413 Phil. 445
KAPUNAN, J.:
WHEREFORE, judgment is hereby rendered in favor of plaintiff and against defendants, ordering the latter, jointly and severally, to pay the plaintiff the following:FGU filed a motion for partial reconsideration, pointing out that the action was not for a sum of money but for foreclosure of mortgage. It prayed that in accordance with Section 2, Rule 68 of the Rules of Court, "the decision be amended by ordering the sale of the property mortgaged in case defendant should not satisfy the judgment in favor of plaintiff within ninety (90) days from notice of decision."SO ORDERED.[3]
- The amount of P368,785.80 with interest at 12% per annum compounded monthly from May 5, 1982 until the same is fully paid;
- The amount of P22,501.60 with interest at 12% per annum compounded monthly from December 7, 1977 until the same is fully paid;
- P5,000.00 as attorney's fees;
- The costs of suit.
Acting on the partial motion for reconsideration of the Decision rendered by the Court on January 22, 1988 and finding the same to be meritorious, the same is hereby granted.No appeal was taken from the above Order and the same subsequently became final and executory.
Accordingly, the first paragraph and the dispositive portion of said Decision are hereby ordered amended to read as follows:
"This is an action for foreclosure of real estate mortgage filed by plaintiff, FGU Insurance Corporation against Spouses Tomas Mendoza and Linda A. Mendoza, filed way back on June 1, 1982."
"WHEREFORE, judgment is hereby rendered in favor of plaintiff and against the defendants, ordering the latter, jointly and severally, to pay the plaintiff the following: 1. The amount of P368,785.80 with interest at 12% per annum compounded monthly from May 5, 1982 until the same is fully paid; 2. The amount of P22,501.60 with interest at 12% per annum compounded monthly from December 7, 1977 until the same is fully paid; 3. P5,000.00 as attorney's fees; 4. the costs of suit. Should defendants fail to pay said amounts within 90 days from receipt of the Decision dated Jan. 22, 1988, the mortgaged property described in par. 6 of the complaint shall be sold in the manner and under the regulations governing sales of real estate under execution. The proceeds of the sale, after deducting the cost of the sale shall be applied to the judgment and any balance shall be turned over to the defendants or their agent."
SO ORDERED.[4]
WHEREFORE, the motion to intervene filed by the Spouses Gutang is granted and the decision on May 19, 1988 is reconsidered set aside together with all orders subsequent and related thereto.[5]On October 11, 1990, Looyuko et al. filed a motion for intervention, which the RTC granted in its Order dated October 18, 1990.
WHEREFORE, the petition for certiorari, mandamus and prohibition is hereby (1) GRANTED insofar as that portion of the Order of February 9, 1990 is concerned reconsidering and setting aside the money judgment is concerned, which judgment [is] final and executory, and in the process of satisfaction, should be maintained and remains as such; and (2) DISMISSING insofar as that portion of the same Order allowing the private respondents to intervene is concerned.The Court of Appeals ruled that the action before the RTC was not actually an action for foreclosure but one for collection of a sum of money. The court also affirmed the order of the RTC allowing intervention, thus:
SO ORDERED.[6]
The Court, both from the factual, procedural and substantive points, finds that respondent court had just and valid reasons to allow the private respondents to intervene in the case. Had it denied the intervention, the execution in satisfaction of the money judgment against the judgment debtors, would be violative of section 15 of Rule 30, that should be "on all the property, real and personal, x x x of the judgment debtor x x x." when, in the case, the ownership of the parcel of land, covered by TCT 45066 is claimed by private respondents as well as movants-intervenors. Finally, even if it is considered, as petitioner claims, petitioner should have impleaded in its action "all persons having or claiming an interest in the (mortgage) premises subordinate in right to that of the holder of the mortgage, all of whom shal be made defendants in the action" (sec. 1, Rule 68, Rules of Court) and without their inclusion there can be no final determination in the action. Petitioner did not include private respondents as well as movants-intervenors, both of whom hold liens on the same property. Even under this aspect, respondent court should not be faulted for allowing private respondents to intervene, considering its reason that "what (is) sought to be safeguarded (is) x x x the provision of Rule 68 of the Rules of Court." And while the time to intervene, under section 2, of Rule 12, is before or during a trial, x x x, in its discretion x x x", or even on the day when the case is submitted for decision (Falcasantos vs. Falcasantos, L-4627, May 13, 1952), or at any time before the rendition of final judgment (Lichauco vs. C.A., ET AL., L-23642, Mar. 13, 1975), in Director of Lands vs. C.A., et al. (L-45168, Sept. 25, 1979), intervention was permitted pending appeal "in order to avoid injustice" which must have impelled the respondent court to allow the intervention.On August 16, 1991, the Court of Appeals noted a motion for leave to intervene by Schubert Tanunliong.
Be that as it may, insofar as the default judgment dated January 27, 1988, ordering the defendants spouses Mendoza, jointly and severally, to pay petitioner the judgment debt, interest, attorney's fees and costs, and which money judgment was restated in the Order dated may 19, 1988, since that judgment had already become final and executory and in the process of execution, what cropped up in the interim - on the question of whether or not the money judgment can be enforced against the parcel of land covered by TCT 450666, it appearing that petitioner, private respondents and herein movants-intervenors are all having and claiming interest in that property, a question which has no relevance and would not affect the correctness of the money judgment, the respondent court had no reason to reconsider and set aside the judgment which had already become final and executory, can no longer be altered, amended, reconsidered, set aside. Nothing more can be done therewith. The court which rendered it has no more authority to modify or revoke it, except for its execution, otherwise, there would be not end to the litigation. Hence, the money judgment should be maintained and set at rest as and all that remains to be done in connection therewith is to have the same properly executed against the judgment debtors.[7]
"WHEREFORE, in view of all the foregoing, the Petitioners two (2) Motions for reconsideration dated August 30, 1993 and October 27, 1993; and Respondents' Motion for Reconsideration dated November 3, 1993 and the Opposition and Motion to Dismiss dated June 23, 1991, are all DENIED for lack of merit.On March 6, 1995, the court issued another order in both LRC cases, thus:
On the other hand, movant Intervenor's Motion for Leave to Intervene with Opposition dated August 29, 1991 is Granted.
In the meantime, let a notice of hearing be issued setting these cases for hearing in accordance with the provisions of P.D. 1529.
Let copies of the same be furnished the parties in this case, thru their counsels, the Register of Deeds of Mandaluyong, Metro Manila; the Office of the Solicitor General; and Intervenor Schubert Tanunliong, thru his counsel Atty. Nelson Ng."[8]
Accordingly, let the questioned Omnibus Order dated July 19, 1994 stand, and the Branch Clerk of Court is directed to issue the notice of initial hearing in [this] case with notice to the Office of Solicitor General, the Registry of Deed of the City of Mandaluyong, herein respondents and intervenor Ng, pursuant to Section 108 of the Presidential Decree No. 1529.[9]Yet another order was subsequently issued by the RTC in LRC Case No. 4212, the dispositive portion of which reads:
FURTHERMORE, let a copy of this order and the petition be furnished the Solicitor General, Makati, Metro Manila.[10]Antonia Gutang went to the Court of Appeals and questioned, among others, the allowance of the intervention by Tanunliong (CA-G.R. SP No. 36825). In a Decision dated June 30, 1995, the Court of Appeals, through the Special Ninth Division, set aside and declared void the Orders of the Land Registration Court insofar as they allowed the intervention of Tanunliong.
WHEREFORE, the Petition for Certiorari and Prohibition, with Temporary Restraining Order, is hereby GRANTED. The Order of the RTC-Pasig, Branch 152, dated May 14, 1992, in Civi9l Case No. 61209, is SET ASIDE, for being null and void. The RTC-Pasig, Branch 152, is ENJOINED from proceeding with Civil Case No. 61209 and is ORDERED to dismiss said case, for lack of jurisidiction.Tanunliong thus assails the ruling of the Court of Appeals in G.R. No. 108257, maintaining, in essence, that the action for cancellation of title, accounting and issuance of a writ of preliminary injunction is proper.
IT IS SO ORDERED.[12]
Intervention. - A person may, before or during a trial be permitted by the court, in its discretion, to intervene in an action, if he has legal interest in the matter in litigation, or in the success of either of the parties, or an interest against both, or when he is so situated as to be adversely affected by a distribution or other disposition of property in the custody of the court or of an officer thereof. [Underscoring supplied.]None of the grounds underscored above are present to warrant their intervention. Accordingly, we assume for purposes of discussion that the action was indeed for the foreclosure of the mortgage over the subject property.
1. The former rule as to when intervention may be allowed was expressed in Sec. 2, Rule 12 as "before or during a trial," and this ambiguity also gave rise to indecisive doctrines. Thus, inceptively it was held that a motion for leave to intervene may be filed "before or during a trial" even on the day when the case is submitted for decision (Falcasantos vs. Falcasantos, L-4627, May 13, 1952) as long as it will not unduly delay the disposition of the case. The term "trial" was used in its restricted sense, i.e., the period for the introduction for intervention was filed after the case had already been submitted for decision, the denial threof is proper (Vigan Electric Light Co., Inc. vs. Arciaga, L-29207 and L-29222, July 31, 1974). However, it has also been held that intervention may be allowed at any time before the rendition of final judgment (Lichauco vs. CA, et al., L-23842, Mar. 13, 1975). Further, in the exceptional case of Director of Lands vs. CA, et al. (L-45168, Sept. 25, 1979), the Supreme Court permitted intervention in a case pending before it on appeal in order to avoid injustice and in consideration of the number of parties who may be affected by the dispute involving overlapping of numerous land titles.In the present case, the motions for intervention were filed after judgment had already been rendered, indeed when the case was already final and executory. Certainly, intervention can no longer be allowed in a case already terminated by final judgment.[15]
2. The uncertainty in these ruling has been eliminated by the present Sec. 2 of this amended Rule which permits the filing of the motion to intervene at any time before the rendition of the judgment in the case, in line with the doctrine in Lichauco above cited. The justification advanced for this is that before judgment is rendered, the court, for god cause shown, may still allow the introduction of additional evidence and that is still within a liberal interpretation of the period for trial. Also, since no judgment has yet been rendered, the matter subject of the intervention may still be readily resolved and integrated in the judgment disposing of all claims in the case, and would not require an overall reassessment of said claims as would be the case if the judgment had already been rendered.[14]
A decision was already rendered therein and no appeal having been taken therefrom, the judgment in that main case is now final and executory. Intervention is legally possible only "before or during a trial," hence a motion for intervention filed after trial--and, a fortiori, when the case has already been submitted, when judgment has been rendered, or worse, when judgment is already final and executory--should be denied.[18]In exceptional cases, the Court has allowed intervention notwithstanding the rendition of judgment by the trial court. In Director of Lands vs. Court of Appeals,[19] intervention was allowed even when the petition for review of the assailed judgment was already submitted for decision in the Supreme Court. Recently in Mago vs. Court of Appeals,[20] the Court granted intervention despite the case having become final and executory.
Admittedly, petitioners' motion for intervention was filed on 2 August 1988 after the amended order of 30 March 1988 had already become final.It must be noted, however, that in both these cases, the intervenors were indispensable parties.[21] This is not so in the case at bar.xxx
It must be noted however that petitioners were unaware of the proceedings in Civil Case No. Q-52319. Aside from the obvious fact that they were never impleaded, they were also lulled into believing that all was well. After all, there was a previous agreement or "Kasunduan ng Paghahati ng Lote" which private respondent Asis executed in ther favor on 23 May 1980 or before the disputed lot was awarded to Asis by the NHA. In that agreement private respondent voluntarily agreed to divide the awarded lot into two (2)-on-half (1/2) to be retained by him, and the other one-half (1/2) to belong to petitioners. It can be seen from this that private respondent acted in bad faith when he accepted the award erroneously made to him by NHA knowing fully well that a perfected agreement had been forged earlier between him and petitioners. As a matter of record, the NHA even acknowledged its mistake.xxx These matters should have been taken into account by the courts a quo for being of utmost importance in ruling on petitioners' motion for intervention. The permissive tenor of the provision on intervention shows the intention of the Rules to give to the court the full measure of discretion in permitting or disallowing the same. But needless to say, this discretion should be exercised judiciously and only after consideration of all the circumstances obtaining in the case.
But it is apparent that the courts a quo only considered the technicalities of the rules on the intervention and of the petition for relief from judgment. The denial of their motion to intervene arising from the strict application of the rule was an injustice to petitioners whose substantial interest in the subject property cannot be disputed. It must be stressed that the trial court granted private respondent's petition for prohibition with injunction without petitioners being impleaded, in total disregard of their right to be heard, when on the face of the resolution of the Community Relations and Information Office (CRIO) sought to be enjoined, petitioners were the ones directly to be affected. We need not belabor the point that petitioners are indeed indispensable parties with such an interest in the controversy or subject matter that a final adjudication cannot be made in their absence without affecting, nay injuring, such interest.
In Director of Lands v. Court of Appeals where the motions for intervention were filed when the case had already reached this Court, it was declared:It is quite clear and patent that the motions for intervention filed by the movants at this stage of the proceedings where trial had already been concluded x x x and on appeal x x x the same was affirmed by the Court of Appeals and the instant petition for certiorari to review said judgment is already submitted for decision by the Supreme Court, are obviously and manifestly late, beyond the period prescribed under x x x Section 2, Rule 12 of the Rules of Court.In Tahanan Development Corp. v. Court of Appeals this Court allowed intervention almost at the end of the proceedings. Accordingly, there should be no quibbling, much less hesitation or circumvention, on the part of subordinate and inferior courts to abide and conform to the rule enunciated by the Supreme Court.
But Rule 12 of the Rules of Court, like all other Rules therein promulgated, is simply a rule of procedure, the whole purpose and object of which is to make the powers of the Court fully and completely available for justice. The purpose of procedure is not to thwart justice. Its proper aim is to facilitate the application of justice to the rival claims of contending parties. It was created not to hinder and delay but to facilitate and promote the administration of justice. It does not constitute the thing itself which courts are always striving to secure to litigants. It is designed as the means best adopted to obtain that thing. In other words, it is a means to an end.
As we have ruled in Northern Motors, Inc. v. Coquia, (66 SCRA 415, 420):Accordingly, an execution creditor who levies his execution upon property that the judgment debtor has mortgaged to another can sell at most only the equity of redemption belonging to the mortgagor.[26] As it is the equity of redemption that the subordinate lien holders had acquired by the levy on execution and that was sold in the public auction, this equity, not the property itself, was what the purchasers, who incidentally are the subordinate lien holders themselves, bought at the execution sale."To levy upon the mortgagor's incorporeal right or equity of redemption, it was not necessary for the sheriff to have taken physical possession of the mortgaged taxicabs. x x x Levying upon the property itself is distinguishable from levying on the judgment debtor's interest in it (McCullough & Co. v. Taylor, 25 Phil. 110, 115)."Likewise, in the case of Blouse Potenciano v. Mariano, (96 SCRA 463, 469), we ruled:"Quirino's interest in the mortgaged lots is merely an equity of redemption, an intangible or incorporeal right (Sun Life Assurance Co. of Canada v. Gonzales Diez, 52 Phil. 271; Santiago v. Dionisio, 92 Phil. 495; Northern Motors Inc. v. Coquia, 66 SCRA 415).It is, therefore, error on the part of the petitioner to say that since private respondents' lien is only a total of P343,227.40. they cannot be entitled to the equity of redemption because the exercise of such right would require the payment of an amount which cannot be less than P40,000,000.00.
"That interest could be levied upon by means of writ of execution issued by the Manila Court as had been done in the case of property encumbered by a chattel mortgage (Levy Hermanos, Inc. v. Ramirez and Casimiro, 60 Phil. 978, 982; McCullough & Co. v. Taylor, 25 Phil. 110).["]
When herein private respondents prayed for the attachment of the properties to secure their respective claims against Consolidated Mines, Inc., the properties had already been mortgaged to the consortium of twelve banks to secure an obligation of US$62,062,720.66. Thus, like subsequent mortgagees, the respondents' liens on such properties became inferior to that of the banks, which claims in the event of foreclosure proceedings, must first be satisfied. The appellate court, therefore, was correct in holding that in reality, what was attached by the respondents was merely Consolidated Mines' right or equity of redemption. Thus, in the case of Alpha Insurance and Surety Co., Inc. v. Reyes (106 SCRA 274, 278), we ruled:"Deciding the legal question before Us, even if the DBP were just an ordinary first mortgagee without any preferential liens under Republic Act No. 85 or Commonwealth Act 459, the statutes mentioned in the Associated Insurance case relied upon by the trial court, it would be unquestionable that nothing may be done to favor plaintiff-appellant, a mere second mortgage, until after the obligations of the debtors-appellees with the first mortgagee have been fulfilled, satisfied and settled. In law, strictly speaking, what was mortgaged by the Reyeses to Alpha was no more than their equity of redemption.We, therefore, hold that the appellate court did not commit any error in ruling that there was no over-levy on the disputed properties. What was actually attached by respondents was Consolidated Mines' right or equity of redemption, an incorporeal or intangible right, the value of which can neither be quantified nor equated with the actual value of the properties upon which it may be exercised. [Underscoring supplied.]
Section 2, Rule 68 provides that -Such equity of redemption does not constitute a bar to the registration of the property in the name of the mortgagee. Registration may be granted in the name of the mortgagee but subject to the subordinate lien holders' equity of redemption, which should be exercised within ninety (90) days from the date the decision becomes final.[28] This registration is merely a necessary consequence of the execution of the final deed of sale in the foreclosure proceedings. Consequently, there is no merit in Looyuko et al.'s contention that the Manila RTC, which was not acting as a land jurisdiction court, had no authority to order the cancellation of TCT No. 242. For the same reason, neither does the submission of the Gutangs that the foreclosure proceedings was a collateral attack on their TCT deserve any credence.
"x x If upon the trial x x the court shall find the facts set forth in the complaint to be true, it shall ascertain the amount due to the plaintiff upon the mortgage debt or obligation, including interest and costs, and shall render judgment to be paid into court within a period of not less than ninety (90) days from the date of the service of such order, and that in default of such payment the property be sold to realize the mortgage debt and costs."
This is the mortgagor's equity (not right) of redemption which, as above stated, may be exercised by him even beyond the 90-day period "from the date of service of the order," and even after the foreclosure sale itself, provided it be before the order of confirmation of the sale. After such order of confirmation, no redemption can be effected any longer.
It is this same equity of redemption that is conferred by law on the mortgagor's successors-in-interest, or third persons acquiring right over the mortgaged property subsequent, and therefore subordinate to the mortgagee's lien [e.g., by second mortgage or subsequent attachment or judgment]. If these subsequent or junior lien-holders be not joined in the foreclosure action, the judgment in the mortgagor's favor is ineffective as to them, of course. In that case, they retain what is known as the "unforeclosed equity of redemption," and a separate foreclosure proceeding should be brought to require them to redeem from the first mortgagee, or the party acquiring title to the mortgaged property at the foreclosure sale, within 90 days, [the period fixed in Section 2, Rule 68 for the mortgagor himself to redeem], under penalty of losing that prerogative to redeem. x x x. [Underscoring supplied.]