme Court denied the petition and affirmed the appellate court’s decision. The core legal logic centers on the statutory nature of the right of redemption in extrajudicial foreclosure. Under Act No. 3135, the mortgagor’s right to redeem is limited to a period of one year from the date of registration of the sheriff’s certificate of sale. This period is not merely prescriptive but is a condition precedent; failure to exercise redemption within this fixed term extinguishes the right. Consequently, the mortgagor loses all interest in the foreclosed property. The petitioners’ failure to redeem within the statutory period—from October 29, 1993, to October 29, 1994—was fatal. Their subsequent action to annul the foreclosure, filed in November 1994, could not revive this lost right. The institution of an annulment suit does not suspend the running of the redemption period. Having lost their interest in the property, petitioners no longer possessed a cause of action to challenge the validity of the foreclosure proceedings. The Court thus upheld the dismissal of the complaint, as the petitioners’ inaction constituted laches and a waiver of their rights.