G.R. No.

161122, September 24, 2012

DARE ADVENTURE FARM CORPORATION, PETITIONER, VS. HON. COURT OF APPEALS,
MANILA, HON. AUGUSTINE VESTIL, AS PRESIDING JUDGE OF RTC-CEBU, BR. 56,
MANDAUE CITY, SPS. FELIX NG AND NENITA NG, AND SPS. MARTIN T. NG AND
AZUCENA S. NG AND AGRIPINA R. GOC-ONG, RESPONDENTS.
BERSAMIN, J.:
Facts:
The petitioner acquired a parcel of land situated in Cebu herein referred as the
property through a deed of absolute sale executed on July 28, 1994 between the
petitioner, as vendee, and The Goc-ongs, as vendors.
The petitioner later on discovered that they were mortgaging the property to Felix
Ng, married to Nenita N. Ng, and Martin T. Ng, married to Azucena S. Ng
(collectively, the Ngs) to secure their obligation amounting to P648,000.00, subject
to the condition that should they not pay the stipulated 36-monthly installments,
the Ngs would automatically become the owners of the property.
With the Goc-ongs apparently failing to pay their obligation to the Ngs as stipulated.
The Ngs brought on a complaint for the recovery of a sum of money, or, in the
alternative, for the foreclosure of mortgage in the Regional Trial Court in Mandaue
City (RTC) only against respondent Agripina R. Goc-ong.
With Agripina R. Goc-ong being declared in default for failing to file her answer in C
the RTC rendered its Decision in favor of the Ngs.
In 2001, the petitioner commenced in the Court of Appeals (CA) an action for the
annulment of the October 16, 1997 decision of the RTC.
On June 19, 2001, however, the CA dismissed the petition for annulment of
judgment.
Issues:
Whether the petitioner may claim the remedy of annulment of judgment under Rule
47
Ruling:
No. A petition for annulment of judgment is a remedy in equity so
exceptional in nature that it may be availed of only when other remedies are
wanting, and only if the judgment, final order or final resolution sought to be
annulled was rendered by a court lacking jurisdiction or through extrinsic
fraud. The Court has thus instituted safeguards by limiting the grounds for
the annulment to lack of jurisdiction and extrinsic fraud, and by prescribing
in Section 1[10] of Rule 47 of the Rules of Court that the petitioner should show that
the ordinary remedies of new trial, appeal, petition for relief or other appropriate
remedies are no longer available through no fault of the petitioner.
The doctrine of immutability and unalterability serves a two-fold purpose, namely:
(a) to avoid delay in the administration of justice and thus, procedurally, to make
orderly the discharge of judicial business; and (b) to put an end to judicial
controversies, at the risk of occasional errors, which is precisely why the courts exist
It is elementary that a judgment of a court is conclusive and binding only upon the
parties and those who are their successors in interest by title after the
commencement of the action in court.[15] Section 47(b) of Rule 39 of the Rules of
Court explicitly so provides, to wit:
Section 47. Effect of judgments or final orders .The effect of a judgment or final
order rendered by a court of the Philippines, having jurisdiction to pronounce the
judgment or final order, may be as follows:
xxxx
(b) In other cases, the judgment or final order is, with respect to the matter directly
adjudged or as to any other matter that could have been raised in relation thereto,
conclusive between the parties and their successors in interest by title subsequent
to the commencement of the action or special proceeding, litigating for the same
thing and under the same title and in the same capacity; xxx.
The principle that a person cannot be prejudiced by a ruling rendered in an action or
proceeding in which he has not been made a party conforms to the constitutional
guarantee of due process of law. The operation of this principle was illustrated in
Muoz v. Yabut, Jr.,[16] where the Court declared that a person not impleaded and
given the opportunity to take part in the proceedings was not bound by the decision
declaring as null and void the title from which his title to the property had been
derived. We said there that the effect of a judgment could not be extended to non-
parties by simply issuing an alias writ of execution against them, for no man should
be prejudiced by any proceeding to which he was a stranger. In the same manner, a
writ of execution could be issued only against a party, not against a person who did
not have his day in court.
WHEREFORE, the Court AFFIRMS the decision of the Court of Appeals promulgated
on June 19, 2001; and DIRECTS the petitioner to pay the costs of suit.
SO ORDERED.