Section 1. When a sale is made under a special power inserted
in or attached to any real-estate mortgage hereafter made as security
for the payment of money or the fulfillment of any other obligation,
the provisions of the following election shall govern as to the manner
in which the sale and redemption shall be effected, whether or not
provision for the same is made in the power.
Sec. 2. Said sale cannot be made legally outside
of the province in which the property sold is situated; and in case the
place within said province in which the sale is to be made is subject
to stipulation, such sale shall be made in said place or in the
municipal building of the municipality in which the property or part
thereof is situated.
Sec. 3. Notice shall be given by posting notices
of the sale for not less than twenty days in at least three public
places of the municipality or city where the property is situated, and
if such property is worth more than four hundred pesos, such notice
shall also be published once a week for at least three consecutive
weeks in a newspaper of general circulation in the municipality or
city.
Sec. 4. The sale shall be made at public auction,
between the hours or nine in the morning and four in the afternoon; and
shall be under the direction of the sheriff of the province, the
justice or auxiliary justice of the peace of the municipality in which
such sale has to be made, or a notary public of said municipality, who
shall be entitled to collect a fee of five pesos each day of actual
work performed, in addition to his expenses.
Sec. 5. At any sale, the creditor, trustee, or
other persons authorized to act for the creditor, may participate in
the bidding and purchase under the same conditions as any other bidder,
unless the contrary has been expressly provided in the mortgage or
trust deed under which the sale is made.
Sec. 6. In all cases in which an extrajudicial
sale is made under the special power hereinbefore referred to, the
debtor, his successors in interest or any judicial creditor or judgment
creditor of said debtor, or any person having a lien on the property
subsequent to the mortgage or deed of trust under which the property is
sold, may redeem the same at any time within the term of one year from
and after the date of the sale; and such redemption shall be governed
by the provisions of sections four hundred and sixty-four to four
hundred and sixty-six, inclusive, of the Code of Civil Procedure, in so
far as these are not inconsistent with the provisions of this
Act.
Sec. 7. In any sale made under the provisions of
this Act, the purchaser may petition the Court of First Instance of the
province or place where the property or any part thereof is situated,
to give him possession thereof during the redemption period, furnishing
bond in an amount equivalent to the use of the property for a period of
twelve months, to indemnify the debtor in case it be shown that the
sale was made without violating the mortgage or without complying with
the requirements of this Act. Such petition shall be made under oath
and filed in form of an ex parte motion in the registration or
cadastral proceedings if the property is registered, or in special
proceedings in the case of property registered under the Mortgage Law
or under section one hundred and ninety-four of the Administrative
Code, or of any other real property encumbered with a mortgage duly
registered in the office of any register of deeds in accordance with
any existing law, and in each case the clerk of the court shall, upon
the filing of such petition, collect the fees specified in paragraph
eleven of section one hundred and fourteen of Act Numbered Four hundred
and ninety-six, as amended by Act Numbered Twenty-eight hundred and
sixty-six, and the court shall, upon approval of the bond, order that a
writ of possession issue, addressed to the sheriff of the province in
which the property is situated, who shall execute said order
immediately.
Sec. 8. The debtor may, in the proceedings in
which possession was requested, but not later than thirty days after
the purchaser was given possession, petition that the sale be set aside
and the writ of possession cancelled, specifying the damages suffered
by him, because the mortgage was not violated or the sale was not made
in accordance with the provisions hereof, and the court shall take
cognizance of this petition in accordance with the summary procedure
provided for in section one hundred and twelve of Act Numbered Four
hundred and ninety-six; and if it finds the complaint of the debtor
justified, it shall dispose in his favor of all or part of the bond
furnished by the person who obtained possession. Either of the parties
may appeal from the order of the judge in accordance with section
fourteen of Act Numbered Four hundred and ninety-six; but the order of
possession shall continue in effect during the pendency of the appeal.
Sec. 9. When the property is redeemed after the
purchaser has been given possession, the redeemer shall be entitled to
deduct from the price of redemption any rentals that said purchaser may
have collected in case the property or any part thereof was rented; if
the purchaser occupied the property as his own dwelling, it being town
property, or used it gainfully, it being rural property, the redeemer
may deduct from the price the interest of one per centum per month
provided for in section four hundred and sixty-five of the Code of
Civil Procedure.
Sec. 10. This Act shall take effect on its
approval.
Approved: March 6, 1924
|