FACTS:

Jaime C. Tan executed a deed of absolute sale over the property in question in favor of spouses Jose and Estrella Magdangal. 

Simultaneously, they entered into another agreement giving Tan one (1) year within which to redeem or repurchase the property.

Tan failed to redeem the property until his death on January 4, 1988.

Tan’s heirs, represented by Jaime Tan, Jr., filed before the RTC a suit against the Magdangals for reformation of instrument, alleging that, while Tan and the Magdangals denominated their agreement as deed of absolute sale, their real intention was to conclude an equitable mortgage.

The Magdangals were able to secure in their names title to the subject property. 

The trial court rendered judgment in favor of Tan, Jr., declared the Deed of Absolute sale as equitable mortgage, and ordered him to pay to Magdangal “within 120 days after the finality of this decision P59,200.00 plus interest.

On appeal, the CA affirmed in toto the appealed decision of the lower court.

The corresponding Entry of Judgment was then issued.

The respondents Magdangals filed a Motion for Consolidation and Writ of Possession, upon expiration of the 120-day period of redemption.

On the other hand, petitioner filed a Motion for Execution in the appellate court praying that it direct the court a quo to issue the corresponding writ of execution of the RTC decision.

The court a quo presided by the respondent judge, allowed the petitioner to redeem the lot in question. 

On appeal, the CA set aside the ruling of the trial court.

Hence, this petition for review.

ISSUE:

Whether or not Section 1, Rule 39 of the 1997 Revised Rules of  Procedure should be given retroactive effect in this case.

RULING:

From 1991-1996, the years relevant to the case at bar, the rule that governs finality of judgment is Rule 51 of the Revised Rules of Court.

It is evident that if we apply the old rule on finality of judgment, petitioner redeemed the subject property within the 120-day period of redemption reckoned from the appellate court’s entry of judgment. 

The appellate court, however, did not apply the old rule but the 1997 Revised Rules of Civil Procedure. In fine, it applied the new rule retroactively and we hold that given the facts of the case at bar this is an error.

There is no dispute that rules of procedure can be given retroactive effect. This general rule, however, has well-delineated exceptions. 

Procedural laws are adjective laws which prescribe rules and forms of procedure of enforcing rights or obtaining redress for their invasion; they refer to rules of procedure by which courts applying laws of all kinds can properly administer justice. They include rules of pleadings, practice and evidence. 

The general rule that statutes are prospective and not retroactive does not ordinarily apply to procedural laws. It has been held that “a retroactive law, in a legal sense, is one which takes away or impairs vested rights acquired under laws, or creates a new obligation and imposes a new duty, or attaches a new disability, in respect of transactions or considerations already past. 

Hence, remedial statutes or statutes relating to remedies or modes of procedure, which do not create new or take away vested rights, but only operate in furtherance of the remedy or confirmation of rights already existing, do not come within the legal conception of a retroactive law, or the general rule against the retroactive operation of statutes.”

Statutes regulating the procedure of the courts will be construed as applicable to actions pending and undetermined at the time of their passage. Procedural laws are retroactive in that sense and to that extent. 

We hold that  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.  Undoubtedly, petitioner has the right to redeem the subject lot and this right is a substantive right.