THIRD DIVISION
[G.R. No. 209621. March 12, 2018.]
SPOUSES BENJAMIN AND TEOFILA BAUTISTA, petitioners,vs. LUISA DEL VALLE AND ERNESTO LOPEZ, JR., SHERIFF IV, OFFICE OF THE CLERK OF COURT AND EX-OFFICIO PROVINCIAL SHERIFF, REGIONAL TRIAL COURT, GENERAL SANTOS CITY, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Third Division, issued a Resolution datedMarch 12, 2018, which reads as follows:
"G.R. No. 209621 (Spouses Benjamin and Teofila Bautista v. Luisa Del Valle and Ernesto Lopez, Jr., Sheriff IV, Office of the Clerk of Court and Ex-Officio Provincial Sheriff, Regional Trial Court, General Santos City.) — The Court NOTES respondents' Compliance dated August 30, 2017 with the Resolution of July 10, 2017, informing the Court that a copy of the Notice promulgated on July 10, 2017 was received on August 25, 2017.
This is a petition for review on certiorari filed by the spouses Benjamin and Teofila Bautista (petitioners) seeking to reverse the September 28, 2012 Decision 1 and the August 13, 2013 Resolution 2 of the Court of Appeals (CA) in CA-G.R. CV No. 02053-MIN. In its decision, the CA denied the petitioners' appeal from the November 25, 2008 Decision 3 of the Regional Trial Court of General Santos City, Branch 37 (RTC) which, in turn, dismissed the complaint for declaration of nullity of foreclosure proceedings.
Antecedent Facts
Petitioners obtained a loan in the amount of P630,000.00 from Luisa Del Valle 4(respondent) and mortgaged their land under Lot No. 7032-A covered by Original Certificate of Title No. P-4391 situated at Cagampang St., Public Market Area, Barangay Dadiangas South, General Santos City, as security for the debt. 5 Unfortunately, they failed to settle their obligation. 6
On July 26, 2000, respondent filed before the RTC an application for extrajudicial foreclosure of mortgage. 7
On August 2, 2000, a Notice of Extra-Judicial Foreclosure and a "Notice of Extra-Judicial Sale of Mortgaged Property/ies under Act 3135, as Amended (EJF Case No. 00-235)" were issued stating that a public auction sale would be conducted on September 18, 2000 at 9:00 o'clock in the morning to 4:00 o'clock in the afternoon and in the event that there would only be one bidder, the auction sale would be reset to October 9, 2000. 8 A Certificate of Posting was thereafter issued stating that the notice of auction sale had been posted on the bulletin boards of the General Santos City Hall and Dadiangas South Barangay Hall, where the subject land was located. 9
On October 9, 2000, the public auction sale was finally conducted and the subject land was sold to respondent as the highest bidder. 10 Subsequently, on October 17, 2000, a Certificate of Sale covering the subject land was issued to respondent. 11
Claiming that there were irregularities in the conduct of the foreclosure proceedings, petitioners filed before the RTC a complaint with an application for the issuance of a temporary restraining order (TRO) and writ of preliminary injunction against respondent and Ernesto Lopez, Jr., (Sheriff Lopez) Sheriff IV, Office of the Clerk of Court and Ex-Officio Provincial Sheriff, RTC, General Santos City, alleging, among others, that: the required number of days for posting and publication of the foreclosure notice were not complied with; and the foreclosure notice was never posted at the Dadiangas South Barangay Hall where the subject property was located. 12
On October 26, 2001, the RTC issued a seventy-two (72)-hour TRO enjoining respondent from taking possession of and selling the subject land. 13
On January 9, 2002, respondent filed her Answer arguing that: the foreclosure notice was posted for a period of sixty-eight (68) days from August 2, 2000 until October 9, 2000; and the foreclosure notice was published in Southern Review, a newspaper of general circulation in General Santos City, on August 5 to 11, 12 to 18 and 19 to 25 in 2000. 14
On March 19, 2003, Pre-trial was held whereby both parties agreed that the lone issue is whether the posting and publication requirements of the foreclosure proceedings under Act No. 3135 15 were complied with. 16
During trial, petitioners presented the testimonies of Benjamin and Jocelyn Bautista, Dadiangas South Barangay Secretary Jomel Otero (Otero), and Kagawad Benito T. De Guzman (De Guzman) to support their claim that the foreclosure notice was never posted in the Dadiangas South Barangay Hall. 17 The testimony of De Guzman was used to corroborate Otero's testimony, while Jocelyn's testimony was used to corroborate Benjamin's testimony. 18 Moreover, petitioners also presented a Certification issued by Otero that no foreclosure notice covering the subject land was ever posted in the bulletin board of the Dadiangas South Barangay Hall. 19
For her part, respondent presented the testimony of Atty. Marion Gay Mirabueno (Atty. Mirabueno) of the RTC's Office of the Clerk of Court who testified on the regularity of the foreclosure proceedings based on the records in her custody. 20 Moreover, she also presented the testimony of Rita Joy Yabon to prove the damages that she was claiming from the petitioners. 21
After all the testimonies were completed, the RTC gave respondent fifteen (15) days to file a Formal Offer of Exhibits and Evidence. 22
On August 7, 2008, respondent belatedly filed the formal offer that covered several pieces of documentary evidence, which consisted of the following: (a) Notice of Extra-Judicial Sale which was stamped "Received" by the City Administrator's Office of General Santos City and Office of Barangay Dadiangas South; (b) copies of the Southern Review containing the publication of the foreclosure notice covering the subject land; 23 and (c) Certificate of posting executed by Sheriff Lopez.
The RTC Ruling
In deciding against the petitioners, the RTC explained that, even if respondent's formal offer was to be denied, the records show that the pieces of documentary evidence sought to be offered had been presented, identified and orally offered in open court. 24 It went on to state that truth of the contents of these pieces of documentary evidence had been "judicially admitted" as they had been testified to by the witnesses. 25 Finally, the RTC applied the ruling in Development Bank of the Philippines (DBP) v. Aguirre, et al. (DBP v. Aguirre)26 when it was declared that "[t]he failure to post a notice is not per se a ground for invalidating the sale provided that the notice thereof is duly published in a newspaper of general circulation." 27 The decretal portion of the RTC Decision 28 states:
WHEREFORE, premises considered, and in the interest of substantial justice, complaint is DISMISSED.
There being no showing that the case had been filed by plaintiffs for frivolous and unfounded grounds neither was it intended to harass or besmirch the name and reputation of defendant, claim of defendant for exemplary damages is Denied.
For the same reasons, payments for Attorney's Fees shall be on the individual and separate accounts of the parties.
Litigation fee in the amount of [P]20,000.00 shall be shared equally by plaintiffs and defendant.
SO ORDERED.
Aggrieved, petitioners appealed to the CA arguing that, since respondent belatedly filed her formal offer of evidence, there was an absence of documentary proof that the requirements of posting and publication in the subject extrajudicial foreclosure proceedings have been complied with. 29
The CA Ruling
In its Decision 30 dated September 28, 2012, the CA denied the appeal. It ruled that a belatedly filed formal offer may still be admitted in the exercise of the sound discretion of the trial court. 31 The CA reasoned that there was no showing that the case was unreasonably prolonged or that there was deliberate intent of a party to cause delay in the proceedings resulting to serious and great prejudice to the other party. 32 It also found that Atty. Mirabueno had testified that the Notice of Extrajudicial Sale, which contains an annotation that it was received by the City Administrator's Office of General Santos City and the Office of Barangay Dadiangas South, was existing in the records of the foreclosure proceedings and it was also identified and marked in evidence. 33 Further, the CA found that the petitioners failed to discharge the burden of proving the absence of notice and publication because Otero had testified that he was not yet employed with Dadiangas South Barangay Hall when such notice was supposedly posted, 34 also De Guzman's credibility was questionable because he was unable to recall what transpired between the months of August to September of 2000 and he admitted having no knowledge that notices were being posted on the Barangay's bulletin board. 35 Finally, it concluded that, even if petitioners had successfully proven that no notice of foreclosure was posted in the Barangay's bulletin board, the foreclosure sale would still be valid because the requirement of publication was complied with by respondent. 36
Petitioners filed a motion for reconsideration but it was denied by the CA in its resolution dated August 13, 2013.
Hence, this petition.
Parties' arguments
Petitioners argue that the CA's admission of the belatedly filed formal offer is "highly unreasonable considering the peculiar nature of the case" and that the RTC's liberal application of procedural rules is "highly prejudicial" to them; 37 that they had been deprived of due process because of the lack of publication and posting; 38 and that Otero and De Guzman are not required to have personal knowledge of the facts contained in the Barangay records because they are public officials and custodians of said records. 39
In her Comment, 40 respondent counters that the documents covered in the belated formal offer had been previously offered and made part of the records during the proceedings involving petitioner's application for the issuance of a writ of preliminary injunction; 41 that there was no deliberate or oppressive intention on her part to cause delay and frustrate the ends of justice in belatedly filing the formal offer; 42 and that non-posting of the foreclosure notice does not justify the setting aside of the subject foreclosure sale. 43
In their Reply, 44 petitioners claim that "no evidence support the defenses, claims and contentions" of respondent without offering a clarificatory explanation. 45
Issue
Whether the CA committed a reversible error in affirming the RTC's ruling which upheld the validity of the subject foreclosure sale
The Court's Ruling
The Court rules in favor of respondent and denies the petitioners' petition.
It is a general rule that evidence not formally offered during the trial cannot be used for or against a party litigant. 46 Even the failure to make a formal offer within a considerable period of time shall be deemed a waiver to submit it. 47 This is because it will deny the other parties their right to rebut the evidence not formally offered. 48
However, litigation is not a game of technicalities and the discretion to strictly or liberally apply procedural rules must be exercised in accordance with the tenets of justice and fair play, taking into consideration the circumstances of each case. 49 Accordingly, even evidence not formally offered may still be admitted in evidence as long as the following requisites are met, to wit: (a) the evidence must have been duly identified by testimony duly recorded; and (b) the evidence must have been incorporated in the records of the case. 50
In this case, petitioners did not deny that the documents stated in respondent's formal offer were identified in open court in Atty. Mirabueno's testimony and the same pieces of evidence had been incorporated in the records of the case. They obstinately assert that respondent's belated formal offer should have been denied by the RTC. However, they failed to controvert the exception to the rule that a late formal offer of evidence may still be accepted by the court. Besides, petitioners had been aware of these pieces of documentary evidence because these were adduced before the answer was filed and during the former's application for the issuance of TRO and writ of preliminary injunction. They cannot claim that they were not able to rebut these documents because they had all the opportunity to do so during the trial. Therefore, the CA did not err in upholding the RTC's decision in admitting the pieces of documentary evidence described in respondent's belatedly filed formal offer.
Official acts enjoy the presumption of regularity because of the assumption that the law tells the official what his duties are and that he discharged these duties accordingly. 51 However, this presumption is disputable. 52 It may be overturned by presentation of clear and convincing evidence that the officers were not properly performing their duty or that they were inspired by improper motive. 53 Concomitantly, the burden of proof to overcome the presumption lies on the one contesting the same. 54 Absent any countervailing evidence, the presumption must be upheld. 55 In other words, a presumption becomes conclusive if not rebutted. 56 Also, this presumption stands when no reason exists in the records which places doubts on the regularity of the performance of official duty. 57 Thus, every reasonable intendment will be made in support of the presumption and, in case of doubt as to an officer's act being lawful or unlawful, construction should be in favor of its lawfulness. 58
Here, the presumption that Atty. Mirabueno and Sheriff Lopez performed their official duties regularly was not successfully rebutted by the petitioners. The testimonies of Otero and De Guzman tell short in overcoming the presumption that these court employees conducted the subject foreclosure proceedings in a regular manner. There is no evidence on record that would show that the official issuances of Atty. Mirabueno and Sheriff Lopez relative to the subject foreclosure proceedings are patently defective. 59
By contrast, the acts of Otero and De Guzman cannot be considered as having been regularly performed, Otero testified that he was not yet connected with the Office of Barangay Dadiangas South when the subject foreclosure proceedings were being conducted. Hence, he could not have obtained any personal knowledge of the fact of posting or non-posting of the foreclosure notice on the bulletin board of the Dadiangas South Barangay Hall.
As to De Guzman, his testimony pertaining to the presence or absence of the foreclosure notice on the Barangay Hall's bulletin board deserves no credit. As a Barangay Kagawad, his official duty involves participating in the drafting and enactment of legislations 60 for Barangay Dadiangas South — not monitoring notices and announcements posted in the Barangay Hall's bulletin board. Simply put, De Guzman's duties as Barangay Kagawad bear no connection to his testimony that he never saw the subject foreclosure notice being posed on the Barangay Hall's bulletin board. As such, his testimony cannot rebut testimonies of Atty. Mirabueno and Sheriff Lopez.
As correctly explained by the CA, foreclosure proceedings have in their favor the presumption of regularity and the party who seeks to challenge the proceedings has the burden of evidence to rebut the same. 61 A mortgagor who alleges absence of a requisite in a foreclosure proceeding has the burden of establishing that fact. 62 Regrettably, petitioners failed to present the requisite amount of evidence to rebut this presumption.
At any rate, even if respondent failed to comply with the posting requirement, the Court still upholds the validity of the subject foreclosure sale. The RTC was correct in applying DBP v. Aguirre, 63 which stated "failure to post a notice is not per se a ground for invalidating the sale provided that the notice thereof is duly published in a newspaper of general circulation." Foreclosure is but a necessary consequence of non-payment of mortgage indebtedness. 64 Consequently, in a real estate mortgage, when the principal obligation is not paid when due, the mortgagee has the right to foreclose the mortgage and to have the property seized and sold with the view of applying the proceeds to the payment of the obligation. 65
WHEREFORE, the petition is DENIED. The September 28, 2012 Decision and the August 13, 2013 Resolution of the Court of Appeals in CA-G.R. CV NO. 02053-MIN are AFFIRMEDin toto.
No pronouncement as to costs.
SO ORDERED."
Very truly yours,
(SGD.) WILFREDO V. LAPITANDivision Clerk of Court
Footnotes
1.Rollo, pp. 8-21; penned by Associate Justice Pedro B. Corales with Associate Justices Romulo V. Borja and Ma. Luisa C. Quijano-Padilla, concurring.
2.Id. at 118-122.
3.Id. at 58-63; penned by Presiding Judge Panambulan M. Mimbisa.
4. Died on March 24, 2005 and substituted by her heirs: Veronica Yabon-Delicano, Rosario Yabon-Velasco, Romeo Yabon, Angelita Yabon-Panlaque, Carmelita Yabon-Villaluna and Johnny Yabon.
5.Rollo, p. 9.
6.Id.
7.Id.
8.Id.
9.Id.
10.Id.
11.Id.
12.Id. at 10.
13.Id.
14.Id.
15. An Act to Regulate the Sale of Property under Special Powers Inserted In or Annexed to Real-Estate Mortgages (March 6, 1924).
16.Rollo, p. 10.
17.Id. at 11.
18.Id.
19.Id.
20.Id.
21.Id.
22.Id.
23.Id. at 11-12.
24.Id. at 61.
25.Id.
26. 417 Phil. 235, 239 (2001).
27. Rollo, p. 62.
28. Id. at 58-63.
29. Id. at 13.
30. Id. at 8-21.
31. Id. at 14-15.
32. Id. at 15-16; citing Benares v. Lim, 540 Phil. 120, 128 (2006), citations omitted.
33. Id. at 16-17.
34. Id. at 17-19.
35. Id. at 19.
36. Id. at 19-20.
37. Id. at 50.
38. Id.
39. Id. at 51.
40. Id. at 149-153.
41. Id. at 150.
42. Id.
43. Id. at 152.
44. Id. at 209-211.
45. Id. at 210.
46. Republic v. Gimenez, et al., 776 Phil. 233, 255-257 (2016), citations omitted; see also Star Two (SPV-AMC), Inc. v. Ko, et al., 661 Phil. 716, 720 (2011).
47. Heirs of Pedro Pasag, et al. v. Spouses Parocha, et al., 550 Phil. 571, 579 (2007).
48. Spouses Ong v. Court of Appeals, et al., 361 Phil. 338, 352 (1999), citations omitted.
49. Peñoso v. Dona, 549 Phil. 39, 45 (2007), citations omitted.
50. Sabay v. People, 744 Phil. 760, 771 (2014), citations omitted.
51. Reyes, Jr. v. Belisario, et al., 612 Phil. 936, 960 (2009), citations omitted.
52. Sevilla v. Cardenas, 529 Phil. 419, 433 (2006).
53. People v. Pasion, et al., 752 Phil. 359, 370-371 (2015), citations omitted.
54. Destreza v. Atty. Riñoza-Plazo, et al., 619 Phil. 775, 784 (2009), citations omitted.
55. Ceballos v. Intestate Estate of the late Emigdio Mercado, et al., 474 Phil. 363, 377 (2004), citations omitted.
56. People v. De Guzman, 299 Phil. 849, 854 (1994).
57. People v. Mendoza, 736 Phil. 749, 770 (2014).
58. Bustillo, et al. v. People, 634 Phil. 547, 556 (2010), citations omitted.
59. Cf. Spouses Madrigal v. Court of Appeals, et al., 377 Phil. 345, 353 (1999), citations omitted.
60. See Section 48, Chapter III, Title II, Book I of Republic Act No. 7160, as amended.
61. Bank of the Philippine Islands v. Spouses Castro, 750 Phil. 780, 786 (2015), citations omitted.
62. Century Savings Bank v. Spouses Samonte, 648 Phil. 479, 489 (2010), citations omitted.
63. Supra note 26.
64. Tamonte, et al. v. Hongkong and Shanghai Banking Corporation, Ltd., et al., 671 Phil. 377, 385 (2011), citations omitted.
65. Philippine National Bank v. Castalloy Technology Corporation, et al., 684 Phil. 438, 446 (2012), citations omitted.