G.R. No. 148448 ; August 17, 2004
RUSTICO A. ARDIENTE and ASUNCION PALOMA-ARDIENTE, petitioners, vs. PROVINCIAL SHERIFF, REGISTER OF DEEDS OF QUEZON and PENINSULA DEVELOPMENT BANK, respondents.

FACTS

Petitioners, the Ardiente spouses, obtained a loan from respondent Peninsula Development Bank secured by a real estate mortgage. After defaulting, the bank extrajudicially foreclosed the mortgage. The spouses received a letter dated February 24, 1984, informing them that their one-year redemption period commenced on November 11, 1983. Two days before the redemption period expired, they filed a complaint for annulment of the auction sale. Their primary allegation, as stated in paragraph 15 of their complaint, was that they were not “duly notified of an intended extra-judicial foreclosure auction sale” before receiving the February 1984 letter.
In its Answer, the bank specifically denied this allegation, asserting that petitioners were “duly notified” and that there was “sufficient notice and publication.” The bank later argued in its memorandum that personal notice to the mortgagor is not required under Act No. 3135, and that notice by posting and publication suffices. The trial court dismissed the complaint, a decision affirmed by the Court of Appeals.

ISSUE

Whether the Court of Appeals erred in not annulling the foreclosure sale based on the alleged lack of notice to the mortgagors.

RULING

No. The Supreme Court affirmed the dismissal. The legal logic hinges on the rule that issues not raised in the trial court cannot be raised for the first time on appeal. While petitioners’ complaint alleged a lack of “duly” notifying them of the “intended” sale, the bank’s Answer squarely put in issue the sufficiency of the notice given. Crucially, petitioners never presented any evidence before the trial court to prove that the statutory requirements for notice under Act No. 3135—posting and publication—were not complied with. Their claim remained a bare allegation.
The Court, citing Go v. Court of Appeals, ruled that the specific issue of lack of publication of the notice of sale was never actually raised or tried by the parties. A general allegation of lack of notice is distinct from a specific challenge to the statutory posting and publication requirements. Since petitioners failed to substantiate their claim during trial and did not present evidence to contradict the bank’s assertion of compliance, they cannot raise it as a reversible error on appeal. The factual findings of the lower courts, which found the foreclosure regular, are thus binding.