SPOUSES MARIA AND FERNANDO SAMBAJON, PETITIONERS, VS. HON. JUDGE EDUARDO TUTAAN, PRESIDING JUDGE OF THE COURT OF FIRST INSTANCE OF RIZAL, BRANCH V, QUEZON CITY, AND MERRYLAND DE…

This certiorari case is an incident in the litigation
between Merryland Development Corporation (Merryland for short) and the
spouses, Fernando A. Sambajon (a lawyer and labor arbiter) and Maria N.
Sambajon, over Lot 16, with an area of 729 square meters, located at Santol,
Quezon City and covered by TCT No. 80460 in the names of the said spouses. On that lot, a sixteen-door apartment (now
converted into condominium units) was constructed. The antecedents of the case, which were not recited in an orderly
manner in the pleadings, are as follows:

1.   
To finance the construction of an apartment on their
aforementioned lot, the Sambajon spouses borrowed P160,000 from the Government Service Insurance System
(GSIS). As collateral, they mortgaged
the lot and the apartment to the GSIS.

2.    In
June, 1974 the Sambajon spouses, in order to pay twenty percent of their
arrearages with the GSIS, entered into a transaction with Merryland whereby
they purportedly sold to Merryland the said property for P65,000 and Merryland
assumed their mortgage obligation. (Merryland was not able to register that sale).

3.    On the
theory that the deed of sale with assumption of mortgage was intended to be a
second mortgage, the Sambajon spouses on December 3, 1974 sued Merryland for
the reformation of that document (Civil Case No. Q-19557). That case was assigned to the sala of Judge
Augusto L. Valencia, Branch 31 of the Court of First Instance of Quezon City.

4.    The
extrajudicial foreclosure of the GSIS mortgage was scheduled on February 7,
1975. To stop that foreclosure and to
compel the GSIS to implement the agreement for the conversion of the apartment
into a condominium, the Sambajon spouses on February 5, 1975 sued the GSIS in
the Court of First Instance of Quezon City (Civil Case No. Q-19744). That case was also assigned to Judge
Valencia.

5.   
Notwithstanding the filing of Civil Case No. Q-19744,
the GSIS proceeded with the scheduled foreclosure. The property was sold to it, as the highest bidder, for
P280,560. The certificate of sale was
registered on February 17, 1975. The
Sambajon spouses amended their complaint in Civil Case No. Q-19744 by assailing
the validity of the extrajudicial foreclosure.

6.    On the
basis of the deed of sale with assumption of mort­gage executed by the Sambajon
spouses in favor of Merryland, the latter, over the alleged protest of the Sambajon
spouses, redeemed the property from the GSIS on April 24, 1975 for
P298,558.90. The sheriff issued a
certificate of redemption which was registered on April 29, 1975.

7.    Pursuant
to section 7 of Act No. 3135, Merryland on May 26, 1975 filed in the Court of
First Instance of Quezon City an application for a writ of possession. The Sambajon spouses opposed it. Judge (now Justice) Vicente G. Ericta of
Branch 18 granted it in his order of June 25, 1975 (Case No. Q-647[75], GLRO
Rec. No. 7681). Merryland was placed in
possession of the property on July 3, 1975. The writ of possession was assailed by the Sambajon spouses in the Court
of Appeals. The writ was upheld by that
Court (Sambajon vs. Ericta, CA-G. R. No. SP-04348, January 22, 1976).

8.    On
January 26, 1976, or within the one-year period for redemption, the Sambajon
spouses redeemed the same pro­perty from the sheriff of Quezon City for the sum
of P328,345.20. The sheriff issued to
them a certificate of redemption. It
was duly registered. Two days later, or
on January 28, the Sambajon spouses mortgaged the property for P350,000 to the
spouses, Francia Sambajon and Salvador
Cecilio, their daughter and son-in-law, respectively.

9.   
That redemption triggered in swift succession moves and
counter-moves on the part of Merryland and the Sambajon spouses to determine
who should possess the property and collect the rentals. Thus, on February 2, 1976 Merryland sued in
the Quezon City Court of First Instance the Sambajon spouses, their daughter
and son-in-law, the city sheriff and the city register of deeds. Merryland prayed that the redemption made by
the Sambajon spouses and the mortgage in favor of the Cecilio spouses be
declared void and that the Sambajons and the Cecilios be enjoined from inter­fering
with its administration of the property in question (Civil Case No.
Q-20998). That case was assigned to
Branch 5, the sala of Judge Eduardo C. Tutaan.

10. 
On February 9, 1976 the Sambajon spouses filed a motion
in Judge Tutaan’s sala, praying that Civil Case No. 20998 be transferred to the
sala of Judge Valencia for consolidation with
Civil Cases Nos. Q-19557 and
Q-19744. The Sambajon spouses opposed
Merryland’s motion.

11.  Judge Tutaan in
his order of February 17, 1976 denied the motion for transfer and consolidation. He ruled that the cause of action in Civil
Case No. 20998 is different from the causes of action in the cases pending in
Judge Valencia’s sala.

12.  In another order
dated March 23, 1976 Judge Tutaan directed (a) that, after Merryland had posted
a bond in the sum of P50,000, a writ of preliminary injunction should be issued
to restrain the Sambajon and Cecilio spouses from disturbing Merryland’s
possession of the property and to enjoin the register of deeds from recording
any transaction relative thereto and (b) that Merryland should deposit in court
all the rentals collected from January 26, 1976.

13.  The Sambajon
spouses in their answer of February 27, 1976 in Civil Case No. 20998 alleged
that Merryland invalidly re­deemed the property from the GSIS and fraudulently
obtained pos­session thereof and, once in possession, cannibalized the condomi­nium
apartment and that Merryland instituted the action in order to continue its
possession of the property.

14.  The Sambajon
spouses did not remain passive. Instead
of litigating the issue of possession in Judge Tutaan’s sala, they filed on
February 23, 1976 in Judge Valencia’s sala in Civil Case No. Q-19744 (Sambajon
vs. GSIS, where Merryland is not a party) an ex parte motion for a writ
of possession.

15. 
On March 25, 1976 Judge Valencia issued an order of
possession. Pursuant to that order, the
branch clerk of court issued a writ of possession dated March 31, 1976,
commanding the deputy sheriffs of Branch 31 to place the Sambajon spouses in
possession of the property.

16.  According to the
Sambajon spouses, that writ was im­plemented on April 3, 1976, but, according
to Merryland, it was forcibly enforced on May 14-16, 1976, not by the sheriff
but by two armed sergeants of the Philippine Constabulary. So, Merryland was divested of the possession
of the property. The Sambajon
spouses obtained possession and have retained it up to this time.

17.  On April 5, 1976
Merryland in a certiorari proceeding in the Court of Appeals assailed
Judge Valencia’s order granting the possession of the property to the Sambajon
spouses. On April 7, 1976 the Court of
Appeals issued a preliminary injunction requiring Judge Valencia to desist from
implementing his order of March 25, 1976 (CA-G. R. No. SP-05262).

18.  On the other hand,
the Sambajon spouses filed in this Court on April 26, 1976 their own certiorari
petition wherein they challenged Judge Tutaan’s orders, denying their motion
for transfer and consolidation and enjoining them from interfering with
Merryland’s possession of the property.

19. After Merryland
had submitted its comment and after the Sambajon spouses had filed their reply,
this Court, in the resolution of the Second Division dated June 30, 1976, dismissed
the petition so as “to avoid any unnecessary delay” in the
disposition of Civil Case No. Q-20998 and, at the same time, directed the lower
court to allow the Sambajon spouses to remain in possession of the
property. Said resolution reads:

“L-43652 (Spouses Maria and Fernando Sambajon vs. Hon. Judge
Eduardo Tutaan, etc., et al.). – After
deliberating on (1) the petition, (2) private respon­dents’ comments,
supplementary comments and final supplement to comments, and (3) petitioners’
reply, the Court RESOLVED to DISMISS the petition in order to avoid any
unnecessary delay in the resolution by the lower court in Civil Case No.
Q-20998, “Merryland Development Corporation vs. Vitaliano Valdellon, et
al.”, of the principal question at issue between the Sambajon spouses and
Merryland Development Cor­poration, which is whether the Sambajon spouses
validly redeemed their mortgaged property by paying to the Sheriff of Quezon
City the sum of P328,345.20 or whether the redemption price should be
P536,134.00, as con­tended by the said corporation, a question that should be resolved (in case no amicable settlement
could be effected during the pre-trial) after hearing and in the light of
section 30, Rule 39 of the Rules of Court and the pleadings and evidence of the
parties.

“However, respondent Presiding Judge of Branch V of the Quezon
City CFI is directed to maintain the status quo with respect to the possession
and the rentals of the mortgaged property and not to enforce his order of March
23, 1976 (enjoining the Sambajon spouses and their daughter Francia from
interfering with the corporation’s possession of the mortgaged property and
enjoining the Register of Deeds from registering any tran­saction concerning
the property) since that order is in apparent conflict with the order dated
March 25, 1976 of Hon. Judge Augusto L. Valencia of Branch 31 of the same Court
in Civil Case No. 19744, directing that the Sambajon spouses be placed in
possession of the mortgaged property, an order that was implemented by the
Sheriff thus rendering moot the said order of respondent Judge. (Justice Barredo did not take part. Justice Concepcion Jr. is on leave. Justices
Muñoz Palma and Martin were designated to sit in the Second Division)”

20. Two weeks later or on July 15, 1976 the
Court of Appeals rendered a decision setting aside Judge Valencia’s order awarding
possession of the property to the Sambajon spouses. That Court noted that the Sambajon spouses
sought the writ of possession in Civil Case No. Q-19744 so that Merryland could
not oppose it. (Merryland Development
Corporation vs. Valencia, CA-G. R. No. SP-05262). The petition in this Court of the Sambajon spouses for an
extension of time within which to seek a review of the decision was denied
because it was filed out of time (L-45119, Sambajon vs. Court of Appeals).

21. On July 19, 1976 Merryland filed in this
Court a motion for the reconsideration of the second part of the aforequoted
resolu­tion of June 30 on the grounds that it is incompatible with the dis­missal
of the petition and that the status quo to be maintained is Merryland’s
possession, especially considering that the Court of Appeals nullified the
order of possession issued by Judge Valencia in favor of the Sambajon spouses.

In resume, the situation here is that the Sambajon spouses
mortgaged their property to the GSIS. Then, they sold it to Merryland. They sued Merryland in order to declare the sale an equitable mortgage
(Civil Case No. Q-19557). They sued
also the GSIS in order to require it to transform their apartment into a
condominium and, later, to invalidate the foreclosure (Civil Case No. Q-19744).

The GSIS foreclosed the mortgage on February 7, 1975. It bought the property at the auction
sale. Merryland redeemed the property
from the GSIS. It obtained possession
of the property by means of a writ
of possession. The Sambajon spouses
redeemed the property from the sheriff over Merryland’s opposition and mort­gaged
it to their daughter and son-in-law, the Cecilios.

Then, Merryland sued the Sambajons and the Cecilios in order to
annul the redemption made by the Sambajons (Civil Case No. Q-20998). The Sambajons were able to wrest possession
of the property from Merryland by means
of a writ of possession issued in Civil Case No. 19744. The Court of Appeals voided that writ of
possession.

In Civil Case No. 20998 the court ordered the Sambajons not to
disturb Merryland’s possession of the property and denied the Sambajon’s motion to consolidate that case with
the two prior cases. Those orders are
under review in this certiorari case.

Which of the two redemptions should prevail, that made by
Merryland or that made by the Sambajons? The ultimate issue is who should be adjudged the owner of the property.

A preliminary issue is whether the merits of the petition could
still be reexamined although the parties have not questioned the dismissal
thereof and although Merryland has sought reconsi­deration only of the addendum
or qualification engrafted on the said dismissal.

A casual perusal of the said resolution of dismissal shows that
the first paragraph thereof, dealing with the dismissal, and the second paragraph, dealing with the
maintenance of the status quo as to the possession, are intimately connected.

The petition could have been given due course. But to do so would entail delay in the
adjudication of the case. On the other
hand, when the petition was filed, the Sambajon spouses, the re­gistered owners
of the property, had allegedly obtained possession of the property.

It was assumed in that dismissal resolution that the trial court
could have expeditiously dispatched the case and resolved easily the question
of possession once the propriety of the redemp­tion made by the Sambajon
spouses was passed upon. That expecta­tion
turned out to be illusory.

The parties have extensively discussed the merits of the case in
their pleadings. The issue as to who
should have posses­sion of the property during the pendency of the three cases
is the core of the petition. The other
issue is what branch of the lower court should try the three cases.

To do justice in this case, it is necessary to consider anew the
merits of the petition. Hence, the
aforequoted resolution of June 30, 1976 is hereby set aside.

Considering the decisive supervening fact that the Court of
Appeals nullified Judge Valencia’s order awarding possession to the Sambajon spouses,
and, therefore, their contention that they should possess the property pendente
lite has no leg to stand on and considering the equally decisive fact
that, as a result of the redemption made by Merryland, it secured a writ of
possession which was eventually upheld by the Court of Appeals:

The Court resolved that, in the present posture of the three
cases and in the orderly administration of justice, there is no alter­native
but to restore the possession of the property to Merryland. However, it should deposit in court rentals
to be received by it.

Common sense and convenience dictate that the three related cases
should be tried jointly by one Judge. For this purpose, the Executive Judge of the lower court is directed to
raffle the three cases to one branch but excluding Branches 5 and 31 in the
raffle.

WHEREFORE, the order of Judge Tutaan dated February 17,
1976, denying the motion of the Sambajon spouses for transfer and
consolidation, is set aside.

The Executive Judge of the Court of First Instance of Quezon City
is ordered to raffle Civil Cases Nos. Q-19557, Q-19744 and Q-20998 to any of
its branches but excluding Branches 5 and 31. The branch to which the case is raffled should expedite trial of the
said cases.

The order of injunction of Judge Tutaan dated March 23, 1976 is
affirmed with the clarification that the rentals to be deposited in court by
Merryland are those collected by it from the time it is restored to the
possession of the property and that after Merryland has posted the bond of P50,000,
the writ of preli­minary mandatory injunction should be issued and the Sambajon
spouses should relinquish the possession of the property to Merryland. No costs.

SO ORDERED.

Fernando, Teehankee, Makasiar, Antonio, Muñoz Palma,
Concepcion, Jr., and Martin, JJ., concur.

Castro, C.J., and
Barredo, J., no part.