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Phil Trust Co., vs. CA 320 Scra 719
Phil Trust Co., vs. CA 320 Scra 719
Ponente: YNARES-SANTIAGO
Dispositive Portion:
WHEREFORE, the decision rendered by the Court of Appeals, in C.A. G.R. SP
No. 39342, dismissing the instant petition for certiorari filed by Philippine
Trust Company is AFFIRMED in toto.
Citation Ref:
246 SCRA 365 | 247 SCRA 570 | 277 SCRA 478 | 241 SCRA 21 | 289 SCRA
624 |
* FIRST DIVISION.
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SUPREME COURT REPORTS ANNOTATED
Philippine Trust Company vs. Court of Appeals
should be respected and protected by the means established and the laws of
procedure. Consequently, private respondent having been in lawful possession of
the property covered by OCT-R-165 at the time the writ of possession was
implemented, may institute an action for having been disturbed in its enjoyment.
PETITION for review on certiorari of a decision of the Court of Appeals.
The facts are stated in the opinion of the Court.
Feria, Feria, Lugtu, LaO, Noche for petitioner.
Lumen, Policarpio and Associates for private respondent.
YNARES-SANTIAGO, J.:
The petition before us has its origins in a decision rendered by this Court on August
25, 1969 entitled Philippine Trust Company vs. Simeon Policarpio, Modesta Reyes
and Iluminada (Lumen) R. Policarpio.1
Sometime in 1958, Iluminada Lumen Policarpio, obtained a loan from Philippine
Trust Company (Philtrust, for short) in the sum of P300,000.00. As security for the
loan, Lumens parents, as sureties, executed a deed of mortgage to the bank over
some parcels of land, including all the improvements thereon, covered by Transfer
Certificate of Title No. 4144 (now 51668) of the Register of Deeds of the City of
Manila and Transfer Certificate of Title No. 24182 of the Register of Deeds of Rizal.
Upon failure of Lumen Policarpio to pay the loan when it fell due, Philtrust initiated
foreclosure proceedings before the Court of First Instance (CFI) of Manila. The trial
court rendered judgment for foreclosure on October 14, 1963, which this Court
affirmed on August 25, 1969.2
On October 15, 1970, Philtrust purchased the properties at the auction sale. The
sale was confirmed by the trial court in 1971. That same year, the bank was able to
consolidate own-
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1 29 Phil. 42 (1969).
2 Supra.
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SUPREME COURT REPORTS ANNOTATED
Philippine Trust Company vs. Court of Appeals
in good faith. Meanwhile, on December 29, 1980, the bank sold the properties to the
present owner, Alto Industrial Enterprises, Inc. which, on September 17, 1984, was
allowed to intervene by the court a quo. In a resolution dated January 11, 1985, the
Court of Appeals granted Philtrusts motion for issuance of a writ of partial
possession of the properties involved except the portion of 1,000 square meters
wherein Lumen Policarpios house stood. On August 31, 1987, the Court of Appeals
rendered a decision, the dispositive portion of which reads as follows:
WHEREFORE, in consequence of our conclusion that petitioner was not a builder in
good faith entitled to the right of reimbursement with the right of retention, the
submission and prayer that the writ of possession issued in this case be annulled
and set aside, should in view of the facts disclosed after hearing of this appellate
court, be as it is hereby, rejected and denied. It follows that the court a quo may
now proceed without further delay to implement the questioned writ of possession
and take such other steps and proceedings consistent with this judgment.
SO ORDERED.3
The decision of the Court of Appeals was affirmed by the Supreme Court on
September 2, 1988, and the subsequent motion for reconsideration was denied with
finality on February 15, 1989 for lack of merit. Pursuant to the affirmed decision of
the Court of Appeals, the trial court issued an alias writ of execution and possession
on August 8, 1989. The writ was served on Lumen Policarpio on September 22,
1989. Meanwhile, she filed a motion for reconsideration on September 13, 1989
which was subsequently denied. In February 1990, the implementation of the first
alias writ of possession was ordered. When the life of the first alias writ of
possession expired, Philtrust moved for the issuance of a second alias writ of
possession. On October 30, 1990, the second alias writ of possession was received
by Jose Policarpio, brother of the
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SUPREME COURT REPORTS ANNOTATED
Philippine Trust Company vs. Court of Appeals
short) filed a complaint for Damages, Injunction, and Mandamus against petitioner
Philtrust and RTC Malabon Sheriff Augusto Castro and Deputy Gallardo C. Tolentino,
alleging that on November 14, 1990, by virtue of an alias writ of execution and
possession issued by Branch 12, Regional Trial Court (RTC) of Manila on October 15,
1990, the defendant Sheriff, together with Philtrust counsel Atty. Antonio Sikat,
Justice Guillermo Santos and Maria C. Noche, with the use of trickery and fraudulent
machination, in the absence of the owner of the shipyard shipbuilding corporation,
opened the gates of the shipyard without notice to the owners and took possession
of it despite the fact that it was not one of the properties mortgaged to the bank.5
Petitioner Philtrust filed a motion to dismiss on the grounds of res judicata and
failure on the part of private respondent SPSSC to state a cause of action. Petitioner
alleged that the issues raised by private respondent involved the same parties and
the same properties which have already been passed upon by the courts including
the Supreme Court. Petitioner further alleged that the complaint states no cause of
action since the property covered by OCT-R-165 is no longer owned by private
respondent but by the Land Bank of the Philippines. It appears that the property has
been mortgaged by private respondent to the said bank in an instrument dated
April 30, 1982 to guarantee payment of a loan in the sum of Four Million Five
Hundred Twenty Nine Thousand Pesos (P4,529,000.00).6
The trial court denied the motion to dismiss filed by petitioner Philtrust on the
ground that the doctrine of res judicata is inapplicable as to OCT-R-165.7 On motion
for reconsideration filed by petitioner Philtrust, the trial court ruled that the case
was one for damages anchored on the alleged improper implementation by the
defendant Sheriff of the alias writ of possession subjecting thereto the property
covered by OCT-R-
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8 Rollo, p. 166.
9 Rollo, pp. 78-98.
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SUPREME COURT REPORTS ANNOTATED
Philippine Trust Company vs. Court of Appeals
of petitions before us, in an apparent attempt to forestall foreclosure of the
properties mentioned in Case No. L-228685 entitled, Philippine Trust Company vs.
Simeon Policarpio, Modesta Reyes, and Iluminada (Lumen) R. Policarpio, rendered
by this Court on August 25, 1969. The said decision specifically identified the
parcels of land subject of the deed of mortgage executed by spouses Policarpio to
secure the loan of Lumen Policarpio to be those covered by Transfer Certificate of
Title No. 41144 (now 51668) of the Register of Deeds of the City of Manila, and
Transfer Certificate of Title No. 24182 of the Register of Deeds of Rizal.10
The same properties were the subject of litigation between the same parties before
this Court in the following cases:
1.G.R. No. L-22685On August 25, 1969, this Court affirmed the judgment of
foreclosure by the trial court in favor of Philtrust.
2.G.R. No. L-37143 On July 20, 1973, this Court dismissed the petition for review on
certiorari filed by the Policarpios which sought to declare the auction sale void for
lack of notice.
3.G.R. No. 55900Initially, this Court denied the petition filed by Lumen Policarpio,
but on a motion for reconsideration, we remanded the case to the Court of Appeals
to determine whether petitioner was a builder in good faith.
4.G.R. No. 81142On February 10, 1989, this Court resolved with finality to uphold
its resolution of September 28, 1988 and the decision of the Court of Appeals dated
August 31, 1987 that Lumen Policarpio was a builder in bad faith and the writ of
possession in favor of Philtrust be implemented without further delay.11
5.G.R. No. 97963On August 26, 1991, this Court again dismissed the petition of
Simeon Policarpio, Mode
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10 29 Phil. at 44.
11 As cited in the Resolution in G.R. No. 97963 issued by this Court on August 26,
1991, Rollo pp. 353-354.
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SUPREME COURT REPORTS ANNOTATED
Philippine Trust Company vs. Court of Appeals
With regard to the parcel of land covered by OCT-R-165, however, there is no
showing, and there is nothing on the records, to indicate that it has ever been
mortgaged by the Policarpios or their successors in interest to petitioner Bank. In
fact, the aforesaid parcel of land could not have been the subject of litigation
between the said parties considering that the Original Certificate of Title No. R-165
was only issued in the name of private respondent, Simeon Policarpio Shipyard and
Shipbuilding Corporation, on October 14, 1981, more than twelve years after the
rendition of the afore-stated Supreme Court judgment.15 Hence, res judicata is not
applicable as regards OCT-R-165 because there is no identity of the subject matter.
Petitioner makes much issue of the fact that private respondent has failed to
redeem the foreclosed property covered by OCT-R-165 from Landbank and hence,
not being the owner of the property in question, private respondents complaint for
damages states no cause of action.
This contention deserves scant consideration. Rule 3, Section 2 of the 1997 Rules of
Civil Procedure requires that every action must be prosecuted and defended in the
name of the real party in interest. This means that the action must be brought by
the person who, by substantive law, possesses the right sought to be enforced and
not necessarily the person who will ultimately benefit from the recovery.
Private respondent SPSSC does not dispute that the parcel of land covered by OCT
R-165 has been mortgaged to the Landbank of the Philippines to secure a loan in
the sum of Four Million Five Hundred Twenty Nine Thousand Pesos (P4,529,000.00)
on April 30, 1982. The property was foreclosed as early as April 27, 1987 as
evidenced by a certificate of sale issued by the ex-officio sheriff of Malabon. The
certificate of sale was inscribed in the Register of Deeds on September 21, 1987,
giving private respondent one year to redeem it. However, private respondent failed
to redeem the said property within the one year redemption period. Nevertheless,
despite
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15 Rollo, p. 447.
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VOL. 320, DECEMBER 15, 1999
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Philippine Trust Company vs. Court of Appeals
failure of private respondent to redeem the property within the one year period
following its foreclosure, the bank has deferred consolidation of title and has given
private respondent the option to re-acquire the property subject to certain terms
under negotiation. A certification issued by the bank dated October 18, 1994 reads:
This is to certify that a certain property located in Navotas, Rizal owned by Simeon
Policarpio Shipyard and Building Corporation and covered by OCT-R-165 was
foreclosed by the bank per certificate of sale dated April 29, 1994. The said
corporation, represented by Atty. Lumen Policarpio, was given the option to re-
acquire the property under the terms presently being negotiated with Landbank.
Although the one year period of redemption had expired on September 21, 1988,
this bank has deferred the consolidation of title in view of the report that said
property is fully submerged in water.16
Since private respondent was in possession of the aforesaid parcel of land when the
writ of possession was improperly implemented by the sheriff, it is not correct
therefore to say that private respondent does not have a cause of action, simply
because it was no longer the owner of the property in question when the writ of
possession was implemented. It is elementary that a lawful possessor of a thing has
the right to institute an action should he be disturbed in its enjoyment. Verily,
Article 539 of the Civil Code states that
Every possessor has a right to be respected in his possession; and should he be
disturbed therein, he shall be restored to said possession by the means established
by the laws and rules of court. x x x
The phrase every possessor in the article indicates that all kinds of possession,
from that of the owner to that of a mere holder, except that which constitutes a
crime, should be respected and protected by the means established and the
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16 Records, p. 181.
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SUPREME COURT REPORTS ANNOTATED
Philippine Trust Company vs. Court of Appeals
laws of procedure.17 Consequently, private respondent having been in lawful
possession of the property covered by OCT-R-165 at the time the writ of possession
was implemented, may institute an action for having been disturbed in its
enjoyment.
WHEREFORE, the decision rendered by the Court of Appeals, in C.A. G.R. SP No.
39342, dismissing the instant petition for certiorari filed by Philippine Trust
Company is AFFIRMED in toto.
SO ORDERED.
Davide, Jr., (C.J., Chairman), Puno and Kapunan, JJ., concur.
Pardo, J., No part due to relation to a party.
Judgment affirmed in toto.
Notes.By real interest is meant a present substantial interest, as distinguished
from a mere expectancy or a future, contingent, subordinate, or consequential
interest. (De Leon vs. Court of Appeals, 277 SCRA 478 [1997])
One whose interest over land is a mere expectancy is not a real party in interest.
(Fortich vs. Corona, 289 SCRA 624 [1998])
o0o
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Copyright 2017 Central Book Supply, Inc. All rights reserved. Philippine Trust
Company vs. Court of Appeals, 320 SCRA 719, G.R. No. 124658 December 15, 1999