FRANCISCO MOTORS CORP. v. HON. COURT OF APPEALS AND ANTONIO RAQUIZA G.R. No. 117622-23 October 23, 2006, Velasco, Jr. J.
The cancellation of a notice of pendency terminates the effects of such notice; thus, the buyers of the property cannot be considered transferees pendente lite and purchasers in bad faith.
Facts:
The spouses Alano and Antonio Raquiza entered into a Contract of Legal Retainer wherein it was agreed that Raquiza would be paid his attorney’s fees equivalent to 30% of the properties in litigation. However, Raquiza was dismissed without justifiable cause. Hence, he was allowed to intervene in the civil cases with respect to his claim for attorney’s fees. The trial court ordered the annotation of attorney’s lien in the titles involved in the civil case including the Las Pinas property then in the name of Miguel Campos, but said annotation was later cancelled. A judgment was rendered granting Raquiza his attorney’s fees. Pending appeal of said decision, the Las Piñas property was transferred from Miguel Campos to CPJ Corporation as nominee of the Alano spouses, and later to the Alanos. Despite the fact that the transfer was not yet registered, the Alano spouses mortgaged the property in favor of petitioner FMC. Thereafter, the property was transferred in the name of the Alanos, and subsequently, in the name of petitioner FMC.
The CA modified the lower court’s judgment holding that Raquiza is entitled to 30% pro
indiviso interest in all the properties reconveyed by Campos et al. The Decision became final and
executory and a writ of execution was subsequently issued by the trial court. FMC moved to quash the writ of execution alleging that it is a buyer in good faith. The motion to quash was denied. On reconsideration, the motion was granted and the writ of execution was quashed on the ground that the Las Pinas property was sold by the Alano spouses to FMC long before the CA awarded Raquiza’s attorney’s fees.
Raquiza filed a Motion to Enforce his Motion to Execute which was denied on the ground that the decision sought to be enforced had become final and executory after the lapse of five years.Hence, Raquiza filed a Petition for Certiorari before the Court, which was remanded to the CA. The CA granted the petition stating that FMC was bound to recognize the attorney’s liens, although not inscribed in the title, and held that Raquiza’s petition for certiorari was proper.
Issue:
Whether or not Raquiza can enforce his attorney’s lien against the Las Pinas property bought by FMC in good faith from the Spouses Alano.
Ruling:
No. The annotation of attorney’s lien on TCT No. 56520 was cancelled long before petitioner FMC acquired the property in question. TCT No. 56520 was later cancelled and replaced by TCT No.
61 | P a g e 190712 in the name of CPJ Corporation. A notice of lis pendens was inscribed on TCT No. 190712 by spouses Epifanio J. Alano and Cecilia Alano in view of the pendency of Civil Case No. 4622. On the other hand, respondent Antonio Raquiza did not bother to have his attorney’s lien annotated at the back of TCT NO. 190712, to protect his interests in it. This annotation was cancelled by the Alano spouses. Private respondent did not cause the reannotation of the attorney’s lien and the notice of lis
pendens despite the pendency of the two civil cases. Thus, when petitioner bought the property in
question, the title was free from the attorney’s lien and notice of lis pendens.
The Court held that the filing of a notice of lis pendens in effect (1) keeps the subject matter of the litigation within the power of the court until the entry of the final judgment so as to prevent the defeat of the latter by successive alienations; and (2) binds the purchaser of the land subject of the litigation to the judgment or decree that will be promulgated there on whether such a purchaser is a bona fide purchaser or not; but (3) does not create a non-existent right or lien. The cancellation of a notice of pendency terminates the effects of such notice; thus, the buyers of the property cannot be considered transferees pendente lite and purchasers in bad faith. Petitioner FMC bought the property pending appeal. The title carried no notice of lis pendens and the private respondent did not cause the reannotation of or the attorney’s lien. Thus, petitioner FMC could not be considered a transferee pendente lite and buyer in bad faith.
REDEMPTION
ILIGAN BAY MANUFACTURING CORP., et al. v. HENRY DY G.R. No. 140836 & 140907, June 8, 2007, Velasco, Jr., J.
In cases involving redemption, the law protects the original owner. It is the policy of the law to aid rather than to defeat the owner's right.
Facts:
Iligan Bay Manufacturing Corp. (IBMC) constructed its oil mills on a parcel of land and later IBMC became part of United Coconut Oil Mills (UNICOM). Henry Dy was a supplier providing electrical and construction supplies for the oil mills. IBMC became bankrupt hence its creditors initiated collection suits. UNICOM, as assignee, acquired the right over the loan accounts of IBMC and the mortgage on the land where IBMC's oil mill was located. UNICOM foreclosed the mortgage and acquired the lot. The Provincial Treasurer of Lanao del Norte certified that IBMC/UNICOM was delinquent in paying its taxes, hence it levied the disputed lot and sold it to Dy being the highest bidder. Due to IBMC'S unpaid obligations, Dy filed collection suits and a writ of attachment was issued over the disputed lot. Dy exercised his right of redemption in the tax delinquency sale by tendering a check and asked that a certificate of redemption be issued in his favor but the Provincial Treasurer did not do so. Later, the President of UNICOM redeemed the lot and a certificate of redemption was issued. The Office of the Provincial Treasurer informed UNICOM’s president that there was still an additional redemption price due from UNICOM. Due to UNICOM's failure to pay the total redemption price, Dy requested that a final deed of sale be executed in his favor but was denied. Hence, Dy filed a case for Mandamus with Damages. The RTC found that the refusal of the Provincial Treasurer was proper since UNICOM had redeemed the subject property within the prescribed period. Upon appeal, the CA ruled that the redemption was not valid for failure to pay the total redemption price.
Issue:
62 | P a g e
Ruling:
Yes. Redemption has been defined as "the right of a debtor, and sometimes of a debtor's other creditors, to repurchase from a buyer at a forced sale, property of the debtor that was seized and sold in satisfaction of a judgment or other claim against the debtor, which right is usually limited to forced sale of real property." We have established in jurisprudence that in cases involving redemption, the law protects the original owner. It is the policy of the law to aid rather than to defeat the owner's right. Therefore, "redemption should be looked upon with favor and where no injury will follow, a liberal construction will be given to our redemption laws, specifically on the exercise of the right to redeem."
As provided in Sec. 78 of PD 464, the redemption price should consist of: (1) the total amount of taxes and penalties due up to the date of redemption, (2) the costs of sale, and (3) the interest at the rate of twenty per centum (20%) on the purchase price. We find no error in the CA's finding that there was a deficiency of PhP 13,742.11 in UNICOM's redemption price. However, we find no evidence that UNICOM was notified of this deficiency. The Provincial Treasurer's letters, which were submitted as evidence to prove that there was a deficiency in UNICOM's redemption payment, did not prove that UNICOM received such letters; thus, there was substantial compliance of the requirements of the law.