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VOL. 351, FEBRUARY 7, 2001
399
Idolor vs. Court of Appeals
*
G.R. No. 141853. February 7, 2001.
TERESITA V. IDOLOR, petitioner, vs. HON. COURT OF
APPEALS, SPS. GUMERSINDO DE GUZMAN and ILUMINADA
DE GUZMAN and HON. PRUDENCIO A. CASTILLO, JR.,
Presiding Judge, Regional Trial Court, National Capital Judicial
Region, Branch 220, Quezon City, respondents.
Actions; Injunction; Requisites; Injunction is a preservative remedy
aimed at protecting substantive rights and interests—it is not designed to
protect contingent or future rights.—Injunction is a preservative remedy
aimed at protecting substantive rights and interests. Before an injunction can
be issued, it is essential that the following requisites be present: 1) there
must be a right in esse or the existence of a right to be protected; 2) the act
against which the injunction is to be directed is a violation of such right.
Hence the existence of a right violated, is a prerequisite to the granting of an
injunction. Injunction is not designed to protect contingent or future rights.
Failure to establish either the existence of a clear and positive right which
should be judicially protected through the writ of injunction or that the
defendant has committed or has attempted to commit any act which has
endangered or tends to endanger the existence of said right, is a sufficient
ground for denying the injunction. The controlling reason for the existence
of the judicial power to issue the writ is that the court may thereby prevent a
threatened or continuous irremediable injury to some of the parties before
their claims can be thoroughly investigated and advisedly adjudicated. It is
to be resorted to only when there is a pressing necessity to avoid injurious
consequences which cannot be remedied under any standard of
compensation.
Same; Same; It is always a ground for denying injunction that the party
seeking it has insufficient title or interest to sustain it, and no claim to the
ultimate relief sought—in other words, that she shows no equity—and the
possibility of irreparable damage without proof of actual existing right is
not a ground for an injunction.—In the instant case, we agree with the
respondent Court that petitioner has no more proprietary right to speak of
over the foreclosed property to entitle her to the issuance of a writ of
injunction. It appears that the mortgaged property was sold in a public
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auction to private respondent Gumersindo on May 23, 1997 and the sheriffs
certificate of sale was registered with the Registry of Deeds of
_________________
*
THIRD DIVISION.
400
400
SUPREME COURT REPORTS ANNOTATED
Idolor vs. Court of Appeals
Quezon City on June 23, 1997. Petitioner had one year from the registration
of the sheriffs sale to redeem the property but she failed to exercise her right
on or before June 23, 1998, thus spouses de Guzman are now entitled to a
conveyance and possession of the foreclosed property. When petitioner filed
her complaint for annulment of sheriffs sale against private respondents with
prayer for the issuance of a writ of preliminary injunction on June 25, 1998,
she failed to show sufficient interest or title in the property sought to be
protected as her right of redemption had already expired on June 23, 1998,
i.e. two (2) days before the filing of the complaint. It is always a ground for
denying injunction that the party seeking it has insufficient title or interest to
sustain it, and no claim to the ultimate relief sought—in other words, that
she shows no equity. The possibility of irreparable damage without proof of
actual existing right is not a ground for an injunction.
Obligations and Contracts; Novation; Words and Phrases; Novation is
the extinguishment of an obligation by the substitution or change of the
obligation by a subsequent one which terminates it, either by changing its
objects or principal conditions, or by substituting a new debtor in place of
the old one, or by subrogating a third person to the rights of the creditor;
No novation of a contract had occurred when the new agreement entered
into between the parties was intended to give life to the old one.—Novation
is the extinguishment of an obligation by the substitution or change of the
obligation by a subsequent one which terminates it, either by changing its
objects or principal conditions, or by substituting a new debtor in place of
the old one, or by subrogating a third person to the rights of the creditor.
Under the law, novation is never presumed. The parties to a contract must
expressly agree that they are abrogating their old contract in favor of a new
one. Accordingly, it was held that no novation of a contract had occurred
when the new agreement entered into between the parties was intended to
give life to the old one.
Same; Same; Where the parties to the new obligation expressly
recognize the continuing existence and validity of the old one, where, in
other words, the parties expressly negated the lapsing of the old obligation,
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there can be no novation.—A review of the “Kasunduang Pag-aayos” which
is quoted earlier does not support petitioner’s contention that it novated the
real estate mortgage since the will to novate did not appear by express
agreement of the parties nor the old and the new contracts were
incompatible in all points. In fact, petitioner expressly recognized in the
Kasunduan the existence and the validity of the old obligation where she
acknowledged her long” overdue account since September 20, 1994 which
was
401
VOL. 351, FEBRUARY 7, 2001
401
Idolor vs. Court of Appeals
secured by a real estate mortgage and asked for a ninety (90) days grace
period to settle her obligation on or before December 21, 1996 and that
upon failure to do so, she will execute a deed of sale with a right to
repurchase without interest within one year in favor of private respondents.
Where the parties to the new obligation expressly recognize the continuing
existence and validity of the old one, where, in other words, the parties
expressly negated the lapsing of the old obligation, there can be no
novation.
Same; Same; It is not proper to consider an obligation novated by
unimportant modifications which do not alter its essence.—Notably, the
provision in the “Kasunduang Pag-aayos” regarding the execution of a deed
of sale with right to repurchase within one year would have the same effect
as the extrajudicial foreclosure of the real estate mortgage wherein
petitioner was given one year from the registration of the sheriffs sale in the
Registry of property to redeem the property, i.e., failure to exercise the right
of redemption would entitle the purchaser to possession of the property. It is
not proper to consider an obligation novated by unimportant modifications
which do not alter its essence. It bears stress that the period to pay the total
amount of petitioner’s indebtedness inclusive of interest amounted to
P1,233,288.23 expired on December 21, 1996 and petitioner failed to
execute a deed of sale with right to repurchase on the said date up to the
time private respondents filed their petition for extrajudicial foreclosure of
real estate mortgage. The failure of petitioner to comply with her
undertaking in the “kasunduan” to settle her obligation effectively delayed
private respondents’ right to extrajudicially foreclose the real estate
mortgage which right accrued as far back as 1994. Thus, petitioner has not
shown that she is entitled to the equitable relief of injunction.
PETITION for review on certiorari of a decision of the Court of
Appeals.
The facts are stated in the opinion of the Court.
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Samson, Montesa, Villacorta and Associates for petitioner.
Antonio Z. Magabo for private respondents.
402
402
SUPREME COURT REPORTS ANNOTATED
Idolor vs. Court of Appeals
GONZAGA-REYES, J.:
This is a petition for review on certiorari filed
by petitioner Teresita
1
Idolor which seeks to set aside the decision
of the respondent Court
2
of Appeals which reversed the Order of the Regional Trial Court of
3
Quezon City granting Idolor’s prayer for the issuance of a writ of
preliminary injunction and
the resolution denying petitioner’s
4
motion for reconsideration.
On March 21, 1994, to secure a loan of P520,000.00, petitioner
Teresita Idolor executed in favor of private respondent Gumersindo
De Guzman a Deed of Real Estate Mortgage with right of
extrajudicial foreclosure upon failure to redeem the mortgage on or
before September 20, 1994. The object of said mortgage is a 200square meter property with improvements located at 66 Ilocos Sur
Street, Barangay Ramon Magsaysay, Quezon City covered by TCT
No. 25659.
On September 21, 1996, private respondent Iluminada de
Guzman, wife of Gumersindo de Guzman, filed a complaint against
petitioner Idolor before the Office of the Barangay Captain of
Barangay Ramon Magsaysay, Quezon City, which resulted in a
5
“Kasunduang Pag-aayos” which agreement is quoted in full :
“Kami, ang (mga) may sumbong at (mga) ipinagsusumbong sa usaping
binabanggit sa itaas, ay nagkakasundo sa pamamagitan nito na ayusin ang
aming alitan gaya ng sumusunod:
Na ako si Teresita V. Idolor of legal age ay nakahiram ng halagang
P520,000.00 noong September 20, 1994.
_______________
1
CA-G.R. SP No. 49469, penned by Justice Jesus M. Elbinias, concurred in by
Justices Delilah Vidallon Magtolis and Rodrigo V. Cosico; Rollo, pp. 35-37.
2
CA Rollo, pp. 42-46.
3
Branch 220, presided by Judge Prudencio Altre Castillo, Jr.; Civil Case No. Q-
98-34728.
4
Justice Elbinias retired on October 15, 1999, thus the motion for reconsideration
was raffled to another member, Justice Cosico; Rollo, pp. 40-42.
5
Rollo, p. 43.
403
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VOL. 351, FEBRUARY 7, 2001
403
Idolor vs. Court of Appeals
Na ang nasabing halaga ay may nakasanlang titulo ng lupa (TCT No.
25659) under Registry receipt 3420 dated July 15, 1996.
Na ako si Teresita V. Idolor ay humihingi ng 90 days palugit (grace
period) to settle the said amount.
Failure to settle the above account on or before December 21, 1996, I
agree to execute a deed of sale with the agreement to repurchase without
interest within one year.
Total amount of P1,233,288.23 inclusive of interest earned.
At nangangako kami na tutupad na tunay at matapat sa mga katakdaan
ng pag-aayos na inilahad sa itaas.”
Petitioner failed to comply with her undertaking; thus private
respondent Gumersindo filed a motion for execution before the
Office of the Barangay captain who subsequently issued a
certification to file action.
On March 21, 1997, respondent Gumersindo De Guzman filed an
extra judicial foreclosure of the real estate mortgage pursuant to the
parties agreement set forth in the real estate mortgage dated March
21, 1994.
On May 23, 1997, the mortgaged property was sold in a public
auction to respondent Gumersindo, as the highest bidder and
consequently, the Sheriffs Certificate of Sale was registered with the
Registry of Deeds of Quezon City on June 23, 1997.
On June 25, 1998, petitioner filed with the Regional Trial Court
of Quezon City, Branch 220, a complaint for annulment of Sheriffs
Certificate of Sale with prayer for the issuance of a temporary
restraining order (TRO) and a writ of preliminary injunction against
private respondents. Deputy Sheriffs Marino Cachero and Rodolfo
Lescano and the Registry of Deeds of Quezon City alleging among
others alleged irregularity and lack of notice in the extrajudicial
foreclosure proceedings subject of the real estate mortgage. In the
meantime, a temporary restraining order was issued by the trial
court.
On July 28, 1998, the trial court issued a writ of preliminary
injunction enjoining private respondents, the Deputy Sheriffs and the
Registry of Deeds of Quezon City from causing the issuance of a
final deed of sale and consolidation of ownership of the subject
404
404
SUPREME COURT REPORTS ANNOTATED
Idolor vs. Court of Appeals
property in favor of the De Guzman spouses. The trial court denied
the motion for reconsideration filed by the de Guzman spouses.
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Spouses de Guzman filed with the respondent Court of Appeals a
petition for certiorari seeking annulment of the trial court’s order
dated July 28, 1998 which granted the issuance of a preliminary
injunction.
On September 28, 1999, the respondent court granted the petition
and annulled the assailed writ of preliminary injunction. Teresita
Idolor filed her motion for reconsideration which was denied in a
resolution dated February 4, 2000.
Hence this petition for review on certiorari filed by petitioner
Teresita V. Idolor. The issues raised by petitioner are-: whether or
not the respondent Court of Appeals erred in ruling (1) that
petitioner has no more proprietary right to the issuance of the writ of
injunction, (2) that the “Kasunduang Pag-aayos” did not ipso facto
result in novation of the real estate mortgage, (3) that the
“Kasunduang Pag-aayos” is merely a promissory note of petitioner
to private respondent spouses; and (4) that the questioned writ of
preliminary injunction was issued with grave abuse of discretion.
The core issue in this petition is whether or not the respondent
Court erred in finding that the trial court committed grave abuse of
discretion in enjoining the private and public respondents from
causing the issuance of a final deed of sale and consolidation of
ownership of the subject parcel of land in favor of private
respondents.
Petitioner claims that her proprietary right over the subject parcel
of land was not yet lost since her right to redeem the subject land for
a period of one year had neither lapsed nor run as the sheriffs
certificate of sale was null and void; that petitioner and the general
public have not been validly notified of the auction sale conducted
by respondent sheriffs; that the newspaper utilized in the publication
of the notice of sale was not a newspaper of general circulation.
We do not agree.
405
VOL. 351, FEBRUARY 7, 2001
405
Idolor vs. Court of Appeals
Injunction is a preservative
remedy aimed at protecting substantive
6
rights and interests. Before an injunction can be issued, it is
essential that the following requisites be present: 1) there must be a
right in esse or the existence of a right to be protected; 2) the act
against which the injunction is to be directed is a violation of such
7
right. Hence the existence of a right violated, is a prerequisite to the
granting of an injunction. Injunction is not designed to protect
contingent or future rights. Failure to establish either the existence
of a clear and positive right which should be judicially protected
through the writ of injunction or that the defendant has committed or
has attempted to commit any act which has endangered or tends to
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endanger the existence of said right, is a sufficient ground for
8
denying the injunction. The controlling reason for the existence of
the judicial power to issue the writ is that the court may thereby
prevent a threatened or continuous irremediable injury to some of
the parties before their claims can be thoroughly investigated and
9
advisedly adjudicated. It is to be resorted to only when there is a
pressing necessity to avoid injurious consequences which cannot be
10
remedied under any standard of compensation.
In the instant case, we agree with the respondent Court that
petitioner has no more proprietary right to speak of over the
foreclosed property to entitle her to the issuance of a writ of
injunction. It appears that the mortgaged property was sold in a
public auction to private respondent Gumersindo on May 23, 1997
and the sheriff’s certificate of sale was registered with the Registry
of Deeds of Quezon City on June 23, 1997. Petitioner had one year
from the registration of the sheriff’s sale to redeem the property but
she failed to exercise her right on or before June 23, 1998, thus
spouses de Guzman are now entitled to a conveyance and possession
of the foreclosed property. When petitioner filed her complaint for
annulment of sheriff’s sale against private respondents with prayer
________________
6
Heirs of Joaquin Asuncion vs. Gervacio, Jr., 304 SCRA 322 (1999).
7
Ibid.; Sales vs. SEC, 169 SCRA 109 (1989).
8
S & A Gaisano Incorporated vs. Hidalgo, 192 SCRA 224 (1990) citing Rosauro
vs. Cuneta, 151 SCRA 575 (1987).
9
Del Rosario vs. CA, 255 SCRA 152 (1996).
10
Del Rosario vs. CA, supra.
406
406
SUPREME COURT REPORTS ANNOTATED
Idolor vs. Court of Appeals
for the issuance of a writ of preliminary injunction on June 25, 1998,
she failed to show sufficient interest or title in the property sought to
be protected as her right of redemption had already expired on June
23, 1998, i.e. two (2) days before the filing of the complaint. It is
always a ground for denying injunction that the party seeking it has
insufficient title or interest to sustain it, and no claim to the ultimate
11
relief sought—in other words, that she shows no equity. The
possibility of irreparable damage without proof of actual existing
12
right is not a ground for an injunction.
Petitioner’s allegation regarding the invalidity of the sheriff’s
sale dwells on the merits of the case; We cannot rule on the same
considering that the matter should be resolved during the trial on the
merits.
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Petitioner next contends that the execution of the “Kasunduang
Pag-aayos” dated September 21, 1996 between her and spouses de
Guzman before the Office of the Lupon Tagapamayapa showed the
express and unequivocal intention of the parties to novate or modify
the real estate mortgage; that a comparison of the real estate
mortgage dated March 21, 1994 and the “Kasunduang Pag-aayos”
dated September 21, 1996 revealed the irreconciliable
incompatibility between them, i.e., that under the first agreement, the
amount due was five hundred twenty thousand (P520,000) pesos
only payable by petitioner within six (6) months, after which it shall
earn interest at the legal rate per annum and nonpayment of which
within the stipulated period, private respondents have the right to
extrajudicially foreclose the real estate mortgage while under the
second agreement, the amount due was one million two hundred
thirty three thousand two hundred eighty eight and 23/100
(P1,233,288.23) inclusive of interest, payable within 90 days and in
case of non payment of the same on or before December 21, 1996,
petitioner should execute a deed of sale with right to repurchase
within one year without interest; that the second agreement
“Kasunduang Pagaayos” was a valid new contract as it was duly
________________
11
Angela Estate, Inc. vs. CFI of Negros Occidental, 24 SCRA 500 (1968).
12
Heirs of Joaquin Asuncion vs. Gervacio, Jr., supra citing Arcega vs. CA, 275
SCRA 176 (1997).
407
VOL. 351, FEBRUARY 7, 2001
407
Idolor vs. Court of Appeals
executed by the parties and it changed the principal conditions of
petitioner’s original obligations. Petitioner insists that the
“Kasunduang Pag-aayos” was not a mere promissory note contrary
to respondent court’s conclusion since it was entered by the parties
before the Lupon Tagapamayapa which has the effect of a final
13
judgment.
We are not persuaded.
Novation is the extinguishment of an obligation by the
substitution or change of the obligation by a subsequent one which
terminates it, either by changing its objects or principal conditions,
or by substituting a new debtor in place of the old one, or by
14
subrogating a third person to the rights of the creditor. Under the
law, novation is never presumed. The parties to a contract must
expressly agree that they are abrogating their old contract in favor of
15
a new one. Accordingly, it was held that no novation of a contract
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had occurred when the new agreement entered
into between the
16
parties was intended to give life to the old one.
A review of the “Kasunduang Pag-aayos” which is quoted earlier
does not support petitioner’s contention that it novated the real estate
mortgage since the will to novate did not appear by express
agreement of the parties nor the old and the new contracts were
incompatible in all points. In fact, petitioner expressly recognized in
the Kasunduan the existence and the validity of the old obligation
where she acknowledged her long overdue account since Sep________________
13
Sections 416 and 417 of RA 7160 otherwise known as The New Local
Government Code of 1991” provides:
“Section 416. The amicable settlement and arbitration award should have the force
and effect of the final judgment of a court.
“Section 417. The amicable settlement or arbitration award may be enforced by
execution by the lupon within six (6) months from the date of settlement. After the
lapse of time, the settlement may be enforced the action in the appropriate city or
municipal court.”
14
Cochingyan. Jr. vs. R&B Surely and Insurance Co., Inc, 151 SCRA 339 (1987)
citing De Cortes vs. Venturanza, 79 SCRA 709 (1977).
15
Huibonhua vs. CA, 320 SCRA 625 (1999) citing Rillo vs. CA, 274 SCRA 461
(1997).
16
Ibid.
408
408
SUPREME COURT REPORTS ANNOTATED
Idolor vs. Court of Appeals
tember 20, 1994 which was secured by a real estate mortgage and
asked for a ninety (90) days grace period to settle her obligation on
or before December 21, 1996 and that upon failure to do so, she will
execute a deed of sale with a right to repurchase without interest
within one year in favor of private respondents. Where the parties to
the new obligation expressly recognize the continuing existence and
validity of the old one, where, in other words, the parties expressly
17
negated the lapsing of the old obligation, there can be no novation.
We find no cogent reason to disagree with the respondent court’s
pronouncement as follows:
“In the present case, there exists no such express abrogation of the original
undertaking. The agreement adverted to (Annex 2 of Comment, p. 75 Rollo)
executed by the parties on September 21, 1996 merely gave life to the
March 21, 1994 mortgage contract which was then more than two years
overdue. Respondent acknowledged therein her total indebtedness in the
sum of P1,233,288.23 including the interests due on the unpaid mortgage
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loan which amount she promised to liquidate within ninety (90) days or
until December 21, 1996, failing which she also agreed to execute in favor
of the mortgagee a deed of sale of the mortgaged property for the same
amount without interest. Evidently, it was executed to facilitate easy
compliance by respondent mortgagor with her mortgage obligation. It (the
September 21, 1996 agreement) is not incompatible and can stand together
with the mortgage contract of March 21, 1994.
A compromise agreement clarifying the total sum owned by a buyer with
the view that he would find it easier to comply with his obligations under
the Contract to Sell does not novate said Contract to Sell (Rillo v. Court of
Appeals, 274 SCRA 461 [1997]).
Respondent correctly argues that the compromise agreement has the
force and effect of a final judgment. That precisely is the reason why
petitioner resorted to the foreclosure of the mortgage on March 27, 1997,
after her failure to comply with her obligation which expired on December
21, 1996.
Reliance by private respondent upon Section 417 of the New Local
Government Code of 1991, which requires the lapse of six (6) months
before the amicable settlement may be enforced, is misplaced. The instant
________________
17
Huibonhua vs. CA, supra citing Cochingyan, Jr. vs. R&B Surety and Insurance Co., Inc.,
supra.
409
VOL. 351, FEBRUARY 7, 2001
409
Idolor vs. Court of Appeals
case deals with extra judicial foreclosure governed by ACT No. 3135 as
amended.”
Notably, the provision in the “Kasunduang Pag-aayos” regarding the
execution of a deed of sale with right to repurchase within one year
would have the same effect as the extrajudicial foreclosure of the
real estate mortgage wherein petitioner was given one year from the
registration of the sheriff’s sale in the Registry of property to redeem
the property, i.e., failure to exercise the right of redemption would
entitle the purchaser to possession of the property. It is not proper to
consider an obligation novated
by unimportant modifications which
18
do not alter its essence. It bears stress that the period to pay the
total amount of petitioner’s indebtedness inclusive of interest
amounted to P1,233,288.23 expired on December 21, 1996 and
petitioner failed to execute a deed of sale with right to repurchase on
the said date up to the time private respondents filed their petition
for extrajudicial foreclosure of real estate mortgage. The failure of
petitioner to comply with her undertaking in the “kasunduan” to
settle her obligation effectively delayed private respondents’ right to
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extrajudicially foreclose the real estate mortgage which right
accrued as far back as 1994. Thus, petitioner has not shown that she
is entitled to the equitable relief of injunction.
WHEREFORE, the petition is DENIED. The decision of the
respondent Court of Appeals dated September 28, 1999 is hereby
AFFIRMED.
SO ORDERED.
Melo (Chairman), Vitug, Panganiban and SandovalGutierrez, JJ., concur.
Petition denied, judgment affirmed.
Notes.—Where three lot owners simultaneously entered into a
lease contract with one lessee, novation of the contract could only be
effected by their simultaneous act of abrogating the original
________________
18
Tolentino, Volume IV, Civil Code of the Philippines, 1991 edition, p. 387 citing
Sentencias, March 14, 1908, April 15, 1909 and July 8, 1910.
410
410
SUPREME COURT REPORTS ANNOTATED
People vs. Rondilla
contract and at the same time forging a new one in writing.
(Huibonhoa vs. Court of Appeals, 320 SCRA 625 [1999])
Neither acceptance of partial payment nor change of place or
manner of payment involves novation, for novation cannot be
presumed but must be expressly intended by the parties. (Diongzon
vs. Court of Appeals, 321 SCRA 477 [1999])
——o0o——
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