Sps. Antonio & Leticia Vega v. Social Security System (Sss) & Pilar Development Corporation

Summary

The Supreme Court ruled on property ownership rights involving a mortgaged property sold by the original owner-mortgagor to third parties who assumed mortgage payments. Magdalena Reyes sold her SSS-mortgaged property to spouses Vega in 1979-1981, who took possession and made mortgage payments for over a decade. When Pilar Development Corporation obtained a money judgment against Reyes and had the property executed upon and sold at sheriff's sale in 1994, the Court held this execution invalid since Reyes no longer owned the property. The Court established that mortgage restrictions on sale cannot absolutely prohibit transfer as this contravenes public policy, and that secondary evidence sufficiently proved the sale to the Vegas. The sheriff lacked authority to execute on property the judgment debtor had long transferred to others, making PDC's acquisition invalid despite the property remaining in Reyes' name on title.