GR 178881; (February, 2008) (Digest)
G.R. No. 178881 ; February 18, 2008
SPOUSES ALEX and JULIE LAM, petitioners, vs. METROPOLITAN BANK AND TRUST COMPANY, respondent.
FACTS
Petitioners Spouses Lam obtained loans from respondent Metrobank, secured by a real estate mortgage over their property. Upon default, Metrobank extrajudicially foreclosed the mortgage, purchased the property at the sheriff’s sale, and, after the redemption period expired, consolidated its title. Metrobank then filed a petition for a writ of possession with the Regional Trial Court (RTC). The RTC initially issued summons, and the spouses filed an Answer, participated in pre-trial, and attended mediation. The RTC later issued an Order declaring the proceeding ex parte, barring the spouses from participation. Upon the spouses’ motion for reconsideration, the RTC reversed itself, ruled the proceeding was adversarial due to the bank’s prior acquiescence to their participation, and cited “equitable circumstances” arising from the spouses’ separate action for annulment of foreclosure.
ISSUE
Whether the Regional Trial Court committed grave abuse of discretion in treating the petition for a writ of possession as an adversarial proceeding and in allowing the mortgagors to participate therein.
RULING
No. The Court of Appeals correctly found that the RTC committed grave abuse of discretion. The Supreme Court affirmed that a petition for a writ of possession, filed by a purchaser in an extrajudicial foreclosure sale after the redemption period and consolidation of title, is a non-litigious, ex parte proceeding under Act No. 3135 . The issuance of the writ is a ministerial duty of the court upon the filing of a proper motion and the presentation of the requisite documents, namely the certificate of sale and final deed of sale. The RTC’s initial procedural steps—issuing summons and allowing the filing of an Answer—were erroneous deviations from this established ex parte nature. The court cannot validate its error by subsequently declaring the proceeding adversarial based on estoppel. Any question regarding the validity or regularity of the foreclosure sale is not a legal ground to oppose the issuance of the writ in this summary proceeding; such issues must be ventilated in a separate judicial action, like the annulment case filed by the spouses. The ex parte petition cannot be consolidated with an ordinary civil action. Thus, the RTC’s orders converting the proceeding were invalid.