A Writ of Possession Never Prescribes: Protecting Your Property Rights

Spouses Alfredo and Encarnacion Ching vs. Family Savings Bank, G.R. No. 167835 & G.R. No. 188480 (2010)

Imagine losing your property after years of hard work. What if, decades later, the bank suddenly demands possession? This scenario highlights the crucial issue of property rights after foreclosure. This case clarifies that the right to request a writ of possession doesn’t expire, emphasizing the need for property owners to understand their rights and obligations in foreclosure situations.

Understanding the Writ of Possession

A writ of possession is a court order that directs the sheriff to enter a property and give possession to the person entitled to it, usually the buyer in a foreclosure sale. This is a critical tool for banks and other financial institutions to recover their investments after a borrower defaults on a loan. However, the process can be complex and often leads to legal disputes.

The legal basis for writs of possession is found in Rule 39 of the Rules of Court, specifically Section 33, which discusses the rights of a purchaser after an execution sale. The key principle is that the purchaser’s right to possess the property becomes absolute after the redemption period expires.

“Sec. 33. Deed of sale; statement of sale. If no redemption be made within one (1) year from the date of the registration of the certificate of sale, the purchaser is entitled to a conveyance and confirmation of his title; if redemption be made as provided in this chapter, the effect of the sale is terminated and the proceeds of the sale must be returned to the purchaser…”

For example, if a homeowner fails to pay their mortgage, the bank can foreclose on the property. After the foreclosure sale, if the homeowner doesn’t redeem the property within one year, the bank can obtain a writ of possession to evict the homeowner and take control of the property. This right remains with the bank indefinitely, even if they delay in enforcing it.

The Ching vs. Family Savings Bank Case: A Detailed Breakdown

The case of Spouses Ching vs. Family Savings Bank involves a loan secured by Cheng Ban Yek and Co., Inc., with Alfredo Ching acting as surety. When the company defaulted, the bank sued and obtained a favorable judgment. The conjugal property of the Spouses Ching was then levied upon and sold at public auction.

Decades later, the bank sought to finalize the transfer of title and obtain a writ of possession. The Spouses Ching contested this, arguing that the bank’s right had prescribed. The case then proceeded through the following steps:

• The Regional Trial Court (RTC) granted the bank’s motion for a final deed of conveyance and writ of possession.
• The Spouses Ching appealed to the Court of Appeals (CA), which initially dismissed their petition due to procedural issues.
• Alfredo Ching also filed a separate petition questioning the RTC’s order to cancel the original title.
• The Supreme Court (SC) consolidated the cases to resolve all related issues.

The Supreme Court ultimately ruled in favor of the bank, emphasizing that the right to request a writ of possession never prescribes. The Court cited the case of Paredes v. Court of Appeals, which affirmed this principle. The court also stated:

“Verily, the Bank’s ‘Motion to Retrieve Records, For Issuance of Final Deed of Conveyance, To Order the Register of Deeds of Makati City to Transfer Title and For Writ of Possession’ was merely a consequence of the execution of the summary judgment as the judgment in Civil Case No. 142309 had already been enforced when the lot was levied upon and sold at public auction, with the Bank as the highest bidder.”

Furthermore, the Court noted that the issue of the conjugal nature of the property had already been raised and decided in previous cases, preventing the Spouses Ching from re-litigating the same issue. The SC emphasized the importance of res judicata, which prevents parties from being vexed twice for the same cause.

Practical Implications of the Supreme Court’s Decision

This ruling has significant implications for both lenders and borrowers. For lenders, it reinforces their right to pursue a writ of possession even after a considerable delay. For borrowers, it underscores the importance of understanding the consequences of failing to redeem a foreclosed property.

Businesses should maintain meticulous records of foreclosed properties and actively pursue writs of possession to protect their investments. Property owners facing foreclosure should seek legal advice immediately to understand their redemption rights and explore potential defenses.

Key Lessons:

• The right to request a writ of possession does not prescribe.
• Failure to redeem a foreclosed property within the redemption period can lead to loss of ownership.
• Previous court decisions on the same issue can prevent re-litigation under the principle of res judicata.

Hypothetical Example:

A bank forecloses on a property in 1990. Due to internal administrative issues, they don’t pursue a writ of possession until 2020. Based on this ruling, they can still obtain the writ, even after 30 years, as long as the original judgment and sale were valid.

Frequently Asked Questions (FAQs)

Q: What is a writ of possession?

A: A writ of possession is a court order that directs the sheriff to give possession of a property to the person entitled to it, usually the buyer in a foreclosure sale.

Q: How long do I have to redeem my property after foreclosure?

A: Generally, you have one year from the date of registration of the certificate of sale to redeem your property.

Q: What happens if I don’t redeem my property within the redemption period?

A: If you fail to redeem your property, the buyer can consolidate ownership and obtain a writ of possession to evict you.

Q: Can a bank obtain a writ of possession years after the foreclosure sale?

A: Yes, the right to request a writ of possession does not prescribe, meaning there is no time limit.

Q: What is res judicata?

A: Res judicata is a legal principle that prevents a party from re-litigating an issue that has already been decided by a court.

Q: What can I do if I am facing foreclosure?

A: Seek legal advice immediately to understand your rights and explore potential defenses, such as challenging the validity of the loan or foreclosure process.

ASG Law specializes in Real Estate Law, Foreclosure and Property Rights. Contact us or email hello@asglawpartners.com to schedule a consultation.