GR 157644; (November, 2010) (Digest)
G.R. No. 157644; November 17, 2010
SPOUSES ERNESTO and VICENTA TOPACIO, as represented by their attorney-in-fact MARILOU TOPACIO-NARCISO, Petitioners, vs. BANCO FILIPINO SAVINGS and MORTGAGE BANK, Respondent.
FACTS
Petitioners obtained a loan from respondent Banco Filipino, secured by a real estate mortgage. Upon petitioners’ default, the property was extrajudicially foreclosed and sold at public auction, with respondent as the highest bidder. Respondent subsequently secured a writ of possession from the Regional Trial Court (RTC) in 1984. However, petitioners filed a petition to set aside the auction sale, and the RTC issued a preliminary injunction enjoining the implementation of the writ. After years of delays and postponements initiated by both parties, the RTC, in 1986, dismissed respondent’s petition for a writ of possession on the ground of “failure to prosecute.” This dismissal order was not served on respondent, whose operations had been ordered closed by the Monetary Board in 1985.
Nearly six years later, after respondent bank resumed operations, it filed a motion for clarification and for the issuance of an alias writ of possession. The RTC initially denied the motion but, upon reconsideration in 1993, set aside the 1986 dismissal order and granted the alias writ. The Court of Appeals affirmed this order, prompting the petitioners’ appeal to the Supreme Court.
ISSUE
Whether the Regional Trial Court acted with grave abuse of discretion in setting aside its 1986 order of dismissal and issuing an alias writ of possession in favor of the respondent bank.
RULING
The Supreme Court denied the petition and affirmed the assailed issuances. The Court held that the RTC did not commit grave abuse of discretion. The 1986 dismissal for failure to prosecute was not a dismissal on the merits; it was an adjudication based on a procedural technicality that did not resolve the parties’ substantive rights. The power to dismiss on this ground is not absolute and must be based on a clear lack of due diligence to proceed. The records revealed that the case’s protracted delay was attributable to both parties, not solely to respondent’s inaction. Furthermore, the respondent bank’s closure by the Monetary Board constituted a legal impediment beyond its control, justifying the delay in pursuing the action.
Crucially, the purchaser in an extrajudicial foreclosure sale is entitled to a writ of possession as a matter of right upon the filing of a proper motion and the posting of a bond, if the period for redemption has expired without a redemption being made. This right is ministerial and non-discretionary. The issuance of the alias writ was therefore a correction of a previous erroneous order and a ministerial duty of the court to enforce the consequences of a consummated foreclosure sale. The RTC’s act of setting aside the procedural dismissal to fulfill this ministerial duty was a proper exercise of its jurisdiction.