G.R. No. L-7198. October 30, 1954

This is an appeal from an order denying relief from judgment under
Rule 38. It appears that on February 6, 1950, an action for foreclosure
was filed in the Court of First Instance of Tacloban, Leyte, by
Paciencia G. Piczon and her husband Filomeno Piczon against an unknown
defendant described in the complaint as “John Doe as Representative of
the Estate of Policarpio Ampatin, deceased, “it being alleged in the
complaint that on or about November 6, 1940, the said Policarpio
Ampatin executed a mortgage on his land, identified as Lots Nos. 4240
and 4353 of the Tacloban Cadastre, in favor of plaintiff Paciencia G.
Piczon as security for a debt of P400 (later increased to P460),
payable in 2 years with 12 per cent interests; that Policarpio Ampatin
was killed during the Japanese occupation and left no known heirs or
relatives; that up to the date of the complaint the mortgage debt had
remained unpaid; and that the deceased had left no other indebtedness.
On the strength of the allegations that the deceased Policarpio Ampatin
left no known heirs or relatives, the court ordered service of summons
to be made by publication with designation of the day for appearance
and answer, and when after said publication no one appeared and made
answer for the defendant, the court declared the defendant in default,
heard plaintiff’s evidence and, under date of March 18, 1950, rendered
judgment foreclosing the mortgage and directing the sale of the
mortgaged property after 90 days. Following the usual procedure the
property was sold by the sheriff at public auction and it was bought by
Lino L. Anover who, upon the sale being registered, received from the
Register of Deeds Transfer Certificate of Title No. T-766.

On February 9, 1952, the said Lino Anover obtained a writ of
possession from the court, and in compliance with the writ the sheriff
on the 17th of that month ordered the occupants of the land, among
them the herein appellant Magno Lapuz, to vacate the premises and
immediately put
Anover in material possession thereof.

Five days later, that is, on February 22, 1952, Magno Lapuz filed in
the same case a verified “petition for relief from judgment” with
supporting affidavit of merit, alleging that he had never been notified
of the whole proceeding and that his failure to appear therein was due
to plaintiff’s fraudulent and deceitful misrepresentation by making it
appear that John Doe, an unknown person, was the representative of the
estate of the deceased when plaintiff well knew that since 1949 he was
the representative in possession of the said estate, having bought it
from the heirs of the deceased and the Philippine National Bank in
1948; that if given a chance he could prove that plaintiff had already
been paid the amount of the mortgage by enjoying the products of the
land for a number of years, and that it was only on February 17, 1952,
that petitioner learned of the foreclosure and sale of the land
to Añover.
The petition was denied by the court on the ground that the same had
been filed out of time and that Añover was a purchaser in good faith.
In a motion for reconsideration the denial was reiterated with the
additional ground that petitioner was not entitled to relief because he
was not a party in the case. It is from this ruling that petitioner has
appealed.

It would appear from Añover petition for a writ of possession
that, before title was transferred to him as purchaser in the foreclosure sale, the land was already covered by Original Certificate
of Title No. 52880. Being registered land, the same was subject to
Section 89 and 63 of the Land Registration Act. Section 89 provides
that such land upon the death of its owner goes to the executor or
administrator of the deceased whether the owner dies intestate or
testate and shall be subject to the same rules of administration as if
the same were personal; while section 63 provides that mortgages of
registered land may be foreclosed in the manner provided in the Code of
Civil procedure, now the Rules of Court. Under the Rules the mortgage
creditor is given the option either to abandon his security and
prosecute his claim as an unsecured creditor or foreclose his mortgage
by ordinary action in court, making the executor or the administrator a
party defendant. If he chooses the latter course the executor or
administrator of the deceased debtor is an indispensable party
defendant (Gov’t of the P. I. vs.
Cajigas, 55 Phil. 667). In the present case, the action for foreclosure
was not brought against the executor or administrator of the deceased
Policarpio Ampatin and it does not even appear that an executor or
administrator has been appointed. And aside from this defect in
procedure there is the further anomally alleged by petitioner-appellant
that “the plaintiffs made John Doe, an unknown person, as
representative of the estate of Policarpio Ampatin (deceased) when
plaintiffs knew very well since 1949 that the petitioner was the
representative of the estate,” which allegation, if proved, would tend
to support the claim that the judgment of foreclosure was obtained
through fraud.

But while there may be cause for an action to set aside the said
judgment, a mere’ petition for relief under Rule 38 would in this case
not be the proper remedy because of the lapse of the period allowed for
that purpose and the fact that petitioner was not in the true sense
made a party in the foreclosure proceeding. In the circumstances, we
have to affirm the order appealed from but without prejudice to the
filing of an independent action to annul the judgment of foreclosure.
Without special pronouncement as to costs. So ordered.

Paras, C. J., Bengzon, Padilla, Moiitemayor, Jugo, Bautista Angelo, Concepcion, and Reyes, J, B. L., JJ., concur.