Facts: Lydia Co, married to Ramon Co, was the registered owner of two parcels of land situated in Catbalogan, Samar covered by a TCT. Ramon Co, mortgaged said parcels of land to Metrobank for a sum of P200,000. Said properties were consequently sold to Metrobank in an extrajudicial foreclosure sale. one year after the registration of the certificates of sale, the titles to the properties were consolidated in the name of Metrobank for failure of Ramon Co to redeem the same within the one year period provided for by law. Ramon Co’s TCTs were cancelled and a new TCT were issued in favor of Metrobank. Metrobank  filed a petition for the issuance of a writ of possession against Ramon Co and Lydia Co (the spouses Co). However, since the spouses Co were no longer residing in the Philippines at the time the petition was led, the trial court ordered Metrobank, on January 12, 1994 and again on January 26, 1994 to effect summons by publication against the spouses Co. 

The brothers Teoco  led an answer-in-intervention alleging that they are the successors-in-interest of the spouses Co, and that they had duly and validly redeemed the subject properties within the reglementary period provided by law. The brothers Teoco thus prayed for the dismissal of Metrobank’s petition for a writ of possession, and for the nullification of the TCTs issued in the name of Metrobank. The brothers Teoco further prayed for the issuance in their name of new certificates of title. 

Metrobank, in its reply, alleged that the amount deposited by the brothers Teoco as redemption price was not sufficient, not being in accordance with Section 78 of the General Banking Act. Metrobank also said the assignment of the right of redemption by the spouses Co in favor of the brothers Teoco was not properly executed, as it lacks the necessary authentication from the Philippine Embassy.

The trial court was informed that the brothers Teoco had deposited the amount of P356,297.57 to the clerk of court of the RTC in Catbalogan, Samar. The trial court ordered Metrobank to disclose whether it is allowing the brothers Teoco to redeem the subject properties. Metrobank refused to accept the amount deposited by the brothers Teoco, alleging that they are obligated to pay the spouses Co’s subsequent obligations to Metrobank as well. The brothers Teoco claimed that they are not bound to pay all the obligations of the spouses Co, but only the value of the property sold during the public auction. 

The trial court reiterated its earlier order directing Metrobank to effect summons by publication to the spouses Co. Metrobank complied with said order by submitting documents showing that it caused the publication of summons against the spouses Co. The brothers Teoco challenged this summons by publication, arguing that the newspaper where the summons by publication was published, the Samar Reporter, was not a newspaper of general circulation in the Philippines. The brothers Teoco furthermore argued that Metrobank did not present witnesses to identify the documents to prove summons by publication. 

The RTC rendered its decision in favor of the Teoco brothers, finding that the Teoco brothers have validly redeemed the parcels of land. That Metrobank may now withdraw the redemption money deposited by the Teocos with the clerk of court and it further ordered that the CTCs of Metrobank be cancelled and a new CTC in favor of the Teoco brothers be issued. 

The CA, however, ruled in favor of Metrobank. CA held that the brothers Teoco were not able to effectively redeem the subject properties, because the amount tendered was insufficient, and the brothers Teoco have not sufficiently shown that the spouses Co’s right of redemption was properly transferred to them.

Issue: Whether or not the assignment of right of redemption is admissible in evidence as a public document?

Held: NO. However, this does not necessarily mean that such document has no probative value. 

There are generally three reasons for the necessity of the presentation of public documents. First, public documents are prima facie evidence of the facts stated in them, as provided for in Section 23, Rule 132 of the Rules of Court:

SEC. 23. Public documents as evidence. — Documents consisting of entries in public records made in the performance of a duty by a public officer are prima facie evidence of the facts therein stated. All other public documents are evidence, even against a third person, of the fact which gave rise to their execution and of the date of the latter.

Second, the presentation of a public document dispenses with the need to prove a document’s due execution and authenticity.

Third, the law may require that certain transactions appear in public instruments, such as Articles 1358 and 1625 of the Civil Code.

The exercise by the brothers Teoco of the right to redeem the properties in question is not precluded by the fact that the assignment of right of redemption was not contained in a public document. Metrobank never challenged either the content, the due execution, or the genuineness of the assignment of the right of redemption. Consequently, Metrobank is deemed to have admitted the same. Having impliedly admitted the content of the assignment of the right of redemption, there is no necessity for a prima facie evidence of the facts there stated. In the same manner, since Metrobank has impliedly admitted the due execution and genuineness of the assignment of the right of redemption, a private document evidencing the same is admissible in evidence. True it is that the Civil Code requires certain transactions to appear in public documents. However, the necessity of a public document for contracts which transmit or extinguish real rights over immovable property, as mandated by Article 1358 of the Civil Code, is only for convenience; it is not essential for validity or enforceability. 

In the case at bar, Metrobank would not be prejudiced by the assignment by the spouses Co of their right of redemption in favor of the brothers Teoco. As conceded by Metrobank, the assignees, the brothers Teoco, would merely step into the shoes of the assignors, the spouses Co. The brothers Teoco would have to comply with all the requirements imposed by law on the spouses Co. Metrobank would not lose any security for the satisfaction of any loan obtained from it by the spouses Co. In fact, the assignment would even prove to be bene cial to Metrobank, as it can foreclose on the subject properties anew, provided it proves that the subsequent loans entered into by the spouses Co are covered by the mortgage contract.

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