Royal Savings Bank v. Fernando Asia

Summary

Royal Savings Bank foreclosed on mortgaged property and obtained a writ of possession. Ten individuals claiming 40-year adverse possession filed a motion to quash the writ. The Supreme Court affirmed the RTC's decision to quash the writ, ruling that even government financial institutions under P.D. 385 must allow hearings when third parties claim adverse possession. The Court emphasized that Article 433 of the Civil Code protects actual possessors, and courts must determine the nature of adverse possession before issuing writs of possession. The decision reinforces due process rights of third-party possessors in foreclosure proceedings and clarifies that mandatory foreclosure provisions don't override procedural safeguards for adverse possessors.