KOMATSU INDUSTRIES (PHILS.) INC., PETITIONER, VS. COURT OF APPEALS, PHILIPPINE NATIONAL BANK, SANTIAGO LAND DEVELOPMENT CORPORATION AND MAXIMO CONTRERAS, RESPONDENTS.

Before the Court is pleading filed on March 4, 1998 in behalf of
petitioner and denominated as a Motion for Leave to file Incorporated Second
Motion for Reconsideration of the Resolution of September 10, 1997. This resolution does not in the least depart
from or enervate the specific prohibition against second motions for
reconsideration^[1] Which are applicable thereto. Considering however, the increasing practice
by defeated parties of conjuring scenarios which they blame for their debacle
instead of admitting the lack of merit in their cases, the Court is constrained
to once again express its displeasure against such unethical disregard of the
canons for responsible advocacy, with the warning that this insidious pattern
of professional misconduct shall not hereafter be allowed to pass with
impunity.

Indeed, petitioner has gone to the extent of attributing supposed
errors and irregularities in the disposition of this case to both the Court of
Appeals and this Court, with particular allusions amounting to misconduct on
the part of counsel for respondent private corporation and with specific
imputations against retired Justice Teodoro Padilla in connection
therewith. These will hereafter be
discussed in light of the records of this Court and the vigorous disclaimer of
counsel for said private respondent.

Petitioner’s unbridled remonstrations are directed at the fact
that its petition for review on certiorari of the adverse decision of
respondent Court of Appeals^[2]
was denied by this Court for failure to sufficiently show that respondent court
had committed any reversible error in its questioned judgment.^[3]
This was arrived at after due consideration by the Second Division of this
Court of the merits of the challenged decision and the extended resolution of
respondent court denying petitioner’s motion for reconsideration thereof, the
arguments of petitioner in his present petition for review on certiorari, the
joint comment of respondents, the reply of petitioner, and the joint rejoinder
of respondents, as well as the respective annexes of said pleadings. Indeed, the parties had all the opportunity
to expound on and dissect the issues in this case, and in some instances even
the non-issues, through the liberal admission by this Court of such pleadings.

Petitioner then filed a 24-page motion for reconsideration, and
this Court required respondents to comment thereon, after which petitioner’s
reply filed without leave was nonetheless admitted, and to which, on leave
sought and granted, respondents filed a joint rejoinder. All these pleadings, just like those
mentioned in the preceding paragraph, were so extensive, to the point of even
incorporating new and modified issues, as to cover all possible aspects of the
case to subserve the partisan views of the parties. Since no additional and substantial arguments were adduced to
warrant the reconsideration sought, the Court resolved to deny the motion on
January 26, 1998.^[4]

It defies explanation, therefore, why petitioner would still
insist that the parties should further have been allowed to file memoranda, an
obvious ploy to justify a resolution giving due course to its petition, while
simultaneously insinuating that its pleadings were not read. Indeed, petitioner would even dictate how
this Court should have acted on its petition, with the improbable theory that
because the case had progressed to the rejoinder stage, the petition must be
given due course and a decision be rendered thereafter in its favor. This it tries to buttress by the palpably
erroneous submission that since respondent court reversed the decision of the
court a quo, this Court is duty bound to determine the facts
involved. Firstly, this is a deliberate
misstatement of our jurisprudence which merely holds that, in such a case, this
Court may at its option review the factual findings of the Court of Appeals
instead of being bound thereby. Secondly, and worse for petitioner, there is no conflict in the factual
findings of the two lower courts as the Court of Appeals actually adopted the
findings of fact of the trial court.

In its second motion for reconsideration, petitioner now tries a
different tack by lecturing this Court on its theory that the “minute
resolutions” it assails are supposedly in violation of Section 14, Article VIII
of the present Constitution. In
characteristic fashion, it insinuates that such procedure adopted by this Court
is a culpable constitutional violation and can be subject of impeachment
proceedings. Petitioner is, of course,
free to believe and act as it pleases just as this Court may likewise be minded
to take the appropriate sanctions, for which purpose it would do well for all
and sundry to now imbibe the consistent doctrines laid down by this Court.

As early as Novino, et al. vs. Court of Appeals, et al,^[5]
it has been stressed that these “resolutions” are not “decisions” within the
above constitutional requirements; they merely hold that the petition for
review should not be entertained and even ordinary lawyers have all this time
so understood it; and the petition to review the decision of the Court of
Appeals is not a matter of right but of sound judicial discretion, hence there
is no need to fully explain the Court’s denial since, for one thing, the facts
and the law are already mentioned in the Court of Appeals’ decision.

This was reiterated in Que vs. People, et al.,^[6]
and further clarified in Munal vs. Commission on Audit, et al.^[7]
that the constitutional mandate is applicable only in cases “submitted for
decision,” i.e., given due course and after the filing of briefs or memoranda
and/or other pleadings, but not where the petition is refused due course, with
the resolution therefore stating the legal basis thereof. Thus, when the Court, after deliberating on
a petition and subsequent pleadings, decides to deny due course to the petition
and states that the questions raised are factual or there is no reversible
error in the respondent court’s decision, there is sufficient compliance with
the constitutional requirement.^[8]

For, as expounded more in detail in Borromeo vs. Court of
Appeals, et al.:^[9]

The Court reminds all lower courts, lawyers, and litigants that it
disposes of the bulk of its cases by minute resolutions and decrees them as
final and executory, as where a case is patently without merit, where the
issues raised are factual in nature, where the decision appealed from is
supported by substantial evidence and is in accord with the facts of the case
and the applicable laws, where it is clear from the records that the petition
is filed merely to forestall the early execution of judgment and for non-compliance with the rules. The resolution denying due course or
dismissing the petition always gives the legal basis. As emphasized in In Re: Wenceslao Laureta (148 SCRA 382, 417 [1987]), “[T]he Court is not
‘duty bound’ to render signed Decisions all the time. It has ample discretion to formulate Decisions and/or Minute
Resolutions, provided a legal basis is given, depending on its
evaluation of a case” (Italics supplied). This is the only way whereby it can act on all cases filed before it
and, accordingly discharge its constitutional functions. x x x.

x x x

In G.R. No. 76355, Macario Tayamura, et al. v. Intermediate
Appellate Court, et al. (May 21,
1987), the Court clarified the constitutional requirement that a decision must
express clearly and distinctly the facts and law on which it is based as
referring only to decisions. Resolutions disposing of petitions fall under the constitutional
provision which states that, “No petition for review x x x shall be refused due
course x x x without stating the legal basis therefor” (Section 14, Article VIII,
Constitution). When the Court, after
deliberating on a petition and any subsequent pleadings, manifestations,
comments, or motions decides to deny due course to the petition and states that
the questions raised are factual or no reversible error in the respondent
court’s decision is shown or for some other legal basis stated in the
resolution, there is a sufficient compliance with the constitutional
requirement.

The course of action adopted by the Court in disposing of this
case through its two resolutions, after a thorough review of the issues and
arguments of the parties in the plethora of pleadings they have filed, is not
only in accord with but is justified by this firm and realistic doctrinal rule:

x x x The Supreme Court is
not compelled to adopt a definite and stringent rule on how its judgment shall
be framed. It has long been settled
that this Court has discretion to decide whether a “minute resolution” should
be used in lieu of a full-blown decision in any particular case and that a
minute Resolution of dismissal of a Petition for Review on Certiorari constitutes
an adjudication on the merits of the controversy or subject matter of
the Petition. It has been stressed by
the Court that the grant of due course to a Petition for Review is “not a
matter of right, but of sound judicial discretion; and so there is no need to
fully explain the Court’s denial. For
one thing, the facts and law are already mentioned in the Court of Appeals
opinion.” A minute Resolution denying a
Petition for Review of a Decision of the Court of Appeals can only mean that
the Supreme Court agrees with or adopts the findings and conclusions of the
Court of Appeals, in other words that the decision sought to be reviewed and
set aside is correct.^[10]

That this Court was fully justified in handing down its minute
resolution because it “agrees with or adopts the findings and conclusions of
the Court of Appeals” since “the decision sought to be reviewed and set aside
is correct,” is best demonstrated and appreciated by reproducing the salient
pronouncements of respondent court on the real issues actually involved in this
case. The material holdings in its
decision^[11]
of June 28, 1996 are as follows:

“The facts of the case as found by the trial court are as follows:

“Sometime
in 1975, NIDC granted KIPI a direct loan of Eight Million Pesos (P8,000,000.00)
and a Two Million ((P2,000,000.00) guarantee to secure PNB. (Exh. “M” of petitioner and Exh. “22” of
respondent PNB and intervenor SLDC, T.S.N. October 14, 1992 pp. 19-28). As security thereof, a Deed of Real Estate
Mortgage dated April 24, 1975 was executed by Petitioner KIPI in favor of NIDC,
covering, among others, a parcel of land with all its improvements embraced in
and covered by TCT NO. 469737 of the Registry of Deeds of the Province of Rizal
(now Makati, Metro Manila). At the
instance of Respondent PNB and with the conformity of its subsidiary, NIDC, in
order to secure the obligation of Petitioner KIPI under Respondent PNB’s
deferred letter of credit for US$1,564,826.00 in favor of Toyota Tsusho Kaisha
Ltd., Japan, Petitioner KIPI executed an Amendment of Mortgage Deed dated June
21, 1978 covering the same parcel of land and its improvements under TCT No. 469737
on a pari passu basis in favor of Respondent PNB and NIDC. (Exhibit “H”, “H-1” to “H-9”). Upon full payment of Petitioner KIPI’s
account with NIDC and the P2.0 M Credit Line with Respondent PNB, NIDC
executed a Deed of Release and Cancellation of Mortgage^[12]
dated January 7, 1981 releasing the
mortgage on TCT No. 469737 (Exhibit “1”
to “1-4” of Petitioner and Exhibits “7” to “7-D” of Respondent PNB and
Intervenor SLDC). In this Deed of
Release and Cancellation of Mortgage, it is provided among the whereases that
“Whereas, the credit accomodations had been fully paid by the Borrower to the
Philippine National Bank (PNB) and NIDC”. (Exh. “1-5”). By virtue of this
full payment and the execution of the Deed of Release and Cancellation of
Mortgage, NIDC returned the owner’s copy of the TCT No. 469737 of the
petitioner and accordingly the Deed of Release and Cancellation of Mortgage was
registered with the Registry of Deed on January 28, 1981. (Exhibits “E” to “E-5”) (sic) that there
were some accounts chargeable to
Petitioner KIPI on deferred letters of credit opened and established in 1974
and 1975 settled by Respondent PNB with the foreign suppliers in 1978 and 1979
but came to the knowledge of Respondent PNB only in 1981 and 1982 (Exhibits
“21-1” to “21-L”. T.S.N. May 20, 1992
pp. 16-30).

“In a letter to Petitioner KIPI dated
March 31, 1992, Respondent PNB requested for the return of the owner’s copy of
TCT No. 469737 (Exh. “22”). On July 7,
1982 in a letter addressed to Mr. Ricardo C. Silverio, then President of
Petitioner KIPI, Respondent PNB reiterated for the return of the aforesaid TCT
NO. 469737 (Exh. “22-A”) and the said title was returned to Respondent PNB.

“On May 7, 1982, Respondent PNB filed a
“Petition for Correction of Entry and Adverse Claim” with the office of the
Registry of Deeds of Makati, Metro Manila and was able to have the same
annotated at the back of TCT No. 469737 (Exh. “9” joint exhibit of Respondent
PNB and Intervenor SLDC).

“On November 2, 1983, Respondent PNB filed
with the Ex-Officio Sheriff of Makati, Metro Manila a Petition of Sale Under
ACT 1508, as amended by P.D. 385 to extra-judicially foreclose various
properties belonging to Petitioner by virtue of a Chattel Mortgage with Power
of Attorney dated June 21, 1978 (Exhibits “J” to “J-4”).

“On November 25, 1983, Petitioner KIPI
received an undated Notice of Sheriff’s Sale to the effect that the land
covered by TCT No. 469737 would be foreclosed extra-judicially on December 19,
1983 at 9:00 a.m. (Exh. “K” to “K-2”).”

x x x

Simplifying and summing up all the
assigned errors of both appellants Philippine National Bank and Santiago Land
Development Corporation, there are actually three main issues to be resolved in
this appeal, to wit: (1) Whether the
“Deed of Release” dated January 7, 1981 executed by the National Investment and
Development Corporation in favor of appellee Komatsu Industries (Phil.) Inc.
[Exhibit “I”, p. 76 Record – Vol. I; Exhibit “7”, p. 1494 Record – Vol. IV],
had the effect of releasing the real estate mortgage in favor of appellant
Philippine National Bank, as embodied in the “Amendment of Mortgage Deed” dated
June 21, 1978 [Exhibit “H”, p. 64 Record – Vol I; Exhibit “6”, p. 1482
Record – Vol. IV]; (2) Whether the
foreclosure of appellee’s property conducted on May 17, 1984 is valid; (3) Whether
there is legal and/or factual basis for the awards of damages in favor of the
appellee.

Anent the first issue, We rule that the
“Deed of Release” dated January 7, 1981 executed solely by the National Investment
and Development Corporation in favor of the appellee Komatsu Industries (Phil.)
Inc., did not operate to release the real estate mortgage executed in favor of
appellant Philippine National Bank as embodied in the “Amendment of Mortgage
Deed” dated June 21, 1978. Said
“Deed of Release” is not binding upon the appellant Philippine National Bank
which was not a signatory to it and has not ratified the same.

It is axiomatic under Our law on
obligations and contracts that contracts take effect only between the parties,
their assigns and heirs (Art. 1311, New Civil Code). The characteristic of “relativity of contracts” renders it
binding only upon the parties and their successors. [Civil Code of the Philippines, Annotated, Paras, Vol. IV 1994
ed., pp. 550-552]. A contract cannot be
binding upon and cannot be enforced against one who is not a party to it [Civil
Code of the Philippines, Tolentino, Vol. IV 1995 ed., p. 428 citing Lopez vs.
Enriquez, 16 Phil. 336, Ibañez vs. Rodriguez, 47 Phil. 554, etc.] even if he is
aware of such contract and has acted with knowledge thereof [Civil Code of the
Philippines, Tolentino, Vol. IV 1995, p. 428 citing Manila Port Service et
al. vs. Court of Appeals et al. 20 SCRA 1214]. The rights of a party cannot be prejudiced
by the act, declaration, or omission of another, and proceedings against one
cannot affect another, except as expressly provided by law or the Rules of
Court [Civil Code of the Philippines, Tolentino, Vol. IV 1995 ed., p. 428 /
Rule 123 sec. 10 Rules of Court].

We accordingly find no legal basis for the
court’s ruling that the “Deed of Release” dated January 7, 1981, had the effect
of releasing the mortgage in favor of appellant bank despite the fact that it
was executed solely by the National Investment and Development Corporation
without any conformity or authority whatsoever of its joint mortgagee, the
appellant Philippine National Bank. It
is not disputed that PNB is a corporation with a separate and distinct
personality from that of NIDC. The court
a quo erred in holding that PNB recognized the release of the mortgage as
shown by its Exhibit “22” wherein Vice President Ramirez stated in his memo to
the Litigation and Collection Division of the PNB that upon discovery of the
aforecited release of the mortgage, “we immediately wrote NIDC informing them
that KIPI effected the release of PNB’s mortgage using NIDC’s Deed of
Release”. The same memo stated that PNB
requested KIPI to return the title for the reannotation of PNB’s mortgage
“which was erroneously cancelled” (p. 1712, Record). Accordingly, the same exhibit indubitably showed that PNB promptly
objected to the erroneous cancellation of the mortgage in its favor. Moreover, as above pointed out, an agreement
cannot bind one who is not a party even if he had knowledge of the agreement
and had acted on the basis thereof.

Moreover, a reading of the Amendment of Mortgage Deeds executed by
Komatsu, PNB and NIDC, will show that it covered not only the credit
accommodations obtained by Komatsu with NIDC as described in the first whereas clause,
but also another obligation arising from the establishment of a deferred letter
of credit for US$1,564,826.00, and other credit accommodations. We quote from the said Amendment:

“NOW THEREFORE, for and in consideration of the foregoing premises,
the Deed of Mortgage in favor of NIDC referred to in the first ‘Whereas’ clause
hereof shall be as it is hereby amended in the sense that the mortgage shall be
in favor of PNB and NIDC, their successors and assigns on a pari-passu basis to
secure the respective obligations of the Mortgagor to PNB and NIDC as follows:

NIDC      : a) Direct loan of P8,000,000.00

              : b) Guarantee in the amount of P2,000,000.00
issued in favor of PNB to secure the Credit Line of the MORTGAGOR with PNB

PNB       : US $1,564,826.00 or equivalent in Philippine
Currency by way of deferred Letter of Credit issued by PNB in favor of Toyoda
Tsusho Kaisha Ltd., Japan, thru Republic National Bank of New York, N.Y.

plus interest and charges as well as all
other obligations, whether direct or indirect, primary or secondary, as
appearing in the respective Books of Account of NIDC and PNB and other
reasonable expenses and charges arising thereunder, whether such obligations
have been contracted before, during or after date hereof. Subject to condition No. 4 hereinbelow, in
case the MORTGAGOR execute subsequent promissory note or notes either as
renewal of the former note, an extension thereof, as new loan, or is given any
kind of accommodations such as overdraft, letters of credit, acceptance and
bills of exchange, release of import shipments, on trust receipts etc., this
mortgage shall also stand as security for the payment of said promissory notes
or notes and/or accommodations without necessity of executing new contract and
this mortgage shall have the same force and effect as if the said promissory
notes or notes and/or accommodations were existing on the date hereof. However, if the MORTGAGOR shall pay to the
MORTGAGEES, their successors or assigns the obligations secured by this
mortgage, together with interest, costs and other expenses on or before the
date they are due and shall keep and perform all the covenants and agreements
herein contained for the MORTGAGOR then this mortgage shall be null and void,
otherwise, it shall remain in full force and effect.” (pp. 65-66, Record).

It is clear that the
reference to the credit accommodations consisting of P8,000,000.00
direct loan and P2,000,000.00 guarantee mentioned in the third “whereas”
clause of the Deed of Release “as having been fully paid by the borrower” was
to these two obligations obtained from NIDC, and not to the other obligation described
in the Amended Mortgage as pertaining to PNB directly, arising from the
issuance of the deferred letter of credit in the amount of US $1,564,826.00,
the express inclusion of which obligation in the Amended Mortgage cannot be
ignored. It is equally clear that NIDC was
in no position to state that Komatsu’s direct obligation to PNB has been fully
paid. And on the basic proposition
above-stated that the deed of release executed by NIDC cannot bind its joint
mortgagee, which is an entirely different entity, We find that the court a quo
erroneously invoked the 3^rd whereas clause stating that “the credit
accommodations had been fully paid by the Borrower to the Philippine National
Bank (PNB) and NIDC”.

We are thus unable to accept the trial court’s reasoning that the
release executed by NIDC will “necessarily include” the mortgage to PNB. The hypothesis that NIDC being a wholly
owned subsidiary of its joint mortgagee could not have executed the Deed of
Release and Cancellation of Mortgage without the knowledge and consent of
respondent PNB, “its mother company”, has no support in law and
jurisprudence. Neither does the
evidence of record show that any confirmation or ratification of the release of
mortgage was made by the PNB. Nothing
short of an actual payment of the debt or an express release will operate to
discharge a mortgage (55 Am. Jur. 394).

Defendants-appellants also question the trial court’s ruling that
even granting that PNB’s claim is correct that insofar as it is concerned, the
mortgage was not released it being separate entity and the mortgage being on a
pari passu basis, the extrajudicial foreclosure should be to the extent only of
its proportionate credit.

We do not agree that the extrajudicial foreclosure of the mortgage
on the whole Pasong Tamo property is null and void. A mortgage is indivisible in nature, so that payment of a part
of the secured debt does not extinguish the entire mortgage (See Paras,
Civil Code Anno., 1995 ed., Vol. V, p. 1044; Art. 2089, Civil Code). There is also no language in the mortgage
instrument to indicate otherwise, i.e. that the mortgage of the Pasong Tamo
property is divisible, so that in case of the payment of the obligation to one
mortgagee the mortgage would subsist only to the extent of the remaining lien
of the other mortgagee. The mortgage
instrument contemplated not only obligations existing on the date thereof, but
also future obligations or accommodations appearing in the respective Books of
Account of NIDC and PNB, thus rendering it unlikely and impractical for the
parties to have intended a division of the mortgaged property in accordance
with the proportionate credits of the two joint mortgagors.

The case of Central Bank of the Philippines vs. Court of Appeals
(139 SCRA 46) cited by the court a quo is not in point. It refers to a mortgage of one parcel of
land in favor of one mortgagee, where there was a failure of consideration,
i.e., the entire amount of the loan was not released to the mortgagor and the
mortgage was thus held to be enforceable only to the extent of the amount of
the loan that was released. The factual
situation in this case is obviously different. The mortgage here is not being enforced for more than the actual sum
due.

With respect to the court’s pronouncement that the “Petition for
Correction of Entry or Adverse Claim” cannot be made as basis of any
foreclosure proceeding, suffice it to point out that the records bear out
defendants-appellants’ claim that the PNB filed a verified petition for
extrajudicial foreclosure under Act No. 3135 pursuant to the provisions of the
Amendment of Mortgage Deed (Records, pp. 1482 to 1493). The Petition for Sale under Act No. 3135, as
amended, dated October 8, 1983, was made the basis for the issuance of the
Notice of Sheriff’s sale (Exhs. “9” to “9-d”, “9-e” to “9-bbb”, “9-ccc –
Komatsu; Exhs. “10”, “14” to “14-b”, “15”, “17” – PNB,/SLDC). The plaintiff-appellee has not controverted
the veracity of these documents either in the court below or in its Appellee’s
brief. Accordingly, We rule that since
the mortgage in favor of PNB is still subsisting, the sheriff’s sale on the
basis of the petition for extrajudicial foreclosure is valid.

Finally, consistently with Our above ruling relative to the
validity of the foreclosure proceedings and the non-binding effect of the Deed
of Release executed by the National Investment and Development Corporation in
so far as the mortgage in favor of the appellant Philippine National Bank is
concerned. We rule that the appellee
Komatsu Industries (Phil.) Inc. is not entitled to any award of damages
pursuant to the principle of damnum absque injuria, i.e. there might
have been a loss (on the part of the appellee-mortgagor) arising from the
foreclosure but said loss does not create a ground of legal redress. A loss or damage which does not constitute the violation of a legal
right or amount to a legal wrong is damnum absque injuria [Huyong Hian
vs. Court of Appeals, 59 SCRA 134; Gilchrist vs. Cuddy, 29 Phil. 548]. (Italics supplied)

Consequently, respondent court reversed and set aside the judgment
of the trial court in Civil Case NO. 5957 and declared legal and valid the
First Notice of Sheriff’s Sale dated November 12, 1983, the Second Notice of
Sheriff’s Sale dated April 6, 1984, the Extrajudicial Foreclosure Proceedings
held and conducted thereunder, the Certificate of Sale dated May 17, 1984 and
the registration thereof, the Final Deed of Sale, its registration and the
Transfer Certificate of Title issued to respondent Philippine National Bank as
the highest and lone bidder, the Deed of Sale in favor of and the Transfer
Certificate of Title issued to the intervenor Santiago Land Development
Corporation.

Petitioner’s subsequent motion for reconsideration was denied by
respondent court in its resolution^[13]
of January 14, 1997, from which we quote the following pertinent excerpts:

The motion for reconsideration has no merit.

We reiterate our ruling that the “Deed of Release” executed solely
by National Investment and Development Corporation did not operate to release
the real estate mortgage executed in favor of appellant Philippine National
Bank as embodied in the “Amendment of Mortgage Deed”. This issue was fully discussed in our decision and We find no
substantial argument in the motion for reconsideration, the
petitioner-appellee’s memorandum or at the hearing, that would warrant a
reversal of our previous findings.

It is evident that the “Deed of Release” pertains only to the
mortgage executed in favor of the National Investment and Development
Corporation whose credit has been fully paid. Insofar as the mortgage executed in favor of PNB is concerned, the same
subsists as the credit in the amount of $1,564,826.00 remained unpaid. Contrary to appellee’s submission, the “Deed
of Release” executed by the National Investment and Development Corporation is
not an exercise in futility for said document actually released the indebtedness
due to the National Investment and Development Corporation consisting of an
P8,000,000.00 direct loan and P2,000,000.00 guarantee loan.

Petitioner-appellee submits that in the light of Article 2089 of
the Civil Code, the “Amendment of Mortgage Deed” is null and void, and there
was no valid mortgage in favor of PNB. Hence when the “Deed of Release” cancelled the only valid mortgage in
favor of National Investment Development Corporation, there was no more
mortgage left to be foreclosed by Philippine National Bank.

We do not agree.

At the outset, We note that the legality and validity of the
“Amendment of Mortgage Deed” was never put in issue before the trial court nor
was it raised in the appeal proper. “If
well recognized jurisprudence precludes raising an issue only for the first
time on appeal proper, with more reason should such issue be disallowed or disregarded when initially raised only in
a motion for reconsideration of the decision of the appellate court” [Manila
Bay Club Corporation vs. Court of Appeals, 249 SCRA 303].

At any rate, We are not inclined to uphold appellee’s contention
that the “Amendment of Mortgage Deed” (which is the basis of the mortgage in
favor of the PNB) is null and void on the argument that Article 2089 of the Civil
Code “prohibits a situation where two or more creditors, with separate and
distinct credits secured a mortgage over a single property”.

There is nothing in Article 2089 of the Civil Code that prohibits
the mortgagor from mortgaging the same property for a separate and distinct
debt in favor of another creditor. In
this jurisdiction, the mortgagor is allowed to obtain subsequent loans by means
of subsequent and successive mortgages on the same property. We further agree with appellant that “if an
owner-mortgagor can enter into second and further mortgages, there is no law
that prohibits the mortgagor and the mortgagee from agreeing that the mortgages
would be pari-passu.” What is
proscribed by Article 2089 is for a debtor who has mortgaged his property to
secure a debt, to demand that the mortgage be released in proportion to the
amount of the debt he has paid. Under
the said article, the mortgagor has to pay the debt in full before he can ask
for the release of the mortgage. This
is compatible with the principle that a mortgage is indivisible.

Our ruling that the extrajudicial foreclosure of the mortgage on
the whole Pasong Tamo property is valid since the mortgage is indivisible in
nature is not inconsistent with our statement that “the Deed of Released executed
solely by National Investment and Development Corporation did not operate to
release the real estate mortgage executed in favor of appellant Philippine
National Bank”. The fact that the
Deed of Release executed by the National Investment and Development Corporation
did not operate to release the real estate mortgage in favor of appellant
Philippine National Bank, does not render the mortgage divisible. Indeed, foreclosure of the property in its
entirety by Philippine National Bank is necessary because of the indivisible
nature of a mortgage. The fact that
there are two obligations secured by the same mortgaged property does not
render the mortgage divisible. “The
indivisibility of the mortgage or pledge does not affect the divisibility of
the principal obligation. When the same
thing is pledged or mortgaged to several creditors, the indivisibility of the
pledge or mortgage entitled each and every creditor to the same action against
the thing which is liable in its entirety for the individual share of each
creditor.” [Civil Code of the
Philippines, by Tolentino, Vol. V, pp. 538-539, 1992 Ed.].

The rest of the arguments of the appellee in its motion for
reconsideration are mere rehash of what have been raised in its brief and were
already fully considered and discussed in our decision. (Emphasis ours)

In the same manner, we readily found that, despite the lengthy
and repetitious submissions of petitioner in its pleadings filed with this
Court as earlier enumerated, all the arguments therein are also mere rehashed
versions of what it posited before respondent court. We have patiently given petitioner’s postulates the corresponding
thorough and objective review but, on the real and proper issues so
completely and competently discussed and resolved by respondent court,
petitioner’s obvious convolutions of the same arguments are evidently
unavailing. It must be noted that its
recourse to respondent court was by appeal on writ of error, hence the
preceding quotation in extenso of said court’s decision readily shows
how the real issues were correctly particularized and summarized to meet
petitioner’s assignment of errors, and then ably adjudicated on both evidential
and legal grounds.

Petitioner has come to this Court this time on appeal by
certiorari and it must be aware of the elementary rule that, as emphasized in
the decisions previously cited, a review thereunder is not a matter of right
but of sound judicial discretion, and will be granted only when there are
special and important reasons therefor.^[14]
Here, there is no novel question of substance nor has respondent court decided
the case contrary to law or our applicable decisions. On the contrary, it acted with commendable fealty to the same,
and that is the other reason why we extensively reproduced the pertinent
discussions in its challenged decision.

All these notwithstanding, petitioner still comes up with another
supposed issue, this time faulting respondent court for allegedly not resolving
the question of whether or not petitioner is entitled to redeem its foreclosed
property from respondent Philippine National Bank in the event the foreclosure
thereof is held to be valid. We agree
with respondents’ observation that this matter is not proper at this stage of
the case since it was never raised in the complaint or admitted as an issue at
the pre-trial, but was raised only in petitioner’s memorandum before the trial
court.^[15]
Also, respondents point out that the period of redemption had long lapsed since
the sheriff’s certificate of sale was registered on May 17, 1984 and, citing
applicable authorities, the one-year redemption period is not suspended by an
action for nullification of the auction sale.

What is more telling against petitioner’s new proposition,
however, is the documented fact that as early as April 17, 1985, it executed a
Deed of Assignment of Right of Redemption over the property in question in
favor of Atty. Norberto J. Quisumbing.^[16]
In fact, the exercise of such right of redemption by the assignee is involved
in Civil Case No. 105 of the Regional Trial court of Makati, and the side issue
of the right of respondent Santiago Land Development Corporation to intervene
therein was decided by this Court in G.R. NO. 106194. On both substantive and procedural considerations, therefore,
petitioner’s presentation of that so-called issue in the present appellate
stage is an undue imposition on the time of this Court.

We have stated, at the outset, that petitioner’s second motion
for reconsideration could have been correctly rejected outright. But, as further noted, petitioner has
distressingly adopted the lamentable technique contrived by losing litigants of
resorting to ascriptions of supposed irregularities in the courts of justice as
the cause for their defeat. Here,
petitioner speaks of pressure having been employed by respondents against the
trial court. It then proceeds to
insinuate anomalous haste on the part of respondent court in reversing the
trial court, pointing to the supposed short period of time it took the former
to come out with its decision. It never
even bothered to mention that the issues are actually very simple, that the
evidence is basically documentary, and that the questions raised are easily
answered by applying settled doctrines of this Court.

On top of that, it now veers towards this Court, spinning the
yarn that retired Justice Teodoro Padilla first approached the ponente
to whom its petition had been raffled, and asked for a disposition in favor of
respondents as a “birthday and parting gift”; that said ponente declined
and unloaded the case such that it was again raffled to a good friend of
Justice Padilla. The records, however,
show that this case was directly raffled to the Second Division on January 28,
1997 and there was no prior ponente to whom it was assigned who then
supposedly unloaded it; and under the internal rules of this Court, when a case
is unloaded, there is no need for holding a second raffle.

Petitioner could have rendered a signal service to the judiciary
if it had only verified and proved the facts it purveyed but which are now
belied even just by the internal rules of this Court, of which petitioner
appears to be ignorant hence the valor of his denunciation. The members of the Second Division of this
Court vehemently deny and denounce the animadversion on their allegedly having
been approached by Justice Padilla regarding this case. The Padilla Law Office, counsel for
respondent private corporation, has submitted its response to the imputations
against it, thus calling for petitioner to prove its charges. The same burden is also imposed upon
petitioner to prove its charges. The
same burden is also imposed upon petitioner for the aspersions it has cast upon
respondent Court of Appeals. We,
therefore, leave it to the aforesaid law firm, Justice Teodoro Padilla and the
Court of Appeals, on the one hand, and to herein petitioner, on the other, to
decide for themselves whether to further pursue this incident in the proper
proceedings.

On such contingency, this Court will content itself for the nonce
with a stern admonition that petitioner refrain from conduct tending to create
mistrust in our judicial system through innuendos on which no evidence is
offered or indicated to be proffered. Responsible litigants need not be told that only pleadings formulated
with intellectual honesty on facts duly ascertained can subserve the ends of
justice and dignify the cause of the pleader.

WHEREFORE, petitioner’s second motion for reconsideration
is hereby DENIED for lack of merit and EXPUNGED as an unauthorized pleading. This resolution is immediately final and
executory, and no further pleadings or motions will be entertained.

SO ORDERED.

Melo, Puno, Mendoza, and Martinez, JJ., concur.