"x x x.
Before anything more, the Court clarifies that the failure of Apolinario Cruz to register the certificate of sale was of no consequence in this adjudication. The registration of the sale is required only in extrajudicial foreclosure sale because the date of the registration is the reckoning point for the exercise of the right of redemption. In contrast, the registration of the sale is superfluous in judicial foreclosure because only the equity of redemption is granted to the mortgagor, except in mortgages with banking institutions.34 The equity of redemption is the right of the defendant mortgagor to extinguish the mortgage and retain ownership of the property by paying the secured debt within the 90-day period after the judgment becomes final, or even after the foreclosure sale but prior to the confirmation of the sale.35 In this light, it was patent error for the CA to declare that: "By Apolinario Cruz’s failure to register the 18 March 1958 Certificate of Absolute Salein the Office of the Register of Deeds, the period of redemption did not commence to run."36
The applicable rule on March 18, 1959, the date of the foreclosure sale, was Section 3, Rule 7037 of the Rules of Court, which relevantly provided that: "Such sale shall not affect the rights of persons holding prior incumbrances upon the property or a partthereof, and when confirmed by an order of the court, it shall operate to divest the rights of all the parties to the action and to vest their rights in the purchaser, subject to such rights of redemption as may be allowed by law." The records show that no judicial confirmation of the sale was made despite the lapse of more than 40 years since the date of the sale. Hence, it cannot be said that title was fully vested in Apolinario Cruz.
However, the Court will not be dispensing true and effective justice if it denies the petition for review on the basis alone of the absence of the judicial confirmation of the sale. Although procedural rules are not to be belittled or disregarded considering thatthey insure an orderly and speedy administration of justice, it is equally true that litigation is not a game of technicalities. Law and jurisprudence grant to the courtsthe prerogative to relax compliance with procedural rules of even the most mandatory character, mindful of the duty to reconcile both the need to speedily put an end to litigation and the parties’ rightto an opportunity to be heard.38 The Rules of Courtitself calls for a liberal construction of its rules with the view of promoting their objective of securing a just, speedy and inexpensive disposition of every action and proceeding.39
To better serve the ends of justice, the Court holds that the real issue to consider and resolve iswho between the parties had the better right to the property, not whether there was a valid transfer of ownership to Apolinario Cruz.
It was not denied that Fernando F.Yapcinco, as the mortgagor, did not pay his obligation, and that his default led to the filing of the action for judicial foreclosure against him, in which he actively participated in the proceedings, and upon his death was substituted by the administratrive of his estate. In the end, the decision in the action for judicial foreclosure called for the holding of the public sale of the mortgaged property. Due to the subsequent failure of the estate of Fernando F. Yapcinco to exercise the equity of redemption, the property was sold at the public sale, and Apolinario Cruz was declared the highest bidder. Under the circumstances, the respondents as the successors-in-interest of Fernando F. Yapcinco were fully bound by that decision and by the result of the ensuing foreclosure sale.
In this regard, determining whether Patrocinio Yapcinco Kelly, the adminsitratrix of the estate, and respondent Patrocinio Yapcinco were one and the same person was not necessary. Even if they were not one and the same person, they were both bound by the foreclosure proceedings by virtue of their being
both successors-in-interest of Fernando F. Yapcinco.
Although the respondents admitted the existence of the mortgage, they somehow denied knowledge of its foreclosure.1âwphi1 Yet, in asserting their superior right to the property, theyrelied on and cited the entry dated February 11, 1992 concerning the release of mortgage inscribed on TCT No. 20458. This duplicity the Court cannotcountenance. Being the heirs and successors-in-interest of the late Fernando F. Yapcinco, they could not repudiate the foreclosure sale and its consequences, and escape such consequences that bound and concluded their predecessor-in-interest whose shoes they only stepped into.40 Given their position on the lack of judicial confirmation of the sale in favor of Apolinario Cruz, they should have extinguished the mortgage by exercising their equity of redemption through paying the secured debt. They did not do so, and, instead, they sought the annulment of TCT No. 243719 and caused the issuance of another title in their name.
Even assuming that there was no foreclosure of the mortgage, such that the respondents did not need to exercise the equity of redemption, the legal obligation to pay off the mortgageindebtedness in favor of Apolinario Cruz nonetheless devolved on them and the estate of Fernando F. Yapcinco. They could not sincerely rely on the entry about the release or cancellation of the mortgage in TCT No. 20458, because such entry appeared to be unfounded in the face of the lack of any showing by them that either they or the estate of Fernando F. Yapcinco had settled the obligation.
The petitioner did not tender any explanation for the failure of Apolinario Cruz to secure the judicialconfirmation of the sale. He reminds only that Apolinario Cruz and his successors-in-interest and representatives have been in actual, notorious, publicand uninterrupted possession of the property from the time of his purchase at the foreclosure sale until the present.
The effect of the failure of Apolinario Cruz to obtain the judicial confirmation was only to prevent the title to the property from being transferred to him. For sure, such failure did not give riseto any right in favor of the mortgagor or the respondents as his successors-in-interest to take back the property already validly sold through public auction. Nor did such failure invalidate the foreclosure proceedings. To maintain otherwise would render nugatory the judicial foreclosure and foreclosure sale, thus unduly disturbing judicial stability. The non-transfer of the title notwithstanding, Apolinario Cruz as the purchaser should not be deprived of the property purchased at the foreclosure sale. With the respondents having been fully aware of the mortgage, and being legally bound by the judicial foreclosure and consequent public sale, and in view of the unquestioned possession by Apolinario Cruz and his successors-in-interest (including the petitioner) from the time of the foreclosure sale until the present, the respondents could not assert any better right to the property. It would be the height of inequity to still permit them to regain the property on the basis alone of the lack of judicial confirmation of the sale. After all, under the applicable rule earlier cited, the judicial confirmation operated only "to divest the rights of all the parties to the action and to vest their rights in the purchaser, subject to such rights of redemption as may be allowed by law."
Consequently, the late Fernando F. Yapcinco and the respondents as his successors-in-interest were divested of their right in the property, for they did not duly exercise the equity of redemption decreed in the decision of the trial court. With Yapcinco having thereby effectively ceased to be the owner of the property sold, the property was taken out of the mass of the assets of Y apcinco upon the expiration of the equity of redemption.
x x x."
