View full case

HUERTA ALBA RESORT v. CA

FACTS:

The case involves a foreclosure proceeding on four parcels of land mortgaged by the petitioner. The foreclosure was judicial in nature. The petitioner failed to assert its right to redeem in its pleading and only raised it for the first time in a motion to compel the respondent to accept redemption. The trial court initially denied the respondent's motion for a writ of possession, ruling that the petitioner still had until October 21, 1995, to redeem the properties. The trial court emphasized that the right of redemption is an absolute privilege that cannot be lost even if the assignee of the mortgage debt is not a credit institution. The trial court ordered the reconveyance of the titles to the petitioner and directed the register of deeds to register the certificate of sale and the order confirming the sale. The respondent filed a motion for reconsideration, which was denied by the trial court.

On August 19, 1994, Carmelita Te and her daughter, Rosalinda Cruz, were admitted to the Medical City Hospital. They both underwent laparoscopic cholecystectomy. During the operation, complications arose, and Carmelita Te died. The cause of death was determined to be aspiration pneumonia and adult respiratory distress syndrome. Rosalinda Cruz also suffered complications but survived.

On September 19, 1994, Rosalinda filed a Complaint for Damages against the Hospital, seeking moral damages, actual damages, exemplary damages, and attorney's fees. She alleged that the Hospital negligently performed the operation, resulting in the death of her mother and the suffering of injuries on her part.

The Hospital moved to dismiss the Complaint, arguing that the Complaint failed to state a cause of action since the cause of death was not alleged to be due to the negligence of the Hospital. The trial court denied the motion, prompting the Hospital to file a motion for reconsideration, which was also denied.

Unsatisfied with the denial of the motion for reconsideration, the Hospital appealed to the Court of Appeals. However, the appellate court dismissed the case without prejudice for failure to attach copies of the required pleadings and documents.

The Hospital then filed a Petition for Review with the Supreme Court, insisting that the trial court committed grave abuse of discretion in denying its motion to dismiss and motion for reconsideration.

ISSUES:

  1. Whether the petitioner has the right of redemption under Section 78 of Republic Act No. 337.

  2. Whether the trial court's order recognizing the petitioner's right of redemption under Section 78, R.A. No. 337 has the effect of amending, modifying, or setting aside the decision in Civil Case No. 89-5424.

  3. Whether the petitioner is barred by estoppel from raising the issue of its alleged right of redemption.

  4. Whether the Court of Appeals had resolved 'with finality' the issue of whether petitioner had the right of redemption.

  5. Whether the 20 March 1995 resolution in CA G.R. SP No. 35086 is a final judgment, order, or decree.

  6. Whether petitioner's right of redemption was an issue in CA G.R. SP No. 35086.

  7. Whether the Court of Appeals had jurisdiction to act on the motion for clarification.

  8. Whether the trial court properly resolved the issue of petitioner's right of redemption under Section 78, R.A. No. 337.

    • Whether the petitioner seasonably invoked its right under Section 78 of R.A. No. 337 to redeem subject properties.
    • Whether the petitioner failed to assert a right to redeem in several crucial stages of the proceedings.

  11. Whether or not the petitioner is entitled to invoke its alleged right under Section 78 of R.A. No. 337 at this late stage of the case.

  12. Whether the trial court erred in finding the accused guilty of the crime charged.

  13. Whether there was a valid and legal warrantless arrest of the accused.

RULING:

  1. The Court of Appeals held that the petitioner only has the equity of redemption and not the right of redemption under Section 78 of Republic Act No. 337. The trial court's order recognizing the petitioner's right of redemption does not have the effect of amending, modifying, or setting aside the decision in Civil Case No. 89-5424. The petitioner is not estopped from invoking its right of redemption.

  2. The Court of Appeals did not resolve 'with finality' the issue of whether petitioner had the right of redemption.

  3. The 20 March 1995 resolution in CA G.R. SP No. 35086 is not a final judgment, order, or decree.

  4. Petitioner's right of redemption was not an issue in CA G.R. SP No. 35086.

  5. The Court of Appeals no longer had jurisdiction to act on the motion for clarification.

  6. The trial court properly resolved the issue of petitioner's right of redemption under Section 78, R.A. No. 337.

  7. The Court held that it was too late for the petitioner to invoke a right to redeem under Section 78 of R.A. No. 337. The petitioner failed to assert this right at several crucial stages of the proceedings. The Court also pointed out that the petitioner should have alleged its entitlement to the beneficial provisions of Section 78 of R.A. No. 337 in its answer to the complaint for judicial foreclosure.

  8. The petitioner is not entitled to invoke its alleged right under Section 78 of R.A. No. 337 at this late stage of the case. The failure of the petitioner to seasonably assert its alleged right precludes it from doing so after the decision has become final. The principle of estoppel applies where a party fails to raise a claim in the early stages of the proceedings, and subsequently invoking the claim would reduce the judgment to a mockery and place the administration of justice in disrepute. The trial court erred in still allowing the petitioner to introduce evidence and ruling in its favor. The "law of the case" holds that the petitioner has the equity of redemption without any qualification, meaning it does not have the right of redemption allowed by law. The sale of the subject properties confirmed by the trial court operated to divest the rights of all parties and vest them in the private respondent. As the petitioner failed to exercise its equity of redemption within the prescribed period, redemption cannot be effected, and the confirmation of the sale and issuance of transfer certificates of title to the private respondent is in order. The trial court has the ministerial duty to place the private respondent in possession of the subject properties.

  9. The trial court did not err in finding the accused guilty of the crime charged. The prosecution was able to present sufficient evidence to prove the guilt of the accused beyond reasonable doubt.

  10. There was no valid and legal warrantless arrest of the accused. The arresting officers did not have personal knowledge of any information that would lead them to believe that the accused had committed a crime. Therefore, the arrest violated the constitutional rights of the accused.

PRINCIPLES:

  • The right of redemption under Section 78 of Republic Act No. 337 is not available to the petitioner in this case.

  • The trial court's order recognizing the petitioner's right of redemption does not amend, modify, or set aside the decision in Civil Case No. 89-5424.

  • The petitioner is not estopped from invoking its right of redemption.

  • The right of redemption under Section 78 of R.A. No. 337 is mandatory and automatically exists by law.

  • The courts are duty-bound to recognize the right of redemption.

  • Equitable considerations weigh heavily in favor of the petitioner.

  • The equity of redemption is different from and should not be confused with the right of redemption.

  • The right of redemption in relation to a mortgage exists only in the case of extrajudicial foreclosure.

  • No equivalent right of redemption exists in a judicial foreclosure, except for certain cases.

  • The mortgagor has the equity of redemption, which is the right to extinguish the mortgage and retain ownership of the property by paying the secured debt within a certain period.

  • Section 2, Rule 68 of the Rules of Court provides for the mortgagor's equity of redemption.

  • The mortgagor's equity of redemption may be exercised even after the foreclosure sale but before its confirmation.

  • The right of redemption under Section 78 of R.A. No. 337 must be seasonably invoked.

  • The applicability of Section 78 of R.A. No. 337 hinges on the factual question of whether or not the predecessor in interest of the respondent was a credit institution.

  • A judicial foreclosure sale, when confirmed by an order of the court, operates to divest the rights of all parties to the action and vest their rights in the purchaser, subject to such rights of redemption as may be allowed by law.

  • The prosecution must prove the guilt of the accused beyond reasonable doubt.

  • Warrantless arrests are generally considered illegal and unconstitutional, unless it falls under one of the recognized exceptions.