LZK HOLDINGS and DEVELOPMENT CORPORATION

versus
PLANTERS DEVELOPMENT BANK
G.R. No. 187973
January 20, 2014

FACTS
LZK Holdings loaned P40,000,000.00 from Planters Bank in 1996 and secured the same with a Real Estate
Mortgage over its 589sqm lot located in La Union. Two years later, LZK Holdings' failed to pay its loan,
thereby Planters Bank extra-judicially foreclosed the real estate mortgage thereon and the lot was sold at a
public auction. Planters Bank emerged as the highest bidder then registered the Certificate of sale on March
1999.
LZK Holdings filed before the RTC of Makati City, a complaint for annulment of extrajudicial foreclosure,
mortgage contract, promissory note and damages. LZK Holdings also prayed for the issuance of a temporary
restraining order (TRO) or writ of preliminary injunction to enjoin the consolidation of title over the lot by
Planters Bank.
Regional Trial Court:
Planters Bank filed before the RTC-San Fernando a motion to set ex-parte hearing for the issuance of a writ of
possession and set the hearing on April 14, 2008, but on April 8, 2008, the RTC-San Fernando issued another
Order declaring the scheduled hearing moot and academic and granting Planters Bank's ex-parte motion for
the issuance of a writ of possession which was filed as early as December 1999. The order placed the Deputy
Sherriff to place Planters Development Bank or any of its authorized representatives in possession of the
subject parcel of land, together with all the improvements existing thereon. CA affirmed.
Court of Appeals:
The Court of Appeals held that Planters Bank, as the purchaser in the foreclosure sale, may apply for a writ of
possession during the redemption period. In fact, it did apply for a writ three (3) days before the expiration of
LZK Holdings' redemption period. The San Fernando RTC, given its ministerial duty to issue the writ should
have acted on the ex parte petition. An injunction is not allowed to prohibit the issuance of a writ of
possession. Neither does the pending case for annulment of foreclosure sale, mortgage contract, promissory
notes and damages stay the issuance of said writ.

ISSUE
1.
2.

Whether or not Planters Bank is entitled to writ of possession over the subject parcel of land
Whether or not the RTC erred in the cancellation of the hearing for the issuance of writ of possession

RULING
Supreme Court:
1. Under the principle of conclusiveness of judgment, the right of Planter's Bank to a writ of possession
is binding and conclusive on the parties. The doctrine of res judicata by conclusiveness of judgment
postulates that "when a right or fact has been judicially tried and determined by a court of competent
jurisdiction, or when an opportunity for such trial has been given, the judgment of the court, as long
as it remains unreversed, should be conclusive upon the parties and those in privity with them.

Hence, LZK Holdings can no longer question Planter Bank's right to a writ of possession over the
subject property because the doctrine of conclusiveness of judgment bars the re-litigation of such
particular issue. The purchaser in foreclosure sale may take possession of the property even before
the expiration of the redemption period by filing an ex parte motion for such purpose and upon
posting of the necessary bond. Right of possession is based on the ownership of the subject property
by the applicant pertains to applications for writ of possession after the expiration of the redemption
period, a situation not contemplated within the facts of the present case.
2.

R TC did not err in cancelling the previously scheduled hearing and in granting Planters Bank's motion
without affording notice to LZK Holdings or allowing it to participate. No hearing is required prior to
the issuance of a writ of possession. The proceeding in a petition for a writ of possession is ex parte
and summary in nature. It is a judicial proceeding for the enforcement of one's right of possession as
purchaser in a foreclosure sale.
The decision of the CA is in accordance with the law and jurisprudence on the matter. It correctly
sustained the Order of the RTC in issuing a writ of possession in favor of Planters Bank.