NHMFC v. TAROBAL

NATIONAL HOME MORTGAGE FINANCE CORPORATION, petitioner vs. FLORITA C. TAROBAL, respondent.

G.R. No. 206345

January 23, 2017

Facts:

On May 15, 1990, Joy Dela Cruz obtained a housing loan from China Banking Corporation. She executed a Loan and Mortgage Agreement covering her house and lot to secure the loan in favor of the bank. The bank assigned the loan of Dela Cruz to petitioner, National Home Mortgage Finance Corporation.

Petitioner filed to foreclose the mortgage account of Dela Cruz since the latter failed to pay her monthly amortization and arrearages.  She also failed to redeem the property within the one-year period of redemption from the date of the registration of the sale. Thus, petitioner filed for an issuance of a writ of possession on the subject property.

Respondent Florita C. Taroba, who is a transferee of mortgagor Dela Cruz, then filed a motion for reconsideration.  She alleged that she bought the subject property in May 2005, took immediate control of property and made the same their family home. Respondent claimed that she was neither notified of the public auction nor was a party to the foreclosure proceedings in violation of her right to due process.

On March 17, 2011, a Contract to sell covering the subject property was executed between petitioner and Gilda J. Torres, the buyer in the Housing Fair Program of petitioner. The RTC issued a Writ of Possession the next day ordering the deputy sheriff to place petitioner in physical possession of the subject property.

On April 6, 2011, respondent, filed a Petition for Certiorari before the CA. She contended that there was grave abuse of discretion on the part of the RTC when it issued the writ of possession without resolving first her motion for reconsideration in violation of her right to due process.

The CA in its decision denied the petition for certiorari, the Writ of Possession and the Notice to Vacate are affirmed. However, petitioner is ordered to give priority to petitioner Flora C. Tarobal to re-acquire to subject property.

Issue:

Whether or not the CA committed a reversible error in ordering petitioner to give priority to respondent to reacquire the foreclosed property.

Held:

Yes. The affirmance of the CA of the issuance of the aforesaid orders by the RTC in favor of petitioner would become meaningless, since a possible reacquisition of the subject property by respondent would prejudice the buyer in petitioner's Housing Fair Program for whose benefit the petition was filed. The priority given to respondent who reneged in the payment of her loan to petitioner will affect the vested right of the new buyer.

Lastly, the SC noted the manifestation of petitioner that respondent had the chance to settle her account with petitioner in 2005 but failed to file any application to reacquire the subject property. The respondent did not tender any amount as reservation while the subject property had not been sold to the public yet. Nor did she exercise her right to redeem the subject property during the period of redemption.

Wherefore, the decision of the Court Appeals insofar as it ordered petitioner to give priority to respondent to reacquire the subject property are hereby reversed and set aside.