G.R. No. L-6493 March 25, 1954
EUGENIO S. DE GRACIA, petitioner, vs. HON. RAMON R. SAN JOSE, REPUBLIC SURETY & INSURANCE CO., INC., and SHERIFF OF THE CITY OF MANILA, respondents.

FACTS

Petitioner Eugenio S. de Gracia is the registered owner of real property covered by Transfer Certificate of Title No. 3731 of Manila. This property was sold at a public auction on November 14, 1952, via extrajudicial foreclosure of a mortgage in favor of the Rehabilitation Finance Corporation, pursuant to Act No. 3135 , as amended. The highest bidder was respondent Republic Surety & Insurance Co., Inc. Three days after the sale, the purchaser filed an ex-parte verified motion in the Court of First Instance of Manila, praying for a writ of possession during the redemption period as authorized by Section 7 of Act No. 3135 , as amended, and offering to furnish the required bond. Before the court could act on the motion, petitioner filed an opposition, followed by a complaint for annulment of the sale and a motion to dismiss or postpone the petition for a writ of possession pending resolution of the annulment complaint. The court, citing its specific power under the Act to grant the writ on an ex-parte motion, authorized the issuance of the writ upon the filing of a bond, without prejudice to petitioner’s right to question the sale’s validity in the proper proceedings.

ISSUE

Whether the lower court acted without jurisdiction and with grave abuse of discretion in authorizing the issuance of a writ of possession to the purchaser at the extrajudicial foreclosure sale during the redemption period, despite the mortgagor’s pending action for annulment of the sale.

RULING

The Supreme Court dismissed the petition. The lower court acted in accordance with the express provisions of Sections 7 and 8 of Act No. 3135 , as amended. The law expressly authorizes the purchaser at an extrajudicial foreclosure sale to petition for a writ of possession during the redemption period by filing an ex-parte motion under oath in the corresponding registration proceeding. Upon filing such motion and approval of the required bond, the court is mandated to issue the order for a writ of possession; no discretion is left to the court. Any question regarding the regularity or validity of the sale is to be determined in a subsequent proceeding as outlined in Section 8 of the Act, where the debtor may petition to set aside the sale and cancel the writ. The rule denying possession to a purchaser at a judicial auction during redemption is not applicable to sales under Act No. 3135 , which expressly authorizes such possession. The precedent in Previsora Filipina vs. Ledda, which refused to apply the amendatory Act, is distinguishable because the mortgage in that case was constituted prior to the Act’s effectivity, whereas the mortgage here was constituted in 1948 and 1949, subject to the Act which took effect in 1933. Therefore, the judge did not act without jurisdiction or with grave abuse of discretion.