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    Digest Castro Jr. v. CA G.R. No. 97401 December 6 1995

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    sophia
    The document discusses a case where a college obtained a loan secured by mortgaging land, then leased part of the land to petitioners who built a house. When the college defaulted, the land was foreclosed and sold, with the purchaser seeking possession of the entire property including the house. The Supreme Court ruled that the house built by the lessee could not be covered by the writ of possession following foreclosure.

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    Digest Castro Jr. v. CA G.R. No. 97401 December 6 1995

    Uploaded by

    sophia
    444 views1 page
    The document discusses a case where a college obtained a loan secured by mortgaging land, then leased part of the land to petitioners who built a house. When the college defaulted, the land was foreclosed and sold, with the purchaser seeking possession of the entire property including the house. The Supreme Court ruled that the house built by the lessee could not be covered by the writ of possession following foreclosure.

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    Digest-Castro-Jr.-v.-CA-G.R.-No.-97401-December-6-1995

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    The document discusses a case where a college obtained a loan secured by mortgaging land, then leased part of the land to petitioners who built a house. When the college defaulted, the land was foreclosed and sold, with the purchaser seeking possession of the entire property including the house. The Supreme Court ruled that the house built by the lessee could not be covered by the writ of possession following foreclosure.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    444 views1 page

    Digest Castro Jr. v. CA G.R. No. 97401 December 6 1995

    Uploaded by

    sophia
    The document discusses a case where a college obtained a loan secured by mortgaging land, then leased part of the land to petitioners who built a house. When the college defaulted, the land was foreclosed and sold, with the purchaser seeking possession of the entire property including the house. The Supreme Court ruled that the house built by the lessee could not be covered by the writ of possession following foreclosure.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    LUIS CASTRO, JR., ET AL. VS.

    COURT OF APPEALS
    G.R. No. 97401, December 6, 1995

    FACTS:
    Cabanatuan City Colleges obtained a loan from the Bancom Development
    Corporation. The college mortgaged to Bancom two parcels of land. While the mortgage
    was subsisting, the college board of directors agreed to lease to petitioners a 1,000-
    square-meter portion of the encumbered property on which the latter, eventually, built a
    residential house. The school defaulted in the due payment of the loan. Bancom
    extrajudicially foreclosed on the mortgage, and the mortgaged property was sold at
    public auction with Bancom coming out to be the only bidder. Bancom assigned its
    credit to herein private respondent Union Bank of the Philippines.
    Following the expiration of the redemption period without the college having
    exercised its right of redemption, private respondent filed with the RTC an ex-parte
    motion for the issuance of a writ of possession not only over the land and school
    buildings but also the residential house constructed by petitioners. The lower court
    granted the motion. Petitioners sought reconsideration of the order but the lower court
    denied. Petitioners elevated the case to the Court of Appeals but affirmed the decision
    of the lower court. Hence, this petition to the SC.

    ISSUE:
    Whether or not the residential house can be foreclosed

    RULING:
    No. A residential house, which was constructed by a lessee on a portion of the
    leased property theretofore encumbered under a real estate mortgage by the lessor,
    cannot be rightly covered by a writ of possession following the foreclosure sale of the
    mortgaged land. A sale would result in the transmission of title to the buyer which is
    feasible only if the seller can be in a position to convey ownership of the thing sold
    (Article 1458, Civil Code). Article 2127 of the Civil Code extending the effects of the real
    estate mortgage to accessions and accessories found on the hypothecated property
    when the secured obligation becomes due, is not applicable. Improvements are to be
    considered so incorporated only if so owned by the mortgagor since a contract of
    security needs as an indispensable element of ownership by the pledgor or mortgagor.

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