[ G.R. No. 141958. March 22, 2000]

SOLID HOMES, INC. vs. STATE FINANCING CENTER, INC., et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated MAR 22 2000.

G.R. No. 141958 (Solid Homes, Inc. vs. State Financing Center, Inc., et al.)

Herein petitioner Solid Homes, Inc. mortgaged its properties, which were covered by TCT Nos. 96333 and 11938 of the Registry of Deeds of Pasig City, to respondent State Financing Center, Inc. (State Financing) to secure the payment of its loans in the total amount of P13,011,082.00. because petitioner defaulted on the loans, State Financing filed a petition for extrajudicial foreclosure of the mortgages with the Provincial Sheriff of Rizal.

No auction sale was held, however, as petitioner and State Financing entered into a "Memorandum of Agreement/Dacion En Pago," whereby, among others, it was agreed that should petitioner be able to pay State Financing 60% of its principal obligation within 180 days from signing of the agreement, the balance of its obligation shall be restructured; otherwise, the document shall automatically operate as an instrument of dacion en pago and petitioner shall transfer the mortgaged properties to State Financing which in turn shall grant petitioner the right to repurchase the properties within ten months from 180 days from the date of signing of the Memorandum.

Petitioner again defaulted on its obligation so that Solid Homes registered the Memorandum with the Register of Deeds of Pasig City and caused the transfer in its name of the titles of the properties.

Petitioner filed an action for annulment of the Memorandum and the consequent reinstatement of the mortgages over the same properties. The complaint was filed with the Regional Trial Court which rendered judgment as follows:

WHEREFORE, this Court hereby renders judgment, as follows:

1. Declaring that the Memorandum of Agreement/Dacion En Pago entered into by and between plaintiff Solid Homes and defendant State Financing on February 28, 1983 is a valid and binding document which does not violate the prohibition against pactum commisorium under Art. 2088 of the Civil Code;

2. Declaring that the said Memorandum of Agreement/Dacion En Pago is a true sale with right of repurchase, and not an equitable mortgage;

3. Declaring that the registration of the said Memorandum of Agreement/Dacion EN Pago with the defendant Register of Deeds in Pasig, Metro manila by defendant State Financing on September 15, 1983 is in accordance with law and the agreement of the parties in the said documents; but the annotation of the said document by the said Register of Deeds on the certificates of title over the properties subject of the Memorandum of Agreement/Dacion En Pago without any mention of the right of repurchase and the period thereof, is improper, and said Register of Deeds' cancellation of the certificates of the title in the name of Solid Homes over the properties referred to and issuance of new titles in lieu thereof in the name of State Financing-during the period of repurchase and without any judicial order-is in violation of Art. 1607 of the Civil Code, which renders said titles null and void;

4. Ordering the defendant State Financing to surrender to the defendant Register of Deeds in Pasig, Metro Manila for the cancellation thereof, all the certificates of title issued in its name over the properties subject to the Memorandum of Agreement/Dacion En Pago, including those titles covering the fully paid condominium units and the substitute collateral submitted in exchange for said condominium units;

5. Ordering the said defendant Register of Deeds to cancel all the titles in the name of State Financing referred to and to reinstate the former titles over the same properties in the name of Solid Homes, with the proper annotation thereon of the Memorandum of Agreement/Dacion En Pago together with the right of repurchase and the period thereof-as provided in said document-and to return the said reinstated former titles (owner's copies) in the name of Solid Homes to State Financing;

6. Ordering the defendant State Financing to release to plaintiff Solid Homes all the certificates of title over the fully paid condominium units in the name of Solid Homes, free from all liens and encumbrances by releasing the mortgage thereon;

7. Granting the plaintiff Solid Homes the opportunity to exercise its right to repurchase the properties subject of the Memorandum of Agreement/Dacion En Pago within thirty (30) days from the finality of this Decision, by paying to defendant State Financing the agreed price of P14,225,178.40 plus all cost of money equivalent to 30% (interest of 14% and penalty of 16% from March 1, 1983) per annum, registration fees, real estate and documentary stamp and other incidental expenses incurred by State Financing I the transfer and registration of its ownership via the Dacion En Pago, as provided in the said document and in pursuance of Articles 1606 and 1616 of the Civil Code; and

8. Ordering the defendant Register of Deeds in Pasig, Metro Manila-should plaintiff Solid Homes fail to exercise the abovementioned right to repurchase within 30 days from the finality of this judgment-to record the consolidation of ownership in State Financing over the properties subject of the Memorandum of Agreement/Dacion En Pago in the Registry of Property, in pursuance of this Order, but excluding therefrom the fully paid condominium units and their corresponding titles to be released by State Financing.

For lack of merit, the respective claims of both parties for damages, attorney's fees, expenses of litigation and costs of suits are hereby denied.

On appeal to the Court of Appeals, the decision was affirmed with the modification that petitioner is ordered to deliver possession of the properties to State Financing. On appeal to this Court, the decision of the RTC was further modified when the Court ordered that the redemption price shall not include the expenses for registration and other costs incurred by State Financing in the issuance of new certificates of title in its name, as this was done without the proper judicial order required under Art. 1607 of the Civil Code. (G.R. No. 117501, Decision of July 8, 1997)

Upon remand of the case to the RTC, both petitioner and State Financing filed motions for issuance of writ of execution. In its motion, State Financing alleged that the decision of the Court, which was promulgated on July 8, 1997, had become final and executory on September 22, 1997 and that the redemption period had expired some 30 days thereafter on October 22, 1997 without petitioner having exercised its option to repurchased the properties. On the other hand, petitioner, contending that the decision should be executed in stages, sought a writ of execution (1) ordering State Financing and the Register of Deeds of Pasig City to comply with the first three stages of the decision before plaintiff exercised its right of redemption; (2) directing the Register of Deeds of Pasig City to formally advise petitioner of the completion by private respondent of the required acts; and (3) declaring the period of redemption to commence from receipt of said notice from the Register of Deeds of Pasig City.

In its order, dated June 9, 1998, the RTC granted State Financing's motion for writs of execution and possession. It declared petitioner's contention "a sly approach to buy more time for obvious reasons" and held that it was not for petitioner "to interpret the decision of the decision of the highest court of the land."

Petitioner assailed the order of the RTC in a petition for certiorari in the Court of Appeals, arguing that the decision of this Court had not become final on September 22, 1997 as stated in the entry of judgment issued by the Court. Nor did the 30-day period to repurchase granted in said decision expire on October 22, 1997, according to petitioner, but only on the thirtieth day from its receipt of a copy of the entry of judgment.

The Court of Appeals denied the petition, holding petitioner's argument to be contrary to Rule 51, �10 of the 1997 Rules of Civil Procedure which provides that "[t]he date when the judgment or final resolution becomes executory shall be deemed as the date of its entry."

Petitioner appealed to this Court, but its appeal, docketed as G.R. No. 139427, was likewise dismissed by the Third Division of this Court for lack of an affidavit of service of a copy on the Court of Appeals. The action of the Court is embodied in its resolution of August 23, 1999.

Petitioner served, although belatedly, a copy of the petition on the Court of Appeals, but the Court, treating petitioner's motion for admission of the affidavit of service as one for reconsideration, denied the same "as no compelling reasons exist nor any substantial argument was raised to warrant a reconsideration" thereof. (Resolution of October 4, 1999)

Petitioner then filed a "Motion to Admit Motion for Reconsideration of Resolution Dated October 4, 1999 with request for Referral to Court En Banc and with Prayer for Suspension of Resolution Dated August 23, 1999 During the Pendency of this Motion." Petitioner argued, among other, that instead of Rule 51, �10 of the 1997 Rules of Civil Procedure providing that "[t]he date when the judgment or final resolution becomes executory shall be deemed as the date of its entry," what should have been applied is Rule 36, �2 of the 1964 Rules of Court providing that "the recording of the judgment or order in the book of entries of judgment shall constitute its entry."

Petitioner also prayed that "should [the Third Division] deem it proper, [G.R. No. 139427] be referred to the WHOLE COURT for resolution En Banc (pursuant [to] SC Circular 2-89, February 07, 1989) considering [that] the issues involved are novel and important. . ."

In the resolution of November 24, 1999, the Third Division denied petitioner's motion for lack of merit and directed that entry of its judgment be made in due course.

On November 12, 1999, the resolution of August 23, 1999 became final and executory and was accordingly recorded in the Book of Entries of Judgment on December 23, 1999. The records were then remanded to the lower court.

The January 7, 2000, petitioner moved that G.R. No. 139427 be referred to the Court en banc, alleging that "this case involves a new question of law, particularly the effect of the new provisions on the computation of date of finality of judgment and date when it becomes final and executory, as provided for in Rule 51, Sections 10 and 11 (1997) amendment) on the right to repurchase under the provisions of Art. 1606 of the Civil Code, accorded petitioner in G.R. No. 117501, promulgated on July 8, 1997."

In its resolution of February 2, 2000, however, the Third Division merely noted petitioner's motion without taking any further action.

Petitioner then filed an "Urgent Ex-Parte Motion to Recall Entry of Judgment and Urgent Motion to Admit Supplement and Plea to Resolve Motion to Enforce Art. VIII, Sec. 1, Constitution, to Prevent Imminent Injustice with Application for Writ of Preliminary Injunction and Restraining Order Ex-Parte." This was ordered expunged from the records of G.R. No. 139427 on February 23, 2000.

Petitioner next filed this instant petition for mandamus and certiorari, docketed as G.R. No. 141958, assailing the above resolutions, dated November 24, 1999 and February 23, 2000, of the Court in G.R. No. 139427. Petitioner argues that G.R. No. 139427 should have been resolved by the Court en banc for the reason that the Third Division, in denying its petition in G.R. No. 139427 failed to settle the "actual controversy" presented by it, apparently, referring to its contention that Rule 51, �10 of the 1997 Rules of Civil Procedure should not have been applied since it impairs its vested right under Article 1606 of the Civil Code to repurchase the properties "within thirty days from the time final judgment was rendered."

The present petition must be dismissed. Petitioner's effort to secure a reconsideration of the ruling of the Third Division in G.R. No. 139427 cannot succeed. The decision of the Third Division is now final. What petitioner does not seem to appreciate is the fact that an act or a decision of a Division of the Court is considered an act or a decision of the Court itself. (Arrow Head Golf Club v. Second Division of the Supreme Court, G.R. NO. 117504, Dec. 15, 1994 (res.); United States v. Limsiongco, 41 Phil. 94 (1920)) Consequently, no appeal from the decision of a Division can be taken to the Court en banc. Neither does certiorari or mandamus lie to set aside a resolution of a Division or compel such Division to perform an act.

WHEREFORE, the petition for certiorari and mandamus is DISMISSED for lack of merit.

Very truly yours,

TOMASITA M. DRIS

Clerk of Court

(Sgd.) LUDICHI YASAY-NUNAG

Asst. Clerk of Court


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