Resolving Moot Issues; When issue is susceptible of repetition

G.R. No. 142896 - Caneland Sugar Corp. v. Alon

Austria Martinez, J.
Caneland Sugar Corporation (petitioner) filed a case with the RTC, essentially to nullify any of the foreclosure
proceedings that the Land Bank of the Philippines and Sheriff De Vera may hold over Canelands property, in
favor of Alon. The RTC denied this and rescheduled the auction sale, ratiocinating that it is mandatory for
government financial institutions to foreclose the property based on P.D. 385. Petitioner filed a motion for
reconsideration but was denied, and the CA subsequently denied them too. Without resolving the principal
issue of whether the CA erred in finding that the RTC did not gravely abuse its discretion when it did not enjoin
the foreclosure proceedings, the Court finds that the petition should be denied since the act sought to be
enjoined has already been accomplished. Records show that the foreclosure sale has been carried out by
Sheriff De Vera. However, the Court found it necessary to resolve the merits of the principal issue raised for
future guidance of both bench and bar.
DOCTRINE
As the Court stated in Acop v. Guingona, Jr, courts will decide a question otherwise moot and academic if it is
capable of repetition, yet evading review.

FACTS
1. Caneland Sugar Corporation files with the Regional Trial Court of Silay City a complaint for damages,
injunction and nullity of mortgage against the Land Bank of the Philippines and Sheriff Eric de Vera.
2. The following reliefs were prayed for:
a. Issuance of a Temporary Restraining Order enjoining respondent and Sheriff from proceeding
with the sale
b. Declaration of nullity of any foreclosure sale to be held
c. Declaration of nullity of the mortgage constituted over Canelands property in favor of Alon
3. RTC issues an order holding in abeyance the sale, however, in spite of this, another foreclosure sale
was scheduled.
4. The RTC again issues another order, however this time, the order simply re-scheduled the sale
because the court found that as per P.D. 385, it is mandatory for government financial institutions to
foreclose collaterals and/or securities for any loan.
5. Caneland files for a Motion for Reconsideration but was denied.
6. Caneland files an appeal with the Court of Appeals but the CA found that the RTC did not commit any
grave abuse of discretion.
7. Thus this petition for Review on Certiorari under Rule 45.
ISSUE with HOLDING
It is important to note that this case supposedly should have been dismissed outright since an injunction would
not lie where the acts sought to be enjoined have become fait accompli. That is, the act sought to be enjoined
(the foreclosure sale) has already been accomplished by Sheriff De Vera. However, the Court deemed it proper
to resolve the merits of the principal issue as future guidance for both the bench and bar.
Whether or not the CA erred in finding that the RTC did not commit grave abuse of discretion in not enjoining
the extrajudicial foreclosure of the properties of Caneland. - NO THE CA DID NOT ERR. THE RTC ALSO DID
NOT COMMIT GRAVE ABUSE OF DISCRETION.
Petitioners allegations are not justifiable basis for the granting of any injunctive relief
The Provisions of P.D. 385 state:
1

Section 1. It shall be mandatory for government financial institutions after the lapse of sixty (60) days
from the issuance of this Decree, to foreclose the collaterals and/or securities
More importantly, Section 2 of the same P.D. prohibits the issuance of restraining orders or
injunctions against government financial institutions in any foreclosure action taken by the
former.
Petitioners claim that the case of Filipinas Marble Corporation v. Intermediate Appellate Court is
applicable does not hold water as the circumstances there are completely different from the present
case.
o In Filipinas, the reason why the Court granted the injunction there against the foreclosure sale
was because P.D. 385 was never meant to protect officials of government lending institutions
who take over the management of a borrower corporation, lead them to bankruptcy (and of
course, foreclosure sales), and then use P.D. 385 as a shield for any restraining order filed
against them.

DISPOSITIVE PORTION
WHEREFORE, the petition is DENIED. Costs against petitioner.
DIGESTER: Kim