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G.R.No.156364

TodayisTuesday,July19,2016

RepublicofthePhilippines
SUPREMECOURT
Manila
THIRDDIVISION
G.R.No.156364September3,2007
JACOBUSBERNHARDHULST,petitioner,
vs.
PRBUILDERS,INC.,respondent.
DECISION
AUSTRIAMARTINEZ,J.:
BeforetheCourtisaPetitionforReviewonCertiorariunderRule45oftheRevisedRulesofCourtassailingthe
Decision1datedOctober30,2002oftheCourtofAppeals(CA)inCAG.R.SPNo.60981.
Thefacts:
JacobusBernhardHulst(petitioner)andhisspouseIdaJohannaHulstVanIjzeren(Ida),Dutchnationals,entered
into a Contract to Sell with PR Builders, Inc. (respondent), for the purchase of a 210sq m residential unit in
respondent'stownhouseprojectinBarangayNiyugan,Laurel,Batangas.
When respondent failed to comply with its verbal promise to complete the project by June 1995, the spouses
Hulst filed before the Housing and Land Use Regulatory Board (HLURB) a complaint for rescission of contract
withinterest,damagesandattorney'sfees,docketedasHLRBCaseNo.IV60711960618.
On April 22, 1997, HLURB Arbiter Ma. Perpetua Y. Aquino (HLURB Arbiter) rendered a Decision 2 in favor of
spousesHulst,thedispositiveportionofwhichreads:
WHEREFORE,premisesconsidered,judgmentisherebyrenderedinfavorofthecomplainant,rescinding
theContracttoSellandorderingrespondentto:
1) Reimburse complainant the sum of P3,187,500.00, representing the purchase price paid by the
complainantstoP.R.Builders,plusinterestthereonattherateoftwelvepercent(12%)perannumfromthe
timecomplaintwasfiled
2)PaycomplainantthesumofP297,000.00asactualdamages
3)PaycomplainantthesumofP100,000.00bywayofmoraldamages
4)PaycomplainantthesumofP150,000.00asexemplarydamages
5)P50,000.00asattorney'sfeesandforotherlitigationexpensesand
6)Costofsuit.
SOORDERED.3
Meanwhile,spousesHulstdivorced.Idaassignedherrightsoverthepurchasedpropertytopetitioner.4Fromthen
on,petitioneralonepursuedthecase.
On August 21, 1997, the HLURB Arbiter issued a Writ of Execution addressed to the ExOfficio Sheriff of the
RegionalTrialCourtofTanauan,Batangasdirectingthelattertoexecuteitsjudgment.5
OnApril13,1998,theExOfficioSheriffproceededtoimplementtheWritofExecution.However,uponcomplaint
ofrespondentwiththeCAonaPetitionfor CertiorariandProhibition,thelevymadebytheSheriffwassetaside,
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requiring the Sheriff to levy first on respondent's personal properties.6 Sheriff Jaime B. Ozaeta (Sheriff) tried to
implementthewritasdirectedbutthewritwasreturnedunsatisfied.7
OnJanuary26,1999,uponpetitioner'smotion,theHLURBArbiterissuedanAliasWritofExecution.8
OnMarch23,1999,theSheriffleviedonrespondent's15parcelsoflandcoveredby13TransferCertificatesof
Title(TCT)9inBarangayNiyugan,Laurel,Batangas.10
InaNoticeofSaledatedMarch27,2000,theSheriffsetthepublicauctionoftheleviedpropertiesonApril28,
2000at10:00a.m..11
TwodaysbeforethescheduledpublicauctionoronApril26,2000,respondentfiledanUrgentMotiontoQuash
Writ of Levy with the HLURB on the ground that the Sheriff made an overlevy since the aggregate appraised
valueoftheleviedpropertiesatP6,500.00persqmisP83,616,000.00,basedontheAppraisalReport12ofHenry
HunterBayneCo.,Inc.datedDecember11,1996,whichisoverandabovethejudgmentaward.13
At10:15a.m.ofthescheduledauctiondateofApril28,2000,respondent'scounselobjectedtotheconductofthe
public auction on the ground that respondent's Urgent Motion to Quash Writ of Levy was pending resolution.
Absent any restraining order from the HLURB, the Sheriff proceeded to sell the 15 parcels of land. Holly
Properties Realty Corporation was the winning bidder for all 15 parcels of land for the total amount of
P5,450,653.33.ThesumofP5,313,040.00wasturnedovertothepetitionerinsatisfactionofthejudgmentaward
afterdeductingthelegalfees.14
At 4:15 p.m. of the same day, while the Sheriff was at the HLURB office to remit the legal fees relative to the
auctionsaleandtosubmittheCertificatesofSale15forthesignatureofHLURBDirectorBelenG.Ceniza(HLURB
Director),hereceivedtheOrderdatedApril28,2000issuedbytheHLURBArbitertosuspendtheproceedingson
thematter.16
Fourmonthslater,oronAugust28,2000,theHLURBArbiterandHLURBDirectorissuedanOrdersettingaside
thesheriff'slevyonrespondent'srealproperties,17reasoningasfollows:
While we are not making a ruling that the fair market value of the levied properties is PhP6,500.00 per
square meter (or an aggregate value of PhP83,616,000.00) as indicated in the Hunter BaynesAppraisal
Report,wedefinitelycannotagreewiththepositionoftheComplainantsandtheSheriffthattheaggregate
value of the 12,864.00square meter levied properties is only around PhP6,000,000.00. The disparity
betweenthetwovaluationsare[sic]soegregiousthattheSheriffshouldhavelookedintothematterfirst
before proceeding with the execution sale of the said properties, especially when the auction sale
proceedings was seasonably objected by Respondent's counsel,Atty. Noel Mingoa. However, instead of
resolving first the objection timely posed byAtty. Mingoa, Sheriff Ozaete totally disregarded the objection
raisedand,posthaste,issuedthecorrespondingCertificateofSaleevenpriortothepaymentofthelegal
fees(pars.7&8,Sheriff'sReturn).
WhileweagreewiththeComplainantsthatwhatismaterialinanexecutionsaleproceedingistheamount
forwhichthepropertieswerebiddedandsoldduringthepublicauctionandthat,mereinadequacyofthe
priceisnotasufficientgroundtoannulthesale,thecourtisjustifiedtointervenewheretheinadequacyof
the price shocks the conscience (Barrozo vs. Macaraeg, 83 Phil. 378). The difference between
PhP83,616,000.00andPhp6,000,000.00isPhP77,616,000.00anditdefinitelyinvitesourattentiontolook
intotheproceedingshadespeciallysowhentherewasonlyonebidder,theHOLLYPROPERTIESREALTY
CORPORATION represented by Ma, Chandra Cacho (par. 7, Sheriff's Return) and the auction sale
proceedingswastimelyobjectedbyRespondent'scounsel(par.6,Sheriff'sReturn)duetothependencyof
theUrgentMotiontoQuashtheWritofLevywhichwasfiledpriortotheexecutionsale.
Besides, what is at issue is not the value of the subject properties as determined during the
auctionsale,butthedeterminationofthevalueofthepropertieslevieduponbytheSherifftaking
intoconsiderationSection9(b)ofthe1997RulesofCivilProcedurexxx.
xxxx
Itisveryclearfromtheforegoingthat,evenduringlevy,theSheriffhastoconsiderthefairmarketvalueof
thepropertiesleviedupontodeterminewhethertheyaresufficienttosatisfythejudgment,andanylevyin
excessofthejudgmentawardisvoid(Buanv.CourtofAppeals,235SCRA424).
xxxx18(Emphasissupplied).
ThedispositiveportionoftheOrderreads:
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WHEREFORE, the levy on the subject properties made by the ExOfficio Sheriff of the RTC of Tanauan,
Batangas,isherebySETASIDEandthesaidSheriffisherebydirectedtolevyinsteadRespondent'sreal
properties that are reasonably sufficient to enforce its final and executory judgment, this time, taking into
considerationnotonlythevalueofthepropertiesasindicatedintheirrespectivetaxdeclarations,butalso
all the other determinants at arriving at a fair market value, namely: the cost of acquisition, the current
valueoflikeproperties,itsactualorpotentialuses,andintheparticularcaseoflands,theirsize,shapeor
location,andthetaxdeclarationsthereon.
SOORDERED.19
A motion for reconsideration being a prohibited pleading under Section 1(h), Rule IV of the 1996 HLURB Rules
andProcedure,petitionerfiledaPetitionforCertiorariandProhibitionwiththeCAonSeptember27,2000.
On October 30, 2002, the CA rendered herein assailed Decision 20 dismissing the petition. The CA held that
petitioner's insistence that Barrozov.Macaraeg21 does not apply since said case stated that "when there is a
righttoredeeminadequacyofpriceshouldnotbematerial"holdsnowateraswhatisobtaininginthiscaseisnot
"mereinadequacy,"butaninadequacythatshocksthesensesthatBuanv.CourtofAppeals 22properlyapplies
since the questioned levy covered 15 parcels of land posited to have an aggregate value of P83,616,000.00
whichshockinglyexceededthejudgmentdebtofonlyaroundP6,000,000.00.
Withoutfilingamotionforreconsideration,23petitionertookthepresentrecourseonthesolegroundthat:
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE ARBITER'S ORDER
SETTINGASIDETHELEVYMADEBYTHESHERIFFONTHESUBJECTPROPERTIES.24
Before resolving the question whether the CA erred in affirming the Order of the HLURB setting aside the levy
made by the sheriff, it behooves this Court to address a matter of public and national importance which
completelyescapedtheattentionoftheHLURBArbiterandtheCA:petitionerandhiswifeareforeignnationals
whoaredisqualifiedundertheConstitutionfromowningrealpropertyintheirnames.
Section7ofArticleXIIofthe1987Constitutionprovides:
Sec. 7. Save in cases of hereditary succession, no private lands shall be transferred or conveyed
except to individuals, corporations, or associations qualified to acquire or hold lands of the public
domain.(Emphasissupplied).
Thecapacitytoacquireprivatelandismadedependentuponthecapacitytoacquireorholdlandsofthepublic
domain.Privatelandmaybetransferredorconveyedonlytoindividualsorentities"qualifiedtoacquirelandsof
the public domain." The 1987 Constitution reserved the right to participate in the disposition, exploitation,
developmentandutilizationoflandsofthepublicdomainforFilipinocitizens25orcorporationsatleast60percent
ofthecapitalofwhichisownedbyFilipinos.26Aliens,whetherindividualsorcorporations,havebeendisqualified
fromacquiringpubliclandshence,theyhavealsobeendisqualifiedfromacquiringprivatelands.27
Since petitioner and his wife, being Dutch nationals, are proscribed under the Constitution from acquiring and
owningrealproperty,itisunequivocalthattheContracttoSellenteredintobypetitionertogetherwithhiswifeand
respondentisvoid.UnderArticle1409(1)and(7)oftheCivilCode,allcontractswhosecause,objectorpurpose
iscontrarytolaworpublicpolicyandthoseexpresslyprohibitedordeclaredvoidbylawareinexistentandvoid
fromthebeginning.Article1410ofthesameCodeprovidesthattheactionordefenseforthedeclarationofthe
inexistenceofacontractdoesnotprescribe.Avoidcontractisequivalenttonothingitproducesnocivileffect. 28
Itdoesnotcreate,modifyorextinguishajuridicalrelation.29
Generally, parties to a void agreement cannot expect the aid of the law the courts leave them as they are,
becausetheyaredeemedinparidelictoor"inequalfault."30 In pari delicto is "a universal doctrine which holds
that no action arises, in equity or at law, from an illegal contract no suit can be maintained for its specific
performance, or to recover the property agreed to be sold or delivered, or the money agreed to be paid, or
damagesforitsviolationandwherethepartiesareinparidelicto,noaffirmativereliefofanykindwillbegivento
oneagainsttheother."31
Thisrule,however,issubjecttoexceptions32thatpermitthereturnofthatwhichmayhavebeengivenundera
voidcontractto:(a)theinnocentparty(Arts.14111412,CivilCode)33(b)thedebtorwhopaysusuriousinterest
(Art. 1413, Civil Code)34 (c) the party repudiating the void contract before the illegal purpose is
accomplished or before damage is caused to a third person and if public interest is subserved by
allowing recovery (Art. 1414, Civil Code)35 (d) the incapacitated party if the interest of justice so demands
(Art.1415,CivilCode)36(e)thepartyforwhoseprotectiontheprohibitionbylawisintendediftheagreementis
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notillegalpersebutmerelyprohibitedandifpublicpolicywouldbeenhancedbypermittingrecovery(Art.1416,
CivilCode)37 and (f) the party for whose benefit the law has been intended such as in price ceiling laws (Art.
1417,CivilCode)38andlaborlaws(Arts.14181419,CivilCode).39
It is significant to note that the agreement executed by the parties in this case is a Contract to Sell and not a
contractofsale.Adistinctionbetweenthetwoismaterialinthedeterminationofwhenownershipisdeemedto
have been transferred to the buyer or vendee and, ultimately, the resolution of the question on whether the
constitutionalproscriptionhasbeenbreached.
In a contract of sale, the title passes to the buyer upon the delivery of the thing sold.The vendor has lost and
cannot recover the ownership of the property until and unless the contract of sale is itself resolved and set
aside.40Ontheotherhand,acontracttosellisakintoaconditionalsalewheretheefficacyorobligatoryforceof
thevendor'sobligationtotransfertitleissubordinatedtothehappeningofafutureanduncertainevent,sothatif
the suspensive condition does not take place, the parties would stand as if the conditional obligation had never
existed.41Inotherwords,inacontracttosell,theprospectiveselleragreestotransferownershipoftheproperty
tothebuyeruponthehappeningofanevent,whichnormallyisthefullpaymentofthepurchaseprice.Buteven
upon the fulfillment of the suspensive condition, ownership does not automatically transfer to the buyer. The
prospectivesellerstillhastoconveytitletotheprospectivebuyerbyexecutingacontractofabsolutesale.42
SincethecontractinvolvedhereisaContracttoSell,ownershiphasnotyettransferredtothepetitionerwhenhe
filed the suit for rescission. While the intent to circumvent the constitutional proscription on aliens owning real
propertywasevidentbyvirtueoftheexecutionoftheContracttoSell,suchviolationofthelawdidnotmaterialize
because petitioner caused the rescission of the contract before the execution of the final deed transferring
ownership.
Thus, exception (c) finds application in this case. Under Article 1414, one who repudiates the agreement and
demandshismoneybeforetheillegalacthastakenplaceisentitledtorecover.Petitioneristhereforeentitledto
recoverwhathehaspaid,althoughthebasisofhisclaimforrescission,whichwasgrantedbytheHLURB,was
notthefactthatheisnotallowedtoacquireprivatelandunderthePhilippineConstitution.Butpetitionerisentitled
to the recovery only of the amount of P3,187,500.00, representing the purchase price paid to respondent. No
damages may be recovered on the basis of a void contract being nonexistent, the agreement produces no
juridical tie between the parties involved.43 Further, petitioner is not entitled to actual as well as interests
thereon,44moralandexemplarydamagesandattorney'sfees.
TheCourttakesintoconsiderationthefactthattheHLURBDecisiondatedApril22,1997haslongbeenfinaland
executory. Nothing is more settled in the law than that a decision that has acquired finality becomes immutable
and unalterable and may no longer be modified in any respect even if the modification is meant to correct
erroneousconclusionsoffactorlawandwhetheritwasmadebythecourtthatrendereditorbythehighestcourt
of the land.45 The only recognized exceptions to the general rule are the correction of clerical errors, the so
callednuncprotuncentrieswhichcausenoprejudicetoanyparty,voidjudgments,andwhenevercircumstances
transpireafterthefinalityofthedecisionrenderingitsexecutionunjustandinequitable.46Noneoftheexceptions
is present in this case. The HLURB decision cannot be considered a void judgment, as it was rendered by a
tribunalwithjurisdictionoverthesubjectmatterofthecomplaint.47
Ineluctably, the HLURB Decision resulted in the unjust enrichment of petitioner at the expense of respondent.
Petitionerreceivedmorethanwhatheisentitledtorecoverunderthecircumstances.
Article22oftheCivilCodewhichembodiesthemaxim,nemoexalteriusincommodedebetlecupletari (no man
oughttobemaderichoutofanother'sinjury),states:
Art. 22. Every person who through an act of performance by another, or any other means, acquires or
comes into possession of something at the expense of the latter without just or legal ground, shall return
thesametohim.
The abovequoted article is part of the chapter of the Civil Code on Human Relations, the provisions of which
wereformulatedasbasicprinciplestobeobservedfortherightfulrelationshipbetweenhumanbeingsandforthe
stabilityofthesocialorderdesignedtoindicatecertainnormsthatspringfromthefountainofgoodconscience
guidesforhumanconductthatshouldrunasgoldenthreadsthroughsocietytotheendthatlawmayapproachits
supremeidealwhichistheswayanddominanceofjustice.48Thereisunjustenrichmentwhenapersonunjustly
retains a benefit at the loss of another, or when a person retains money or property of another against the
fundamentalprinciplesofjustice,equityandgoodconscience.49
Asenseofjusticeandfairnessdemandsthatpetitionershouldnotbeallowedtobenefitfromhisactofentering
intoacontracttosellthatviolatestheconstitutionalproscription.
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Thisisnotacaseofequityoverrulingorsupplantingapositiveprovisionoflaworjudicialrule.Rather,equityis
exercisedinthiscase"asthecomplementoflegaljurisdiction[that]seekstoreachandtocompletejusticewhere
courts of law, through the inflexibility of their rules and want of power to adapt their judgments to the special
circumstancesofcases,areincompetenttodoso."50
The purpose of the exercise of equity jurisdiction in this case is to prevent unjust enrichment and to ensure
restitution. Equity jurisdiction aims to do complete justice in cases where a court of law is unable to adapt its
judgmentstothespecialcircumstancesofacasebecauseoftheinflexibilityofitsstatutoryorlegaljurisdiction.51
ThesheriffdeliveredtopetitionertheamountofP5,313,040.00representingthenetproceeds(biddedamountis
P5,450,653.33) of the auction sale after deducting the legal fees in the amount of P137,613.33.52 Petitioner is
only entitled to P3,187,500.00, the amount of the purchase price of the real property paid by petitioner to
respondentundertheContracttoSell.Thus,theCourtintheexerciseofitsequityjurisdictionmayvalidlyorder
petitionertoreturntheexcessamountofP2,125,540.00.
TheCourtshallnowproceedtoresolvethesingleissueraisedinthepresentpetition:whethertheCAseriously
erredinaffirmingtheHLURBOrdersettingasidethelevymadebytheSheriffonthesubjectproperties.
PetitioneraversthattheHLURBArbiterandDirectorhadnofactualbasisforpeggingthefairmarketvalueofthe
leviedpropertiesatP6,500.00persqmorP83,616,000.00thatrelianceontheappraisalreportwasmisplaced
sincetheappraisalwasbasedonthevalueoflandinneighboringdevelopedsubdivisionsandontheassumption
thattheresidentialunitappraisedhadalreadybeenbuiltthattheSheriffneednotdeterminethefairmarketvalue
ofthesubjectpropertiesbeforelevyingonthesamesincewhatismaterialistheamountforwhichtheproperties
were bidded and sold during the public auction that the pendency of any motion is not a valid ground for the
Sherifftosuspendtheexecutionproceedingsand,byitself,doesnothavetheeffectofrestrainingtheSherifffrom
proceedingwiththeexecution.
Respondent, on the other hand, contends that while it is true that the HLURB Arbiter and Director did not
categoricallystatetheexactvalueoftheleviedproperties,saidpropertiescannotjustamounttoP6,000,000.00
that the HLURBArbiter and Director correctly held that the value indicated in the tax declaration is not the sole
determinantofthevalueoftheproperty.
Thepetitionisimpressedwithmerit.
If the judgment is for money, the sheriff or other authorized officer must execute the same pursuant to the
provisionsofSection9,Rule39oftheRevisedRulesofCourt,viz:
Sec.9.Executionofjudgmentsformoney,howenforced.
(a)Immediate payment on demand. The officer shall enforce an execution of a judgment for money by
demanding from the judgment obligor the immediate payment of the full amount stated in the writ of
executionandalllawfulfees.xxx
(b)Satisfaction by levy. If the judgment obligor cannot pay all or part of the obligation in cash, certified
bankcheckorothermodeofpaymentacceptabletothejudgmentobligee,theofficershalllevyuponthe
propertiesofthejudgmentobligorofeverykindandnaturewhatsoeverwhichmaybedisposedof
forvalueandnototherwiseexemptfromexecution,givingthelattertheoptiontoimmediatelychoose
whichpropertyorpartthereofmaybeleviedupon,sufficienttosatisfythejudgment.Ifthejudgmentobligor
doesnotexercisetheoption,theofficershallfirstlevyonthepersonalproperties,ifany,andthenonthe
realpropertiesifthepersonalpropertiesareinsufficienttoanswerforthejudgment.
The sheriff shall sell only a sufficient portion of the personal or real property of the judgment
obligorwhichhasbeenleviedupon.
Whenthereismorepropertyofthejudgmentobligorthanissufficienttosatisfythejudgmentand
lawfulfees,hemustsellonlysomuchofthepersonalorrealpropertyasissufficienttosatisfythe
judgmentandlawfulfees.
Realproperty,stocks,shares,debts,credits,andotherpersonalproperty,oranyinterestineitherrealor
personal property, may be levied upon in like manner and with like effect as under a writ of
attachment(Emphasissupplied).53
Thus,underRule39,inexecutingamoneyjudgmentagainstthepropertyofthejudgmentdebtor,thesheriffshall
levyonallpropertybelongingtothejudgmentdebtorasisamplysufficienttosatisfythejudgmentandcosts,and
sellthesamepayingtothejudgmentcreditorsomuchoftheproceedsaswillsatisfytheamountofthejudgment
debtandcosts.Anyexcessintheproceedsshallbedeliveredtothejudgmentdebtorunlessotherwisedirected
bythejudgmentororderofthecourt.54
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Clearly,therearetwostagesintheexecutionofmoneyjudgments.First,thelevyandthentheexecutionsale.
Levyhasbeendefinedastheactoractsbywhichanofficersetsapartorappropriatesapartorthewholeofa
judgmentdebtor'spropertyforthepurposeofsatisfyingthecommandofthewritofexecution.55Theobjectofa
levyistotakepropertyintothecustodyofthelaw,andtherebyrenderitliabletothelienoftheexecution,andput
itoutofthepowerofthejudgmentdebtortodivertittoanyotheruseorpurpose.56
Ontheotherhand,anexecutionsaleisasalebyasherifforotherministerialofficerundertheauthorityofawrit
ofexecutionoftheleviedpropertyofthedebtor.57
In the present case, the HLURB Arbiter and Director gravely abused their discretion in setting aside the levy
conducted by the Sheriff for the reason that the auction sale conducted by the sheriff rendered moot and
academicthemotiontoquashthelevy.TheHLURBArbiterlostjurisdictiontoactonthemotiontoquashthelevy
by virtue of the consummation of the auction sale.Absent any order from the HLURB suspending the auction
sale,thesheriffrightfullyproceededwiththeauctionsale.Thewinningbidderhadalreadypaidthewinningbid.
ThelegalfeeshadalreadybeenremittedtotheHLURB.Thejudgmentawardhadalreadybeenturnedoverto
thejudgmentcreditor.Whatwaslefttobedonewasonlytheissuanceofthecorrespondingcertificatesofsaleto
thewinningbidder.Infact,onlythesignatureoftheHLURBDirectorforthatpurposewasneeded58 a purely
ministerialact.
Apurelyministerialactordutyisonewhichanofficerortribunalperformsinagivenstateoffacts,inaprescribed
manner,inobediencetothemandateofalegalauthority,withoutregardforortheexerciseofhisownjudgment
upontheproprietyorimproprietyoftheactdone.Ifthelawimposesadutyuponapublicofficerandgiveshimthe
righttodecidehoworwhenthedutyshallbeperformed,suchdutyisdiscretionaryandnotministerial.Thedutyis
ministerialonlywhenthedischargeofthesamerequiresneithertheexerciseofofficialdiscretionnorjudgment.59
Inthepresentcase,alltherequirementsofauctionsaleundertheRuleshavebeenfullycompliedwithtowarrant
theissuanceofthecorrespondingcertificatesofsale.
AndeveniftheCourtshouldgointothemeritsoftheassailedOrder,thepetitionismeritoriousonthefollowing
grounds:
Firstly,therelianceoftheHLURBArbiterandDirector,aswellastheCA,on Barrozov.Macaraeg60andBuanv.
CourtofAppeals61ismisplaced.
The HLURB and the CA misconstrued the Court's pronouncements in Barrozo. Barrozo involved a judgment
debtor who wanted to repurchase properties sold at execution beyond the oneyear redemption period. The
statement of the Court in Barrozo, that "only where such inadequacy shocks the conscience the courts will
intervene," is at best a mere obiter dictum. This declaration should be taken in the context of the other
declarationsoftheCourtinBarrozo,towit:
Anotherpointraisedbyappellantisthatthepricepaidattheauctionsalewassoinadequateastoshock
theconscienceofthecourt.Supposingthatthisissueisopenevenaftertheoneyearperiodhasexpired
and after the properties have passed into the hands of third persons who may have paid a price higher
thantheauctionsalemoney,thefirstthingtoconsideristhatthestipulationcontainsnostatementofthe
reasonable value of the properties and although defendant' answer avers that the assessed value was
P3,960italsoaversthattheirrealmarketvaluewasP2,000only.Anyway, mere inadequacy of price
which was the complaint' allegation is not sufficient ground to annul the sale.It is only where
suchinadequacyshockstheconsciencethatthecourtswillintervene.xxxAnotherconsiderationis
thattheassessedvaluebeingP3,960andthepurchasepricebeingineffectP1,864(P464salepriceplus
P1,400 mortgage lien which had to be discharged) the conscience is not shocked upon examining the
pricespaidinthesalesinNationalBankv.Gonzales,45Phil.,693andGuerrerov.Guerrero,57Phil.,445,
saleswhichwereleftundisturbedbythisCourt.
Furthermore,wherethereistherighttoredeemasinthiscaseinadequacyofpriceshouldnotbe
materialbecausethejudgmentdebtormayreacquirethepropertyorelsesellhisrighttoredeem
and thus recover any loss he claims to have suffered by reason of the price obtained at the
executionsale.
xxxx(Emphasissupplied).62
In other words, gross inadequacy of price does not nullify an execution sale. In an ordinary sale, for reason of
equity,atransactionmaybeinvalidatedonthegroundofinadequacyofprice,orwhensuchinadequacyshocks
one'sconscienceastojustifythecourtstointerferesuchdoesnotfollowwhenthelawgivestheownertheright
toredeemaswhenasaleismadeatpublicauction,63uponthetheorythatthelessertheprice,theeasieritisfor
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theownertoeffectredemption.64 When there is a right to redeem, inadequacy of price should not be material
becausethejudgmentdebtormayreacquirethepropertyorelsesellhisrighttoredeemandthusrecoverany
lossheclaimstohavesufferedbyreasonofthepriceobtainedattheexecutionsale.65Thus,respondentstood
togainratherthanbeharmedbythelowsalevalueoftheauctionedpropertiesbecauseitpossessestherightof
redemption.Moreimportantly,thesubjectmatterinBarrozoistheauctionsale,notthelevymadebytheSheriff.
TheCourtdoesnotsanctionthepiecemealinterpretationofadecision.Togetthetrueintentandmeaningofa
decision,nospecificportionthereofshouldbeisolatedandresortedto,butthedecisionmustbeconsideredinits
entirety.66
As regards Buan, it is cast under an entirely different factual milieu. It involved the levy on two parcels of land
ownedbythejudgmentdebtorandthesaleatpublicauctionofonewassufficienttofullysatisfythejudgment,
suchthatthelevyandattemptedexecutionofthesecondparceloflandwasdeclaredvoidforbeinginexcessof
andbeyondtheoriginaljudgmentawardgrantedinfavorofthejudgmentcreditor.
Inthepresentcase,theSheriffcompliedwiththemandateofSection9,Rule39oftheRevisedRulesofCourt,to
"sellonlyasufficientportion"oftheleviedproperties"asissufficienttosatisfythejudgmentandthelawfulfees."
Eachofthe15leviedpropertieswassuccessivelybiddeduponandsold,oneaftertheotheruntilthejudgment
debt and the lawful fees were fully satisfied. Holly Properties Realty Corporation successively bidded upon and
bought each of the levied properties for the total amount of P5,450,653.33 in full satisfaction of the judgment
awardandlegalfees.67
Secondly, the Rules of Court do not require that the value of the property levied be exactly the same as the
judgmentdebtitcanbelessormorethantheamountofdebt.ThisisthecontingencyaddressedbySection9,
Rule 39 of the Rules of Court. In the levy of property, the Sheriff does not determine the exact valuation of the
leviedproperty.UnderSection9,Rule39,inconjunctionwithSection7,Rule57oftheRulesofCourt,thesheriff
isrequiredtodoonlytwospecificthingstoeffectalevyuponarealty:(a)filewiththeregisterofdeedsacopyof
theorderofexecution,togetherwiththedescriptionoftheleviedpropertyandnoticeofexecutionand(b)leave
with the occupant of the property copy of the same order, description and notice.68 Records do not show that
respondentallegednoncompliancebytheSheriffofsaidrequisites.
Thirdly,indeterminingwhatamountofpropertyissufficientoutofwhichtosecuresatisfactionoftheexecution,
theSheriffislefttohisownjudgment.Hemayexerciseareasonablediscretion,andmustexercisethecarewhich
a reasonably prudent person would exercise under like conditions and circumstances, endeavoring on the one
hand to obtain sufficient property to satisfy the purposes of the writ, and on the other hand not to make an
unreasonable and unnecessary levy.69 Because it is impossible to know the precise quantity of land or other
propertynecessarytosatisfyanexecution,theSheriffshouldbeallowedareasonablemarginbetweenthevalue
ofthepropertylevieduponandtheamountoftheexecutionthefactthattheSheriffleviesuponalittlemorethan
is necessary to satisfy the execution does not render his actions improper.70 Section 9, Rule 39, provides
adequate safeguards against excessive levying. The Sheriff is mandated to sell so much only of such real
propertyasissufficienttosatisfythejudgmentandlawfulfees.
In the absence of a restraining order, no error, much less abuse of discretion, can be imputed to the Sheriff in
proceedingwiththeauctionsaledespitethependingmotiontoquashthelevyfiledbytherespondentswiththe
HLURB. It is elementary that sheriffs, as officers charged with the delicate task of the enforcement and/or
implementationofjudgments,must,intheabsenceofarestrainingorder,actwithconsiderabledispatchsoasnot
toundulydelaytheadministrationofjusticeotherwise,thedecisions,orders,orotherprocessesofthecourtsof
justiceandthelikewouldbefutile.71ItisnotwithinthejurisdictionoftheSherifftoconsider,muchlessresolve,
respondent'sobjectiontothecontinuationoftheconductoftheauctionsale.TheSheriffhasnoauthority,onhis
own,tosuspendtheauctionsale.Hisdutybeingministerial,hehasnodiscretiontopostponetheconductofthe
auctionsale.
Finally,onewhoattacksalevyonthegroundofexcessivenesscarriestheburdenofsustainingthatcontention.72
In the determination of whether a levy of execution is excessive, it is proper to take into consideration
encumbrancesupontheproperty,aswellasthefactthataforcedsaleusuallyresultsinasacrificethatis,the
pricedemandedforthepropertyuponaprivatesaleisnotthestandardfordeterminingtheexcessivenessofthe
levy.73
Here,theHLURBArbiterandDirectorhadnosufficientfactualbasistodeterminethevalueoftheleviedproperty.
Respondent only submitted an Appraisal Report, based merely on surmises. The Report was based on the
projectedvalueofthetownhouseprojectafteritshallhavebeenfullydeveloped,thatis,ontheassumptionthat
theresidentialunitsappraisedhadalreadybeenbuilt.TheAppraiserinfactmadethisqualificationinitsAppraisal
Report: "[t]he property subject of this appraisal has not been constructed. The basis of the appraiser is on the
existing model units."74 Since it is undisputed that the townhouse project did not push through, the projected
value did not become a reality. Thus, the appraisal value cannot be equated with the fair market value. The
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Appraisal Report is not the best proof to accurately show the value of the levied properties as it is clearly self
serving.
Therefore,theOrderdatedAugust28,2000ofHLURBArbiterAquinoandDirectorCenizainHLRBCaseNo.IV6
0711960618 which set aside the sheriff's levy on respondent's real properties, was clearly issued with grave
abuseofdiscretion.TheCAerredinaffirmingsaidOrder.
WHEREFORE,theinstantpetitionisGRANTED.TheDecisiondatedOctober30,2002oftheCourtofAppealsin
CAG.R.SPNo.60981isREVERSEDandSETASIDE.TheOrderdatedAugust28,2000ofHLURBArbiterMa.
Perpetua Y. Aquino and Director Belen G. Ceniza in HLRB Case No. IV60711960618 is declared NULL and
VOID. HLURBArbiterAquino and Director Ceniza are directed to issue the corresponding certificates of sale in
favorofthewinningbidder,HollyPropertiesRealtyCorporation.Petitionerisorderedtoreturntorespondentthe
amountofP2,125,540.00,withoutinterest,inexcessoftheproceedsoftheauctionsaledeliveredtopetitioner.
Afterthefinalityofhereinjudgment,theamountofP2,125,540.00shallearn6%interestuntilfullypaid.
SOORDERED.
YnaresSantiago,Chairperson,ChicoNazario,Nachura,Reyes,JJ.,concur.

Footnotes
1PennedbyAssociateJusticePortiaAlioHormachuelosandconcurredinbyAssociateJusticesEliezerR.

deLosSantos(nowdeceased)andAmelitaG.Tolentino,CArollo,p.443.
2Id.at48.
3Id.at50.
4Id.at46.
5Id.at51.
6Id.at66.
7Id.at75.
8Id.at76.
9Id.at78129.
10Id.at81,85,89,93,97,101,105,109,113,117,121,125and129.
11Id.at130.
12Id.at140and151.
13Id.at136.
14Id.at210.
15Id.at191207.
16Supranote14.
17Id.at38.
18Id.at4243.
19Id.at44.
20Supranote1.
2183Phil.378(1949).
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22G.R.No.101614,August17,1994,235SCRA424.
23ApplyingbyanalogytherulinginCommissioneronHigherEducationv.Mercado,G.R.No.157877,

March10,2006,484SCRA424,432,apartymayelevateadecisionoftheCourtofAppealsbeforethe
SupremeCourtbywayofapetitionforreviewunderRule45oftheRulesofCourt,withoutthebenefitofa
priormotionforreconsideration.
24Rollo,p.19.
25Constitution,(1987),ArticleXII,Section3.

Sec.3.Landsofthepublicdomainareclassifiedintoagricultural,forestortimber,minerallands,and
nationalparks.Agriculturallandsofthepublicdomainmaybeclassifiedbylawaccordingtotheuses
towhichtheymaybedevoted.Alienablelandsofthepublicdomainshallbelimitedtoagricultural
lands.Privatecorporationsorassociationsmaynotholdsuchalienablelandsofthepublicdomain
exceptbylease,foraperiodnotexceedingtwentyfiveyears,renewablefornotmorethantwenty
fiveyears,andnottoexceedonethousandhectaresinarea.CitizensofthePhilippinesmaylease
notmorethanfivehundredhectares,oracquirenotmorethantwelvehectaresthereofby
purchase,homestead,orgrant.
xxxx(Emphasissupplied).
26Id.atSection2.

Sec.2.Alllandsofthepublicdomain,waters,minerals,coal,petroleum,andothermineraloils,all
forcesofpotentialenergy,fisheries,forestsortimber,wildlife,floraandfauna,andothernatural
resourcesareownedbytheState.Withtheexceptionofagriculturallands,allothernatural
resourcesshallnotbealienated.Theexploration,development,andutilizationofnaturalresources
shallbeunderthefullcontrolandsupervisionoftheState.TheStatemaydirectlyundertakesuch
activities,oritmayenterintocoproduction,jointventure,orproductionsharingagreementswith
Filipinocitizens,orcorporationsorassociationsatleastsixtypercentumofwhosecapitalis
ownedbysuchcitizens.xxx(Emphasissupplied).
27Mullerv.Muller,G.R.No.149615,August29,2006,500SCRA65,71Frenzelv.Catito,G.R.No.

143958,July11,2003,406SCRA55,69OngChingPov.CourtofAppeals,G.R.No.11347273,
December20,1994,239SCRA341,346.
28Tolentino,CivilCodeofthePhilippines(1991),Vol.IV,p.629Tongoyv.CourtofAppeals,208Phil.95,

113(1983).
29Id.at632Tongoyv.CourtofAppeals,id.
30Sodhi,LatinWordsandPhrasesforLawyers(1980),p.115.
31Moreno,PhilippineLawDictionary(1988),p.451,citingRellosav.GawCheeHun,93Phil.827,831,

(1953).
32Vitug,CivilLawAnnotated,Vol.III(2003),pp.159160.
33Art.1411.Whenthenullityproceedsfromtheillegalityofthecauseorobjectofthecontract,andtheact

constitutesacriminaloffense,bothpartiesbeinginparidelicto,theyshallhavenoactionagainsteach
other,andbothshallbeprosecuted.Moreover,theprovisionsofthePenalCoderelativetothedisposalof
effectsorinstrumentsofacrimeshallbeapplicabletothethingsorthepriceofthecontract.
Thisruleshallbeapplicablewhenonlyoneofthepartiesisguiltybuttheinnocentonemayclaimwhathe
hasgiven,andshallnotbeboundtocomplywithhispromise.
Art.1412.Iftheactinwhichtheunlawfulorforbiddencauseconsistsdoesnotconstituteacriminaloffense,
thefollowingruleshallbeobserved:
(1)Whenthefaultisonthepartofbothcontractingparties,neithermayrecoverwhathehasgiven
byvirtueofthecontract,ordemandtheperformanceoftheother'sundertaking
(2)Whenonlyoneofthecontractingpartiesisatfault,hecannotrecoverwhathehasgivenby
reasonofthecontract,oraskforthefulfillmentofwhathasbeenpromisedhim.Theotherwhoisnot
atfault,maydemandthereturnofwhathehasgivenwithoutanyobligationtocomplywithhis
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promise.
34Art.1413.Interestpaidinexcessoftheinterestallowedbytheusurylawsmayberecoveredbythe

debtor,withinterestthereonfromthedateofthepayment.
35Art.1414.Whenmoneyispaidorpropertydeliveredforanillegalpurpose,thecontractmaybe

repudiatedbyoneofthepartiesbeforethepurposehasbeenaccomplished,orbeforeanydamagehas
beencausedtoathirdperson.Insuchcase,thecourtsmay,ifthepublicinterestwillthusbesubserved,
allowthepartyrepudiatingthecontracttorecoverthemoneyorproperty.
36Art.1415.Whereoneofthepartiestoanillegalcontractisincapableofgivingconsent,thecourtsmay,if

theinterestofjusticesodemands,allowrecoveryofmoneyorpropertydeliveredbytheincapacitated
person.
37Art.1416.Whentheagreementisnotillegalpersebutismerelyprohibited,andtheprohibitionbythe

lawisdesignedfortheprotectionoftheplaintiff,hemay,ifpublicpolicyistherebyenhanced,recoverwhat
hehaspaidordelivered.
38Art.1417.Whenthepriceofanyarticleorcommodityisdeterminedbystatute,orbyauthorityoflaw,

anypersonpayinganyamountinexcessofthemaximumpriceallowedmayrecoversuchexcess.
39Art.1418.Whenthelawfixes,orauthorizesthefixingofthemaximumnumberofhoursoflabor,anda

contractisenteredintowherebyalaborerundertakestoworklongerthanthemaximumthusfixed,hemay
demandadditionalcompensationforservicerenderedbeyondthetimelimit.
Art.1419.Whenthelawsets,orauthorizesthesettingofaminimumwageforlaborers,andacontractis
agreeduponbywhichalaboreracceptsalowerwage,heshallbeentitledtorecoverthedeficiency.
40AyalaLifeAssurance,Inc.v.RayBurtonDevelopmentCorporation,G.R.No.163075,January23,2006,

479SCRA462,468469Dijamcov.CourtofAppeals,G.R.No.113665,October7,2004,440SCRA190,
197.
41PhilippineNationalBankv.CourtofAppeals,330Phil.1048,1067(1996)RosePackingCo.,Inc.v.

CourtofAppeals,G.R.No.L33084,November14,1988,167SCRA309,318Limv.CourtofAppeals,
G.R.No.85733,February23,1990,182SCRA564,570.
42SacobiaHillsDevelopmentCorporationv.Ty,G.R.No.165889,September20,2005,470SCRA395,

404Coronelv.CourtofAppeals,331Phil.294,309(1996).
43Menchavezv.Teves,Jr.,G.R.No.153201,January26,2005,449SCRA380,393.
44EasternShippingLines,Inc.v.CourtofAppeals,G.R.No.97412,July12,1994,234SCRA78,95.
45Peav.GovernmentServiceInsuranceSystem(GSIS),G.RNo.159520,September19,2006,502

SCRA383,404Siyv.NationalLaborRelationsCommission,G.R.No.158971,August25,2005,468
SCRA154,161162Sacdalanv.CourtofAppeals,G.R.No.128967,May20,2004,428SCRA586,599.
46Peav.GovernmentServiceInsuranceSystem(GSIS),supranote45Siyv.NationalLaborRelations

Commission,supranote45,at162Sacdalanv.CourtofAppeals,supranote45.
47Pilapilv.HeirsofMaximinoR.Briones,G.R.No.150175,February5,2007,citingGomezv.Concepcion,

47Phil.717,722723(1925).
48SecurityBank&TrustCompanyv.CourtofAppeals,319Phil.312,317(1995).
4966AmJur2dRestitutionandImpliedContracts3.
50Tamiov.Ticson,G.R.No.154895,November18,2004,443SCRA44,55.
51Agcaoiliv.GovernmentServiceInsuranceSystem,G.R.No.L30056,August30,1988,165SCRA1,9

AirManila,Inc.v.CourtofIndustrialRelations,G.R.No.L39742,June9,1978,83SCRA579,589.
52Sheriff'sReturndatedMay3,2000,CArollo,pp.208210.
53RulesofCourt,Rule57,Section7:
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Sec.7.Attachmentofrealandpersonalpropertyrecordingthereof.Realandpersonalproperty
shallbeattachedbythesheriffexecutingthewritinthefollowingmanner:
(a)Realproperty,orgrowingcropsthereon,standingupontherecordoftheregistryofdeedsofthe
provinceinthenameofthepartyagainstwhomattachmentisissued,ornotappearingatallupon
suchrecords,orbelongingtothepartyagainstwhomattachmentisissuedandheldbyanyother
person,orstandingontherecordsoftheregistryofdeedsinthenameofanyotherperson,byfiling
withtheregistryofdeedsacopyoftheorder,togetherwithadescriptionofthepropertyattached,
andanoticethatitisattached,orthatsuchrealpropertyandanyinterestthereinheldbyorstanding
inthenameofsuchotherpersonareattached,andbyleavingacopyofsuchorder,description,and
noticewiththeoccupantoftheproperty,ifany,orwithsuchotherpersonorhisagentiffoundwithin
theprovince.WherethepropertyhasbeenbroughtundertheoperationofeithertheLand
RegistrationActorthePropertyRegistrationDecree,thenoticeshallcontainareferencetothe
numberofthecertificateoftitle,thevolumeandpageintheregistrationbookwherethecertificateis
registered,andtheregisteredownerorownersthereof.
Theregistrarmustindexattachmentsfiledunderthisparagraphinthenamesbothoftheapplicant,
theadverseparty,orthepersonbywhomthepropertyisheldorinwhosenameitstandsinthe
records.xxx.
xxxx
54Moran,CommentsontheRulesofCourt,Vol.II,p.297(1980).
55Cajav.Nanquil,A.M.No.P041885,September13,2004,438SCRA174,191CagayandeOro

Coliseum,Inc.v.CourtofAppeals,378Phil.498,523(1999)Fiestanv.CourtofAppeals,G.R.No.81552,
May28,1990,185SCRA751,757DelRosariov.Hon.Yatco,125Phil.396,399(1966)Llenaresv.
Valdeavella,46Phil.358,360(1924).
56CagayandeOroColiseum,Inc.v.CourtofAppeals,supranote55,at523524Francisco,TheRevised

RulesofCourtinthePhilippines,Vol.II,p.700(1968),citing33C.J.S.234DelRosariov.Yatco,supra
note55.
57Cajav.Nanquil,supranote55.
58CArollo,pp.191207.
59Espiridionv.CourtofAppeals,G.R.No.146933,June8,2006,490SCRA273,277Codilla,Sr.v.de

Venecia,442Phil.139,189(2002).
60Supranote21.
61Supranote22.
62Supranote21,at380381.
63RevisedRulesofCourt,Rule39,Section28,provides:

SEC.28.Timeandmannerof,andamountspayableon,successiveredemptionsnoticetobegiven
andfiled.Thejudgmentobligor,orredemptioner,mayredeemthepropertyfromthepurchaser,at
anytimewithinone(1)yearfromthedateoftheregistrationofthecertificateofsale,by
payingthepurchasertheamountofhispurchase,withonepercentumpermonthinterestthereonin
addition,uptothetimeofredemption,togetherwiththeamountofanyassessmentsortaxeswhich
thepurchasermayhavepaidthereonafterpurchase,andinterestonsuchlastnamedamountofthe
samerateandifthepurchaserbealsoacreditorhavingapriorlientothatoftheredemptioner,
otherthanthejudgmentunderwhichsuchpurchasewasmade,theamountofsuchotherlien,with
interest.
xxxx(Emphasissupplied).
64PhilippineNationalBankv.CourtofAppeals,367Phil.508,522(1999)Sulitv.CourtofAppeals,335

Phil.914,927(1997)TheAbacaCorporationofthePhilippinesv.Garcia,338Phil.988,993(1997)
Tiongcov.PhilippineVeteransBank,G.R.No.82782,August5,1992,212SCRA176,189190.
65SuicoRattan&BuriInteriors,Inc.v.CourtofAppeals,G.R.No.138145,June15,2006,490SCRA560,

579,citingPrudentialBankv.Martinez,G.R.No.51768,September14,1990,189SCRA612,617
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DevelopmentBankofthePhilippinesv.Moll,150Phil.101,107(1972).
66TelefunkenSemiconductorsEmployeesUnionv.CourtofAppeals,401Phil.776,800(2000)

Valderramav.NationalLaborRelationsCommission,326Phil.477,484(1996)Policarpiov.Philippine
VeteransBoardandAssociatedInsurance&SuretyCo.,Inc.,106Phil.125,131(1959).
67CArollo,p.210.
68CagayandeOroColiseum,Inc.v.CourtofAppeals,supranote55,at524PhilippineSurety&Insurance

Company,Inc.v.Zabal,128Phil.714,718(1967).SeealsoMartin,CivilProcedure,Vol.I,p.806(1989).
6930AmJr2dExecutionsandEnforcementofJudgments122.
70Id.
71SecurityBankCorporationv.Gonzalbo,A.M.No.P062139,March23,2006,485SCRA136,145146

Zaratev.Untalan,A.M.No.MTJ051584,March31,2005,454SCRA206,216Mendozav.Tuquero,412
Phil.435,442(2001).
7230AmJr2dExecutionsandEnforcementofJudgments122.
73Id.at123,citingFrenchv.Snyder,30Ill339.
74CArollo,p.152.
TheLawphilProjectArellanoLawFoundation

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