G.R. No. 194104; March 13, 2013
NOVATEKNIKA LAND CORPORATION, Petitioner, vs. PHILIPPINE NATIONAL BANK and THE REGISTER OF DEEDS OF MANILA CITY, Respondents.

FACTS

Petitioner Novateknika Land Corporation (NLC), along with several other corporations, entered into a Credit Agreement with respondent Philippine National Bank (PNB) for an omnibus line, with all borrowers jointly and severally liable. As security, they executed a Real Estate and Chattel Mortgage covering 21 properties, including four parcels of land owned by NLC. The loan agreements were renewed, and drawdowns were made primarily by two co-borrowers, Kenstar Industrial Corporation and Plastic City Corporation, accumulating a significant unpaid obligation.
Despite demands, the loan remained unpaid, prompting PNB to initiate extrajudicial foreclosure proceedings on the mortgaged properties, including NLC’s lands. NLC filed an action for injunction in the Regional Trial Court (RTC), arguing prescription of PNB’s action, its status as a mere third-party mortgagor, and lack of corporate authorization for the mortgage. The RTC initially issued a temporary restraining order but later denied the prayer for a writ of preliminary injunction, finding NLC’s claimed right was not clear and unmistakable. NLC then directly elevated the case to the Court of Appeals via a petition for certiorari under Rule 65.

ISSUE

Whether the Court of Appeals correctly dismissed NLC’s petition for certiorari for failure to file a motion for reconsideration before the RTC.

RULING

Yes, the Court of Appeals correctly dismissed the petition. The Supreme Court affirmed that the filing of a motion for reconsideration is a mandatory prerequisite to a petition for certiorari under Rule 65. This requirement affords the lower court an opportunity to correct its own alleged error and is indispensable, except in certain recognized exceptions. NLC invoked the exception of “extreme urgency,” arguing that the impending registration of the certificate of sale would cause irreparable harm by cutting off its right of redemption.
The Court, however, ruled that NLC failed to substantiate this claim of extreme urgency. The mere allegation of urgency, without concrete proof that the RTC would not act promptly on a motion for reconsideration, is insufficient to justify bypassing the procedural requirement. The period for filing such a motion would not have caused a delay so prejudicial as to warrant an exception, especially since the factual and legal issues involved required careful study. Procedural rules are not to be disregarded lightly. The Court found no compelling reason to excuse NLC’s procedural misstep, thereby upholding the CA’s dismissal of the petition for non-compliance with the condition precedent.