THE GOVERNMENT OP THE PHILIPPINE ISLANDS, PLAINTIFF AND APPELLEE, VS. CANDELARIO DE LAS CAJIGAS, DEFENDANT AND APPELLANT. JOSE CATOT, PURCHASER AND APPELLEE.

This action was brought by the Government of the Philippine Islands for the purpose of foreclosing a mortgage on real property located in the City of Manila, which mortgage was executed, with the approval of the court, by Candelario de las Cajigas, in his capacity as administrator of the estate of his deceased wife, Dolores G. Azaola de Cajigas, for the purpose of securing the repayment of P15,000  advanced in the form  of a loan by the Philippine  Postal Savings Bank.  In the course  of the proceedings judgment was entered directing that the amount of the mortgage debt should be paid into court within the period of ninety days, as prescribed by law, in default of which it was ordered that the mortgaged  property should be sold for the satisfaction of the debt, with other  dispositions appropriate to the case. The debt was not paid, and after a delay of some two years resulting from the indulgence of the creditor, the property was exposed to sale and was purchased by Jose Catot, for the sum  of about P16,375.  The  confirmation of this sale was opposed by Candelario de las  Cajigas, but the sale was, nevertheless confirmed, and Cajigas appealed.  It should be stated that Jose Rodriguez Serra was at first named as a defendant, in the character of administrator  of the testate estate of his wife, Encarnaciqn Serra, who  held a subordinate lien on the personal interest of  Candelario de las Cajigas; but this lien having  been satisfied by  Jose  de las Cajigas,  son of the defendant Candelario  de las Cajigas, the court granted a motion asking that the estate of Encarnacion Serra be excluded as a defendant.   In the  same motion it was requested  that Jose de las Cajigas, as successor to the right of Encarnacion Serra, should be included as a defendant but notwithstanding the granting of said motion by the court  no answer was required  from Jose de las Cajigas, and  he  was thereafter  ignored.  Also  it should be noted that in  the course of the proceedings the Philippine  Trust  Company was admitted as  a  defendant, and answer was interposed by this entity in the character of successor to Candelario de  las Cajigas, administrator, upon it being made to appear that the latter had  been removed from the office of administrator by the court having charge of the administration and  that the Philippine Trust Company had been appointed as  successor to the office of said administrator.

When the cause came on to trial on its merits, Candelario de las Cajigas did not appear to make any defense, and the Philippine Trust Company admitted the material allegations of the complaint.  It was only after the foreclosure had reached the stage when the sale was about to be confirmed that Candelario de las Cajigas appeared  and opposed the confirmation on the grounds hereinafter mentioned.  We may add that it is  not entirely clear that the appellant Candelario de las Cajigas really has any interest in the subject matter of this  lawsuit which would entitle him to maintain this appeal; because he has been supplanted as administrator, and the personal interest which he had in the property  has been alienated by him.   But ignoring this point, and assuming that he has an interest in the property subject to this foreclosure which would entitle him to be heard, we are of the opinion that none of the technical grounds upon which he seeks to defeat the proceeding are well taken.

The first assignment of error raises the question whether the foreclosure  proceeding was  conducted  against all of the indispensable parties,  and  particularly  it is insisted that the heirs of  Dolores  G. Azaola de Cajigas should have been impleaded.  It will be noted, however,  that the property in question is  covered by a Torrens title, and the mortgage  was executed by the administrator, with the approval of  the court, after the death of Dolores G. Azaola de  Cajigas, the  original owner.   Under section 89 of the Land Registration Act  (No.  496)  real estate  registered under  the Torrens system  passes upon the death of the owner to  the executor  or administrator of the deceased, whether such owner dies testate or intestate.   There can be, therefore, no question as to the validity of the mortgage, and inasmuch as the legal title was vested in the administrator when the mortgage was executed, such administrator was the  only indispensable party  defendant in the foreclosure proceeding.   The  interest of the heirs of the original  owner  was derivative  and contingent,  and for the purposes of foreclosure they were  represented by the administrator who was the true party in interest; and even supposing that the heirs might have been  proper parties in interest within the meaning of section 255 of the Code of Civil  Procedure,  a valid  foreclosure could be effected although they were not impleaded.  As  was pointed out in Sun Life Assurance Co. of Canada vs. Gonzalez Diez (52 Phil., 271), the effect of the failure to make a subordinate lien-holder a party to a  foreclosure proceeding is, not that the foreclosure is void as between the parties to the proceeding,  but that the foreclosure is ineffective as against such subordinate lien-holder, with the consequence that there remains in him an unforeclosed  equity of redemption.   The same reasoning  holds with respect to Jose  de las Cajigas in his character as transferee of the subordinate lien originally vested in Encarnacion  Serra.   The  failure to implead him formally as a party,  in lieu of the administrator of Encarnacion Serra, when the transfer was made known to the court, did not invalidate  the foreclosure, but at most might have left in him a right of redemption, upon the existence of which right it is  not necessary here to pass an opinion.  While the subordinate lien-holder is a proper party defendant in order to  make a decree  of foreclosure completely binding on all interests, he is not an absolutely indispensable party  in  the foreclosure proceeding.

The second assignment of  error directs attention to the fact  that the appellant  Candelario de las Cajigas was not notified of the motion which was presented by the plaintiff in order to procure the execution of the judgment of foreclosure.  Upon this point it  appears that after the judgment of foreclosure had been entered  the mortgage creditor indulged the debtor with a long period of delay, amounting to some two years, without asking  for execution  of the judgment.   During this period payments were made from time to time  on the mortgage debt  to keep down the  interest, but  in the end the debtor defaulted and  the creditor applied to the court for an order of sale. It is insisted that the sale could not  be  effected without notification to the debtor party of the motion for the execution of the judgment.  This view  is, in our  opinion, untenable.  The judgment of foreclosure had become final, and the motion asking for execution was a motion which in its  very nature was  grantable as  of  course;  and the failure to give notice of  the motion is no ground for nullifying the sale.

In the third assignment of error it is contended that the sale was invalid  because, in the published  advertisement announcing the sale, the indebtedness  constituting a lien  upon the property was overstated by about P5,000. We find,  however, that  the  debt was advertised in the amount fixed  by the court in its judgment as the  amount of the mortgage debt, with  interest.  This amount  had, however,  been reduced by payments made  by the judgment debtor to the  amount, approximately, which was bid for the property at the sale.   Upon these facts we are of the opinion that the error in stating the amount of the debt in the notice of sale does not affect the validity of the  mortgage. A mortgage debtor has a right to satisfy the indebtedness or any part of it, at  any time, and it would be  dangerous doctrine to make the efficacy of the foreclosure sale depend upon the precise correctness of the statement of the amount of the mortgage debt.  Under the provisions relating to the foreclosure of mortgages contained in our present Code of Civil Procedure,  no upset price is fixed, and every person desirous of purchasing  at a  foreclosure  sale knows that the property will be sold for  the highest amount which is bid for it at the sale, regardless of the amount of the indebtedness fixed  in the judgment.  No person having a  bona fide desire to purchase the mortgaged property would be in the least concerned over the  amount of the indebtedness. It results that the error in the overstatement of the indebtedness could not materially  affect the rights of anybody concerned  in the sale.

Finally, it is contended that the sale should be set aside for the manifest injustice involved in the fact that the property was sold for much less than it was  worth.  But the property was assessed at less than P20,000 and at the foreclosure  sale  brought more  than P16,000,  and we see nothing in these figures that would justify interfering with the effects of the sale.  Nor would the court be justified  in non-confirming the sale on this  ground even if  the value  of the property were as much as P40,000, as suggested in the brief of the appellant.

In the course of the appellant’s brief other considerations are advanced in  aid of the contention that the sale was invalid.  The contentions thus  made appear to us  to  be overrefined  and  to have no substantial merit.  We are therefore of the opinion that the  sale was valid and that the trial  court committed  no error in confirming it.

The judgment  will therefore be affirmed, and it is  so ordered, with costs against the appellant.

Avanceña, C. J., Johnson, Malcolm, Villamor, Johns, Romualdez, and Villa-Real, JJ., concur.