UBP vs CA (CREDIT TRANSACTIONS-mortgage)

 

Union Bank of the Philippines vs CA 

GR No. 134068

June 25, 2001

DOCTRINE: The one-year period is actually to be reckoned from the date of the registration of the sale. The one-year period to redeem the property foreclosed is not suspended by the institution of an action to annul the foreclosure sale 

FACTS: 

On March 2, 1990, respondents-spouses Gonzalo and Trinidad Vincoy mortgaged their residence in favor of petitioner to secure the payment of a loan to Delco Industries (Phils.), Incorporated in the amount of Two Million Pesos (P2,000,000.00). For failure of the respondents to pay the loan at its date of maturity, petitioner extrajudicially foreclosured the mortgage and scheduled the foreclosure sale on April 10, 1991. The petitioner submitted the highest bid at the foreclosure sale. Prior to the expiration of the redemption period on May 8, 1992, the respondents filed a complaint for annulment of mortgage with the lower court. In their complaint, respondents alleged that the subject property mortgaged to petitioner had in fact been constituted as a family home RTC rendered judgment declaring the constitution of the family home void and the mortgage executed in favor of the petitioner valid. Court of Appeals upheld the validity of the mortgage executed over the said property in favor of the petitioner. 

ISSUE: 

Whether or not the filing of action for annulment of the mortgage tolled the running of the oneyear period of redemption 

HELD: 

No It cannot also be argued that the action for annulment of the mortgage filed by the respondents tolled the running of the one-year period of redemption. In the case of Sumerariz v. Development Bank of the Philippines, petitioners therein contended that the one-year period to redeem the property foreclosed by respondent was suspended by the institution of an action to annul the foreclosure sale filed three (3) days before the expiration of the period. To this we ruled that: "We have not found, however, any statute or decision in support of this pretense. Moreover, up to now plaintiffs have not exercised the right of redemption. Indeed, although they have intimated their wish to redeem the property in question, they have not deposited the amount necessary therefor. It may not be amiss to note that, unlike Section 30 of Rule 39 of the Rules of Court, which permits the extension of the period of redemption of mortgaged properties, Section 3 of Commonwealth Act No. 459, in relation to Section 9 of Republic Act No. 85, which governs the redemption of property mortgaged to the Bank does no contain a similar provision. Again this question has been definitely settled by the previous case declaring that plaintiff's right of redemption has already been extinguished in view of their failure to exercise it within the statutory period." Also, in the more recent case of Vaca v. Court of Appeals, we declared that the pendency of an action questioning the validity of a mortgage cannot bar the issuance of the writ of possession after title to the property has been consolidated in the mortgagee. The implication is clear: the period of redemption is not interrupted by the filing of an action assailing the validity of the mortgage, so that at the expiration thereof, the mortgagee who acquires the property at the foreclosure sale can proceed to have the title consolidated in his name and a writ of possession issued in his favor.