G.R. No. 70144 March 26, 1990
ACTIVE WOOD PRODUCTS, INC., petitioner, vs. INTERMEDIATE APPELLATE COURT and STATE INVESTMENT HOUSE, INC., respondents.

FACTS

Petitioner Active Wood Products, Inc. filed an action for injunction to restrain respondent State Investment House, Inc. from extrajudicially foreclosing mortgaged properties, alleging usurious interest charges. The trial court issued a restraining order and, after protracted proceedings on the required injunction bond, issued an order on November 28, 1983. This order reconsidered prior rulings and granted the issuance of a writ of preliminary injunction upon petitioner’s filing of a P1,000,000 bond within fifteen days from receipt. Despite this clear order, the provincial sheriff proceeded with the foreclosure auction on November 29, 1983, selling the properties to the respondent. The trial court later dismissed a contempt charge against the sheriff but declared the auction sale null and void. The Intermediate Appellate Court reversed this nullification, ruling that no effective injunction existed at the time of the sale since the bond had not yet been filed.

ISSUE

Whether the extrajudicial foreclosure sale conducted on November 29, 1983, was valid despite the trial court’s November 28, 1983 order granting a preliminary injunction conditioned upon the filing of a bond within a fifteen-day period.

RULING

The Supreme Court reversed the appellate court and reinstated the trial court’s orders nullifying the sale. The legal logic centers on the effectivity and purpose of a court order granting an injunction. The Court held that the trial court’s November 28 order was immediately effective and directive. By granting the writ conditioned on the posting of a bond within a specified period, the court had already made a determination that the sale should be enjoined pending the litigation. The grant of a period to file the bond was a mere procedural completion; the substantive ruling to enjoin the sale was already in place. For the sheriff to proceed with the sale the very next day was a blatant disregard of the court’s authority and intent, frustrating the judicial process. The Court emphasized that sheriffs must exercise professionalism and uphold the integrity of court orders. The nullification was necessary to preserve the orderly administration of justice and the status quo the court sought to maintain. The issue of the bond’s filing became moot once the trial court later allowed its completion, and the premature sale could not be justified by the technical absence of the bond at the very moment of the auction.