Tan vs Court of Appeals

Tan vs  Court of Appeals
G.R. No. 136368. January 16, 2002

Facts:
Petitioner (Tan Sr.) executed a deed of absolute sale with respondents (Jose and Estrella Magdangal) for a plot of land in Davao. Later, Tan's heirs (Tan Jr.) filed before the Davao RTC a civil complaint alleging that the real intention of the agreement between Tan Sr. and respondents was for an equitable mortgage, rather than a deed of absolute sale. On June 4, 1991, the Davao RTC held that 1) the contract between the parties is an equitable mortgage; and 2) petitioner should pay to the respondents Magdangal "within 120 days after the finality of this decision P59,200.00 plus interest." The respondent court affirmed the RTC ruling in on September 28, 1995.

Both parties received the decision of the appellate court on October 5, 1995; however, the CA ruling was entered by the clerk of court in the Book of Entries of Judgement much later on March 13, 1996. The trial court allowed petitioner to redeem the lot, ruling that the 120-day redemption period should be reckoned from the date of Entry of Judgment in the appellate court, or from March 13; petitioners deposited the redemption price on April 17, 1996. The respondent court on the other hand, cited section 1, Rule 39 of the 1997 Revised Rules of Civil Procedure, and alleges that the 120-day redemption period of the petitioner had expired as the period began 15 days after October 5, 1995.

Issue:
Wether or not the CA was correct in using the 1997 Revised Rules of Civil Procedure to determine redemption period for petitioner.

Held:
​No. Decision annulled and set aside. Section 1, Rule 39 of the 1997 Revised Rules of Procedure should not be given retroactive effect in this case as it would result in great injustice to the petitioner. Petitioner has the right to redeem the subject lot and this right is a substantive right. Petitioner followed the procedural rule then existing as well as the decisions of the courts governing the reckoning date of the period of redemption when he redeemed the subject lot. Unfortunately for petitioner, the rule was changed by the 1997 Revised Rules of Procedure which if applied retroactively would result in his losing the right to redeem the subject lot. It is difficult to reconcile the retroactive application of this procedural rule with the rule of fairness. Petitioner cannot be penalized with the loss of the subject lot when he faithfully followed the laws and the rule on the period of redemption when he made the redemption.