SC decides: Payment of the full redemption price within the one-year redemption period is a valid exercise of the right of redemption.
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Doctrine:
Payment of the full redemption price within the one-year redemption period is a valid exercise of the right of redemption.
Facts of the Case:
On May 21, 2014, Davidson Go (“Go”) filed a Petition for the consolidation of title over a lot in Quezon City covered by Transfer Certificate of Title (TCT) No. 59729 (“Subject Property”), and the issuance of a new title in his favor.
On October 17, 2014, Spouses Henry and Janet Ko (“Sps. Ko”) filed an Urgent Omnibus Motion for the RTC to admit their Opposition to the Petition filed by Go. The motion was granted.
During trial, Go alleged that he purchased the subject property in a tax delinquency auction sale conducted by the City Government of Quezon City on April 11, 2011, wherein the Certificate of Sale was duly annotated in the title of the subject property. He alleged he became the lawful owner and possessor thereof when Sps. Ko failed to validly redeem it within a year from the date of the sale.
For Sps. Ko, they alleged that they are the owners of the subject property, having bought the same from Lexus Development, Inc. (Lexus) by virtue of an undated Deed of Absolute Sale, and have been residing thereat since 1996.
Sps. Ko contend that they only learned of the auction sale on March 13, 2012. They validly redeemed the subject property when they settled the redemption price of the PhP348,335.92 on March 19, 2012 after an Order of Payment Redemption-Auction was given by the City Treasurer’s Office of Quezon City.
The Regional Trial Court (RTC) granted Go’s Petition and ordered the issuance of a new certificate of title over the subject property. The RTC ruled there was no valid redemption on the part of Sps. Ko since there was no evidence that they were authorized by Lexus, as the delinquent registered owner of the subject property. According the RTC, Sps. Ko failed to establish any vested right of ownership over the subject property and the one-year redemption period expired without Lexus validly redeeming the subject property.
Sps. Ko appealed the decision of the RTC before the Court of Appeals (CA). The CA granted the appeal and directed the City Treasurer’s Office to invalidate the Certificate of Sale it issued to Go and issue a certificate of redemption to Sps. Ko.
According to the CA, the Deed of Absolute Sale between Sps. Ko and Lexus is valid and binding despite being undated and unnotarized. Sps. Ko also has an open, continuous, exclusive and notorious possession and occupation of the subject property.
In the instant Petition for Review on Certiorari filed by Go before the Supreme Court, Go alleged that Sps. Ko’s failure to submit proof of ownership, legal interest or authority to redeem the subject property to the City Treasurer’s Office within the redemption period amounts to failure of redemption. As such, the Final Bill of Sale in his favor is valid.
In their Comment, Sps. Ko alleged that there is nothing in the law (Section 261 or Republic Act No. 7160) that required the delinquent registered owner to present an authority to pay redemption price. Sps. Ko further added that their payment was specifically credited to Lexus, as evidenced by an Official Receipt issued by the City Treasurer’s Office in the name of Lexus. Thus, the payment of the full redemption price made by Sps. Ko within the one-year period is considered valid.
Issue at hand:
Did the Spouses Ko validly redeem the subject property even though they are not the registered owners thereof and they did not present any proof of ownership or legal interest over the subject property when the redemption price was paid?
Ruling:
The Supreme Court ruled: Yes.
Section 261 of Republic Act No. 7160 provides that the owner of the delinquent real property or person with legal interest thereon, or his or her representative, shall have the right to redeem the property sold at a public auction within one year from the date of sale upon payment of the total amount of the delinquent tax with the interest thereon, plus the expenses of sale and the interest on the purchase price from the date of sale up to the date of redemption.
In denying Go’s Petition, the Supreme Court ruled that it is clear that Sps. Ko had the right to redeem the subject property as the owners thereof notwithstanding the fact that the title had yet to be transferred under their names. Contrary to Go’s insistence, Sps. Ko’s payment of the redemption price as Computed by the City Treasurer’s Office on March 29, 2012 or well within the one-year redemption period is a valid exercise of the right of redemption on the part of Sps. Ko despite non-submission of any proof of ownership or legal interest on the subject property.
The Court noted that even the City Treasurer’s Office acknowledged that redemption price paid by Sps. Ko was meant for the redemption of the subject property which, based on its record, was still owned by Lexus.
On a last note, the Supreme Court held that where the redemptioner has chosen to exercise the right of redemption, it is the policy of the law to aid rather than defeat such right. Redemption should be looked upon with favor and where no injury will follow, a liberal construction will be given to our redemption laws, specially on the exercise of the right to redeem.
Source: Supreme Court
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