G.R. No. 101083 , July 30, 1993
METROPOLITAN BANK AND TRUST COMPANY, Petitioner, vs. HON. COURT OF APPEALS AND SPOUSES FORTUNATO AND VIRGINIA VENERACION, Respondents.

FACTS

Spouses Fortunato and Virginia Veneracion obtained a loan from Metropolitan Bank and Trust Company (Metrobank) secured by a real estate mortgage over their property. Due to alleged defaults, Metrobank initiated extrajudicial foreclosure proceedings. The property was sold at a public auction where Metrobank was the highest bidder. A certificate of sale was issued and registered. Before the expiration of the one-year redemption period, the Veneracions filed a complaint for annulment of the foreclosure sale and damages against Metrobank, alleging irregularities in the foreclosure proceedings. The trial court issued a writ of preliminary injunction enjoining Metrobank from consolidating its ownership over the property. After trial, the court dismissed the Veneracions’ complaint and lifted the injunction. The Veneracions appealed to the Court of Appeals. During the pendency of the appeal and *after the redemption period had expired*, Metrobank filed a motion for the issuance of a writ of possession with the trial court, which the court granted. The Veneracions challenged this order before the Court of Appeals via a petition for certiorari. The Court of Appeals annulled the trial court’s order granting the writ of possession, ruling that the trial court lost jurisdiction to issue the writ because the case was already pending on appeal. Metrobank filed the present petition.

ISSUE

Whether the trial court, after dismissing the complaint for annulment of foreclosure sale and during the pendency of the plaintiff’s appeal, retains jurisdiction to grant a writ of possession in favor of the purchaser in the extrajudicial foreclosure sale.

RULING

YES. The Supreme Court granted Metrobank’s petition and reversed the decision of the Court of Appeals. The Court held that the trial court retained jurisdiction to issue the writ of possession despite the pending appeal. The Court explained that an order granting a writ of possession in an extrajudicial foreclosure sale is a ministerial duty of the trial court once the redemption period has expired without the mortgagor exercising the right of redemption. This ministerial duty is based on Act No. 3135 , as amended. The appeal filed by the Veneracions from the judgment dismissing their complaint for annulment did not involve the issuance of the writ of possession, as this was a separate and distinct proceeding. The appeal did not suspend the ministerial duty of the court to issue the writ upon proper application by the purchaser. The writ of possession is not a judgment on the merits of the annulment case but an order in an ancillary proceeding to enforce a right conferred by law upon the purchaser. Therefore, the trial court did not lose jurisdiction to act on Metrobank’s motion for a writ of possession. The Court of Appeals erred in annulling the trial court’s order.