GR 47579; (October, 1981) (Digest)
G.R. No. L-47579 October 9, 1981
EDUARDO JALANDONI (Deceased), Substituted by ROGELIA R. JALANDONI, BRENDA R. TAYAG, ARTHUR JALANDONI, DEANNA J. FELICIANO and SUSAN R. JALANDONI, petitioners, vs. PHILIPPINE NATIONAL BANK and COURT OF FIRST INSTANCE OF NEGROS OCCIDENTAL, Silay City Branch I, respondents.
FACTS
On March 31, 1959, the Court of First Instance of Manila rendered a final and executory judgment ordering Eduardo Jalandoni to pay the Philippine National Bank (PNB) a sum of money. Within five years from the entry of judgment, specifically on March 9, 1964, the sheriff levied upon Jalandoni’s land in Silay City, and a notice of embargo was annotated on the title. However, PNB took no further action to have the levied property sold at public auction.
On April 22, 1974, more than ten years after the levy, Jalandoni filed a petition to cancel the levy on the ground of prescription. The lower court dismissed his subsequent action to quiet title, prompting Jalandoni’s heirs to appeal to the Supreme Court. The core dispute centered on whether the levied property could still be sold at an execution sale after the expiration of the ten-year period for enforcing the judgment.
ISSUE
May the judgment debtor’s land, levied upon within five years from the entry of judgment, be sold at an execution sale after the expiration of the ten-year period for enforcing the judgment?
RULING
No. The Supreme Court reversed the trial court’s decision, ordering the cancellation of the notice of embargo. The Court applied the rule established in Ansaldo vs. Fidelity and Surety Co., which holds that properties levied upon by execution must be sold at public auction within the ten-year period during which the judgment can be enforced by action. The legal logic is anchored on the principle that an execution is enforced and accomplished by both levy and sale, not by levy alone. While a levy may validly be made within five years from the judgment’s finality under Section 6, Rule 39 of the Rules of Court, the subsequent sale must still occur within the overarching ten-year prescriptive period for enforcing a judgment by action under Article 1144 of the Civil Code.
The Court rejected PNB’s reliance on the dictum in Del Rosario vs. Yatco, which suggested a sale could occur indefinitely after a valid levy. That dictum was inapplicable because, in the instant case, the sale was not conducted within the ten-year period. The bank’s prolonged inaction constituted negligence, and the law aids the vigilant, not those who sleep on their rights. Consequently, the levy, having become barred by the statute of limitations, was an extinguished obligation that constituted a cloud on the title removable under Article 478 of the Civil Code.