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LZK HOLDINGS and DEVELOPMENT CORPORATION vs.

PLANTERS DEVELOPMENT BANK


G.R. No.: 187973
January 20, 2014

FACTS:

On December 16, 1996, LZK Holdings obtained a 40 million peso loan from Planters Bank and
secured it with a Real Estate Mortgage over its 589 m lot in La Union. Due to LZK Holdings failure to pay
its loan, it was extra judicially foreclosed by Planters Bank and was sold at a public auction on September
21, 1998. During the auction sale, Planters Bank emerged as the highest bidder and thereafter its
certificate of sale was registered.
LZK Holdings filed a complaint on April 5, 1999 for annulment of extrajudicial foreclosure and
prayed for the issuance of a TRO or writ of preliminary injunction to enjoin the consolidation of title over
the lot by Planters Bank. On the other hand, Planters Bank filed an ex-parte motion on December 27,
1999 for the issuance of a writ of possession with the RTC-San Fernando.
3 days before the expiration of LZK Holdings redemption period, the RTC-Makati issued a TRO
effective for 20 days enjoining Planters Bank from consolidating its title over the property. The issuance
of a writ of preliminary injunction for the same purpose was done after the posting of LZK Holdings of a
Php40,000.00 bond.
But on April 24, 2000, Planters Bank succeeded in consolidating its ownership over the property
but the proceeding for its ex-parte motion for the issuance of a writ of possession was suspended by the
RTC-San Fernando in view of the issuances of RTC-Makati. Planters Bank moved for reconsideration but
it was denied. Upon motion of LZK Holdings, the RTC-Makati declared as null and void the consolidated
title of Planters Bank and this decision was likewise affirmed by the CA on February 26, 2004. It was
elevated to the SC but the SC sustained the decision of CA on September 13, 2004.
Planters Bank likewise appealed the decision of RTC-San Fernando which held in abeyance the
resolution of its ex-parte motion for the issuance of a writ of possession and the CA granted its appeal
and annulled the assailed order of RTC-San Fernando. LZK Holdings elevated the matter to the SC but SC
on April 27, 2007 affirmed the decision of CA and decreed that Planters Bank is entitled to apply for a
writ of possession as the purchaser of the property in the foreclosure sale during the redemption period.
SC further emphasized that given the ministerial duty of San Fernando RTC to issue the writ; it should
have acted on the ex parte petition. According to the SC, an injunction is not allowed to prohibit the
issuance of a writ of possession neither does the pending case for annulment of foreclosure sale,
mortgage contract, promissory notes and damages stay the issuance of said writ. Armed with this
pronouncement, Planters Bank filed before the RTC-San Fernando a motion to set ex-parte hearing for
the issuance of a writ of possession but LZK Holdings opposed the motion. This opposition was denied by
the RTC-San Fernando and set the ex parte hearing on April 14, 2008 but on April 8, RTC-San Fernando
declared that the scheduled hearing is moot and academic and Planters Bank is granted with its ex parte
motion for the issuance of a writ of possession. The CA affirmed the ruling of the trial court, dismissed the
petition for certiorari of LZK Holdings and denied its motion for reconsideration on May 12, 2009. LZK
Holdings then filed a motion to the SC for a 30-day extension to file a petition for review reckoned from
the date of its receipt of the resolution granting such extension. SC granted the motion on July 15, 2009
but the reckoning period granted shall be counted from the expiration of the original reglementary
period. LZK Holdings failed to file their petition within the extended period and pursuant to Sec. 5(a),
Rule 56 of the Rules of Court and for lack of reversible error in the assailed judgment of the CA, SC denied
the petition. LZK Holdings filed a motion for reconsideration and explained the reason why they werent
able to beat the deadline and that is because they were able to hold a copy of the July 15, 2009 resolution
on July 29, 2009. On October 13, 2010, SC granted the motion for reconsideration and the petition for
review was reinstated.

ISSUES:

LZK Holdings claimed that the writ of possession issued to Planters Bank should be annulled for
the following reasons:
1. With the cancellation of Planters Banks consolidated title, LZK Holdings remain to be the
registered owner of the property as such Planters Bank have no right to apply for a writ of
possession because according to PNB vs. Sanao Marketing Corporation, the right of possession is
based on the ownership of the subject property by the applicant;
2. LZK Holdings was deprived of due process because the RTC did not conduct a hearing on Planters
Banks motion for the issuance of a writ of possession;
3. The Php2,000,000.00 bond posted by LZK Holdings does not conform with Sec. 7 of Act No. 3135
which mandated that the bond amount shall be equivalent to 12 months use of the subject
property which in this case amounted to Php7,801,472.28 at the time the writ was issued.

HELD:

SC finds and stands that the CA committed no reversible error in affirming the issuance of a writ of
possession by the RTC in favor of Planters Bank. The doctrine of res judicata by conclusiveness of
judgment postulates that when a right or fact has been judicially tried and determined by a court of
competent jurisdiction, or when an opportunity for such trial has been given, the judgment of the court,
as long as it remains unreversed, should be conclusive upon the parties and those in privity with them.
Meaning, LZK Holdings can no longer question Planters Banks right to a writ of possession over the
subject property because the doctrine of conclusiveness of judgment bars the relitigation of such
particular issue. The pronouncement in PNB vs. Sanao Marketing Corporation is a situation not
contemplated within the facts of the present case.
SC also made mention that given the ex parte nature of the proceedings for a writ of possession;
the RTC did not err in cancelling the scheduled hearing and in granting Planters Banks motion without
affording notice to LZK Holdings or allowing it to participate.
And lastly, SC explained that the contentions of LZK Holdings that the RTC, in issuing the writ of
possession, transgressed Act No. 3135 are untenable. The task of SC in an appeal by petition for review
on certiorari is limited, as a jurisdictional matter, to reviewing errors of law that might have been
committed by the CA. The allegations of incorrect computation of the surety bond involve factual matters
within the competence of the trial court to address as this Court is not a trier of facts. Hence the petition
is denied and the decision of CA is affirmed.

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