G.R. No. L-57617 May 24, 1984
FORTUNE HOMES, INC., petitioner, vs. COURT OF APPEALS, NATIONAL INVESTMENT AND DEVELOPMENT CORPORATION, SHERIFF OF BACOLOD CITY and REGISTER OF DEEDS OF BACOLOD CITY, respondents.

FACTS

Fortune Homes, Inc. mortgaged a 53-hectare lot in Bacolod City to respondent National Investment and Development Corporation (NIDC) as security for a $1,000,000 loan from a Chicago bank, for which NIDC acted as primary obligor. Fortune Homes defaulted by failing to pay three loan amortizations, compelling NIDC to pay these sums. Consequently, NIDC initiated the extrajudicial foreclosure of the mortgage. The sheriff sold the property at public auction on April 29, 1968, with NIDC as the highest bidder.
Just before the expiration of the redemption period, Fortune Homes filed an injunction suit to prevent NIDC from consolidating title, later amending it to annul the foreclosure sale. The trial court upheld the validity of the foreclosure and, on NIDC’s counterclaim, ordered Fortune Homes to pay a deficiency judgment of P9,850,915.75 with interest. The Court of Appeals affirmed this decision. Fortune Homes appealed to the Supreme Court, contesting the foreclosure’s validity.

ISSUE

Whether the extrajudicial foreclosure of the mortgage and the consequent deficiency judgment against Fortune Homes are valid.

RULING

Yes, the foreclosure and deficiency judgment are valid. The Supreme Court affirmed the lower courts’ rulings, finding no merit in Fortune Homes’ arguments, which largely involved factual issues already thoroughly resolved. The Court emphasized that Fortune Homes’ brief failed to raise any important legal issue, contained no formal assignment of errors, and presented no definite prayer.
The petitioner’s specific contentions—including non-receipt of the full loan amount, NIDC’s prevention of obligation fulfillment, absence of default, and prematurity of foreclosure—were factual matters conclusively settled by the trial and appellate courts. For instance, the claim of receiving only $800,000 was contradicted by admissions from Fortune Homes’ own officers regarding the credited “compensating balance.” On the default issue, the evidence clearly showed Fortune Homes failed to pay three amortizations, which NIDC covered. This default triggered the acceleration clause in the mortgage contract, expressly granting NIDC the right to foreclose extrajudicially. The Court found no legal basis to overturn these factual determinations. Other arguments, like NIDC’s alleged failure to fulfill its corporate purpose, were deemed improper for the appeal. The deficiency judgment, representing the unpaid balance after applying the foreclosure sale proceeds, was correctly imposed.