G.R. No. 196358 March 21, 2012 June 15, 2011 resolution.
June 15, 2011 resolution. It also treated his motion to rescind as a motion for
JANDY J. AGOY, Petitioner,
vs.
ARANETA CENTER, INC., Respondents.
RESOLUTION
ABAD, J.:
This case reiterates the Court’s ruling that the adjudication of a case by
minute resolution is an exercise of judicial discretion and constitutes sound
and valid judicial practice.
The Facts and the Case
On June 15, 2011 the Court denied petitioner Jandy J. Agoy’s petition for
review through a minute resolution that reads:
"G.R. No. 196358 (Jandy J. Agoy vs. Araneta Center, Inc.).- The Court
resolves to GRANT petitioner’s motion for extension of thirty (30) days from
the expiration of the reglementary period within which to file a petition for
review on certiorari.
The court further resolves to DENY the petition for review on certiorari
assailing the Decision dated 19 October 2010 and Resolution dated 29
March 2011 of the Court of Appeals (CA), Manila, in CA-G.R. SP No. 108234
for failure to show that the CA committed reversible error when it affirmed the
dismissal of petitioner Jandy J. Agoy. Petitioner’s repeated delays in
remitting the excess cash advances and admission that he spent them for
other purposes constitute serious misconduct and dishonesty which rendered
him unworthy of the trust and confidence reposed in him by respondent
Araneta Center, Inc."
Apparently, however, Agoy doubted the authenticity of the copy of the above
minute resolution that he received through counsel since he promptly filed a
motion to rescind the same and to have his case resolved on its merits via a
regular resolution or decision signed by the Justices who took part in the
deliberation. In a related development, someone claiming to be Agoy’s
attorney-in-fact requested an investigation of the issuance of the resolution of
June 15, 2011.
On September 21, 2011 the Court denied Agoy’s motion to rescind the
subject minute resolution and confirmed the authenticity of the copy of the
reconsideration and denied the same with finality.
Upon receipt of the Court’s September 21, 2011 resolution, Agoy filed a
motion to rescind the same or have his case resolved by the Court En Banc
pursuant to Section 13 in relation to Sec. 4(3), Article VIII of the 1987
Constitution. Agoy reiterated his view that the Court cannot decide his
petition by a minute resolution. He thus prayed that it rescind its June 15 and
September 21, 2011 resolutions, determine whether it was proper for the
Court to resolve his petition through a minute resolution, and submit the case
to the Court en banc for proper disposition through a signed resolution or
decision.
Questions Presented
At the heart of petitioner’s motions are the following questions:
1. Whether or not the copies of the minute resolutions dated June
15, 2011 and September 21, 2011 that Agoy received are authentic;
and
2. Whether or not it was proper for the Court to deny his petition
through a minute resolution.
The Court’s Rulings
One. The notices of the minute resolutions of June 15 and September 21,
2011 sent to Agoy, bearing the signatures of Assistant Clerk of Court
Teresita Aquino Tuazon and Deputy Division Clerk of Court Wilfredo V.
Lapitan, both printed on pink paper and duly received by counsel for
petitioner as evidenced by the registry return cards, are authentic and
original copies of the resolutions. The Court has given Tuazon and Lapitan
the authority to inform the parties under their respective signatures of the
Court’s actions on the incidents in the cases.
Minute resolutions are issued for the prompt dispatch of the actions of the
Court. While they are the results of the deliberations by the Justices of the
Court, they are promulgated by the Clerk of Court or his assistants whose
duty is to inform the parties of the action taken on their cases by quoting
verbatim the resolutions adopted by the Court.1 Neither the Clerk of Court nor
his assistants take part in the deliberations of the case. They merely transmit
the Court’s action in the form prescribed by its Internal Rules:
Sec. 7. Form of notice of a minute resolution.—A notice of minute resolution
shall be embodied in a letter of the Clerk of Court or the Division Clerk of
Court notifying the parties of the action or actions taken in their case. In the
absence of or whenever so deputized by the Clerk of Court or the Division
Clerk of Court, the Assistant Clerk of Court or Assistant Division Clerk of
Court may likewise sign the letter which shall be in the following form:
(SUPREME COURT Seal)
REPUBLIC OF THE PHILIPPINES
SUPREME COURT
Manila
EN BANC/____ DIVISION
NOTICE
Sirs/Mesdames:
Please take notice that the Court en banc/___ Division issued a Resolution
dated _____, which reads as follows:
"G.R./UDK/A.M./A.C. No. ____ (TITLE).—(QUOTE RESOLUTION)"
Very truly yours,
(Sgd.)
CLERK OF COURT/Division Clerk of Court
As the Court explained in Borromeo v. Court of Appeals,2 no law or rule
requires its members to sign minute resolutions that deny due course to
actions filed before it or the Chief Justice to enter his certification on the
same. The notices quote the Court’s actual resolutions denying due course
to the subject actions and these already state the required legal basis for
such denial. To require the Justices to sign all its resolutions respecting its
action on new cases would be unreasonable and unnecessary.
Based on last year’s figures, the Court docketed a total of 5,864 new cases,
judicial and administrative. The United States Supreme Court probably
receives lesser new cases since it does not have administrative supervision
of all courts. Yet, it gives due course to and decides only about 100 cases
per year. Agoy’s demand that this Court give due course to and decide all
cases filed with it on the merits, including his case, is simply unthinkable and
shows a lack of discernment of reality.
Two. While the Constitution requires every court to state in its decision
clearly and distinctly the fact and the law on which it is based, the
Constitution requires the court, in denying due course to a petition for review,
merely to state the legal basis for such denial.
Sec. 14. No decision shall be rendered by any court without expressing
therein clearly and distinctly the facts and the law on which it is based. No
petition for review or motion for reconsideration of a decision of the court
shall be refused due course or denied without stating the legal basis
therefor.3 (Emphasis supplied)
With the promulgation of its Internal Rules, the Court itself has defined the
instances when cases are to be adjudicated by decision, signed resolution,
unsigned resolution or minute resolution.4 Among those instances when a
minute resolution shall issue is when the Court "denies a petition filed under
Rule 45 of the [Rules of Court], citing as legal basis the absence of reversible
error committed in the challenged decision, resolution, or order of the court
below."5 The minute resolutions in this case complied with this requirement.
The Court has repeatedly said that minute resolutions dismissing the actions
filed before it constitute actual adjudications on the merits.6 They are the
result of thorough deliberation among the members of the Court.7When the
Court does not find any reversible error in the decision of the CA and denies
the petition, there is no need for the Court to fully explain its denial, since it
already means that it agrees with and adopts the findings and conclusions of
the CA. The decision sought to be reviewed and set aside is correct. 8 It would
be an exercise in redundancy for the Court to reproduce or restate in the
minute resolution denying the petition the conclusions that the CA
reached.1âwphi1
Agoy questions the Court’s act of treating his motion to rescind as a motion
for reconsideration, arguing that it had no basis for doing so. But the Court
was justified in its action since his motion to rescind asked the Court to
review the merits of his case again.
WHEREFORE, the Court DENIES petitioner Jandy J. Agoy’s motion to
rescind dated December 21, 2011 and the Motion for Clarification and to
Resolve Pending Incidents dated January 31, 2012 for lack of merit.
The Court shall not entertain further pleadings or motions in this case. Let
entry of judgment be issued.
SO ORDERED.
 G.R. No. 166051 April 8, 2008
SOLID HOMES, INC., petitioner,
vs.
EVELINA LASERNA and GLORIA CAJIPE, represented by PROCESO F.
CRUZ, respondents.
DECISION
CHICO-NAZARIO, J.:
This is a Petition for Review on Certiorari under Rule 45 of the 1997 Revised Rules of
Civil Procedure seeking to annul, reverse and set aside (1) the Decision 1 dated 21
July 2004 of the Court of Appeals in CA-G.R. SP No. 82153, which denied and
dismissed the Petition filed before it by the petitioner for lack of merit; and (2) the
Resolution2 dated 10 November 2004 of the same court, which denied the
petitioner’s Motion for Reconsideration.
The factual antecedents of this case are as follows:
On 1 April 1977, respondents Evelina Laserna and Gloria Cajipe, represented by
their attorney-in-fact, Proceso F. Cruz, as buyers, entered into a Contract to
Sell3 with petitioner Solid Homes, Inc. (SHI), a corporation engaged in the
development and sale of subdivision lots, as seller. The subject of the said Contract
to Sell was a parcel of land located at Lot 3, Block I, Phase II, Loyola Grand Villas,
Quezon City, with a total area of 600 square meters, more or less. The total contract
price agreed upon by the parties for the said parcel of land was P172,260.00, to be
paid in the following manner: (1) the P33,060.00 down payment should be paid
upon the signing of the contract; and (2) the remaining balance of P166,421.884 was
payable for a period of three years at a monthly installment of P4,622.83 beginning
1 April 1977. The respondents made the down payment and several monthly
installments. When the respondents had allegedly paid 90% of the purchase price,
they demanded the execution and delivery of the Deed of Sale and the Transfer
Certificate of Title (TCT) of the subject property upon the final payment of the
balance. But the petitioner did not comply with the demands of the respondents.
The respondents whereupon filed against the petitioner a Complaint for Delivery of
Title and Execution of Deed of Sale with Damages, dated 28 June 1990, before the
Housing and Land Use Regulatory Board (HLURB). The same was docketed as HLURB
Case No. REM-073090-4511. In their Complaint, respondents alleged that as their
outstanding balance was only P5,928.18, they were already demanding the
execution and delivery of the Deed of Sale and the TCT of the subject property upon
final payment of the said amount. The petitioner filed a Motion to Admit
Answer,5 together with its Answer6 dated 17 September 1990, asserting that the
respondents have no cause of action against it because the respondents failed to
show that they had complied with their obligations under the Contract to Sell, since
the respondents had not yet paid in full the total purchase price of the subject
property. In view of the said non-payment, the petitioner considered the Contract
to Sell abandoned by the respondents and rescinded in accordance with the
provisions of the same contract.
On 7 October 1992, HLURB Arbiter Gerardo L. Dean rendered a Decision 7 denying
respondents’ prayer for the issuance of the Deed of Sale and the delivery of the
TCT. He, however, directed the petitioner to execute and deliver the aforesaid Deed
of Sale and TCT the moment that the purchase price is fully settled by the
respondents. Further, he ordered the petitioner to cease and desist from charging
and/or collecting fees from the respondents other than those authorized by
Presidential Decree (P.D.) No. 9578 and similar statutes.9
Feeling aggrieved, the petitioner appealed10 the aforesaid Decision to the HLURB
Board of Commissioners. The case was then docketed as HLURB Case No. REM-A-
1298.
On 10 August 1994, the HLURB Board of Commissioners rendered a
Decision,11 modifying the 7 October 1992 Decision of HLURB Arbiter Dean. The
decretal portion of the Board’s Decision reads:
WHEREFORE, in view of the foregoing, the [D]ecision of [HLURB] Arbiter Gerardo
Dean dated 07 October 1992 is hereby MODIFIED to read as follows:
1. [Herein respondent]12 is hereby directed to pay the balance of P11,585.41 within
the (sic) thirty (30) days from finality of this [D]ecision.
2. [Herein petitioner] is hereby directed to execute the necessary deed of sale and
deliver the TCT over the subject property immediately upon full payment.
3. [Petitioner] is hereby directed to cease and desist from charging and/or collecting
fees other than those authorized by P.D. 957 and other related laws. 13 (Emphasis
supplied).
Petitioner remained unsatisfied with the Decision of the HLURB Board of
Commissioners, thus, it appealed the same before the Office of the President,
wherein it was docketed as O.P. Case No. 5919.
After evaluating the established facts and pieces of evidence on record, the Office
of the President rendered a Decision14 dated 10 June 2003, affirming in toto the 10
August 1994 Decision of the HLURB Board of Commissioners. In rendering its
Decision, the Office of the President merely adopted by reference the findings of
fact and conclusions of law contained in the Decision of the HLURB Board of
Commissioners.
Resultantly, petitioner moved for the reconsideration15 of the 10 June 2003
Decision of the Office of the President. However, in an Order 16 dated 9 December
2003, the Office of the President denied the same.
The petitioner thereafter elevated its case to the Court of Appeals by way of
Petition for Review under Rule 4317of the 1997 Revised Rules of Civil Procedure,
docketed as CA-G.R. SP No. 82153, raising the following issues, to wit: (1) the
Honorable Office of the President seriously erred in merely adopting by reference
the findings and conclusions of the HLURB Board of Commissioners in arriving at the
questioned [D]ecision; and (2) the Honorable Office of the President seriously erred
in not dismissing the complaint for lack of cause of action. 18
On 21 July 2004, the appellate court rendered a Decision denying due course and
dismissing the petitioner’s Petition for Review for lack of merit, thus affirming the
Decision of the Office of the President dated 10 June 2003, viz:
WHEREFORE, in view of the foregoing, the instant [P]etition is hereby DENIED DUE
COURSE and DISMISSED for lack of merit.19 (Emphasis supplied).
Petitioner moved for reconsideration of the aforesaid Decision but, it was denied by
the Court of Appeals in a Resolution dated 10 November 2004.
Hence, this Petition.
Petitioner raises the following issues for this Court’s resolution:
I. WHETHER OR NOT THE [HONORABLE] COURT OF APPEALS SERIOUSLY ERRED IN
HOLDING THAT THE DECISION OF THE OFFICE OF THE PRESIDENT, WHICH MERELY
ADOPTS BY REFERENCE THE FINDINGS AND CONCLUSIONS OF THE BOARD OF
COMMISSIONERS OF THE [HLURB], IS IN ACCORDANCE WITH THE MANDATE OF THE
CONSTITUTION THAT THE DECISION SHOULD BE BASED ON THE FINDINGS OF FACTS
AND LAW TO ARRIVE AT A DECISION; AND
II. WHETHER OR NOT THE [HONORABLE] COURT OF APPEALS SERIOUSLY ERRED IN
NOT REVERSING THE DECISION OF THE OFFICE OF THE PRESIDENT CONSIDERING
THAT THE COMPLAINT OF THE RESPONDENTS LACKS CAUSE OF ACTION. 20
In its Memorandum,21 the petitioner alleges that the Decision of the Office of the
President, as affirmed by the Court of Appeals, which merely adopted by reference
the Decision of the HLURB Board of Commissioners, without a recitation of the facts
and law on which it was based, runs afoul of the mandate of Section 14, Article VIII
of the 1987 Philippine Constitution which provides that: "No decision shall be
rendered by any court without expressing therein clearly and distinctly the facts
and law on which it is based." The Office of the President, being a government
agency, should have adhered to this principle.
Petitioner further avers that a full exposition of the facts and the law upon which a
decision was based goes to the very essence of due process as it is intended to
inform the parties of the factual and legal considerations employed to support a
decision. The same was not complied with by the Office of the President when it
rendered its one-page Decision dated 10 June 2003. Without a complete statement
in the judgment of the facts proven, it is not possible to pass upon and determine
the issues in the case, inasmuch as when the facts are not supported by evidence, it
is impossible to administer justice to apply the law to the points argued, or to
uphold the rights of the litigant who has the law on his side.
Lastly, petitioner argues that the Complaint filed against it by the respondents
stated no cause of action because the respondents have not yet paid in full the
purchase price of the subject property. The right of action of the respondents to file
a case with the HLURB would only accrue once they have fulfilled their obligation to
pay the balance of the purchase price for the subject property. Hence, the
respondents’ Complaint against the petitioner should have been dismissed outright
by the HLURB for being prematurely filed and for lack of cause of action.
The Petition is unmeritorious.
The constitutional mandate that, "no decision shall be rendered by any court
without expressing therein clearly and distinctly the facts and the law on which it is
based,"22 does not preclude the validity of "memorandum decisions," which adopt
by reference the findings of fact and conclusions of law contained in the decisions
of inferior tribunals.23 In fact, in Yao v. Court of Appeals,24 this Court has sanctioned
the use of "memorandum decisions," a specie of succinctly written decisions by
appellate courts in accordance with the provisions of Section 40,25 B.P. Blg. 129, as
amended,26 on the grounds of expediency, practicality, convenience and docket
status of our courts. This Court likewise declared that "memorandum decisions"
comply with the constitutional mandate.27
This Court found in Romero v. Court of Appeals28 that the Court of Appeals
substantially complied with its constitutional duty when it adopted in its Decision
the findings and disposition of the Court of Agrarian Relations in this wise:
"We have, therefore, carefully reviewed the evidence and made a re-assessment of
the same, and We are persuaded, nay compelled, to affirm the correctness of the
trial court’s factual findings and the soundness of its conclusion. For judicial
convenience and expediency, therefore, We hereby adopt, by way of reference, the
findings of facts and conclusions of the court a quo spread in its decision, as integral
part of this Our decision." (Underscoring supplied)
In Francisco v. Permskul,29 this Court similarly held that the following memorandum
decision of the Regional Trial Court (RTC) of Makati City did not transgress the
requirements of Section 14, Article VIII of the 1997 Philippine Constitution:
"MEMORANDUM DECISION
After a careful perusal, evaluation and study of the records of this case, this Court
hereby adopts by reference the findings of fact and conclusions of law contained in
the decision of the Metropolitan Trial Court of Makati, Metro Manila, Branch 63 and
finds that there is no cogent reason to disturb the same.
"WHEREFORE, judgment appealed from is hereby affirmed in toto." (Underscoring
supplied.)
Hence, incorporation by reference is allowed if only to avoid the cumbersome
reproduction of the decision of the lower courts, or portions thereof, in the decision
of the higher court.30
However, also in Permskul,31 this Court laid down the conditions for the validity of
memorandum decisions, to wit:
The memorandum decision, to be valid, cannot incorporate the findings of fact and
the conclusions of law of the lower court only by remote reference, which is to
say that the challenged decision is not easily and immediately available to the
person reading the memorandum decision. For the incorporation by reference to
be allowed, it must provide for direct access to the facts and the law being
adopted, which must be contained in a statement attached to the said decision. In
other words, the memorandum decision authorized under Section 40 of B.P. Blg.
129 should actually embody the findings of fact and conclusions of law of the
lower court in an annex attached to and made an indispensable part of the
decision.
It is expected that this requirement will allay the suspicion that no study was made
of the decision of the lower court and that its decision was merely affirmed without
a proper examination of the facts and the law on which it is based. The proximity at
least of the annexed statement should suggest that such an examination has been
undertaken. It is, of course, also understood that the decision being adopted
should, to begin with, comply with Article VIII, Section 14 as no amount of
incorporation or adoption will rectify its violation.
The Court finds necessary to emphasize that the memorandum decision should be
sparingly used lest it become an addictive excuse for judicial sloth. It is
an additional condition for the validity that this kind of decision may be resorted
to only in cases where the facts are in the main accepted by both parties and
easily determinable by the judge and there are no doctrinal complications
involved that will require an extended discussion of the laws involved. The
memorandum decision may be employed in simple litigations only, such as ordinary
collection cases, where the appeal is obviously groundless and deserves no more
than the time needed to dismiss it.
xxxx
Henceforth, all memorandum decisions shall comply with the requirements herein
set forth both as to the form prescribed and the occasions when they may be
rendered. Any deviation will summon the strict enforcement of Article VIII,
Section 14 of the Constitution and strike down the flawed judgment as a lawless
disobedience.32
In the case at bar, we quote verbatim the Decision dated 10 June 2003 of the Office
of the President which adopted by reference the Decision dated 10 August 1994 of
the HLURB Board of Commissioners:
This resolves the appeal filed by [herein petitioner] Solid Homes, Inc. from the
[D]ecision of the [HLURB] dated [10 August 1994].
After a careful study and thorough evaluation of the records of the case, this Office
is convinced by the findings of the HLURB, thus we find no cogent reason to depart
from the assailed [D]ecision. Therefore, we hereby adopt by reference the findings of
fact and conclusions of law contained in the aforesaid [D]ecision, copy of which is
hereto attached as "Annex A."
WHEREFORE, premises considered, judgment appealed from is hereby AFFIRMED in
toto.33 (Emphasis supplied).
It must be stated that Section 14, Article VIII of the 1987 Constitution need not
apply to decisions rendered in administrative proceedings, as in the case a bar. Said
section applies only to decisions rendered in judicial proceedings. In fact, Article VIII
is titled "Judiciary," and all of its provisions have particular concern only with
respect to the judicial branch of government. Certainly, it would be error to hold or
even imply that decisions of executive departments or administrative agencies are
oblige to meet the requirements under Section 14, Article VIII.
The rights of parties in administrative proceedings are not violated as long as the
constitutional requirement of due process has been satisfied. 34 In the landmark
case of Ang Tibay v. CIR, we laid down the cardinal rights of parties in administrative
proceedings, as follows:
1) The right to a hearing, which includes the right to present one’s case and submit
evidence in support thereof.
2) The tribunal must consider the evidence presented.
3) The decision must have something to support itself.
4) The evidence must be substantial.
5) The decision must be rendered on the evidence presented at the hearing, or at
least contained in the record and disclosed to the parties affected.
6) The tribunal or body or any of its judges must act on its or his own independent
consideration of the law and facts of the controversy and not simply accept the
views of a subordinate in arriving at a decision.
7) The board or body should, in all controversial question, render its decision in
such a manner that the parties to the proceeding can know the various issues
involved, and the reason for the decision rendered.35
As can be seen above, among these rights are "the decision must be rendered on
the evidence presented at the hearing, or at least contained in the record and
disclosed to the parties affected;" and that the decision be rendered "in such a
manner that the parties to the proceedings can know the various issues involved,
and the reasons for the decisions rendered." Note that there is no requirement
in Ang Tibay that the decision must express clearly and distinctly the facts and the
law on which it is based. For as long as the administrative decision is grounded on
evidence, and expressed in a manner that sufficiently informs the parties of the
factual and legal bases of the decision, the due process requirement is satisfied.
At bar, the Office of the President apparently considered the Decision of HLURB as
correct and sufficient, and said so in its own Decision. The brevity of the assailed
Decision was not the product of willing concealment of its factual and legal bases.
Such bases, the assailed Decision noted, were already contained in the HLURB
decision, and the parties adversely affected need only refer to the HLURB Decision
in order to be able to interpose an informed appeal or action for certiorari under
Rule 65.
However, it bears observation that while decisions of the Office of the President
need not comply with the constitutional requirement imposed on courts under
Section 14, Article VIII of the Constitution, the Rules of Court may still find
application, although suppletory only in character and apply only whenever
practicable and convenient. There is no mandate that requires the application of
the Rules of Court in administrative proceedings.
Even assuming arguendo that the constitutional provision invoked by petitioner
applies in the instant case, the decision of the OP satisfied the standards set forth in
the case of Permskul.
Firstly, the Decision of the Office of the President readily made available to the
parties a copy of the Decision of the HLURB Board of Commissioners, which it
adopted and affirmed in toto, because it was attached as an annex to its Decision.
Secondly, the findings of fact and conclusions of law of the HLURB Board of
Commissioners have been embodied in the Decision of the Office of the President
and made an indispensable part thereof. With the attachment of a copy of the
Decision of the HLURB Board of Commissioners to the Decision of the Office of the
President, the parties reading the latter can also directly access the factual and legal
findings adopted from the former. As the Court of Appeals ratiocinated in its
Decision dated 21 July 2004, "the facts narrated and the laws concluded in the
Decision of the HLURB Board of Commissioners should be considered as written in
the Decision of the Office of the President. It was still easy for the parties to
determine the facts and the laws on which the decision were based. Moreover,
through the attached decision, the parties could still identify the issues that could
be appealed to the proper tribunal."36
Thirdly, it was categorically stated in the Decision of the Office of the President that
it conducted a careful study and thorough evaluation of the records of the present
case and it was fully convinced as regards the findings of the HLURB Board of
Commissioners.
And lastly, the facts of the present case were not contested by the parties and it can
be easily determined by the hearing officer or tribunal. Even the respondents
admitted that, indeed, the total purchase price for the subject property has not yet
been fully settled and the outstanding balance is yet to be paid by them. In
addition, this case is a simple action for specific performance with damages, thus,
there are neither doctrinal complications involved in this case that will require an
extended discussion of the laws involved.
Accordingly, based on close scrutiny of the Decision of the Office of the President,
this Court rules that the said Decision of the Office of the President fully complied
with both administrative due process and Section 14, Article VIII of the 1987
Philippine Constitution.
The Office of the President did not violate petitioner’s right to due process when it
rendered its one-page Decision. In the case at bar, it is safe to conclude that all the
parties, including petitioner, were well-informed as to how the Decision of the
Office of the President was arrived at, as well as the facts, the laws and the issues
involved therein because the Office of the President attached to and made an
integral part of its Decision the Decision of the HLURB Board of Commissioners,
which it adopted by reference. If it were otherwise, the petitioner would not have
been able to lodge an appeal before the Court of Appeals and make a presentation
of its arguments before said court without knowing the facts and the issues
involved in its case.
This Court also quotes with approval the following declaration of the Court of
Appeals in its Decision on the alleged violation of petitioner’s right to due process:
The contention of the [herein] petitioner that the said [D]ecision runs afoul to the
Constitutional provision on due process cannot be given credence. The case already
had gone through the Offices of the HLURB Arbiter and the Board of
Commissioners where petitioner was given the opportunity to be heard and
present its evidence, before the case reached the Office of the President which
rendered the assailed [D]ecision after a thorough evaluation of the evidence
presented. What is important is that the parties were given the opportunity to be
heard before the [D]ecision was rendered. To nullify the assailed [D]ecision would
in effect be a violation of the Constitution because it would deny the parties of
the right to speedy disposition of cases.37
Petitioner’s assertion that respondents’ complaint filed with the HLURB lacked a
cause of action deserves scant consideration.
Section 7 of the 1987 HLURB Rules of Procedure states that:
Section 7. Dismissal of the Complaint or Opposition. – The Housing and Land Use
Arbiter (HLA) to whom a complaint or opposition is assigned may immediately
dismiss the same for lack of jurisdiction or cause of action. (Emphasis supplied).
It is noticeable that the afore-quoted provision of the 1987 HLURB Rules of
Procedure used the word "may" instead of "shall," meaning, that the dismissal of a
complaint or opposition filed before the HLURB Arbiter on the ground of lack of
jurisdiction or cause of action is simply permissive and not directive. The HLURB
Arbiter has the discretion of whether to dismiss immediately the complaint or
opposition filed before him for lack of jurisdiction or cause of action, or to still
proceed with the hearing of the case for presentation of evidence. HLURB Arbiter
Dean in his Decision explained thus:
This Office is well aware of instances when complainants/petitioners fail, through
excusable negligence, to incorporate every pertinent allegations (sic) necessary to
constitute a cause of action. We will not hesitate to go outside of the
complaint/petition and consider other available evidences if the same is necessary
to a judicious, speedy, and inexpensive settlement of the issues laid before us or
when there are reasons to believe that the [com]plaints are meritorious.
"Administrative rules should be construed liberally in order to PROMOTE THEIR
OBJECT AND ASSIST THE PARTIES IN OBTAINING A JUST, SPEEDY AND INEXPENSIVE
DETERMINATION OF THEIR RESPECTIVE CLAIMS AND DEFENSES" (Mangubat vs. de
Castro, 163 SCRA 608).38 (Emphasis supplied).
Given the fact that the respondents have not yet paid in full the purchase price of
the subject property so they have yet no right to demand the execution and
delivery of the Deed of Sale and the TCT, nevertheless, it was still within the HLURB
Arbiter’s discretion to proceed hearing the respondents’ complaint in pursuit of a
judicious, speedy and inexpensive determination of the parties’ claims and
defenses.
Furthermore, the Court of Appeals already sufficiently addressed the issue of lack of
cause of action in its Decision, viz:
The Offices below, instead of dismissing the complaint because of the clear showing
that there was no full payment of the purchase price, decided to try the case and
render judgment on the basis of the evidence presented. The complaint of the
respondents does not totally lack cause of action because of their right against
the cancellation of the contract to sell and the forfeiture of their payments due to
non-payment of their monthly amortization.
xxxx
The HLURB Arbiter in his [D]ecision, stated that it is undisputed that the contract
price is not yet fully paid. This was affirmed by the HLURB Board of Commissioners
and the Office of the President. No less than the respondents admitted such fact
when they contended that they are willing to pay their unpaid balance. Without full
payment, the respondents have no right to compel the petitioner to execute the
Deed of Sale and deliver the title to the property. xxx.
xxxx
Lastly, notwithstanding such failure to pay the monthly amortization, the
petitioner cannot consider the contract as cancelled and the payments made as
forfeited.
Section 24, PD 957 provides:
"Section 24. Failure to pay installments. - The rights of the buyer in the event of his
failure to pay the installments due for reasons other than the failure of the owner
or developer to develop the project shall be governed by Republic Act No. 6552. x x
x."
Section 4, RA 6552 or the Realty Installment Buyer Protection Act provides:
"Section 4. In case where less than two years of installments were paid, the seller
shall give the buyer a grace period of not less than sixty days from the date the
installment became due. If the buyer fails to pay the installments due at the
expiration of the grace period, the seller may cancel the contract after thirty days
from receipt by the buyer of the notice of cancellation or the demand for rescission
of the contract by a notarial act."
It is therefore clear from the above provisions that the petitioner cannot consider
the [C]ontract to [S]ell as cancelled. The requirements above should still be
complied with.39 (Emphasis supplied).
Hence, during the hearing conducted by HLURB Arbiter Dean, it became apparent
that respondents’ cause of action against petitioner is not limited to the non-
execution and non-delivery by petitioner of the Deed of Sale and TCT of the subject
property, which is dependent on their full payment of the purchase price thereof;
but also the wrongful rescission by the petitioner of the Contract to Sell. By virtue
thereof, there is ample basis for HLURB Arbiter Dean not to dismiss respondents’
complaint against petitioner and continue hearing and resolving the case.
As a final point. Based on the records of this case, respondents have tendered
payment in the amount of P11,584.41,40 representing the balance of the purchase
price of the subject property, as determined in the 10 August 1994 Decision of the
HLURB Board of Commissioners, and affirmed by both the Office of the President
and the Court of Appeals. However, the petitioner, without any justifiable reason,
refused to accept the same. In Ramos v. Sarao,41 this Court held that tender of
payment is the manifestation by debtors of their desire to comply with or to pay
their obligation. If the creditor refuses the tender of payment without just cause,
the debtors are discharged from the obligation by the consignation of the sum
due. Consignation is made by depositing the proper amount with the judicial
authority, before whom the tender of payment and the announcement of the
consignation shall be proved. All interested parties are to be notified of the
consignation. Compliance with these requisites is mandatory.42 In the case at bar,
after the petitioner refused to accept the tender of payment made by the
respondents, the latter failed to make any consignation of the sum due.
Consequently, there was no valid tender of payment and the respondents are not
yet discharged from the obligation to pay the outstanding balance of the purchase
price of the subject property.
Since petitioner did not rescind the Contract to Sell it executed with the
respondents by a notarial act, the said Contract still stands. Both parties must
comply with their obligations under the said Contract. As ruled by the HLURB Board
of Commissioners, and affirmed by the Office of the President and the Court of
Appeals, the respondents must first pay the balance of the purchase price of the
subject property, after which, the petitioner must execute and deliver the
necessary Deed of Sale and TCT of said property.
WHEREFORE, premises considered, the instant Petition is hereby DENIED. Costs
against the petitioner.
SO ORDERED.
G.R. No. 198139 September 8, 2014
NATIONAL POWER CORPORATION, Petitioner,
vs.
FELICISIMO TARCELO and HEIRS OF COMIA SANTOS, Respondents.
DECISION
DEL CASTILLO, J.:
Execution must always conform to that decreed in the dispositive part of the
decision, because the only portion thereof that may be the subject of execution is
that which is precisely ordained or decreed in the dispositive portion; whatever is in
the body of the decision can only be considered as part of the reasons or
conclusions and serves as a guide in determining the ratio decidendi.1
This Petition for Review on Certiorari2 seeks to set aside the January 20, 2011
Decision3 of the Court of Appeals (CA) and August 9, 2011 Resolution 4 in CA-G.R. SP
No. 112054, which denied the herein petitioner's Petition for Certiorari and Motion
for Reconsideration, respectively, thus affirming the dispositions of the Regional
Trial Court of Batangas City, Branch VII (Batangas City RTC) in Civil Case No. 5785.
Factual Antecedents
Civil Case No. 5785
Respondents Felicisimo Tarcelo (Tarcelo) and the heirs of Comia Santos (Santos
heirs) are the owners of two lots measuring 4,404 and 2,611 square meters,
respectively, which are situated in Brgy. Tabangao-Ambulong, Batangas City.
Sometime in 2000, petitioner National Power Corporation (NPC) filed Civil Case No.
5785 with the Batangas City RTC, seeking to expropriate portions of Tarcelo and the
Santos heirs’ lots to the extent of 1,595.91 square meters which are affected by the
construction and maintenance of NPC’s 1,200 MW Ilijan Natural Gas Pipeline
Project. In other words, NPC’s natural gas pipeline shall traverse respondents’ lands
to such extent.
On July 29, 2002, the Batangas City RTC issued an order of condemnation, thus
authorizing NPC to take possessionof the subject lots. Thereafter, it appointed three
commissioners who in turn submitted their respective Reports5 and
recommendations on the amount of just compensation to be paid to respondents.
On November 7, 2005, the Batangas City RTC rendered a Decision 6 fixing just
compensation for the subject lots at ₱1,000.00 per square meter, thus:
In the Commissioner’s Report filed by Chairman of the Board Emelinda C. Atienza,
she recommended x x x the amount of ₱1,120.00 per square meter as just
compensation for the properties involvedin this case. She based her findings on the
following:
Property of Felicisimo Tarcelo7
1. The subject property is classified as agricultural land;
2. It is approximately 420 meters away from Shell Refinery and approximately 40
meters away from the Barangay Road;
3. Adjoining boundary owners property [sic] are also classified as agricultural lands.
Property of the Heirs of Santos Comia8
1. The subject property is classified as agricultural land;
2. It is approximately 560 meters away from Shell Refinery and approximately 140
meters away from the Barangay Road;
3. Adjoining boundary owners property [sic] are also classified as agricultural lands.
Commissioners Alberto M. Nuique and Eladio Taupa of the National Power
Corporation (NPC) also submitted their own Commissioner’s Report. They
recommended that the amount of ₱475.00 per square meter be made as the
payment of the affected portion of the subject property which is 10% of the fair
market value pursuant to Republic Act No. 6395 as amended. Commissioners Taupa
and Nuique recommended the amount of ₱475.00 per square meter because only a
right-of-way easement will be acquired. According to the Supreme Court in the case
of NPC v. Manubay Agro Industrial Dev. Corp., G.R. No. 150936, August 18, 2004,
even if what is acquired is only an easement of right of way, still, the plaintiff should
pay the full value of the property and not a mere easement fee.
Based on the foregoing, the court fixes the just compensation for the subject
properties situated in Brgy. Tabangao-Ambulong, Batangas City at ONE THOUSAND
PESOS (₱1,000.00)per square meter.
WHEREFORE, plaintiff National Power Corporation is ordered to pay the defendants
the amount of ₱1,000.00 per square meter.
Upon payment of just compensation to the defendants, subject to the deductions
of the sums due the Government for unpaid real estate taxes and other imposts,
the plaintiff shall have a lawful right to enter, take possession and acquire easement
of right-of-way over the portions of the properties together with the improvements
sought to be expropriated for the purpose stated, free from any and all liens and
encumbrances.
Finally, the plaintiff is directed topay the corresponding Commissioner’s fees per
meeting or the following sums:
Chairman Emelinda C. Atienza - ₱1,000.00
Members Alberto M. Nuique - P 800.00
and Eladio Taupa - P 800.00
SO ORDERED.9
CA-G.R. CV No. 86712
NPC filed an appeal – docketed as CA-G.R. CV No. 86712 – with the CA. On June 26,
2007, the appellate court issued a Decision,10 stating as follows:
At bar, it cannot be gainsaid thatthe construction of underground pipeline is a
simple case ofmere passage of gas pipeline. It will surely cause damage and
prejudice to the agricultural potentials of appellees’ property. Deep excavation will
have to be done whereby plants and trees will be uprooted. A possible leakage
could certainly do harm and adversely restrict the agricultural and economic activity
of the land. This is not to mention that it will create an environmental health hazard
dangerous to the occupant’s life and limb.
Hence, defendants-appellees are entitled for [sic] justcompensation to [sic] the
fullmarket value of their property notjust ten percent (10%) of it.
xxxx
Taking all the consideration [sic] of the subject property, Commissioners Taupa and
Nuique placed the value of the property at ₱475.00 per square meter based on the
Land Bank valuation and Cuervo Appraisers, Inc. and the Provincial/City Appraisal
Committees of Batangas, Laguna and Lipa City, while Commissioner Atienza valued
the property at ₱1,120.00 per square meter, based on the average value per
findings of the Committee composed of the City Assessor, City Treasurer, City
Engineer under Resolution No. 9-99 dated June 18, 1999 that the subject property
will cost ₱1,000.00 to ₱1,300.00 per square meter, and the opinion value of her
Team’s survey and Report which revealed that the prevailing price of agricultural
land in Tabangao-Ambulong, Batangas City is NINE HUNDRED THIRTY PESOS
(₱930.00) per square meter.
In pronouncing the just compensation in this case, We fix the rate of the subject
property at SEVEN HUNDREDNINETY SEVEN [sic] and FIFTY CENTAVOS (₱797.50) per
square meter by averaging ₱475.00 and ₱1,120.00 of the commissioner’s report.
This is nearest to and in consonance with the ruling that in expropriation
proceedings, the owner of the property condemned is generally entitled to the fair
market value, that is the sum of money which a person desirous but not compelled
to buy, and an owner willing but not compelled to sell.
IN VIEW OF ALL THE FOREGOING, appealed decision dated November 7, 2005 is
AFFIRMEDwith MODIFICATIONthat the just compensation in this case is lowered
from ONE THOUSAND PESOS (₱1,000.00) to SEVEN HUNDRED NINETY SEVEN and
FIFTY CENTAVOS (₱797.50) per square meter. No pronouncement as to costs.
SO ORDERED.11
The above Decision ofthe appellate court became final and executory, and entry of
judgment was done accordingly.12
Respondents moved for execution.13 In a March 6, 2009 Order,14 the Batangas City
RTC granted their respective motions, and a Writ of Execution15 was issued.
On May 14, 2009, a Notice of Garnishment16 was served on the Manager of the
Land Bank of the Philippines, NPC Branch, Quezon City for the satisfaction of the
amount of ₱5,594,462.50 representing justcompensation for the wholeof
respondents’ 4,404- and 2,611-square meter lots – or 7,015 square meters – and
not merely the supposedly affected portions thereof totaling 1,595.91 square
meters as NPC originally sought to acquire.
On May 29, 2009, NPC filed an Urgent Omnibus Motion17 seeking to quash the Writ
of Execution and Notice of Garnishment, which it claimed were inconsistent with
the Batangas City RTC’s November 7, 2005 Decision and the CA’s June 26, 2007
Decision in CA-G.R. CV No. 86712 where just compensation was fixed at ₱1,000.00
per square meter only for the affected area of 1,591.91 square meters, and not for
the whole of respondents’ respective lots. It argued that the appeal in CA-G.R. CV
No. 86712 resolved only the issue of whether respondents should be paid the full
marketvalue of the affected 1,595.91-square meter area or just a 10% easement fee
therefor; it did not decide whether NPC should pay just compensation for the entire
area of 7,015 square meters.
On September 24, 2009,the Batangas City RTC issued an Order18 denying
NPC’s Urgent Omnibus Motion, declaring that –
The cases cited by plaintiff are not in point. These cases involved either the
construction and maintenance of electric transmission lines x x x or the widening of
road component x x x. None of the cited cases involved underground natural gas
pipelines, as in this case. It does not take an expert to be able to infer that there is a
world of difference on the probable effects of the two (2) kinds of projects on the
properties upon which these are imposed. In the case of transmission lines, the NPC
imposes a limitation on the property owner’s use of their property in that below
said transmission lines no plant higher than three (3) meters is planted. In the case
of underground pipelines, similar, if not more burdensome restrictions, are
imposed for the reason that the ground under which the natural gas pipelines are
located could not be cultivated in view of the dangers that might result from
accidental injury or damage to the pipelines.
Moreover, there is the possible inestimable damage that an unpredictable natural
disaster such as an earthquake of tectonic origin, the precise date and time of
occurrence of which are yet beyond the powers of man to accurately foretell, could
inflict on the underground natural gas pipelines and consequently, on all things,
living and non-living, that exist in the vicinity of the defendants’ properties.
Moreover, the ruling that just compensation should be paid for the entire area of
the owner’s property and not justthe affected portion thereof is not without
precedent. In NPC vs. Court of Appeals (436 SCRA 195, 201 [August 12, 2001]), the
Supreme Court [noted] that "Pobre’s property suffered permanent injury because
of the noise, water, air, and land pollution generated by NPC’s geothermal plants[;
t]he construction and operation of the geothermal plants drastically changed the
topography of the property making it no longer viable as a resort-subdivision[; and
t]he chemicals emitted by the geothermal plants damaged the natural resources in
the property and endangered the lives of the residents. Accordingly, the Supreme
Court held that "NPC did not only take the 8,311.60 square meter portion of the
property but also the remaining area of the 68,969 square-meter property. NPC had
rendered Pobre’s entire property useless as a resort-subdivision. The property has
become useful only to NPC. NPC must therefore take Pobre’s entire property and
pay for it. x x x
In the case at bar, it was not disputed that the subject properties are agricultural
lands. In order to be usefulto its owners, suchagricultural lands must be cultivated
to yield a harvest ofagricultural produce. But when such lands are burdened with an
easement even of the non-apparent kind, but which to all intents and purposes
restrict, nay, preclude the very activity that would render it useful to its owners
because the existence of such easement poses an undeniable danger to the life and
limb of the occupants, then such lands cease to be useful to the property owners
and useful only to the entity that imposed the easement upon the land. The
Honorable Court of Appeals recognized this fact when it declared that:
"At bar, it cannot be gainsaid that the construction of underground pipeline is a
simple case of mere passage of gas pipeline. It will surely causedamage and
prejudice to the agricultural potentials of appellees’ property. Deep excavation will
have to be done whereby plants and trees will be uprooted. A possible leakage
could certainly do harm and adversely restrict the agricultural and economic
activityof the land. This is not to mention that it will create anenvironmental health
hazard dangerous to the occupant’s life and limb.
Hence, defendants-appellees are entitled for [sic] just compensation to the full
market value of their property not just ten percent of it.
Just compensation is defined as the full and fair equivalent of the property taken
from its owner by the expropriator. The measure is not the taker’s gain, but the
owner’s loss." x x x
Thus, the argument of defendant heirs of Santos Comia is well taken that as to
them, the entire area of their property, and not just the affected portion thereof,
had become useless to them. It is [useful only] to plaintiff NPC. The same holds true
for the entire property owned by defendant Felicisimo Tarcelo. Therefore, NPC
must pay for the full market value of the entire properties owned by defendant
Felicisimo Tarcelo and defendant heirs of Santos Comia.
WHEREFORE, the Omnibus Motion is DENIED. As the Writ of Execution dated March
9, 2009 and Notice ofGarnishment dated May 14, 2009 are consistent with the
Decision of the Court of Appeals dated June 28, 2007, this Court’s Sheriff is hereby
ordered to forthwith enforce the Writ of Execution dated March 9, 2009 and Notice
of Garnishment dated May 14, 2009 and to submit immediately a written report on
his proceedings thereon.
SO ORDERED.19
NPC filed a Motion for Reconsideration,20 which was deniedin an October 23, 2009
Order21 on the ground that it did not contain a notice of hearing and was thus a
mere scrap of paper that did not toll the running of the period to appeal and
therefore rendered the Batangas City RTC’s September 24, 2009 Order final and
executory.
Ruling of the Court of Appeals
Seeking to set aside the September 24, 2009 and October 23, 2009 Orders of the
Batangas City RTC as well as itsMarch 9, 2009 Writ ofExecution and May 14, 2009
Notice of Garnishment, NPC filed a Petition for Certiorari22with the CA, which was
docketed as CA-G.R. SP No. 112054. It pleaded liberality in the application of the
rule on motions and insisted that the assailed writ of execution and notice of
garnishment were inconsistent with the CA’s June 26, 2007 Decision in CA-G.R. CV
No. 86712 in which just compensation was fixed at ₱1,000.00 per square meter only
for the affected area of 1,595.91 square meters, and not for the whole of
respondents’ respective lots. It reiterated that since the trial court’s dispositions
were irregular and inconsistent with the Decision in CA-G.R. CV No. 86712, justice
dictated that the technical rules on motions should give way to considerations of
equity; that in CA-G.R. CV No. 86712, the only question that had to be resolved was
whether NPC should pay the full market value of the 1,595.91-square meter
affectedarea or merely a 10% easement fee for the use thereof – and not whether
it should pay for the entire 7,015 square meters owned by respondents. Finally, it
maintained that the inclusion of the whole property instead of only the affected
portions thereof would render the execution process in Civil Case No. 5785 unjust
and inequitable.
On January 20, 2011, the CA rendered the assailed Decision containing the
following decretal portion:
WHEREFORE, the instant petition for certiorari is DENIED. Accordingly, the assailed
Orders of the public respondent Regional Trial Court of Batangas City, in Civil Case
No. 5785, STAND. SO ORDERED.23
The CA held that there was nothing in the November 7, 2005 Decision of the
Batangas City RTC to indicate thatNPC was being ordered to pay just compensation
only for the 1,595.91-square meter portion ofrespondents’ properties; on the
contrary, the trial court held that –
Based on the foregoing, the court fixes the justcompensation for the subject
propertiessituated in Brgy. Tabangao-Ambulong, Batangas City at ONE THOUSAND
PESOS (₱1,000.00) per square meter.24 (Emphasis supplied)
– which meant that in the fixing of the amount of just compensation, the trial court
did not confine itself to the 1,595.91-square meter portion but ratherto the subject
properties in their entirety and without qualification. It added that the trial court’s
citation of National Power Corporation v. Manubay Agro-Industrial Development
Corporation25 strengthened the view that the trial court intended for respondents
to be paid compensation for the whole of their properties,as it was held in said
cited case that just compensation should be "neither morenor less than the
monetary equivalent of the land;"26 the trial court’s judgment may be clarified by
referring to other portions thereof, and not by reading them separately from the
whole decision – in other words, the "decision should be taken as a whole and
considered in its entirety to get the truemeaning and intent of any particular
portion thereof."27
The CA noted that even in the June 26, 2007 Decision inCA-G.R. CV No. 86712, it
was acknowledged that –
At bar, it cannot be gainsaid thatthe construction of underground pipeline is a
simple case of mere passage of gas pipeline. It will surely cause damage and
prejudice to the agricultural potentials of appellees’ property. Deep excavation will
have to be done whereby plants and trees will be uprooted. A possible leakage
could certainly do harm and adversely restrict the agricultural and economic activity
of the land. This is not to mention that it will create an environmental health hazard
dangerous to the occupant’s life and limb.
Hence, defendants-appellees are entitled for [sic] justcompensation to [sic] the
fullmarket value of their property not just ten percent (10%) of it.28
It added that in the September 24, 2009 Order of the BatangasCity RTC, it was made
clear that NPC should pay for the entire area of respondents’ properties, and not
just the affectedportions thereof when it held that –
x x x. In the case of underground pipelines, similar, if not more burdensome
restrictions, are imposed for the reason that the ground under which the natural
gas pipelines are located could not be cultivated in view of the dangers that might
result from accidental injury or damage to the pipelines. Moreover, there is the
possible inestimable damage that an unpredictable natural disaster such as an
earthquake of tectonic origin, the precise date and time of occurrence of which are
yet beyond the powers of man to accurately foretell, could inflict on the
underground natural gas pipelines and consequently, on all things, living and non-
living, that exist in the vicinity of the defendants’ properties.
Moreover, the ruling that just compensation should be paid for the entire area of
the owner’s property and not justthe affected portion thereof is not without
precedent. In NPC vs. Court of Appeals (436 SCRA 195, 201 [August 12, 2001]), the
Supreme Court [noted] that "Pobre’s property suffered permanent injury because
of the noise, water, air, and land pollution generated by NPC’s geothermal plants[;
t]he construction and operation of the geothermal plants drastically changed the
topography of the property making it no longer viable as a resort-subdivision[; and
t]he chemicals emitted by the geothermal plants damaged the natural resources in
the property and endangered the lives of the residents. Accordingly, the Supreme
Court held that "NPC did not only take the 8,311.60 square meter portion of the
property but also the remaining area of the 68,969 square-meter property. NPC had
rendered Pobre’s entire property useless as a resort-subdivision. The property has
become useful only to NPC. NPC must therefore take Pobre’s entire property and
pay for it. x x x
In the case at bar, it was not disputed that the subject properties are agricultural
lands. In order to be usefulto its owners, suchagricultural lands must be cultivated
to yield a harvest ofagricultural produce. But when such lands are burdened with an
easement even of the non-apparent kind, but which to all intents and purposes
restrict, nay, preclude the very activity that would render it useful to its owners
because the existence of such easement poses an undeniable danger to the life and
limb of the occupants, then such lands cease to be useful to the property owners
and useful only to the entity that imposed the easement upon the land. The
Honorable Court of Appeals recognized this fact when it declared that:
"At bar, it cannot be gainsaid that the construction of underground pipeline is a
simple case of mere passage of gas pipeline.1âwphi1 It will surely causedamage and
prejudice to the agricultural potentials of appellees’ property. Deep excavation will
have to be done whereby plants and trees will be uprooted. A possible leakage
could certainly do harm and adversely restrict the agricultural and economic
activityof the land. This is not to mention that it will create an environmental health
hazard dangerous to the occupant’s life and limb.
Hence, defendants-appellees are entitled for (sic) just compensation to [sic] the full
market value of their property not just ten percent of it.29
Finally, the CA found nothing wrong with the trial court’s October 23, 2009 Order
denying NPC’s Motion for Reconsideration (of the trial court’s September 24, 2009
Order), since the saidmotion lacked the required notice of hearing; it was properly
treated as a pro formamotion, a mere scrap of paper, and in the absence of merit
and compelling reasons, the Rule pertaining to motions may not be relaxed for
NPC’s benefit.
NPC filed its Motion for Reconsideration,30 which was denied by the appellate court
in an August 9, 2011 Resolution. Hence, the instant Petition.
Issues
The Petition is grounded on the following:
I
THE COURT OF APPEALS ERRED IN UPHOLDING THE TRIAL COURT’S ORDERS
APPROVING THE NOTICE OF GARNISHMENT WHICH DEMANDED PAYMENT OF JUST
COMPENSATION FOR THE ENTIRE PROPERTY OF RESPONDENTS INSTEAD OF THE
AFFECTED PORTIONS ONLY INACCORDANCE WITHTHE COMPLAINT AND THE TRIAL
COURT’S DECISION.
II
THE COURT OF APPEALS ERRED IN UPHOLDING THE ORDER OF THE TRIAL COURT
WHICH DENIEDPETITIONER’S MOTION FOR RECONSIDERATION IN COMPLETE
DISREGARD OF LIBERALITY ENUNCIATED IN SEVERAL DECISIONS OF THIS
HONORABLE COURT.31
Petitioner’s Arguments
In its Petition and Consolidated Reply,32 NPC argues that while there is no dispute as
to its liability torespondents, the Sheriff’s computation as reflected in the Notice of
Garnishment is erroneous inthat it is being made to pay for more than what was
adjudged; justcompensation should be limited to the value of that portion so taken,
and not the entire property of which such portion forms part. It cites cases where
the computation and payment of just compensation was limited to the value of the
affected portions only.33 It continues to plead for liberality in respect to its Motion
for Reconsideration of the trial court’s September 24, 2009 Order, which was
denied via the October 23, 2009 Order for lack of the required notice of hearing.
NPC thus prays that the assailed CA dispositions – together with the September 24,
2009 and October 23, 2009 Orders and the May 14, 2009 Notice of Garnishment –
be set aside. Respondents’ Arguments
Praying that the Petition be denied for lack of merit, the Santos heirs in their
Comment34 restate the assailed CA Decision, and add that while NPC sought a mere
right-of-way for its pipelines, the truth is that their property will be rendered
useless by the toxic fumes and hazardous substances that could beemitted by such
pipelines; that their situation is akin tothat of the landowner in the case of National
Power Corporation v. Manubay Agro-Industrial Development Corporation,35 who
was adjudged to be entitled to the full value of the property, and not a mere
easement fee; and thatNPC cannot claim liberality in the application of the Rule on
motions36 because there exist no special or compelling circumstances to warrant
the relaxation of the rule, and NPC’s failure is the result of fault and negligence on
itspart, and it has not shown to the satisfaction of the court that it is entitled to
leniency.
On the other hand, respondent Tarcelo argues in his Comment 37 that there is no
inconsistency between the trial court’s November 7, 2005 Decision and the June 26,
2007 Decision of the CA inCA-G.R. CV No. 86712 on the one hand, and the trial
court’s September 24, 2009 and October 23, 2009 Orders and the March 9, 2009
Writ of Execution and May 14, 2009 Notice of Garnishment on the other; that the
trial court and the CA treated respondents’ properties as a whole or in their entirety
in resolving the cases before them; thatNPC already knew beforehand that it is
being ordered to pay just compensation for the entirety of respondents’ properties
and not mere portionsthereof; and finally, that the trial court correctly denied
NPC’s Motion for Reconsideration of the September 24, 2009 Order for lack of a
notice of hearing.
Our Ruling
The Court grants the Petition.
The exercise of the right of eminent domain, whether directly by the State or by its
authorized agents, is necessarily in derogation of private rights. It is one of the
harshest proceedings known to the law. x x x The authority to condemn is to be
strictly construed in favor of the owner and against the condemnor. When the
power is granted, the extent to which it may be exercised is limited to the express
terms or clear implication of the statute in which the grant is contained. 38
Corollarily, it has been held that trial courts should exercise care and
circumspection in the resolution of just compensation cases, considering that they
involve the expenditure of public funds.39
The above principles were somehow lost on both the trial and appellate courts.
The Commissioners’ Reports in Civil Case No. 5785 indicate that only the affected
areas were intended to beacquired and compensated. Thus, Commissioner
Emelinda C. Atienza’s Report containsthe following recommendation:
IV. Recommendation
Finding x x x that the valuation established herein was reasonable and fair, the
undersigned recommend [sic] thatthe amount of Php1,120.00 per square meter be
adopted to compensate the affected areas on the properties involve [sic] in the
above subject case.40 (Emphasis supplied)
On the other hand, Commissioners Alberto M. Nuique and Eladio R. Taupa’s
respective Reports uniformly state:
III. RECOMMENDATIONS
It is hereby recommended that only easement fee be made as the payment on the
affected portionof the above-mentioned parcel of agricultural land which is 10% of
the fair market value pursuant to Republic Act 6395 as amended x x x 41 (Emphasis
supplied)
The trial court itself particularly decreed in its November 7, 2005 Decision that only
the affectedportions of respondents’ properties were to be acquired and
compensated for. In the decretal portion ofits Decision, it thus held as follows:
WHEREFORE, plaintiff National Power Corporation is ordered to pay the defendants
the amount of ₱1,000.00 per square meter.
Upon payment of just compensation to the defendants, subject to the deductions
of the sums due the Government for unpaid real estate taxes and other imposts,
the plaintiff shall have a lawful right to enter, take possession and acquire easement
of right-of-way over the portions of the propertiestogether with the improvements
sought to be expropriated for the purpose stated, free from any and all liens and
encumbrances.42(Emphasis and underscoring supplied)
The CA therefore patently erred in declaring in its assailed Decision that there is
nothing in the November 7, 2005 Decision of the Batangas City RTC to indicate that
NPC was being ordered to pay just compensation only for the 1,595.91-square
meter portion of respondents’ properties.On the contrary, the evidence is quite
clear that NPC has beenmade liable precisely to such extent only, and not more.
The Court likewise observes that contrary to the CA’s appreciation, the June 26,
2007 Decision in CA-G.R. CV No. 86712 did notparticularly declare that NPC should
pay for the entirearea of respondents’ properties. It merely stated that respondents
should be compensated for the full and fair market value of their property and not
merely paid a 10%easement fee therefor; it did not resolve the issue of whether
NPC should pay just compensation for the entire area of 7,015 square meters. It
simply said that NPC should pay for the full per-square meter value of the affected
portions, and not just a fraction thereof (or 10%). There could be no other
interpretation of the June 26, 2007 pronouncement in CAG.R. CV No. 86712 when
the CA stated therein that – At bar, it cannot be gainsaid thatthe construction of
underground pipeline is a simple case of mere passage of gas pipeline. It will surely
cause damage and prejudice to the agricultural potentials of appellees’ property.
Deep excavation will have to be done whereby plants and trees will be uprooted. A
possible leakage could certainly do harm and adversely restrict the agricultural and
economic activity of the land. This is not to mention that it will create an
environmental health hazard dangerous to the occupant’s life and limb.
Hence, defendants-appellees are entitled for (sic) just compensation to (sic) the
fullmarket value of their property notjust ten percent (10%) of it.
xxxx
Taking all the consideration [sic] ofthe subject property, Commissioners Taupa and
Nuique placed the value of the property at ₱475.00 per square meter based on the
Land Bank valuation and Cuervo Appraisers, Inc. and the Provincial/City Appraisal
Committees of Batangas, Laguna and Lipa City, while Commissioner Atienza valued
the property at ₱1,120 per square meter, based on the average value per findings
of the Committee composed of the City Assessor, City Treasurer, City Engineer
under Resolution No. 9-99 dated June 18, 1999 that the subject property will cost
₱1,000.00 to ₱1,300.00 per square meter, and the opinion value of her Team’s
surveyand Report which revealed that the prevailing price of agricultural land
inTabangao-Ambulong, Batangas City is NINE HUNDRED THIRTY PESOS (₱930.00)
per square meter.43 (Emphasis in the original; underscoring supplied)
NPC is thus correct in its observation that the issue of whether it should be made to
pay for the whole 7,015-square meter area was not at all raised. Besides, in arriving
at its judgment, the CA took into full consideration the Commissioners’ Reports,
which recommended the payment of just compensation only for the affected
portions of respondents’ properties;if it believed otherwise, the appellate court
would have so indicated, and it would have taken exception to the said reports and
arrived at its own independent consideration of the case.
It has always been the rule that "[t]he only portion of the decision that may be the
subject of execution is that which isordained or decreed in the dispositive portion.
Whatever may be found in the body of the decision can only be considered as part
of the reasons or conclusions of the court and serve only as guides to determine the
ratio decidendi."44 "[W]here there is a conflict between the dispositive portion of
the decision and the body thereof, the dispositive portion controls irrespective of
what appears in the body of the decision. While the body of the decision, order or
resolution might create some ambiguityin the manner of the court’s reasoning
preponderates, it is the dispositive portion thereof that finally invests rights upon
the parties,sets conditions for the exercise of those rights, and imposes
corresponding duties or obligation."45 Thus, with the decretal portion of the trial
court’s November 7, 2005 Decision particularly stating that NPC shall have the
lawful right to enter, take possession and acquire easement of right-ofway over the
affected portions of respondents’ properties upon the payment of just
compensation, any order executing the trial court’s Decision should be based on
such dispositive portion. "An order of execution is based on the disposition, not on
the body, of the decision."46 Execution must therefore conform to that ordained or
decreed in the dispositive part of the decision. 47 Since there is a disparity between
the dispositive portion of the trial court’s November 7, 2005 Decision asaffirmed
with modification by the final and executory June 26, 2007 Decision of the CA in CA-
G.R. CV No. 86712 – which decreed that respondents be paid just compensation
only for the affected portionsof their properties, totaling 1,595.91 square meters –
and the Notice of Garnishment – for the satisfaction of the amount of
₱5,594,462.50 representing just compensation for the whole 7,015 square meters –
the latter must be declared null and void.
It is a settled general principle that a writ of execution must conform substantially
to every essential particular of the judgment promulgated. Execution not in
harmony with the judgment is bereft of validity. It must conform, more particularly,
to that ordained or decreed in the dispositive portion of the decision. 48
In the same manner, the Batangas City RTC’s September 24, 2009 and October 23,
2009 Orders are hereby declared null and void in regard only to the Notice of
Garnishment, as it countermands the decretal portion of the November 7, 2005
Decision and completely changes the tenor thereof by holding NPC liable to pay for
the value of the whole of respondents’ properties; all proceedings held for the
purpose of amending or altering the dispositive portion of the trial court’s
November 7, 2005 Decision, as affirmed with modification by the CA’s final and
executory June 26, 2007 Decision in CA-G.R. CV No. 86712, are null and void for lack
of jurisdiction.1âwphi1 This is exactly what the Court said in one case:
Moreover, petitioner is correct in saying that impleading her for the purpose of
execution is tantamount to modifying a decision that had long become final and
executory. The falloof the 1997 Decision bythe NLRC only held "respondents Pro
Agency Manila Inc., and Abdul Rahman Al Mahwes to jointly and severally pay
complainants x x x." By holding her liable despite not being ordained as such by the
decision, both the CA and NLRCviolated the doctrine on immutability of judgments.
In PH Credit Corporation v. Court of Appeals, we stressed that "respondent’s
[petitioner’s] obligation is based on the judgment rendered by the trial court. The
dispositive portion or the fallois its decisive resolution and is thus the subject of
execution. x x x. Hence the execution must conform with that which is ordained or
decreed in the dispositive portion of the decision."
In INIMACO v. NLRC, we also held thus:
None of the parties in the case before the Labor Arbiter appealed the Decision
dated March 10, 1987, hence the same became final and executory. It was,
therefore, removed from the jurisdiction of the Labor Arbiter orthe NLRC to further
alter or amend it. Thus, the proceedings held for the purpose of amending or
altering the dispositive portion of the said decision are null and void for lack of
jurisdiction. Also, the Alias Writ of Execution is null and void because it varied the
tenor of the judgment in that it sought to enforce the final judgment against
‘‘Antonio Gonzales/Industrial Management Development Corp. (INIMACO) and/or
Filipinas Carbon and Mining Corp. and Gerardo Sicat, which makes the liability
solidary.
In other words, "[o]nce a decision or order becomes final and executory, it is
removed from the power or jurisdiction of the court which rendered it to further
alter or amend it. It thereby becomes immutable and unalterable and any
amendment or alteration which substantially affects a final and executory judgment
is null and void for lack of jurisdiction, including the entire proceedings heldfor that
purpose. An order of execution which varies the tenor of the judgment or exceeds
the terms thereof is a nullity."49 (Emphasis supplied)
The failure of NPC to include a notice of hearing in its Motion for Reconsideration of
the trial court’s September 24, 2009 Order has been rendered irrelevant
considering our pronouncement that the said Order is null and void on the matter
covering the Notice of Garnishment. "A void judgment or order has no legal and
binding effect, force or efficacy for any purpose. In contemplation of law, it is non-
existent. Suchjudgment or order may be resisted in any action or proceeding
whenever it is involved. It is not even necessary to take any steps to vacate or avoid
a void judgment or final order; itmay simply be ignored."50
WHEREFORE, the Petition is GRANTED. Judgment is hereby rendered as follows:
1. The January 20, 2011Decision and August 9,2011 Resolution of the Court of
Appeals in CA-G.R. SP No. 112054 are PARTIALLY REVERSED and SET ASIDE;
2. The September 24, 2009 and October 23, 2009 Orders of the Regional Trial Court
of Batangas City, Branch VII in Civil Case No. 5785 are declared NULL and VOID IN
PART, in that the Notice of Garnishment is nullified and set aside;
3. Petitioner National Power Corporation is adjudged liable to PAY JUST
COMPENSATIONto respondents Felicisimo Tarcelo and the Heirs of Comia Santos
for the affected portions of their respective properties totaling 1,595.91 square
meters, at ₱797.50 per square meter, subject to interest at the rate of twelve per
cent (12%) per annumfrom July 29, 2002 up to June 30, 2013, and thereafter, six
percent (6%) per annumfrom July 1, 2013 until full satisfaction, pursuant to Bangko
Sentral ng Pilipinas-Monetary Board Circular No. 799, Series of 2013 and applicable
jurisprudence;
4. Petitioner National Power Corporation is DIRECTED to pay the Commissioners'
Fees as set forth in the November 7, 2005 Decision of the Regional Trial Court
ofBatangas City, Branch VII in Civil Case No. 5785.
SO ORDERED.
G.R. No. 167968 January 23, 2006
VICENTE FLORENTINO, Petitioner,
vs.
MARIANO, CYNTHIA, ADELFA, all surnamed RIVERA and TEOFILA, MAXIMO,
CIRIACO, NORBERTO, FELICIANO, JUAN GENEROSO, ANGEL, NOLASCO and
MARCOSA, all surnamed MENDOZA, Respondents.
DECISION
YNARES-SANTIAGO, J.:
This petition for review under Rule 45 of the Rules of Court assails the February 10,
2005 Decision1 of the Court of Appeals in CA-G.R. SP No. 62080 as well as its April
26, 2005 Resolution2 denying the motion for reconsideration.
The issue for resolution is whether the Court of Appeals overstepped the bounds of
judicial discretion in reversing the orders of the trial court which substantially
amended the dispositive portion of its final and executory judgment by reducing the
damages awarded to respondents.
The facts3 as found by the appellate court are not disputed:
The petition stemmed from a complaint filed before the RTC by Mariano, Cynthia
and Adelfa, all surnamed Rivera (hereinafter Riveras) against Vicente Florentino
(hereinafter private respondent) and the latter as third-party plaintiff against
Teofila Mendoza, et al., as third-party defendants (hereinafter Mendozas), for
rescission, annulment, redemption, reconveyance and damages, docketed as Civil
Case No. 5761-M.
On October 20, 1986, the RTC rendered a decision, the dispositive portion of which
reads:
PREMISES CONSIDERED, judgment is hereby rendered for the plaintiffs Riveras and
third parties defendants Mendozas and adversely to the defendant and third-party
plaintiff Florentino
(aa) declaring the lease contract (Exh. ‘G’ also marked Exh. ‘2’) terminated;
(bb) ordering the defendant Florentino to turn over the possession of the leased
premises to the Riveras, with Florentino being permitted to take all removable
improvements at his expense in accordance with the lease contract;
(cc) ordering Florentino to pay the Riveras annual lease rental of P500.00 for the
year 1982 up to the time possession had been delivered to the Riveras and to
compensate in cash or in kind the Riveras’ claim for damage for unrealized annual
harvest of 100 cavans from 1978 up to the present;
(dd) ordering further Florentino to pay the Riveras and the Mendozas attorney’s
fees in the amount of P20,000.00;
(ee) dismissing for lack of merit the counterclaims in the original complaint and the
third-party complaint of Florentino.
SO ORDERED.4
Aggrieved, private respondent appealed the foregoing decision to the Court of
Appeals (CA), docketed as CA-G.R. CV No. 15784, which affirmed the same in a
decision dated March 29, 1996. Undaunted, private respondent filed a petition for
review on certiorari before the Supreme Court (SC), docketed as G.R. No. 140927,
which the latter denied in its Resolution dated February 9, 2000. Per entry of
judgment5 issued by the Supreme Court, the said Resolution became final and
executory on June 1, 2000 and was recorded in the Book of Entries of Judgment[s].
Consequently, petitioners filed before the RTC a Motion for Execution 6 of its
decision dated October 20, 1986 which the latter granted on August 14,
2000.7 Dissatisfied, the private respondent moved for a reconsideration8on the
ground that the decision sought to be enforced is vague and contrary to the
pronouncement made by the CA in the body of its decision that the petitioners
were deprived of only an area of 1,650 square meters or an annual harvest of 16.5
cavans.
On September 13, 2000, the RTC granted the said motion, the decretal portion of
which reads:
"All told, going by the explanation enunciated by the Court of Appeals, which this
Court must pay obeisance to, paragraph (cc) of the decision rendered by this Court
on October 20, 1986 is hereby CLARIFIED to such extent that the quantity of the
damages which defendant Florentino must pay the Riveras for unrealized annual
harvest is 16.5 (instead of 100) cavans from 1978 onwards.
SO ORDERED."9
Petitioners’ motion for reconsideration of the afore-quoted order was denied in the
Order dated October 31, 2000.
On appeal, the appellate court reversed the trial court’s ruling thus:
WHEREFORE, premises considered, the instant petition is GRANTED. The assailed
Orders dated September 13, 2000 and October 31, 2000 of the Regional Trial Court
of Malolos, Branch 9, are REVERSED and SET ASIDE. The RTC is ordered to enforce
its Decision dated October 20, 1986 in accordance with its terms and conditions.
SO ORDERED.10
The Court of Appeals found that the trial court gravely abused its discretion in
modifying the dispositive portion of a final and executory judgment, since the
modification substantially reduced the amount of damages awarded to herein
respondents, i.e., from 100 cavans to only 16.5 cavans of palay, annually.
A motion for reconsideration was subsequently denied by the Court of Appeals in a
Resolution dated April 26, 2005.11
Dissatisfied, petitioner filed the instant petition insisting that the challenged
judgment and resolution of the appellate tribunal is not in accordance with law or
applicable decisions of the Court because there existed an ambiguity in the
dispositive portion of the trial court’s decision and the text of the appellate court’s
judgment. According to petitioner, the orders of the trial court "merely clarified and
quantified" the decision sought to be executed.
Considering that the crux of the controversy centers on a perceived vagueness in
the fallo of the trial court’s decision, it is necessary to restate the guidelines on the
contents of a proper dispositive portion enunciated in Velarde v. Social
Justice Society,12 viz:
In a civil case as well as in a special civil action, the disposition should state whether
the complaint or petition is granted or denied, the specific relief granted, and the
costs. The following test of completeness may be applied. First, the parties should
know their rights and obligations. Second, they should know how to execute the
decision under alternative contingencies. Third, there should be no need for further
proceedings to dispose of the issues. Fourth, the case should be terminated by
according the proper relief. The "proper relief" usually depends upon what the
parties seek in their pleadings. It may declare their rights and duties, command the
performance of positive prestations, or order them to abstain from specific acts.
The disposition must also adjudicate costs.
In sum, petitioner argues that in substantially reducing the amount of damages, by
way of unrealized income, from 100 cavans to 16.5 cavans of palay annually, the
trial court was merely ‘clarifying’ an ambiguity between the appellate tribunal’s
pronouncements in the body of its decision in CA-G.R. CV No. 15784 which states
that –
While it may be true that the only portion of the adjacent riceland that was affected
by the waste water coming from the piggery is only 150 square meters, it must be
noted, however, that this 150 square meters was counted from the peripheral
fence of the piggery and poultry farm which is occupying 5,000 square meters of
prime agricultural land. In the final analysis, the Mendozas, and later the Riveras,
were deprived of an opportunity to cultivate 1,500 square meters of "encroached"
land plus 150 square meters of land contaminated with decaying piggery sludge. 13
and paragraph (cc) of the dispositive portion of the trial court’s judgment which,
among others, dictates that it is –
(cc) ordering Florentino to pay the Riveras annual lease rental of P500.00 for the
year 1982 up to the time possession had been delivered to the Riveras and to
compensate in cash or in kind the Riveras’ claim for damage for unrealized annual
harvest of 100 cavans from 1978 up to the present.14
We disagree.
It bears stressing that a decision that has acquired finality, as in this case, becomes
immutable and unalterable.15A final judgment may no longer be modified in any
respect, even if the modification is meant to correct erroneous conclusions of fact
or law.16 In short, once a judgment becomes final and executory, it can no longer be
disturbed no matter how erroneous it may be17 and nothing further can be done
therewith except to execute it.18
It is settled rule that "the operative part in every decision is the dispositive portion
or the fallo, and where there is conflict between the fallo and the body of the
decision, the fallo controls. This rule rests on the theory that the fallo is the final
order while the opinion in the body is merely a statement, ordering nothing." 19 We
expounded on the underlying reason behind this rule in Republic v.
Nolasco20 where, reiterating the earlier pronouncements made in Contreras v.
Felix,21 we said:
More to the point is another well-recognized doctrine, that the final judgment of
the court as rendered in the judgment of the court irrespective of all seemingly
contrary statements in the decision. "A judgment must be distinguished from an
opinion. The latter is the informal expression of the views of the court and cannot
prevail against its final order or decision. While the two may be combined in one
instrument, the opinion forms no part of the judgment. So, ... there is a distinction
between the findings and conclusions of a court and its Judgment. While they may
constitute its decision and amount to the rendition of a judgment, they are not the
judgment itself. They amount to nothing more than an order for judgment, which
must, of course, be distinguished from the judgment." (1 Freeman on Judgments, p.
6). At the root of the doctrine that the premises must yield to the conclusion is
perhaps, side by side with the needs of writing finis to litigations, the recognition of
the truth that "the trained intuition of the judge continually leads him to right
results for which he is puzzled to give unimpeachable legal reasons." "It is an
everyday experience of those who study judicial decisions that the results are
usually sound, whether the reasoning from which the results purport to flow is
sound or not." (The Theory of Judicial Decision, Pound, 36 Harv. Law Review, pp. 9,
51). It is not infrequent that the grounds of a decision fail to reflect the exact views
of the court, especially those of concurring justices in a collegiate court. We often
encounter in judicial decisions, lapses, findings, loose statements and generalities
which do not bear on the issues or are apparently opposed to the otherwise sound
and considered result reached by the court as expressed in the dispositive part, so
called, of the decision.
Succinctly stated, "where there is a conflict between the dispositive portion of the
decision and the body thereof, the dispositive portion controls irrespective of what
appears in the body of the decision."22 While the body of the decision, order or
resolution might create some ambiguity in the manner the court’s reasoning
preponderates, it is the dispositive portion thereof that finally invests rights upon
the parties, sets conditions for the exercise of those rights, and imposes the
corresponding duties or obligations.23
More emphatically, Light Rail Transit Authority v. Court of Appeals24 declares that "it
is the dispositive part of the judgment that actually settles and declares the rights
and obligations of the parties, finally, definitively, and authoritatively,
notwithstanding the existence of inconsistent statements in the body that may tend
to confuse." In this regard, it must be borne in mind "that execution must conform
to that ordained or decreed in the dispositive part of the decision; consequently,
where the order of execution is not in harmony with and exceeds the judgment
which gives it life, the order has pro-tanto no validity."25
It bears noting that in the foregoing cases cited, the perceived inconsistencies
referred to alleged ambiguities found in the body of the same judgments. It is worse
in this case because what the trial court did was to amend paragraph (cc) of
the dispositive portion of its final and executory October 20, 1986 verdict in order
that the same would conform to the disquisitions contained in the body of
the appellate court’s judgment which had affirmed in full in the decretal portion of
the decision dated March 29, 1996 in CA-G.R. CV No. 15784, the lower court’s
ruling. Suffice it to state that this is anathema to the above-mentioned rules. Hence,
the Court of Appeals could not be faulted for setting aside the trial court’s assailed
orders of September 13, 2000 and October 31, 2000 and ordering said court "to
enforce its Decision dated October 20, 1986 in accordance with its terms and
conditions."26
It has not escaped our attention that this is the second time this case has reached
us. As pointed out by the Court of Appeals in its March 29, 1996 in CA-G.R. CV No.
15784 Decision, the case at that time had already "been dragging for almost two
decades."27 What should have been a simple implementation of an October 20,
1986 judgment in 2000 was delayed by the filing of a motion for reconsideration
questioning the computation of damages which petitioner insists should be 16.5
instead of 100 cavans each year. This issue had already been long settled with the
issuance of the April 12, 2000 Resolution28 in G.R. No. 140927 denying with finality
petitioner’s motion for reconsideration.
It is to the interest of the public that there should be an end to litigation by the
parties over a subject fully and fairly adjudicated. The doctrine of res judicata is a
rule which pervades every well-regulated system of jurisprudence and is founded
upon two grounds embodied in various maxims of the common law, namely: (1)
public policy and necessity, which makes it to the interest of the State that there
should be an end to litigation – republicae ut sit litium, and (2) the hardship on the
individual that he should be vexed twice for the same cause – nemo debet bis vexari
et eadem causa. A contrary doctrine would subject the public peace and quiet to
the will and neglect of individuals and prefer the gratification of the litigious
disposition on the part of suitors to the preservation of the public tranquility and
happiness.29
It is almost trite to say that execution is the fruit and end of the suit and is the life of
the law. A judgment, if left unexecuted, would be nothing but an empty victory for
the prevailing party.30 Litigation must end sometime and somewhere. An effective
and efficient administration of justice requires that once a judgment has become
final, the winning party be not deprived of the fruits of the verdict. Courts must,
therefore, guard against any scheme calculated to bring about that result.
Constituted as they are to put an end to controversies, courts should frown upon
any attempt to prolong them.31
WHEREFORE, the petition is DENIED. The February 10, 2005 Decision of the Court
of Appeals in CA-G.R. SP No. 62080, and its April 26, 2005 Resolution,
are AFFIRMED.
SO ORDERED.
G.R. No. 137566 February 28, 2001
ROBERTO G. ROSALES, as successor-in-interest of NAPOLEON S. ROSALES and LUIS
BUSTILLO,petitioners,
vs.
THE HON. COURT OF APPEALS and NATIONAL DEVELOMENT CORPORATION, as
substituted plaintiff and the successor-in-interest of CONTINENTAL
BANK, respondents.
YNARES-SANTIAGO, J.:
This is a petition for review assailing the decision of the Court of Appeals dated
January 6, 1999, and the resolution dated February 18, 1999, in CA-G.R. SP No.
46391.
On April 12, 1966, the Continental Bank instituted Civil Case No. 612 with the then
Court of First Instance of Balayan, Batangas, Branch 7, entitled, "Continental Bank,
Plaintiff versus Atlas Timber Company, Napoleon S. Rosales and Luis Bustillo,
Defendants." The complaint1 alleged that Atlas Timber Company, through its
Managing Partner Napoleon Rosales, and Luis Bustillo in his personal capacity,
executed in favor of Continental Bank a promissory note dated August 11, 1965, in
the amount of P1,000,000.00; that as security for the payment of the note, Bustillo
executed in favor of the bank a real estate mortgage over forty-four (44) parcels of
land registered in his name under Transfer Certificate of Title No. T-11337, situated
in Nasugbu, Batangas; that likewise as security for the payment of the note, Rosales
executed a real estate mortgage over forty-nine (49) parcels of land registered in his
name under TCT Nos. T-11828 and T-11839, also in Nasugbu, Batangas; that
defendants failed and refused to pay the first amortization on the loan of
P90,000.00, thus rendering the whole principal amount thereof due and
demandable. Plaintiff bank prayed that defendants be ordered to pay the amount
of One Million Pesos (P1,000,000.00) with interest thereon at 8% per annum and
attorney's fees equivalent to 10% thereof, and, in default thereof, that the real
estate mortgages executed by defendants Rosales and Bustillo in favor of the bank
be judicially foreclosed.1âwphi1.nêt
In their Answer with Counterclaim,2 defendants admitted the execution of the
promissory note and real estate mortgages. By way of affirmative defenses, they
averred that the loan was applied for under the Industrial Guaranty Loan Fund
(IGLF) of the Central Bank, through Continental Bank, and was intended for the
completion of the veneer plant of Atlas Timber Company, then being constructed in
Butuan City. Pursuant to the terms of the Fund, the proceeds of the loan in the
amount of P1,000,000.00 were deposited by the Central Bank with Continental
Bank. Upon the assurance by Continental Bank that the full amount of
P1,000,000.00 will be released to them, defendants executed the promissory note
and real estate mortgages. However, instead of delivering to them the entire
amount of P1,000,000.00, Continental Bank delivered only P424,000.00 and
retained the balance of P576,000.00, despite repeated demands for the turn-over
thereof. Consequently, defendants were unable to complete the construction of the
plant and to manufacture veneer for exportation to the United States. Defendants,
therefore, set up a counterclaim for pecuniary, moral and exemplary damages and
for attorney's fees.
Continental Bank filed its answer to the counterclaim, alleging that out of the net
proceeds of the loan, in the amount of P999,730.00, the sum of P575,535.82 was
applied to previous loans obtained by Atlas Timber for the initial construction of the
veneer plant.
On December 16, 1974, the trial court rendered its decision, 3 the dispositive portion
of which reads:
WHEREFORE, judgment is hereby rendered as follows:
(1) Ordering the defendants Atlas Timber Company and Napoleon S. Rosales, jointly
and severally, to pay plaintiff bank the sum of P1 million with interest at the rate of
8% per annum from August 11, 1965 until fully paid and the further sum equivalent
to 10% of the total amount due, as and for attorney's fees, plus costs of suit, and
which defendants shall pay within ninety (90) days from date of receipt of this
decision;
(2) In default of such payment, the mortgaged properties including the
improvements existing thereon covered by OCT (sic) No. T-11337 and TCT No.
11282, both of the Land Records of Batangas, shall be sold at public auction to
satisfy the judgment herein, without prejudice to the issuance of writ of execution
against defendants Atlas Timber Company and Napoleon S. Rosales in the event
that the proceeds of the foreclosure sale be insufficient to satisfy the entire
judgment.
SO ORDERED.4
Subsequently, the trial court issued an Order dated April 22, 1975, 5 amending the
aforesaid decision as follows:
Finding plaintiff's motion to amend the decision dated December 16, 1974 to be
well-founded, same is hereby granted, and the dispositive part of the decision
specifically paragraph 2 thereof, is hereby amended in the sense that Original
Transfer Certificate of Title No. T-11337 should read as Transfer Certificate of Title
No. T-11337 and that Transfer Certificate of Title No. T-11839 registered in the
name of Napoleon S. Rosales given as security for the obligation mentioned in the
complaint should be included in the public auction sale to satisfy the judgment in
case of default in the payment of the obligation.
SO ORDERED.
On July 14, 1975, after ascertaining that defendants have failed to pay the judgment
debt within ninety (90) days from January 25, 1975, when service of the decision on
them was deemed completed, the court issued the Writ of Execution, 6 commanding
the Branch Deputy Sheriff to sell at public auction the lands covered by TCT Nos. T-
11337, T-11828, and T-11839.
At the foreclosure sale, Continental Bank was awarded the lands as the highest
bidder for the price of P120,500.00. Accordingly, the Branch Deputy Sheriff of the
CFI, Branch VII, Balayan, Batangas, executed the Officer's Deed of Sale7 on
September 25, 1975, conveying to Consolidated Bank the mortgaged parcels of
land.
On October 30, 1975, Continental Bank filed a Motion for Confirmation of Officer's
Deed of Sale and To Order Issuance of Certificate of Final Record.8 The hearing on
the motion was set on December 3, 1975, and later reset to February 20, 1976. In
the meantime, Atty. Santiago F. Alidio, collaborating counsel for defendants, filed a
Manifestation and Motion,9 alleging that he had been designated as the City Legal
Officer of the City of Manila since December 20, 1974; and that on February 20,
1976, he was directed by the Mayor of Manila to attend a conference at
Malacañang Palace with Presidential Assistant Juan C. Tuvera. Hence, he moved
that his appearance at the hearing on said date be dispensed with and that
defendants and their lead counsel, Atty. Tagalo, be served notice of hearing.
The lower court issued an Order dated June 15, 1976,10 denying Atty. Alidio's prayer
for deferment of the hearing and granting the confirmation and approval of sheriff's
sale.
On September 19, 1996, petitioners Roberto G. Rosales, as successor-in-interest of
Napoleon S. Rosales, and Luis Bustillo, filed with the lower court, then designated as
the Regional Trial Court of Balayan, Batangas, Branch 9, a Motion to Reopen the
case, on the ground that defendants and their lead counsel never received the
decision dated December 16, 1974; that they were never notified of any hearing for
the confirmation of the Sheriff's Deed of Sale; and that the lower court did not
conduct a hearing prior to the issuance of its Order dated June 15, 1976, confirming
the Sheriff's Deed of Sale. Petitioners prayed, among others, that the sheriff's sale
and order of confirmation be set aside; and that another ninety-day period be fixed
within which they shall pay the judgment debt.
In an Order dated March 17, 1997,11 the trial court denied petitioners' motion to
reopen the case.
Meanwhile, on June 30, 1997, the lower court, resolving an Ex-Parte Motion to
Order the Issuance of Final Deed of Sale filed by National Development Corporation,
the successor-in-interest of Continental Bank, ruled as follows:
Perforce, the Sheriff does not have any option but to execute the Final Deed of Sale
as mandated by Section 63 (a) of P.D. 1529 and there is no need for the Court's
intervention in order for the sheriff to discharge his mandated function. For to do
so, it would leave into the hands of the Sheriff the power to determine when to
transfer the property to the purchaser as he wishes to.
ACCORDINGLY, the ex-parte motion is hereby DENIED.12
On that same date of June 30, 1997, the Ex-Officio Sheriff of the Regional Trial Court
of Balayan, Batangas, executed the Final Deed of Sale in favor of Continental Bank. 13
Petitioners filed a motion for reconsideration of the denial of their motion to
reopen the case, but the same was denied on November 4, 1997.14 Thus, on January
2, 1998, petitioners filed with the Court of Appeals a petition for certiorari,
docketed as CA-G.R. SP No. 46391, entitled, "Roberto G. Rosales, as successor-in-
interest of Napoleon S. Rosales and Luis F. Bustillo, Petitioners versus Hon. Elihu A.
Ybañez as Presiding Judge of the Regional Trial Court of Balayan, Batangas, Branch
9; National Development Corporation, as substituted plaintiff and successors in
interest of Continental Bank; and, Arturo G. Matibag, as Ex-Officio Sheriff of
Balayan, Batangas, Respondents."15
Petitioners argued, in fine, that the lower court amended the decision in its Order
dated April 22, 1975, by adding TCT No. T-11839 to the properties to be sold at
public auction, without prior notice to petitioners (defendants therein). The
amendment was substantial because it included property which was not stated in
the original decision; hence, the ninety-day period for petitioners to pay the
judgment debt should be reckoned not from the date of service of the original
decision but from the date of service of the amendment thereto. Consequently,
plaintiff's motion for execution filed on May 3, 1975, or barely eleven days after the
Order amending the decision, was premature inasmuch as the thirty-day
reglementary period to appeal had not yet elapsed. More importantly, the lower
court's Order dated June 30, 1975 for the issuance of a Writ of Execution was null
and void, since this was done before the expiration of the ninety-day period for
defendants to pay the judgment debt. Therefore, petitioners contend that they
should be allowed another period of ninety (90) days within which to pay the
judgment debt.
Petitioners further argue that the sale to private respondent of the lands, consisting
of a total of 271.306 hectares, for the measly sum of P120,500.00, must be stricken
down as null and void for being grossly inadequate and unconscionable as to shock
the moral sense. Moreover, the inclusion at the auction sale of the property of Luis
Bustillo, covered by TCT No. T-11337, was likewise null and void in view of the lower
court's finding in its decision that "Luis Bustillo did not sign the promissory note and
therefore should not be held liable for the same."16
Likewise, petitioners assail the validity of the order of confirmation issued by the
lower court for having been issued without affording them notice and hearing, as
shown by the Certification of the Clerk of Court of the Regional Trial Court of
Balayan, Batangas, dated March 11, 1999,17 to the effect that counsel for Napoleon
S. Rosales was not furnished a copy of the Order of the court dated June 15, 1976.
As mortgagors, they should have been afforded a hearing and an opportunity to
show cause why the sale should not be confirmed, as by proof of irregularities
therein or gross inadequacy of the price. The lack of such a notice vitiates the
confirmation sale, which may be set aside anytime.
Finally, petitioners accused Consolidated Bank of laches and prescription for its
failure to consolidate its title for twenty (20) years.
On January 6, 1999, the Court of Appeals dismissed the petition. 18 Petitioners'
motion for reconsideration was denied in its Resolution dated February 18,
1999.19 Hence, this petition for review.
In its comment,20 private respondent National Development Corporation,
successor-in-interest of Continental Bank, maintained that Napoleon Rosales was
duly notified of all Orders of the trial court. In fact, petitioners wrote several letters
to private respondent wherein they requested that they be allowed to repurchase
the properties, and that they failed to pay the real estate taxes on the lands or
perform any act consistent with ownership thereof. Based on these, petitioners are
estopped from claiming ownership over the properties
On August 25, 1999, the petition was given due course and the parties were
required to submit their respective memoranda.21
There is merit in the petition.
The Court of Appeals dismissed the petition for certiorari on the main ground that
service on petitioners of the decision dated December 16, 1974 as well as the
orders of the lower court were deemed completed; and that petitioners, by their
subsequent acts, should be deemed to have constructive notice of the decision of
the case a quo. However, the Court of Appeals failed to address petitioners' primary
argument in their petition for certiorari – that the issuance of the writ of execution
was null and void for failure to afford petitioners the full ninety-day period within
which to pay the judgment debt and avoid the sale of their properties at public
auction.
We agree with petitioners that their period of appeal and the ninety days grace
period within which they could have paid the judgment debt should have been
counted from service of the Order dated April 22, 1975, which substantially
amended the decision. The amendatory Order added TCT No. T-11839 to the
properties that were to be judicially foreclosed and sold at public auction in the
event that defendants therein fail to pay the judgment debt within the ninety-day
period.
As such, the period to appeal should be reckoned from service of the said
amendatory Order. Where a judgment is amended, the date of the amendment
should be considered the date of the decision in the computation of the period for
perfecting the appeal.22 For all intents and purposes, the lower court rendered a
new judgment from which the time to appeal must be reckoned. 23
In the case at bar, the records reflect that a copy of the amendatory Order was sent
to defense counsel by registered mail on April 23, 1975. Assuming there was
constructive notice, service thereof must have been deemed completed sometime
thereafter. Consequently, the motion for execution filed by Continental Bank on
May 3, 1975 was premature, inasmuch as it was still within the reglementary period
for petitioners to appeal, which under the Rules in force at that time was fixed at
thirty days.24
(T)he rule is that a judgment may be modified prior to the perfection of the appeal
while the lower court still has control over said judgment. In the case involved,
there was an actual material amendment of the dispositive portion of the original
decision before an appeal was perfected by the defendant. It is likewise settled
that, in such a situation and for all intents and purposes, a new judgment has been
promulgated and it is from receipt thereof that the period to appeal must be
reckoned.25
More importantly, the writ of execution issued by the trial court on July 14, 1975,
which states that "defendants Atlas Timber Company, Napoleon S. Rosales and Luis
Bustillo failed to make any payment even after the ninety (90) day period from
January 25, 1975, when service of the Decision upon them is deemed
completed,"26 and commanding the Branch Deputy Sheriff to sell at public auction
all the foreclosed properties, was null and void. The ninety-day period within which
petitioners could have paid the judgment debt and thus avoided the sale of their
properties at public auction should have commenced a few days from April 23,
1975. When the Writ of Execution was issued on July 14, 1975, the said ninety-day
period had not yet expired.
Since petitioners were deprived of the full use of the ninety-day period within
which to pay the judgment debt, the writ of execution and the order to sell the
properties at public auction were null and void. A judgment in an action for
foreclosure of mortgage could only be executed in a manner prescribed in the
Rules. Where the order of execution was not in conformity with the Rules, the same
is null and void.27 The order for defendants to pay the judgment debt within ninety
days, prior to the sale of the foreclosed properties at public auction, is a substantive
requirement which cannot be omitted.28
This 90-day period given in the rule is not a procedural requirement merely; it is a
substantive right granted to the mortgage debtor as the last opportunity to pay the
debt and save his mortgaged property from final disposition at the foreclosure sale.
It is one of the two steps necessary to destroy what in law is known as the
mortgagor's "equity of redemption," the other being the sale. It may not be
omitted. As the writ of execution or the order allowing the sale of the mortgaged
property was issued without granting the mortgage debtor said 90-day period, the
order for the sale of the property would be a denial of a substantial right and void. 29
Consequently, the sale to Continental Bank of the subject real properties is likewise
null and void. Necessarily, respondent's contention that petitioners' right of action
has prescribed must perforce fail. The action or defense for the declaration of
inexistence of a contract does not prescribe.30 A contract which is null and void is
subject to attack at any time.31 Being null and void, the sale of the properties to
Continental Bank produced no legal effects whatsoever. Quod nullum est, nullum
producit effectum.32
Apart from the foregoing, there exists in this case a more compelling reason to
nullify the auction sale, which is the gross inadequacy of the price at which
respondent acquired the lands. If it is to be presumed that private transactions
were fair and regular,33 and the ordinary course of business was followed,34 then
the properties had a market value of, at the very least, One Million Pesos
(P1,000,000.00), which was the amount of the loan secured by the real estate
mortgages executed on the land. Moreover, it is also presumed that there was
sufficient consideration for a contract.35 Parenthetically, it is worthy to note that
the totality of the mortgaged properties consisted of ninety-three lots, with an
aggregate area of 271.306 hectares. These vast tracts of land, however, were sold
to Continental Bank for only P120,500.00, or roughly twelve percent (12%) of the
estimated market value of the property.
There is no dispute that mere inadequacy of the price per se will not set aside a
judicial sale of real property. Nevertheless, where the inadequacy of the price is
purely shocking to the conscience, such that the mind revolts at it and such that a
reasonable man would neither directly nor indirectly be likely to consent to it, 36 the
sale shall be declared null and void.37 In the early case of Director of Lands v.
Abarca,38 we ruled:
In dismissing the claim of Sarenas and Braganza, the lower court held that the sale
by the sheriff of the property in question in favor of said claimants was null and
void, because it was not made in accordance with the requirements of the law, and
also because the amount of P877.25 paid by Sarenas and Braganza was absolutely
inadequate. In deciding this appeal we do not deem it necessary to discuss all the
questions raised by the parties in their briefs. We believe that the lower court was
right in declaring the sheriff's sale null and void on the ground of the inadequacy
of the price paid. It appears that in 1927 the assessed value of the contested
property was more than P60,000. A judicial sale of real property will be set aside
when the price is so inadequate as to shock the conscience of the court. (National
Bank vs. Gonzalez, 45 Phil., 693.)39
Respondents allege that petitioners should be held guilty of laches. We do not
agree. There is no absolute rule as to what constitutes laches or staleness of
demand; each case is to be determined according to its particular circumstances.
The question of laches is addressed to the sound discretion of the court and since
laches is an equitable doctrine, its application is controlled by equitable
considerations. It cannot be worked to defeat justice or to perpetrate fraud and
injustice.40 In Santiago v. Court of Appeals,41 we held:
As for laches, its essence is the failure or neglect, for an unreasonable and
unexplained length of time to do that which, by the exercise of due diligence, could
or should have been done earlier; it is the negligence or omission to assert a right
within a reasonable time, warranting a presumption that the party entitled to assert
it either has abandoned it or declined to assert it (Felix v. Buenaseda, 240 SCRA 139,
152 [1995], citing Cristobal v. Melchor, 78 SCRA 175, 182 [1977]). But there is, to be
sure, no absolute rule as to what constitutes laches or staleness of demand; each
case is to be determined according to its particular circumstances. The question of
laches is addressed to the sound discretion of the court and since laches is an
equitable doctrine, its application is controlled by equitable considerations. It
cannot be worked to defeat justice or to perpetrate fraud and injustice (Jimenez v.
Fernandez, 184 SCRA 190, 197 [1990]). In the case under consideration, it would not
only be impractical but well-nigh unjust and patently iniquitous to apply laches
against private respondent and vest ownership over a valuable piece of real
property in favor of petitioners by virtue of an absolutely simulated deed of sale
never, in the first place, meant to convey any right over the subject property. It is
the better rule that courts, under the principle of equity, will not be guided or
bound strictly by the statute of limitations or the doctrine of laches when to do so,
manifest wrong or injustice would result (Rañeses v. Intermediate Appellate Court,
187 SCRA 397, 404 [1990], citing Cristobal v. Melchor, supra).42
Respondent argues that petitioners should likewise be declared estopped from
seeking the declaration of nullity of the auction sale because they offered to
repurchase the lands from the bank. It appears that these proposals were made
between the periods September 2, 1993 and July 30, 1996, 43 which was prior to the
filing by petitioners of their motion to reopen the case on September 16, 1996.
Rather than construing this offer against petitioners, this gesture must be taken as
an intention to avoid further litigation and, thus, partook of the nature of an offer
to compromise. As such, the same cannot be taken as an admission that petitioners
were liable for the judgment debt.44 Necessarily, and with more reason, the offer
should not be taken as a waiver of their right to assail the validity of the sale. Verily,
by offering to redeem the properties, petitioners would attain their ultimate
objective, i.e., to pay off the judgment debt and regain ownership of their lands.
When respondent refused this last-ditch proposal, as it were, petitioners were
constrained to resort to legal means to achieve their goal, and thus filed with the
trial court their motion to reopen the case.1âwphi1.nêt
Moreover, we find that, insofar as petitioner Bustillo's land is concerned, the
dispositive portion of the decision was not in accord with the findings as contained
in the body thereof. While the dispositive portion prevails over the body of the
decision in case of conflict, this rule does not apply where it is clear from the body
of the decision that there was a glaring error made in the dispositive portion, in
which case the body of the decision will control.
The general rule is, where there is a conflict between the dispositive portion or
the fallo and the body of the decision, the fallo controls. This rule rests on the
theory that the fallo is the final order while the opinion in the body is merely a
statement ordering nothing. However, where the inevitable conclusion from the
body of the decision is so clear as to show that there was a mistake in the dispositive
portion, the body of the decision will prevail.45
In the case below, the trial court clearly found that Bustillo did not make or sign the
promissory note, and thus declared that he should not be held liable for the loan
and his property should not be sold at public auction, unless the properties included
in petitioner Rosales' mortgage was not sufficient to satisfy the entire money
judgment. In the dispositive portion, however, the trial court ordered that TCT No.
T-11337, in the name of petitioner Bustillo, was to be sold at public auction,
absolutely and without qualification. This part of the judgment, which subjected
Bustillo's property primarily liable for the judgment debt notwithstanding the
finding that the same should only be made to answer for the debt in a subsidiary
manner, violated Bustillo's right against the deprivation of property without due
process of law. Hence, the body of the decision should have prevailed over the
dispositive portion, and Bustillo's property should not have been sold at public
auction unless it was shown that the lands belonging to Napoleon Rosales were
insufficient to satisfy the judgment debt.
Therefore, the sheriff's sale of TCT Nos. T-11337, T-11828 and T-11839 to
Continental Bank is hereby declared null and void. It should be stressed that we are
not here called upon to resolve the merits of Civil Case No. 612, as contained in the
decision of the Court of First Instance of Balayan, Batangas dated December 16,
1974. In their petition for certiorari before the Court of Appeals as well as in the
petition for review before us, petitioners question Continental Bank's act of
debiting the sum of P576,000.00 from the proceeds of their loan, purportedly to
satisfy previous obligations incurred by Atlas Timber Company. However, the
findings of fact of the trial court on this matter were not appealed by
petitioners, albeit for reasons not attributable to them.
Hence, the decision of December 16, 1974, as amended by the Order dated April
22, 1975, should not be disturbed, except only to delete TCT No. 11337 in the name
of Luis Bustillo from the lands to be judicially foreclosed, in view of our finding as
above-stated. Petitioners, therefore, remain liable to pay respondent the amount of
the loan of P1,000,000.00, with interest thereon at the rate of 8% per annum, and
an amount equivalent to 10% thereof as attorney's fees, as stipulated in the
promissory note. Petitioners are hereby granted a new period of one hundred
twenty (120) days within which to pay the same, otherwise the lands covered by
TCT Nos. 11828 and 11839 shall be sold at public auction to satisfy the debt. Under
the 1997 Rules of Civil Procedure, the period prescribed for that purpose in cases of
judicial foreclosure is not less than ninety (90) days nor more than one hundred
twenty (120) days, counted from entry of judgment.46
WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals dated
January 6, 1999, and the Resolution dated February 18, 1999, in CA-G.R. SP No.
46391, are REVERSED and SET ASIDE. The sale of petitioners' lands covered by TCT
Nos. T-11337, T-11828 and T-11839 to Continental Bank is declared NULL and VOID.
Any transfers made and any and all certificates of title issued in lieu of TCT Nos. T-
11337, T-11828 and T-11839, are ORDERED CANCELLED.
Petitioners are ordered to pay to respondent National Development Corporation, as
successor-in-interest of Continental Bank, the sum of One Million Pesos
(P1,000,000.00), with interest thereon at the rate of eight percent (8%) per annum
computed from August 11, 1965 until the date of full payment, and an amount
equivalent to ten percent (10%) of the total amount due, as and for attorney's fees,
plus costs of suit, within a period of one hundred twenty (120) days from the entry
of judgment. In default of such payment, the property included in TCT Nos. T-11828
and T-11839 in the name of Napoleon S. Rosales shall be sold at public auction to
satisfy the judgment.
SO ORDERED.
G.R. No. 81006 May 12, 1989
VICTORINO C. FRANCISCO, petitioner,
vs.
WINAI PERMSKUL and THE HON. COURT OF APPEALS, respondents.
CRUZ, J.:
An important constitutional question has been injected in this case which started
out as an ordinary complaint for a sum of money. The question squarely presented
to the Court is the validity of the memorandum decision authorized under Section
40 of B.P. Blg. 129 in the light of Article VIII, Section 14 of the Constitution.
On May 21, 1984, the petitioner leased his apartment in Makati to the private
respondent for a period of one year for the stipulated rental of P3,000.00 a month.
Pursuant to the lease contract, the private respondent deposited with the
petitioner the amount of P9,000.00 to answer for unpaid rentals or any damage to
the leased premises except when caused by reasonable wear and tear. On May 31,
1985, the private respondent vacated the property. He thereafter requested the
refund of his deposit minus the sum of P1,000.00, representing the rental for the
additional ten days of his occupancy after the expiration of the lease. The petitioner
rejected this request. He said the lessee still owed him for other charges, including
the electricity and water bills and the sum of P2,500.00 for repainting of the leased
premises to restore them to their original condition. 1
The private respondent sued in the Metropolitan Trial Court of Makati. After the
submission of position papers by the parties, a summary judgment was rendered on
October 11, 1985, sustaining the complainant and holding that the repainting was
not chargeable to him. The defendant was ordered to pay the plaintiff the amount
of P7,750.00, representing the balance of the deposit after deducting the water and
electricity charges. The plaintiff was also awarded the sum of P1,250.00 as
attorney's fees, plus the Costs.2
This decision was appealed to the Regional Trial Court of Makati and was affirmed
by Judge Jose C. de la Rama on January 14, 1987. This was done in a memorandum
decision reading in full as follows:
MEMORANDUM DECISION
After a careful and thorough perusal, evaluation and study of the records of this
case, this Court hereby adopts by reference the findings of fact and conclusions of
law contained in the decision of the Metropolitan Trial Court of Makati, Metro
Manila, Branch 63 and finds that there is no cogent reason to disturb the same.
WHEREFORE, judgment appealed from is hereby affirmed in toto.3
When the defendant went to the Court of Appeals, his petition for review was
denied on September 29, 1987, as so too was his motion for reconsideration, on
December 1, 1987.4 He is now before us to fault the respondent court, principally
for sustaining the memorandum decision of the regional trial court. His contention
is that it violates Article VIII, Section 14 of the Constitution.
This provision reads as follows:
Sec. 14. No decision shall be rendered by any court without expressing therein
clearly and distinctly the facts and the law on which it is based.
No petition for review or motion for reconsideration of a decision of the court shall
be refused due course or denied without stating the legal basis therefor.
Except for the second paragraph, which was introduced only in the present charter,
Section 14 has been in force since the Constitution of 1935. The provision was
recast in affirmative terms in the 1973 Constitution but has been virtually restored
to its original form in the Constitution of 1987, to apply to all courts, including the
municipal courts. The purpose has always been the same, viz., to inform the person
reading the decision, and especially the parties, of how it was reached by the court
after consideration of the pertinent facts and examination of the applicable laws.
The parties are entitled to no less than this explanation if only to assure them that
the court rendering the decision actually studied the case before pronouncing its
judgment. But there are more substantial reasons. For one thing, the losing party
must be given an opportunity to analyze the decision so that, if permitted, he may
elevate what he may consider its errors for review by a higher tribunal. For another,
the decision, if well-presented and reasoned, may convince the losing party of its
merits and persuade it to accept the verdict in good grace instead of prolonging the
litigation with a useless appeal. A third reason is that decisions with a full exposition
of the facts and the law on which they are based, especially those coming from the
Supreme Court, will constitute a valuable body of case law that can serve as useful
references and even as precedents in the resolution of future controversies. As the
Court said in Rosales v. Court of First Instance. 5
Precedents are helpful in deciding cases when they are on all fours or at least
substantially Identical with previous litigations. Argumentum a simili valet in
lege. Earlier decisions are guideposts that can lead us in the right direction as we
tread the highways and byways of the law in the search for truth and justice. These
pronouncements represent the wisdom of the past. They are the voice of vanished
judges talking to the future. Except where there is a need to reverse them because
of an emergent viewpoint or an altered situation, they urge us strongly that,
indeed, the trodden path is best.
According to the petitioner, the memorandum decision rendered by the regional
trial court should be revoked for non-compliance with the above-quoted
constitutional mandate. He asks that the case be remanded to the regional trial
court for a full blown hearing on the merits, to be followed by a decision stating
therein clearly and distinctly the facts and the law on which it is based. For his part,
the private respondent demurs. He justifies the memorandum decision as
authorized by B.P. Blg. 129 and invokes the ruling of this Court in Romero v. Court
of Appeals, 6 Which sustained the said law.
Section 40 of B.P. Blg. 129 reads as follows:
Sec. 40. Form of decision in appealed cases. — Every decision or final resolution of a
court in appealed cases shall clearly and distinctly state the findings of fact and the
conclusions of law on which it is based which may be contained in the decision or
final resolution itself, or adopted by reference from those set forth in the decision,
order or resolution appealed from.
The above section was applied in the Romero case, together with a similar rule
embodied in Section 18 of P.D. No. 946, providing that:
All cases of the Court of Agrarian Relations now pending before the Court of
Appeals shall remain in the Division to which they have been assigned, and shall be
decided within sixty (60) days from the effectivity of this Decree; Provided,
however, That if the decision or order be an affirmance in toto of the dispositive
conclusion of the judgment appealed from, then the Court of Appeals may, instead
of rendering an extended opinion, indicate clearly the trial court's findings of fact
and pronouncements of law which have been adopted as basis for the affirmance.
In the said case, Justice Jose Y. Feria, speaking for a unanimous Court, declared:
As previously stated, the decision of the Court of Agrarian Relations consisted of
thirteen pages, single space. The above-quoted decision of the respondent Court of
Appeals consists of four pages, three of which contains verbatim the dispositive
portion of the decision appealed from. The remaining page is devoted to an
explanation of why "for judicial convenience and expediency, therefore, We hereby
adopt, by way of reference, the findings of facts and conclusions of the court a
quo spread in its decision, as integral part of this Our decision." The said decision
may be considered as substantial compliance with the above-quoted provisions in
Section 18 of P.D. No. 946 and Section 40 of B.P. Blg. 129.
Nevertheless, he was quick to add a tenable misgiving and to express the following
reservation:
The authority given the appellate court to adopt by reference the findings of fact
and conclusions of law from those set forth in the appealed decisions should be
exercised with caution and prudence, because the tendency would be to follow the
line of least resistance by just adopting the findings and conclusions of the lower
court without thoroughly studying the appealed case.
This caveat was necessary because, as he correctly observed:
It cannot be too strongly emphasized that just as important as the intrinsic validity
of a decision is the perception by the parties-litigants that they have been accorded
a fair opportunity to be heard by a fair and responsible magistrate before judgment
is rendered. It is this perception, coupled with a clear conscience, which enables the
members of the judiciary to discharge the awesome responsibility of sitting in
judgment on their fellowmen.
There is no question that the purpose of the law in authorizing the memorandum
decision is to expedite the termination of litigations for the benefit of the parties as
well as the courts themselves.
Concerned with the mounting problem of delay in the administration of justice, the
Constitution now contains a number of provisions aimed at correcting this serious
difficulty that has caused much disaffection among the people. Thus, Section 16 of
the Bill of Rights reiterates the original provision in the 1973 Constitution
guaranteeing to all persons "the right to a speedy disposition of their cases before
all judicial, quasi-judicial or administrative bodies." Section 14(2) of the same Article
III retains the rule that the accused shall be entitled to a trial that shall not only be
public and impartial but also speedy. In Article VIII, Section 5(3), the Supreme Court
is expressly permitted to temporarily assign a judge from one station to another
when the public interest so requires, as when there is a necessity for less occupied
judge to help a busier colleague dispose of his cases. In paragraph 5 of the same
section, it is stressed that the rules of court to be promulgated by the Supreme
Court "shall provide a simplified and inexpensive procedure for the speedy
disposition of cases." In Section 15, of the same article, maximum periods are
prescribed for the decision or resolution of cases, to wit, twenty-four months in the
case of Supreme Court and, unless reduced by the Supreme Court, twelve months
for all lower collegiate courts and three months for all other lower courts.
The courts of justice are really hard put at coping with the tremendous number of
cases in their dockets which, to make matters worse, continues to grow by the day
despite the efforts being taken to reduce it. In the Supreme Court alone, an average
of 400 cases is received every month as against the average of 300 cases disposed
of during the same month, leaving a difference of 100 cases monthly that is added
to some 5,000 still unresolved cases that have accumulated during the last two
decades or so. At this rate, the backlog will increase by 1,200 cases every year on
top of the earlier balance, much of which, despite its age, is still viable and have still
to be resolved. Considering that the Court spends four days of the week for
studying and deliberating on these cases in its en banc and division sessions, one
can appreciate the limited time allowed its members for the actual writing of its
decisions. (This particular decision, while extended, happens fortunately to be less
complicated than many of the other cases submitted to it, which require more time
to write, not to mention the antecedent research that may have to be made.)
Viewed in the light of these practical considerations, the memorandum decision can
be welcomed indeed as an acceptable method of dealing expeditiously with the
case load of the courts of justice, But expediency alone, no matter how compelling,
cannot excuse non-compliance with the Constitution; or to put it more familiarly,
the end does not justify the means. It is plain that if Section 40 of B.P. Blg. 129 is
unconstitutional, it must be struck down.
In the case at bar, we find that a judgment was made by the metropolitan trial court
in compliance with the rule on summary procedure. The decision consisted of three
typewritten pages, single space, and stated clearly and distinctly the facts and the
law on which it was based. It was a concise and well-written decision, and a correct
one to boot, for which Judge Paciano B. Balita is to be commended.
The problem, though, as the petitioner sees it, is that in affirming this judgment, the
regional trial court of Makati rendered a mere memorandum decision that simply
adopted by reference the findings of fact and law made by Judge Balita and then
concluded, without saying more, that "there was no cogent reason to disturb the
same." It is claimed that as Judge de la Rama did not make his own statement of the
facts and the law as required by the Constitution, his memorandum decision was a
total nullity. Worse, when the appeal was taken to the respondent court, what it
reviewed was not the memorandum decision of the regional trial court but the
decision rendered by the metropolitan trial court which, legally speaking, was not
before the appellate court.
It is not really correct to say that the Court of Appeals did not review the
memorandum decision of the regional trial court which was the subject of the
petition for review. A reading of its own decision will show that it dealt extensively
with the memorandum decision and discussed it at some length in the light of the
observations — and reservations — of this Court in the Romero case. Moreover, in
reviewing the decision of the metropolitan trial court, the Court of Appeals was
actually reviewing the decision of the regional trial court, which had incorporated
by reference the earlier decision rendered by Judge Balita.
The question, of course, is whether such incorporation by reference was a valid act
that effectively elevated the decision of the metropolitan trial court for examination
by the Court of Appeals.
To be fair, let it be said that when Judge dela Rama availed himself of the
convenience offered by Section 40 of B.P. Blg. 129, he was only acting in accordance
with the ruling announced in Romero permitting the use of the memorandum
decision. It must also be observed that even if the respondent court appeared to be
partial to the reservation rather than the rule in the said case, it nevertheless had
the duty — which it discharged — to abide by the doctrine announced therein by
the highest tribunal of the land. The respondent court could not have acted
otherwise.
This Court is not hampered by such inhibitions. As we may re-examine our own
rulings and modify or reverse them whenever warranted, we take a second look at
the memorandum decision and the Romero case and test them on the touchstone
of the Constitution.
The law does not define the memorandum decision and simply suggests that the
court may adopt by reference the findings of fact and the conclusions of law stated
in the decision, order or resolution on appeal before it. No particular form is
prescribed; the conditions for its use are not indicated. In fact, B.P. Blg. 129 does
not even employ the term "memorandum decision" in Section 40 or elsewhere in
the rest of the statute. This phrase appears to have been introduced in this
jurisdiction not by that law but by Section 24 of the Interim Rules and Guidelines,
reading as follows:
Sec. 24. Memorandum decisions. — -The judgment or final resolution of a court in
appealed cases may adopt by reference the findings of fact and conclusions of law
contained in the decision or final order appealed from.
It is clear that where the decision of the appellate court actually reproduces the
findings of fact or the conclusions of law of the court below, it is not a
memorandum decision as envisioned in the above provision. The distinctive
features of the memorandum decision are, first, it is rendered by an appellate
court, and second, it incorporates by reference the findings of fact or the
conclusions of law contained in the decision, order or ruling under review. Most
likely, the purpose is to affirm the decision, although it is not impossible that the
approval of the findings of fact by the lower court may lead to a different
conclusion of law by the higher court. At any rate, the reason for allowing the
incorporation by reference is evidently to avoid the cumbersome reproduction of
the decision of the lower court, or portions thereof, in the decision of the higher
court. The Idea is to avoid having to repeat in the body of the latter decision the
findings or conclusions of the lower court since they are being approved or adopted
anyway.
Parenthetically, the memorandum decision is also allowed in the United States, but
its form (at least) differs from the one under consideration in this case. Such a
decision is rendered in that country upon a previous' determination by the judge
that there is no need for a published opinion and that it will have no precedential
effect. The judgment is usually limited to the dispositive portion but a
memorandum is attached containing a brief statement of the facts and the law
involved, mainly for the information of the parties to the case.
When a law is questioned before the Court, we employ the presumption in favor of
its constitutionality. As we said in Peralta v. Commission of Elections, "to justify the
nullification of a law, there must be a clear and unequivocal breach of the
Constitution, not a doubtful and argumentative implication."7 Courts will bend over
backward to sustain that presumption. In case of doubt, it is the duty of the
judiciary to exert every effort to prevent the invalidation of the law and the
nullification of the will of the legislature that enacted it and the executive that
approved it. This norm is based on a becoming respect that the judiciary is expected
to accord the political departments of the government which, it must be assumed in
fairness, thoroughly studied the measure under challenge and assured themselves
of its constitutionality before agreeing to enact it.
The Court has deliberated extensively on the challenge posed against the
memorandum decision as now authorized by law. Taking into account the salutary
purpose for which it is allowed, and bearing in mind the above-discussed restraint
we must observe when a law is challenged before us, we have come to the
conclusion that Section 40 of B.P. Blg. 129, as we shall interpret it here, is not
unconstitutional.
What is questioned about the law is the permission it gives for the appellate court
to merely adopt by reference in its own decision the judgment of the lower court
on appeal. It is easy to understand that this device may feed the suspicion feared by
Justice Feria that the court has not given the appeal the attention it deserved and
thus deprived the parties of due process. True or not, this impression is likely to
undermine popular faith in the judiciary as an impartial forum which hears before it
decides and bases its decision on the established facts and the applicable law.
No less objectionable is the inconvenience involved in having to search for the
decision referred to, which, having been incorporated by reference only, does not
have to be attached to the memorandum decision. The Court had occasion earlier
to complain about this difficulty in the case of Gindoy v. Tapucar, 8 where we said:
. . . True it is that the Court of First Instance may adopt in toto either expressly or
impliedly the findings and conclusions of the inferior court, and as a rule, such
adoption would amount to a substantial compliance with the constitutional
mandate discussed herein, but where, as in this case, the specific arguments
presented against the decision of the inferior court are of such nature that a
blanket affirmance of said decision does not in fact adequately dispose of the
strictures against it, it is but proper, if only to facilitate the action to be taken by the
appellate court on the petition for review, that the concrete bases of the impugned
decision should appear on its face, instead of the appellate court having to dig into
the records to find out how the inferior court resolved the issues of the case.
As to this problem, the Solicitor General correctly points out that it does not exist in
the case at bar because the decision of the Court of Appeals extensively quoted
from the decision of the metropolitan trial court. Although only incorporated by
reference in the memorandum decision of the regional trial court, Judge Balita's
decision was nevertheless available to the Court of Appeals. It is this circumstance,
or even happenstance, if you will, that has validated the memorandum decision
challenged in this case and spared it from constitutional infirmity.
That same circumstance is what will move us now to lay down the following
requirement, as a condition for the proper application of Section 40 of B.P. Blg. 129.
The memorandum decision, to be valid, cannot incorporate the findings of fact and
the conclusions of law of the lower court only by remote reference, which is to say
that the challenged decision is not easily and immediately available to the person
reading the memorandum decision. For the incorporation by reference to be
allowed, it must provide for direct access to the facts and the law being adopted,
which must be contained in a statement attached to the said decision. In other
words, the memorandum decision authorized under Section 40 of B.P. Blg. 129
should actually embody the findings of fact and conclusions of law of the lower
court in an annex attached to and made an indispensable part of the decision.
It is expected that this requirement will allay the suspicion that no study was made
of the decision of the lower court and that its decision was merely affirmed without
a proper examination of the facts and the law on which it was based.
The proximity at least of the annexed statement should suggest that such an
examination has been undertaken. It is, of course, also understood that the decision
being adopted should, to begin with, comply with Article VIII, Section 14 as no
amount of incorporation or adoption will rectify its violation.
The Court finds it necessary to emphasize that the memorandum decision should be
sparingly used lest it become an addictive excuse for judicial sloth. It is an additional
condition for its validity that this kind of decision may be resorted to only in cases
where the facts are in the main accepted by both parties or easily determinable by
the judge and there are no doctrinal complications involved that will require an
extended discussion of the laws involved. The memorandum decision may be
employed in simple litigations only, such as ordinary collection cases, where the
appeal is obviously groundless and deserves no more than the time needed to
dismiss it.
Despite the convenience afforded by the memorandum decision, it is still desirable
that the appellate judge exert some effort in restating in his own words the findings
of fact of the lower court and presenting his own interpretation of the law instead
of merely parroting the language of the court a quo as if he cannot do any better.
There must be less intellectual indolence and more pride of authorship in the
writing of a decision, especially if it comes from an appellate court.
It ill becomes an appellate judge to write his rulings with a pair of scissors and a pot
of paste as if he were a mere researcher. He is an innovator, not an echo. The case
usually becomes progressively simpler as it passes through the various levels of
appeal and many issues become unimportant or moot and drop along the way. The
appellate judge should prune the cluttered record to make the issues clearer. He
cannot usually do this by simply mimicking the lower court. He must use his own
perceptiveness in unraveling the rollo and his own discernment in discovering the
law. No less importantly, he must use his own language in laying down his
judgment. And in doing so, he should also guard against torpidity lest his
pronouncements excite no more fascination than a technical tract on the values of
horse manure as a fertilizer. A little style will help liven the opinion trapped in the
tortuous lexicon of the law with all its whereases and wherefores. A judicial
decision does not have to be a bore.
The interpretation we make today will not apply retroactively to the memorandum
decision rendered by the regional trial court in the case at bar, or to the decision of
the respondent court such decision on the strength of Romero v. Court of Appeals.
As earlier observed, there was substancial compliance with Section 40 because of
the direct availability and actual review of the decision of Judge Balita incorporated
by reference in the memorandum decision of Judge de la Rama. The memorandum
decision as then understood under the Romero decision was a valid act at the time
it was rendered by Judge de la Rama and produced binding legal effect. We also
affirm the finding of the respondent court that the summary judgment without a
formal trial was in accord with the Rule on Summary Procedure and that the award
of attorney's fees is not improper.
Henceforth, all memorandum decisions shall comply with the requirements herein
set forth both as to the form prescribed and the occasions when they may be
rendered. Any deviation will summon the strict enforcement of Article VIII, Section
14 of the Constitution and strike down the flawed judgment as a lawless
disobedience.
WHEREFORE, the petition is DENIED, with costs against the petitioner. This decision
is immediately executory. It is so ordered.
G.R. No. 170026 June 20, 2012
SHIMIZU PHILIPPINES CONTRACTORS, INC., Petitioner,
vs.
MRS. LETICIA B. MAGSALIN, doing business under the trade name "KAREN'S
TRADING," FGU INSURANCE CORPORATION, GODOFREDO GARCIA, CONCORDIA
GARCIA, and REYNALDO BAETIONG, Respondents.
DECISION
BRION, J.:
We resolve the petition for review on certiorari1 filed by Shimizu Philippines
Contractors, Inc. (petitioner) to challenge the twin resolutions of the Court of
Appeals (CA)2 in CA-G.R. CV No. 83096 which dismissed the appeal of the petitioner
on the ground of lack of jurisdiction3 and denied the petitioner’s subsequent motion
for reconsideration.4 The appeal in CA-G.R. CV No. 83096 had sought to nullify the
December 16, 2003 order5 of the Regional Trial Court (RTC) dismissing the
petitioner’s complaint for sum of money and damages on the ground of non
prosequitur.
The Antecedents
The antecedent facts of the petition before us are not disputed.
An alleged breach of contract was the initial event that led to the present petition.
The petitioner claims that one Leticia Magsalin, doing business as "Karen’s Trading,"
had breached their subcontract agreement for the supply, delivery, installation, and
finishing of parquet tiles for certain floors in the petitioner’s Makati City
condominium project called "The Regency at Salcedo." The breach triggered the
agreement’s termination. When Magsalin also refused to return the petitioner’s
unliquidated advance payment and to account for other monetary liabilities despite
demand, the petitioner sent a notice to respondent FGU Insurance Corporation
(FGU Insurance) demanding damages pursuant to the surety and performance
bonds the former had issued for the subcontract.
On April 30, 2002, the petitioner filed a complaint docketed as Civil Case No. 02-488
against both Magsalin and FGU Insurance. It was raffled to Branch 61 of the RTC of
Makati City. The complaint sought Two Million Three Hundred Twenty-Nine
Thousand One Hundred Twenty Four Pesos and Sixty Centavos (₱2,329,124.60) as
actual damages for the breach of contract.
FGU Insurance was duly served with summons. With respect to Magsalin, however,
the corresponding officer’s return declared that both she and "Karen’s Trading"
could not be located at their given addresses, and that despite further efforts, their
new addresses could not be determined.
In August 2002, FGU Insurance filed a motion to dismiss the complaint. The
petitioner filed its opposition to the motion. The motion to dismiss was denied as
well as the ensuing motion for reconsideration, and FGU Insurance was obliged to
file an answer.
In October 2002, in an effort to assist the RTC in acquiring jurisdiction over
Magsalin, the petitioner filed a motion for leave to serve summons on respondent
Magsalin by way of publication. In January 2003, the petitioner filed its reply to FGU
Insurance’s answer.
In February 2003, FGU Insurance filed a motion for leave of court to file a third-
party complaint. Attached to the motion was the subject complaint,6 with Reynaldo
Baetiong, Godofredo Garcia and Concordia Garcia named as third-party defendants.
FGU Insurance claims that the three had executed counter-guaranties over the
surety and performance bonds it executed for the subcontract with Magsalin and,
hence, should be held jointly and severally liable in the event it is held liable in Civil
Case No. 02-488.
The RTC admitted the third-party complaint and denied the motion to serve
summons by publication on the ground that the action against respondent Magsalin
was in personam.
In May 2003, the RTC issued a notice setting the case for hearing on June 20, 2003.
FGU Insurance filed a motion to cancel the hearing on the ground that the third-
party defendants had not yet filed their answer. The motion was granted.
In June 2003, Baetiong filed his answer to the third-party complaint. He denied any
personal knowledge about the surety and performance bonds for the subcontract
with Magsalin.7 Of the three (3) persons named as third-party defendants, only
Baetiong filed an answer to the third-party complaint; the officer’s returns on the
summons to the Garcias state that both could not be located at their given
addresses. Incidentally, the petitioner claims, and Baetiong does not dispute, that it
was not served with a copy of Baetiong’s answer. The petitioner now argues before
us that FGU Insurance, which is the plaintiff in the third-party complaint, had failed
to exert efforts to serve summons on the Garcias. It suggests that a motion to serve
summons by publication should have been filed for this purpose. The petitioner also
asserts that the RTC should have scheduled a hearing to determine the status of the
summons to the third-party defendants.8
The Order Of Dismissal
With the above procedural events presented by both parties as the only backdrop,
on December 16, 2003 the RTC issued a tersely worded order9 dismissing Civil Case
No. 02-488. For clarity, we quote the dismissal order in full:
ORDER
For failure of [petitioner] to prosecute, the case is hereby DISMISSED.
SO ORDERED.
10
The RTC denied the petitioner’s motion for reconsideration, prompting the latter
to elevate its case to the CA via a Rule 41 petition for review.11
The Ruling of the Appellate Court
FGU Insurance moved for the dismissal of the appeal on the ground of lack of
jurisdiction. It argued that the appeal raised a pure question of law as it did not
dispute the proceedings before the issuance of the December 16, 2003 dismissal
order.
The petitioner, on the other hand, insisted that it had raised questions of fact in the
appeal.12 Thus -
While, the instant appeal does not involve the merits of the case, the same
involves questions of fact based on the records of the case. It must be emphasized
that the lower court’s dismissal of the case based on alleged failure to prosecute on
the part of plaintiff-appellant was too sudden and precipitate. This being the case,
the facts [sic] to be determined is whether based on the records of the case, was
there a definite inaction on the part of plaintiff-appellant? A careful examination of
all pleadings filed as well as the orders of the lower court vis-à-vis the rules should
now be made in order to determine whether there was indeed a "failure to
prosecute" on the part of plaintiff-appellant[.]13 (emphases supplied)
The CA agreed with FGU Insurance and dismissed the appeal, and denied as well the
subsequent motion for reconsideration.14 The petitioner thus filed the present
petition for review on certiorari.
The Present Petition
The petitioner pleads five (5) grounds to reverse the CA’s resolutions and to
reinstate Civil Case No. 02-488. In an effort perhaps to make sense of the dismissal
of the case (considering that the trial court had not stated the facts that justify it),
the petitioner draws this Court’s attention to certain facts and issues that we find to
be of little materiality to the disposition of this petition:
Grounds/ Statement of Matters Involved
I. The Appellate Court has jurisdiction to determine the merits of the Appeal as the
matters therein involve both questions of law and fact.
II. The lower court erred in declaring that petitioner failed to prosecute the case
despite the fact that petitioner never received a copy of the Answer of Third-party
defendant-respondent Reynaldo Baetiong.
III. The lower court erred in declaring that petitioner failed to prosecute the case
despite the fact that there is no joinder of indispensable parties and issues yet
because defendant-respondent Leticia B. Magsalin as well as third-party defendant-
respondents Godofredo and Concordia Garcia’s whereabouts were unknown, hence
no service yet on them of the copy of the summons and complaint with annexes[.]
IV. The lower court erred in declaring that Petitioner failed to prosecute the case
despite the fact that it was party respondent FGU which caused the cancellation of
the hearing.
V. It is evident that the lower court’s dismissal of the case is a clear denial of due
process.15
In our Resolution dated February 13, 2006,16 we required the respondents to
comment. FGU Insurance’s comment17 alleges that the present petition is "fatally
defective" for being unaccompanied by material portions of the record. It reiterates
that the appeal in CA-G.R. CV No. 83096 was improperly filed under Rule 41 and
should have been filed directly with this Court under Rule 45 of the Rules of Court.
Baetiong, in his comment,18 asserts that the dismissal of the appeal was in accord
with existing laws and applicable jurisprudence.
The Ruling Of The Court
Preliminarily, we resolve the claim that the petition violates Rule 45 of the Rules of
Court on the attachment of material portions of the record. We note that FGU
Insurance fails to discharge its burden of proving this claim by not specifying the
material portions of the record the petitioner should have attached to the petition.
At any rate, after a careful perusal of the petition and its attachments, the Court
finds the petition to be sufficient. In other words, we can judiciously assess and
resolve the present petition on the basis of its allegations and attachments.
After due consideration, we resolve to grant the petition on the ground that the
December 16, 2003 dismissalorder is null and void for violation of due process. We
are also convinced that the appeal to challenge the dismissal order was properly
filed under Rule 41 of the Rules of Court. We further find that the dismissal of Civil
Case No. 02-488 for failure to prosecute is not supported by facts, as shown by the
records of the case.
The Dismissal Order is Void
The nullity of the dismissal order is patent on its face. It simply states its conclusion
that the case should be dismissed for non prosequitur, a legal conclusion, but does
not state the facts on which this conclusion is based.
Dismissals of actions for failure of the plaintiff to prosecute is authorized under
Section 3, Rule 17 of the Rules of Court. A plain examination of the December 16,
2003 dismissal order shows that it is an unqualified order and, as such, is deemed to
be a dismissal with prejudice. "Dismissals of actions (under Section 3) which do not
expressly state whether they are with or without prejudice are held to be with
prejudice[.]"19 As a prejudicial dismissal, the December 16, 2003 dismissal order is
also deemed to be a judgment on the merits so that the petitioner’s complaint in
Civil Case No. 02-488 can no longer be refiled on the principle of res judicata.
Procedurally, when a complaint is dismissed for failure to prosecute and the
dismissal is unqualified, the dismissal has the effect of an adjudication on the
merits.20
As an adjudication on the merits, it is imperative that the dismissal order conform
with Section 1, Rule 36 of the Rules of Court on the writing of valid judgments and
final orders. The rule states:
RULE 36
Judgments, Final Orders and Entry Thereof
Section 1. Rendition of judgments and final orders. — A judgment or final order
determining the merits of the case shall be in writing personally and directly
prepared by the judge, stating clearly and distinctly the facts and the law on which
it is based, signed by him, and filed with the clerk of the court.
The December 16, 2003 dismissal order clearly violates this rule for its failure to
disclose how and why the petitioner failed to prosecute its complaint. Thus, neither
the petitioner nor the reviewing court is able to know the particular facts that had
prompted the prejudicial dismissal. Had the petitioner perhaps failed to appear at a
scheduled trial date? Had it failed to take appropriate actions for the active
prosecution of its complaint for an unreasonable length of time? Had it failed to
comply with the rules or any order of the trial court? The December 16, 2003
dismissal order does not say.
We have in the past admonished trial courts against issuing dismissal orders similar
to that appealed in CA-G.R. CV No. 83096. A trial court should always specify the
reasons for a complaint’s dismissal so that on appeal, the reviewing court can
readily determine the prima facie justification for the dismissal.21 A decision that
does not clearly and distinctly state the facts and the law on which it is based leaves
the parties in the dark and is especially prejudicial to the losing party who is unable
to point the assigned error in seeking a review by a higher tribunal.22
We thus agree with the petitioner that the dismissal of Civil Case No. 02-488
constituted a denial of due process. Elementary due process demands that the
parties to a litigation be given information on how the case was decided, as well as
an explanation of the factual and legal reasons that led to the conclusions of the
court.23Where the reasons are absent, a decision (such as the December 16, 2003
dismissal order) has absolutely nothing to support it and is thus a nullity.24
For this same reason, we are not moved by respondent FGU Insurance’s statement
that the disposition of the present petition must be limited to the issue of whether
the CA had correctly dismissed the appeal in CA-G.R. CV No. 83096.25 This statement
implies that we cannot properly look into the validity of the December 16, 2003
dismissal order in this Rule 45 petition. A void decision, however, is open to
collateral attack. While we note that the validity of the dismissal order with respect
to Section 1, Rule 36 of the Rules of Court was never raised by the petitioner as an
issue in the present petition, the Supreme Court is vested with ample authority to
review an unassigned error if it finds that consideration and resolution are
indispensable or necessary in arriving at a just decision in an appeal.26 In this case,
the interests of substantial justice warrant the review of an obviously void dismissal
order.
The appeal was properly filed
under Rule 41 of the Rules of Court
While the nullity of the December 16, 2003 dismissal order constitutes the ratio
decidendi for this petition, we nevertheless rule on the contention that the appeal
was erroneously filed.27
In dismissing the appeal, the CA relied on the premise that since the facts presented
in the petitioner’s appeal were admitted and not disputed, the appeal must thereby
raise a pure question of law proscribed in an ordinary appeal. This premise was
effectively the legal principle articulated in the case of Joaquin v. Navarro,28 cited by
the CA in its April 8, 2005 resolution. Respondent FGU Insurance thus contends that
the proper remedy to assail the dismissal of Civil Case No. 02-488 was an appeal
filed under Rule 45 of the Rules of Court.
The reliance on Joaquin is misplaced as it is based on the conclusion the appellate
court made in its April 8, 2005 resolution — i.e., that the pleading of undisputed
facts is equivalent to a prohibited appeal. The reliance is inattentive to both the
averments of the subject appeal and to the text of the cited case. The operative
legal principle in Joaquin is this: "[W]here a case is submitted upon an agreement of
facts, or where all the facts are stated in the judgment and the issue is the
correctness of the conclusions drawn therefrom, the question is one of law which
[is properly subject to the review of this Court.]"29 In this case, as already pointed
out above, the facts supposedly supporting the trial court’s conclusion of non
prosequitur were not stated in the judgment. This defeats the application
of Joaquin.
At any rate, we believe that the filing of the appeal in CA-G.R. CV No. 83096 under
Rule 41 of the Rules of Court was proper as it necessarily involved questions of fact.
An authority material to this case is the case of Olave v. Mistas.30 Directly addressed
in Olave was the CA’s jurisdiction over an ordinary appeal supported
by undisputed facts and seeking the review of a prejudicial order of dismissal. In this
case, a complaint was filed before the RTC in Lipa City to nullify an instrument titled
"Affidavit of Adjudication By The Heirs of the Estate of Deceased Persons With
Sale." The RTC dismissed the complaint, with prejudice, after the plaintiffs had
moved to set the case for pre-trial only after more than three (3) months had
lapsed from the service and filing of the last pleading in the case. The plaintiffs
thereafter went to the CA on a Rule 41 petition, contending, among others, that the
trial court had erred and abused its discretion. As in the present case, the
defendants moved to dismiss the appeal on the ground that the issues therein were
legal; they pointed out that the circumstances on record were admitted.31 They
argued that the proper remedy was a petition for review on certiorari under Rule 45
of the Rules of Court.
The CA denied the motion and entertained the appeal. It rendered a decision
reinstating the complaint on the ground that there was no evidence on record that
the plaintiffs had deliberately failed to prosecute their complaint.
When the case was elevated to this court on a Rule 45 petition, we squarely
addressed the propriety of the plaintiffs’ appeal. Though mindful that the
circumstances pleaded in the appeal were all admitted, we categorically held
in Olave that the appeal was correctly filed. We observed that despite undisputed
records, the CA, in its review, still had to respond to factual questions such as the
length of time between the plaintiffs’ receipt of the last pleading filed up to the
time they moved to set the case for pre-trial, whether there had been any manifest
intention on the plaintiffs’ part not to comply with the Rules of Court, and whether
the plaintiffs’ counsel was negligent.
Significantly, in Olave, we agreed with the plaintiffs that among the critical factual
questions was whether, based on the records, there had been factual basis for the
dismissal of the subject complaint. This same question is particularly significant in
the present case given that the order appealed from in CA-G.R. CV No. 83096 does
not even indicate the factual basis for the dismissal of Civil Case No. 02-488. Due to
the absence of any stated factual basis, and despite the admissions of the parties,
the CA, in CA-G.R. CV No. 83096, still had to delve into the records to check whether
facts to justify the prejudicial dismissal even exist. Since the dismissal of Civil Case
No. 02-488 appears to have been rendered motu proprio (as the December 16,
2003 dismissal order does not state if it was issued upon the respondents’ or the
trial court’s motion), the facts to be determined by the CA should include the
grounds specified under Section 3, Rule 17 of the Rules of Court. A court could only
issue a motu proprio dismissal pursuant to the grounds mentioned in this rule and
for lack of jurisdiction over the subject matter.32 These grounds are matters of facts.
Thus, given that the dismissal order does not disclose its factual basis, we are thus
persuaded that the petitioner had properly filed its appeal from the dismissal order
under Rule 41 of the Rules of Court.
The Dismissal of Civil Case No. 02-488 is not Supported by the Facts of the Case
We also find that the dismissal of Civil Case No. 02-488 is not warranted. Based on
available records and on the averments of the parties, the following events were
chronologically proximate to the dismissal of Civil Case No. 02-488: (a) on March 24,
2003, the court admitted FGU Insurance’s third-party complaint; (b) the trial court
cancelled the June 20, 2003 hearing upon FGU Insurance’s motion; and (c) on June
16, 2003, Baetiong filed his Answer to the third-party complaint but did not serve it
upon the petitioner.
None of these events square with the grounds specified by Section 3, Rule 17 of the
Rules of Court for the motu proprio dismissal of a case for failure to prosecute.
These grounds are as follows:
(a) Failure of the plaintiff, without justifiable reasons, to appear on the date of the
presentation of his evidence in chief;
(b) Failure of the plaintiff to prosecute his action for an unreasonable length of
time;
(c) Failure of the plaintiff to comply with the Rules of Court; or
(d) Failure of the plaintiff to obey any order of the court.
In our view, the developments in the present case do not satisfy the stringent
standards set in law and jurisprudence for a non prosequitur.33 The fundamental
test for non prosequitur is whether, under the circumstances, the plaintiff is
chargeable with want of due diligence in failing to proceed with reasonable
promptitude.34 There must be unwillingness on the part of the plaintiff to
prosecute.35
In this case, the parties’ own narrations of facts demonstrate the petitioner’s
willingness to prosecute its complaint.1âwphi1 Indeed, neither respondents FGU
Insurance nor Baetiong was able to point to any specific act committed by the
petitioner to justify the dismissal of their case.
While it is discretionary on the trial court to dismiss cases, dismissals of actions
should be made with care. The repressive or restraining effect of the rule
amounting to adjudication upon the merits may cut short a case even before it is
fully litigated; a ruling of dismissal may forever bar a litigant from pursuing judicial
relief under the same cause of action. Hence, sound discretion demands vigilance in
duly recognizing the circumstances surrounding the case to the end that
technicality shall not prevail over substantial justice. 36
This court is thus of the opinion that the dismissal of Civil Case No. 02-488 is not
warranted. Neither facts, law or jurisprudence supports the RTC’s finding of failure
to prosecute on the part of the petitioner.
Wherefore, premises considered, the instant petition is Granted. The resolutions of
the Court of Appeals dated April 8, 2005 and October 4, 2005 are REVERSED
and SET ASIDE. The order dated December 16, 2003 of the Regional Trial Court,
Branch 61, Makati City, in Civil Case No. 02-488 is declared NULL and VOID, and the
petitioner’s complaint therein is ordered REINSTATED for further proceedings. No
costs.
SO ORDERED.