G.R. No. 184879 ; February 23, 2011
REPUBLIC OF THE PHILIPPINES (DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS), Petitioner, vs. CITY OF MANDALUYONG, Respondent.

FACTS

The Department of Transportation and Communications (DOTC), representing the Republic of the Philippines, entered into a Build, Lease and Transfer (BLT) Agreement with Metro Rail Transit Corporation Limited (Metro Rail) for the EDSA MRT III system. Metro Rail assigned its rights and obligations to Metro Rail Transit Corporation (MRTC), a domestic corporation. The DOTC took over operation of the system in 2000. The City Assessors of Mandaluyong, Quezon City, Makati, and Pasay fixed the system’s value and apportioned it among the cities. The Mandaluyong City Assessor issued a tax declaration in MRTC’s name and demanded payment of real property taxes. After MRTC failed to pay, the City Treasurer issued a Warrant of Levy and, following a public auction where there were no bidders, forfeited the properties in favor of Mandaluyong City. A Final Deed of Sale was executed and a new tax declaration was issued in the city’s name. The Republic filed a case (Civil Case No. MC05-2882) before the RTC (Branch 208) seeking to nullify the tax assessment and levy, arguing that the properties were beneficially owned and used by the tax-exempt DOTC/Republic. The RTC (Branch 208) denied the Republic’s applications for a Temporary Restraining Order and a writ of preliminary injunction. Subsequently, Mandaluyong City filed an ex parte petition before another branch of the RTC (Branch 213) for the issuance of a writ of possession over the properties, which was granted. The Republic filed the instant petition, arguing that the writ of possession was improperly issued because the underlying tax sale was void (as the properties are owned by the tax-exempt Republic) and that the case was barred by litis pendentia due to the pending case in Branch 208.

ISSUE

Whether the Regional Trial Court (Branch 213) properly issued a writ of possession in favor of the City of Mandaluyong over the EDSA MRT III properties following the tax delinquency sale.

RULING

The Supreme Court granted the petition and set aside the writ of possession. The Court held that a writ of possession is a provisional remedy issuable only in specific cases defined by law, such as in land registration proceedings or extrajudicial foreclosure of a real estate mortgage under Act No. 3135 . The issuance of a writ of possession is not an available remedy for a local government unit seeking to take possession of properties sold at a public auction due to tax delinquency. The proper procedure for the City to acquire possession, if it is entitled, is through an ordinary action for ejectment or for recovery of possession. Furthermore, the Court found that the pendency of the main case (Civil Case No. MC05-2882) in Branch 208, which directly challenges the validity of the tax assessment, levy, and sale, precludes the issuance of the writ of possession. The issue of ownership and the validity of the tax sale must first be resolved in that main case. Until the Republic’s claim of exemption is definitively ruled upon, the City’s claim to possession based on the tax sale remains questionable. Therefore, the RTC (Branch 213) acted without jurisdiction and with grave abuse of discretion in issuing the writ of possession.