Nunez vs. GSIS Family Bank, 475 SCRA 305 G.R. No. 163988 November 17, 2005

G.R. No.
163988 November 17, 2005

VALENTINA A. NUÑEZ, FELIX A. NUÑEZ, FELIXITA A. NUÑEZ, LEONILO A. NUÑEZ, JR., ELIZA A.
NUÑEZ, EMMANUEL A. NUÑEZ and DIVINA A. NUÑEZ as heirs of LEONILO S. NUÑEZ,*
Petitioners,
vs.
GSIS FAMILY BANK (Formerly COMSAVINGS BANK) and the COURT OF APPEALS, Respondents.
Topic: Appeal by Certiorari to the Supreme Court (Rule 45)
Ponente: CARPIO MORALES, J.:
Facts:
Leonilo S. Nuñez obtained three loans from the GSIS Family Bank; The first loan was secured by
a mortgage over a parcel of land; The second loan was secured by mortgage of properties; The
third loan... actually amended the first loan... to secure which amended loan the same
property... when the three loans were maturing, Leonilo purportedly obtained a "fourth loan"
On the maturity of the three loans, Leonilo executed a Promissory Note more than nineteen
(19) years after Leonilo's Promissory Note matured... he bank undertook to extrajudicially
foreclose[7] the properties... which... secured the first two loans.
The bank alleged that Leonilo violated the terms and conditions of the loans... when he failed,
despite repeated demands, to pay his principal obligations, and interest due, Leonilo later filed
a complaint against the GSIS Family Bank... for Annulment of Extrajudicial Foreclosure Sale.
Leonilo denied securing a "fourth loan" but nevertheless alleged that "for purposes of the
action, the same shall be assumed to have been validly secured." Invoking prescription, he
citing Articles 1142[13] and 1144[14] of the Civil Code, Leonilo contended that his first three
loans and the "fourth loan" matured... hence, they had prescribed when the bank filed the
Petitions for Extrajudicial Foreclosure of Mortgage, Leonilo concluded that it no longer had any
right as prescription had set in.
RTC found for Leonilo who died during the pendency of the trial of the case, hence, his
substitution by his heirs
The appellate court found for the bank.
Issues:
WON the distinctions between Rules 45 and 65 are far and wide. However, the most apparent
is that errors of jurisdiction are best reviewed in a special civil action for certiorari under Rule65
while errors of judgment can only be corrected by appeal in a petition for review under Rule
45.40
WON in the interest of justice may treat a petition for certiorari as having filed under Rule 45,
more so if the same was filed within the reglementary period for filing a petition for review. 41
Ruling:
This Court finds the petition impressed with merit.
Rule 41 of the 1997 Rules of Civil Procedure which governs appeals from Regional Trial Courts
provides:
SEC. 2. Modes of appeal. –
(a) Ordinary appeal. – The appeal to the Court of Appeals in cases decided by the Regional Trial
Court in the exercise of its original jurisdiction shall be taken by filing a notice of appeal with the
court which rendered the judgment or final order appealed from and serving a copy thereof
upon the adverse party. No record on appeal shall be required except in special proceedings
and other cases of multiple or separate appeals where the law or these Rules so require. In
such cases, the record on appeal shall be filed and served in like manner.
SEC. 3. Period of ordinary appeal. – The appeal shall be taken within fifteen (15) days from
notice of the judgment or final order appealed from. Where a record on appeal is required, the
appellants shall file a notice of appeal and a record on appeal within thirty (30) days from notice
of the judgment or final order. However, on appeal in habeas corpus cases shall be taken within
forty-eight (48) hours from notice of the judgment or final order appealed from.
The period of appeal shall be interrupted by a timely motion for new trial or
reconsideration. No motion for extension of time to file a motion for new trial or
reconsideration shall be allowed. (Underscoring supplied).
On the other hand, Rule 22 provides for the manner of computing time and the effect of
interruption:
SEC. 1. How to compute time. – In computing any period of time prescribed or allowed by these
Rules, or by order of the court, or by any applicable statute, the day of the act or event from
which the designated period of time begins to run is to be excluded and the date of
performance included. If the last day of the period, as thus computed, falls on a Saturday, a
Sunday or a legal holiday in the place where the court sits, the time shall not run until the next
working day.
SEC. 2. Effect of interruption. – Should an act be done which effectively interrupts the running

of the period, the allowable period after such interruption shall start to run on the day after
notice of the cessation of the cause thereof.
The day of the act that caused the interruption shall be excluded in the computation of the
period. (Emphasis and underscoring supplied).
The requirement of notice under Sections 4 and 5 44 of Rule 15 in connection with Section 2,
Rule 37 of the Rules of Court is mandatory. 45 Absence of the mandatory requirement renders
the motion a worthless piece of paper which the clerk of court has no right to receive and
which the court has no authority to act upon. 46 Being a fatal defect, in cases of motions to
reconsider a decision, the running of the period to appeal is not tolled by their filing or
pendency.47
When the bank then filed its Motion for Reconsideration on the last of the 15-day period for
taking an appeal and it was subsequently denied, the bank had only one (1) day from December
9, 2002 when it received a copy of the order denying the motion or until December 10, 2002
within which to perfect its appeal.48
It filed the Notice of Appeal, however, on December 11, 2002, hence, out of time, and the
decision of the trial court had become final and executory.
While Rules may be relaxed when the party invoking liberality adequately explains his failure to
abide therewith, the bank failed to do so.
The explanations49 proffered by the bank behind its failure to incorporate a notice of hearing of
the Motion for Reconsideration — inadvertent deletion from its computer file of the standard
clauses for pleadings during the printing of the finalized draft of the motion and the handling
counsel’s heavy workload — are unsatisfactory.
To credit the foregoing explanations would render the mandatory rule on notice of hearing
meaningless and nugatory as lawyers would simply invoke these grounds should they fail to
comply with the rules.
As to the claim that the government would suffer loss of substantial amount if not allowed to
recover the proceeds of the loans, this Court finds that any loss was caused by respondent’s
own doing or undoing.
In fine, the failure to timely perfect an appeal cannot simply be dismissed as a mere
technicality, for it is jurisdictional.50
Nor can petitioner invoke the doctrine that rules of technicality must yield to the broader
interest of substantial justice. While every litigant must be given the amplest opportunity for
the proper and just determination of his cause, free from the constraints of technicalities, the
failure to perfect
an appeal within the reglementary period is not a mere technicality. It raises
a jurisdictional problem as it deprives the appellate court of jurisdiction over the appeal. The
failure to file the notice of appeal within the reglementary period is akin to the failure to pay
the appeal fee within the prescribed period. In both cases, the appeal is not perfected in due
time. As we held in Pedrosa v. Hill, the requirement of an appeal fee is by no means a mere
technicality of law or procedure, but an essential requirement without which the decision
appealed from would become final and executory. The same can be said about the late filing of
a notice of appeal. (Emphasis and underscoring supplied).51
Jurisdictional issue aside, upon the ground of prescription, the bank’s case would just the same
fail. An action to foreclose a real estate mortgage prescribes in ten years. 52 The running of the
period, however, may be interrupted.53
A review of the records of the case shows that, as correctly claimed by petitioners, no letter of
demand, court action, or foreclosure proceeding was undertaken prior to December 11, 1997
and September 1, 1999.
While the bank included in its Formal Offer of Evidence 54 Exhibits "E" and "H" which are the
Petitions for Extra-Judicial Foreclosure alleging that "repeated demands" for payment were
made after Leonilo defaulted and failed to pay the loan
obligations, allegations are not proofs. Unless a demand is proven, one cannot be held in
default.55
In justifying its failure to file a collection suit, the bank contended that it would have amounted
to a waiver of its right to foreclose. But if early on it opted to foreclose the mortgages, why it
waited until 1997 and 1999, more than nineteen years after the right to do so arose, the bank is
glaringly mute.
Clutching at straws, the bank argues that the applicable provision is Article 1141, 56 not Article
114257 of the Civil Code.
Article 1141 of the Civil Code speaks of real actions over immovables or rights. Article 1142 of
the Civil Code speaks of a mortgage action which prescribes in ten years. The strategic location
of Article 1142 immediately right after Article 1141 of the same Code, which speaks of real
actions, indicates that it is an exception to the rule in the previous article.
That an action for foreclosure of mortgage over real property prescribes in ten years is in fact
settled. In Buhat, et al. v. Besana, etc., et al.58 where an action was instituted on December 6,
1952 for the foreclosure of mortgage over real property to secure an obligation payable on or
before May 31, 1930, this Court affirmed the dismissal of the action by the then Court of First
Instance as the action was filed more than ten years from May 31, 1930 or some 22 years after
the obligation had become due and demandable.
WHEREFORE, the petition is GRANTED. The assailed Court of Appeals decision dated February
23, 2004 and Resolution dated May 25, 2004 are REVERSED and SET ASIDE. The Decision dated
August 9, 2002 of the Regional Trial Court of Gapan, Nueva Ecija, Branch 34, which had become
final and executory, stands.

Nunez vs. GSIS Family Bank, 475 SCRA 305 G.R. No. 163988 November 17, 2005

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G.R. No.

163988 November 17, 2005

This Court finds the petition impressed with merit.

SEC. 2. Modes of appeal. –

SEC. 2. Effect of interruption. – Should an act be done which effectively interrupts the running

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