LANDRITO v. CA (2005) Garcia, J.

Petition for Review on Certiorari Facts:

Spouses Landrito initially obtained a P350,000 loan from respondent Carmencita San Diego. As security for this loan, a deed of Real Estate Mortgage was executed over a parcel of land located at Bayanan, Muntinlupa, Rizal. After making substantial payments, petitioners obtained an additional P1,000,000 loan from Carmencita. An amendment of REM was made to cover this loan; they stipulated that the loan shall be paid within 6 months and if not paid within this period, the mortgagee shall have the right to declare the mortgage due and may foreclose the same judicially or extrajudicially, in accordance with law. Sps. Landrito defaulted on their obligation. San Diego sent a final demand letter, stating that the obligation was currently P1,950,000. When she was still not paid, she extrajudicially foreclosed on the mortgage. Notices were sent and posted in several conspicuous places by the Sheriff. Despite this, the sps. Landrito did not participate in the foreclosure proceedings; San Diego was the highest bidder at P2M.

The Sheriffs Certificate of Sale was registered on 29 October 1993. Sps. Landrito failed to redeem the property within 1 year. They instead filed a complaint for annulment of the extrajudicial foreclosure and auction sale with damages. They alleged that the redemption price should only be P1M, and that the redemption period was extended to them by Benjamin San Diego until 11 Nov 1994, as per a handwritten note. The respondents filed an MTD, which the RTC granted. CA affirmed. Hence this case. Issue and held: WON the petitioners are barred by laches? YES. Ratio: The records indubitably show that at the time of the foreclosure sale on 11 August 1993, petitioners were already in default in their loan obligation to respondent Carmencita San Diego. The rule has been, and still is, that in real estate mortgage, when the principal obligation is not paid when due, the mortgagee has the right to foreclose on the mortgage and to have the mortgaged property seized and sold with the view of applying the proceeds thereof to the payment of the obligation. Here, the validity of the extrajudicial foreclosure on 11 August 1993 was virtually confirmed by the trial court when it dismissed petitioners complaint, and rightly so, what with the fact that petitioners failed to exercise their right of redemption within the 1-year period therefor counted from the registration of the sheriffs certificate of sale.

Petitioners have not offered any valid excuse whythey failed to attend the proceedings and there voiced out what they are now claiming. Truly, laches has worked against them. The law on redemption of mortgaged property is clear1. The one-year redemption period should be counted not from the date of foreclosure sale, but from the time the certificate of sale is registered with the Register of Deeds. Here, it is not disputed that the sheriffs certificate of sale was registered on 29 October 1993. Under Article 13 of the New Civil Code, a year is understood to have three hundred sixty-five (365) days each. Thus, excluding the first day and counting from 30 October 1993 (under paragraph 3 of Article 13 of the New Civil Code), and bearing in mind that 1994 was a leap year, petitioners had only until 29 October 1994, the 365th day after registration of the sheriffs certificate of sale on 29 October 1993, within which to redeem the foreclosed property in accordance with law. And since 29 October 1994 fell on a Saturday, petitioners had until the following working day, 31 October 1994, within which to exercise their right of redemption.

Act No. 3135, Sec. 6. In all cases in which an extrajudicial sale is made under the special power hereinbefore referred to, the debtor, his successors in interest or any judicial creditor or judgment creditor of said debtor, or any person having a lien on the property subsequent to the mortgage or deed of trust under which the property is sold, may redeem the same at any time within the term of one year from and after the date of the sale; xxx"

It must be remembered that the period of redemption is not a prescriptive period but a condition precedent provided by law to restrict the right of the person exercising redemption. Correspondingly, if a person exercising the right of redemption has offered to redeem the property within the period fixed, he is considered to have complied with the condition precedent prescribed by law and may thereafter bring an action to enforce redemption. If, on the other hand, the period is allowed to lapse before the right of redemption is exercised, then the action to enforce redemption will not prosper, even if the action is brought within the ordinary prescriptive period. Moreover, the period within which to redeem the property sold at a sheriffs sale is not suspended by the institution of an action to annul the foreclosure sale. It is clear, then, that petitioners have lost any right or interest over the subject property primarily because of their failure to redeem the same in the manner and within the period prescribed by law.

ZAMORA v. VILLANUEVA (2008) (Per Curiam) Administrative Matter in the SC for Gross Misconduct Facts:

Atty. Zamora was the counsel for the plaintiff in a civil case. The RTC in that case granted his motion for the issuance of a writ of execution. He then informed the Villanueva, who was a sheriff, that the defendant in the civil case had real property in Nasugbu, Batangas and requested him to prepare the required Notice of Levy on the property. Villanueva demanded from him P10,000 allegedly to defray the expenses for the execution proceedings. He agreed and initially gave P5,000 as advance payment and the balance was to be paid upon the transfer of the property in the name of his client. Villanueva and one of Zamoras staff members proceeded to Nasugbu to annotate the notice of levy on the propertys title. Later, Villanueva refused to proceed with the execution sale unless and until he was paid the remaining P5,000. Zamora gave him the balance, but before the sale, Villanueva demanded an additional 5% of the bid price before proceeding, and, when Zamora did not pay, Villanueva refused to proceed with the sale or accept the bid of Zamoras client.

Zamora wrote him a letter reminding him of the irregularity of his acts. Villanueva still did not perform his duty. Hence this admin complaint. Issues and Held:

1. WON Villanueva observed Sec. 9, Rule 141 ROC2 relative to the expenses of the execution
2. Ratio: sale? NO. WON Villanueva prematurely adjourned the execution sale contrary to Sec. 22, Rule 39 ROC? YES.

SEC. 9. Sheriffs and other persons serving processes. x x x (l) For money collected by him by order, execution, attachment, or any other process, judicial or extrajudicial, the following sums, to wit; 1. On the first four thousand (P4,000.00) pesos, four (4%) per centum. 2. On all sums in excess of four thousand (P4,000.00) pesos, two (2%) per centum. In addition to the fees hereinabove fixed, the party requesting the process of any court, preliminary, incidental, or final, shall pay the sheriffs expenses in serving or executing the process, or safeguarding the property levied upon, attached or seized, including kilometrage for each kilometer of travel, guards fees, warehousing and similar charges, in an amount estimated by the sheriff, subject to the approval of the court. Upon approval of said estimated expenses, the interested party shall deposit such amount with the clerk of court and ex officio sheriff, who shall disburse the same to the deputy sheriff assigned to effect the process, subject to liquidation within the same period for rendering a return on the process. Any unspent amount shall be refunded to the party making the deposit. A full report shall be submitted by the deputy sheriff assigned with his return, and the sheriffs expenses shall be taxed as costs against the judgment debtor.

1. A sheriff is guilty of violating the Rules if he fails to observe the following: (1) prepare an
estimate of expenses to be incurred in executing the writ, for which he must seek the court's approval; (2) render an accounting; and (3) issue an official receipt for the total amount he received from the judgment debtor. The rule requires the sheriff executing writs or processes to estimate the expenses to be incurred. Upon the approval of the estimated expenses, the interested party has to deposit the amount with the Clerk of Court and ex-officio Sheriff. The expenses shall then be disbursed to the executing Sheriff subject to his liquidation within the same period for rendering a return on the process or writ. Any unspent amount shall be refunded to the party who made the deposit. There was no evidence showing that respondent submitted to the court, for its approval, the estimated expenses for the execution of the writ before he demanded P10,000 from complainant. Neither was it shown that he rendered an accounting and liquidated the said amount to the court. Any act deviating from these procedures laid down by the Rules is misconduct that warrants disciplinary action. As regards respondents refusal to proceed with the execution sale, allegedly due to the parties refusal to pay the sales commission, nowhere in the Rules can it be inferred that payment of any such commission is a pre-requisite to an execution sale. Respondents refusal to conduct the execution sale was baseless and illegal.

2. A sheriff has no blanket authority to adjourn the sale. It is only upon written consent of the
judgment obligor and obligee, or their duly authorized representatives, that the sheriff may adjourn the sale to a date and time agreed upon. The sheriff may adjourn it from day to day when there is no such agreement but only if it becomes necessary to do so for lack of time to complete the sale on the day fixed in the notice or the day to which it was adjourned. Consequently, respondents act of unilaterally adjourning the execution sale is irregular and contrary to the Rules.