G.R. No. 195592 September 5, 2012 Promissory Note No. 10045 March 27, 1982 Php500,000.00 MAGDIWANG REALTY CORPORATION, RENATO P. DRAGON and Promissory Note No. 10046 March 27, 1982 Php500,000.00 ESPERANZA TOLENTINO, Petitioners, vs. Promissory Note No. 10047 March 27, 1982 Php500,000.00 THE MANILA BANKING CORPORATION, substituted by FIRST SOVEREIGN ASSET MANAGEMENT (SPV-AMC), INC., Respondent. Promissory Note No. 10048 March 27, 1982 Php500,000.00 REYES, J.: All promissory notes included stipulations on the payment of interest and additional charges in case of default by the debtors. This resolves the petition for review on certiorari filed under Rule 45 Despite several demands for payment made by TMBC, the of the Rules of Court which questions. the Decision1 dated October petitioners allegedly failed to heed to the bank’s demands, 11, 201 0 and Resolution2 dated January 31, 2011 of the Court of prompting the filing of the complaint for sum of money. The case Appeals (CA) in CA-G .R. CV No. 90098 entitled The Manila Banking was docketed as Civil Case No. 00-511 and raffled to Branch 148 of Corporation, substituted by First Sovereign Asset Management, Inc., the RTC of Makati City. Plaintiff-Appellee, v. Magdiwang Realty Corporation, Renata P. Instead of filing a responsive pleading with the trial court, the Dragon and Esperanza Tolentino, Defendants-Appellants. petitioners filed on October 12, 2000, which was notably beyond The Factual Antecedents the fifteen (15)-day period allowed for the filing of a responsive pleading, a Motion for Leave to Admit Attached Motion to Dismiss5 The case stems from a complaint3 for sum of money filed on April and a Motion to Dismiss,6 raising therein the issues of novation, 18, 2000 before the Regional Trial Court (RTC), Makati City by herein lack of cause of action against individuals Dragon and Tolentino, and respondent, The Manila Banking Corporation (TMBC), against herein the impossibility of the novated contract due to a subsequent act of petitioners, Magdiwang Realty Corporation (Magdiwang), Renato P. the Congress. The motions were opposed by the respondent TMBC, Dragon (Dragon) and Esperanza Tolentino (Tolentino), after said via its Opposition7 which likewise asked that the petitioners be petitioners allegedly defaulted in the payment of their debts under declared in default for their failure to file their responsive pleading the five promissory notes4 they executed in favor of TMBC, which within the period allowed under the law. contained the following terms: Acting on these incidents, the RTC issued an Order8 on July 5, 2001 Maturity Date Amount declaring the petitioners in default given the following findings: Promissory Note No. 4953December 27, 1976 Php500,000.00 The record shows that as per Officer’s Return dated 19 September WHEREFORE, premises considered, defendants’ Motion to Dismiss 2000, summons were served on even date by way of substituted is hereby treated as a pleading which has not been filed at all and service. Summons were received by a certain LINDA G. MANLIMOS, cannot be ruled upon by the Court anymore for the same has been a person of sufficient age and discretion then working/residing at filed out of time. Plaintiff’s prayer to declare defendants in default is the address indicated in the Complaint at No. 15 Tamarind St., hereby GRANTED, and as a consequence, defendants are hereby Forbes Park, Makati City. declared in DEFAULT. Consequently, in accordance with the Rules, defendants should SO ORDERED.10 have filed an Answer or Motion to Dismiss or any responsive pleading for that matter within the reglementary period, which is The petitioners’ motion for reconsideration was denied by the trial fifteen (15) days from receipt of Summons and a copy of the court in its Order11 dated August 2, 2005. The ex parte complaint with attached annexes. Accordingly, defendants should presentation of evidence by the bank before the trial court’s have filed their responsive pleading on October 2, 2000 but no Presiding Judge was scheduled in the same Order. pleading was filed on the aforesaid date, not even a Motion for Unsatisfied with the RTC orders, the petitioners filed with the CA a Extension of Time. Instead, defendant’s Motion to Dismiss found its petition for certiorari, which was docketed as CA-G.R. SP No. 91820. way into the court only on the 13th day of October, clearly beyond In a Decision12 dated December 2, 2006, the CA affirmed the RTC the period contemplated by the Rules. A perusal of the Motion for orders after ruling that the trial court did not commit grave abuse of Leave to Admit the Motion to Dismiss filed by defendants reveals discretion when it declared herein petitioners in default. The denial that the case, as claimed by the counsel for defendants, was just of petitioners’ motion for reconsideration prompted the filing of a referred to the counsel only on October 10, and further insinuated petition for review on certiorari before this Court, which, through its that the Motion to Dismiss was only filed on the said date in view of Resolutions dated March 5, 200813 and June 25, 2008,14 denied the complicated factual and legal issues involved. While this Court the petition for lack of merit. appreciates the efforts and tenacity shown by defendants’ counsel for having prepared a [lengthy] pleading for his clients in so short a In the meantime, TMBC’s presentation of evidence ex parte time, the Court will have to rule that the Motion to Dismiss was proceeded before Presiding Judge Oscar B. Pimentel of the RTC of nonetheless filed out of time, hence, there is sufficient basis to Makati City. declare defendants in default. x x x.9 The Ruling of the RTC The decretal portion of the Order then reads: 10047. 10047 and 10048 starting from plaintiff penalty charges of 4% per annum from December 27. 10047 and 10048 as attorney’s fees.00 as indicated in WHEREFORE. Requiring defendant Magdiwang Realty Corporation to pay Nos. Feeling aggrieved. 4953.00 as indicated in Promissory Note No. severally pay the plaintiff the following: the petitioners appealed to the CA. Renato Dragon and The petitioners’ motion for reconsideration was denied by the trial Esperanza Tolentino ordering said defendants to jointly and court via its Order17 dated November 5. judgment is hereby rendered in Promissory Note No. 10045. 2007. Requiring the defendant Magdiwang Realty Corporation to pay per annum in PN Nos.00 as indicated in and against herein petitioners. Requiring defendant Magdiwang Realty Corporation to pay the and 10048 from March 27. (3) declaring TMBC entitled to its claims despite the alleged failure of the bank to substantiate its claims. reads: 3. the RTC rendered its Decision15 in favor of TMBC 2. To pay the principal amount of P 500. (4) . 10046.00 as indicated in Promissory the trial court in: (1) not declaring that TMBC’s cause of action was already barred by the statute of limitations.00 as indicated in 1. To pay the principal amount of P 500. (2) declaring herein Note No.16 defendants Magdiwang Realty Corporation.On May 20. principal amount [of] loan plus unpaid interest at the rate of 16% 3. and 7. petitioners liable to pay TMBC despite the alleged novation of the subject obligations. Costs against the defendants. defendant to pay plaintiff the sum of P 500. plaintiff interest to the principal loan at the rate of 14% per annum 6. Defendant Magdiwang Realty Corporation. 1981 until the whole amount is paid. 10046. imputing error on the part of 1. and until the whole amount is paid. plaintiff attorney’s fees equivalent to 10% of the total outstanding obligation. To pay 10% of the total amount due and outstanding under PN 4. To pay penalty at the rate of one percent a month (1%) on the from 27 December 1976 until the amount is paid. The decision’s dispositive portion Promissory Note No. 10047 2.000. 2007. favor of the plaintiff as against: 4. To pay the principal amount of P 500. 1981 until the whole amount is paid. 10045. 5. 10048. requiring said Promissory Note No. The principal amount of P 500.000. Further. 1976 March 27. judgment is rendered in favor of plaintiff and against SO ORDERED. 10045. 10045. 10046.000. premises considered.000. To pay interest in the principal loan at the rate of sixteen (16%) percent per annum as stipulated in PN Nos.000. 10046. the promissory notes had not prescribed. The decision’s dispositive portion reads: letter to the defendants appellants. Inc. when the plaintiff-appellee sent its final demand petitioners’ appeal. The written SO ORDERED. TMBC and during which the defendants-appellants were seeking First Sovereign Asset Management (SPV-AMC). the CA rendered its Decision18 dismissing the Consequently. . in our On the issue of prescription. all the benefits acquired so far Assignment covering all of its rights. the CA cited the rule that the view. 1999. the action filed on April 18.19 communications of the defendants-appellants proposing for the restructuring of their loans and the repayment scheme are. began to run again and. when prescription starts anew. (FSAMI) filed a reconsideration for the non-settlement of their loans and proposing Joint Motion for Substitution. asking that TMBC be substituted by payment schemes of the same should not be reckoned against it. 1984 the consent of the creditor thereto. in Makati City in Civil to compel the defendants-appellants to pay their obligations under Case No. synonymous to an express acknowledgment of the obligation prescriptive period is interrupted in any of the following instances: and had the effect of interrupting the prescription. thus. for the restructuring of their loans until the plaintiff-appellee sent its final demand letter on September 10. the period While appeal was pending before the appellate court. Branch 148. the period of ten years within which to enforce the this case is hereby DENIED and. therefore. through several letters. title and interest over the loans from the lapse of time cease and. and (2) prescriptive period was legally interrupted on September 19. proposed and (5) declaring herein petitioners in default. Indeed. On October 11. namely: (1) the clear and express release of the original debtor from the obligation As shown by the evidence. in view of the foregoing premises. (2) when there is a omitted) written extrajudicial demand by the creditors. it subject of the case. 00-511 are hereby AFFIRMED. The The defense of novation was also rejected by the CA. consequently.declaring TMBC entitled to attorney’s fees and litigation expenses. This concept should not be equated with The Ruling of the CA suspension where the past period is included in the computation being added to the period after prescription is resumed. and (3) when there is any written acknowledgment of the debt by the debtor. the appeal filed in both parties. 2007 and Order dated November 5. DISMISSED. foreclosing all possibilities of reaching a settlement of the loans which could be favorable to WHEREFORE. will be entirely a new one. we arrived at the conclusion that the upon the assumption by the new debtor of the obligation. The five promissory notes under Article 1142 of the New Civil Code assailed Decision dated May 20. FSAMI after the former executed in favor of the latter a Deed of When prescription is interrupted. x x x. 2000 2007 of the Regional Trial Court.20 (Citation (1) when an action is filed before the court. citing the appellate court held: absence of two requirements for a valid novation. when the defendants-appellants. 2010. Hence. – A party desiring to The Present Petition appeal by certiorari from a judgment. final order or resolution of the Court of Appeals. petition: may file with the Supreme Court a verified petition for review on 1. Once it is clear that the issue invites a review of the The petition is dismissible. the Sandiganbayan. A question of law arises when there is doubt as THEMSELVES FROM THEIR OBLIGATION TO RESPONDENT. Section 1. while there is a question of fact when the doubt arises as to the truth or falsity of 3. For a question to be one of law. Sec. the CA in its Resolution21 dated January 31. 1. we explain that based on the issues being raised by On the first issue of prescription. Rule 45 of the Rules of Court. to what the law is on a certain state of facts. Filing of petition with Supreme Court.22 presented by the litigants or any of them. the The petitioners present the following grounds to support their Regional Trial Court or other courts. Rule 45 then categorically states that a petition for review PRINCIPLE OF NOVATION BY THE SUBSTITUTION OF DEBTORS WAS on certiorari shall raise only questions of law. which must be distinctly set forth. THROUGH SEVERAL LETTERS. together with the arguments and the evidence was no written extrajudicial demand by the creditor TMBC that being invoked in support thereof. pendency. THE COURT OF APPEALS ERRED WHEN IT HELD THAT THE certiorari. The petition may include an application for a writ of PRESCRIPTIVE PERIOD WAS LEGALLY INTERRUPTED ON 19 preliminary injunction or other provisional remedies and shall raise SEPTEMBER 1984 WHEN PETITIONERS. the same must COURT’S RULING HOLDING THAT PETITIONERS ARE LIABLE FOR not involve an examination of the probative value of the evidence ATTORNEY’S FEES. the reads: present petition for review on certiorari. THE COURT OF APPEALS ERRED WHEN IT HELD THAT THE Section 1. the question posed is one of fact. only questions of law. The PROPOSED FOR THE RESTRUCTURING OF THEIR LOANS UNTIL THE petitioner may seek the same provisional remedies by verified RESPONDENT SENT ITS FINAL DEMAND LETTER ON 10 SEPTEMBER motion filed in the same action or proceeding at any time during its 1999.A motion for reconsideration filed by the petitioners was denied by on certiorari. the petitioners argue that there the petitioners. the Court of Tax Appeals. The resolution of the issue must rest solely on what the law provides on the given set of This Court’s Ruling circumstances. among other things. THE COURT OF APPEALS ERRED WHEN IT AFFIRMED THE TRIAL the alleged facts. that the bank failed to . 2011. whenever authorized by law. we hold that the petition involves could have validly interrupted the ten (10)-year prescriptive questions of fact that are beyond the ambit of a petition for review period. (Emphasis ours) 2. as amended. evidence presented.23 At the outset. which must be ERRONEOUSLY EMPLOYED BY THE PETITIONERS TO EXTRICATE distinctly set forth.24 They claim. 28 The Supreme Court is declared to have effectively interrupted the running of the not a trier of facts. These contentions are now being previous valid obligation. examine and prescriptive period to initiate the action for sum of money against evaluate or weigh the probative value of the evidence presented. of the demands. and that it was actually received by said petitioners. for distinguishing a question of law from a question of fact. the petitioners failed to file their answer to TMBC’s complaint within the reglementary period allowed under the Rules Presiding Judge in support of said allegations. (2) the parties concerned must agree to a raised even after the trial court that admitted the evidence of the new contract. the existence and for review on certiorari. observe the demeanor of the witnesses while testifying in the case.29 Although jurisprudence admits of several exceptions to the foregoing rules. 1984. question of fact would arise in such event. the 2007 the fact of the respondent’s service. and which correspondences were makes the same binding upon this Court. these factual findings were even affirmed by the CA.26 court is in a better position to examine real evidence. 1987. March 24. of Court. 2007. The validity of the trial court’s declaration of their default is a settled matter.25 In its Order dated November 5. as it necessarily requires a factual determination on the The petitioners also question the several other letters supposedly existence of the following requisites of novation: (1) there must be a exchanged between the parties. as well as are bound to fail for lack of merit. It is not our function to review. February 14. and (4) respondent has categorically declared in its Decision dated May 20. which again cited the several letters exchanged between the parties The fact that the CA adopted the findings of fact of the trial court in relation to the subject debts.prove that it sent the demand letter dated September 10. 1990 and September 10. following the denial of the petitions previously . the issue of the alleged novation involves a question of the petitioners. it is clear that the petitioners are now asking this Court to determine a Even granting that the issues being raised by the petitioners may question of fact. fact. court are entitled to great weight on appeal and should not be disturbed unless for strong and cogent reasons because the trial 1999 that negated the defenses of prescription and novation. including the letters of November The settled rule is that conclusions and findings of fact of the trial 14. Applying the guidelines laid down by jurisprudence on the criteria the present case does not fall under any of them. (3) the old contract must be extinguished.27 Needless to say. there must be a valid new contract. as well as On appeal. A the petitioners. questioned factual findings. as their arguments delve on the truth or falsity of still be validly entertained by this Court through the instant petition the trial and appellate courts’ factual findings. the truth or falsity of the TMBC’s narration of facts in their complaint and the testimonial evidence presented before the Significantly. the trial court had also cited the several other correspondences exchanged between the parties. 1999 to Similarly. we hold that their arguments and defenses authenticity of the respondent’s documentary evidence. and the petitioners’ respondent’s entitlement to attorney’s fees also depends upon the receipt. Preponderance of evidence is the the trial court declaring the defendants-appellants in default for weight. they thereby lose their right to object to the is interrupted when: (1) they are filed before the court. and (3) there is any action. presented by TMBC to it. by their own evidenced by the five Promissory Notes. credit. As correctly stated by the CA in the Decision dated October 11. This is in conformity The petitioners’ default by their failure to file their answer led to with the second and third circumstances under Article 1155 of the certain consequences. support its case.33 the law itself. (2) there is a reception of the plaintiff’s evidence establishing his cause of written extrajudicial demand by the creditors.brought by the petitioners before the CA and this Court questioning evidence. despite due notice. it behooves this Court to accentuate that the Order of preponderance of evidence. the party having the burden of proof must establish his case only by a At the outset. and value of the aggregate evidence on either side their failure to file their responsive pleading to the complaint within and is usually considered to be synonymous with the term "greater the period prescribed under Section 3 of Rule 9 of the Revised Rules weight of evidence" or "greater weight of the credible evidence. inaction. defendants MAGDIWANG. in the last analysis. complaint against the petitioners. 2008 and means probability to truth. Supreme Court through its Resolution dated March 5. Thus.32 court’s consideration. as the final to the court as worthier of belief than that which is offered in arbiter of any justiciable controversy. that the ten (10)-year prescriptive period to file an action aforecited Supreme Court resolutions. despite numerous demands by plaintiff for the the totality of the evidence presented in support thereof. we find no cogent reason to reverse the trial and 2010: appellate courts’ findings." of Court had been declared final and beyond review already by the Preponderance of evidence is a phrase which.31 This is akin to a failure to. assume the same authority as opposition thereto.30 based on the subject promissory notes was interrupted by the several letters exchanged between the parties. even attaching thereto copies thereof for the trial to cross-examine the witnesses presented therein. In TMBC’s court hearings for the presentation of the complainant’s evidence. attend in written acknowledgment of the debt by the debtor. both documentary and testimonial. coupled payment of the loan obligations obtained by defendants and with the said circumstance that the petitioners. It is evidence which is more convincing June 25. Where defendants before a trial court are New Civil Code (NCC) which provides that the prescription of actions declared in default. failed to make their timely objection or opposition to the Dragon and Tolentino failed to settle their obligations with plaintiff. Judicial decisions of the Supreme Court. . the issue raised by the defendants-appellants questioning the wisdom of the trial court’s decision in declaring We agree with the trial and appellate courts. the bank sufficiently made the which absence would amount to the waiver of such defendant’s allegations on its service and the petitioners’ receipt of the subject right to object to the evidence presented during such hearing. Thus. for as the records them in default is now rendered moot and academic by the bear. We stress that in civil cases. However. 2008. and demand letters. the complaint states in part: Taking into consideration the bank’s allegations in its complaint and 23. 10045. behalf of the petitioners. . and (2) Exhibit "M-30". including the account of petitioner receipt of the written extrajudicial demands made by TMBC. (1) Exhibit "M-29". as well as defendants letters in reply to the defendants. Hence. In TMBC’s formal offer of exhibits were correctly claimed by the the absence of a timely objection from the petitioners on these respondents in their Comment36 as also containing the petitioners’ claims. of witness Mr. Hence. made some reservations and other conditions which with the TMBC. as the debtors in the loans therein indicated. 4953. the prescription of the demand letters and requesting for restructuring of loan or extension obligation does not set in. 1995 requesting for an updated Statement of Account of the corporations As against the bare denial belatedly made by the petitioners of their owned by petitioner Dragon. 1999 which was the January 12.35 of time to pay the same are herewith attached as Annexes "F" to "O". However. nowhere in the records is it indicated that such also a correspondence dated February 14. the petitioners failed to adequately court in its Order dated November 5.1âwphi1 What the letters being based on this letter. no meeting of the On the issue of novation. likewise constitute as counter offers. 2007 shall stand. and made integral parts of this Complaint. and the During the bank’s presentation of evidence ex parte. Megdonio Isanan was also offered to further support The following letters that form part of the complaint and included in the claim on the demand made by the bank upon the petitioners. Inc. Magdiwang. the counter-offer of the plaintiff was signatory and the company it represented were designated by the acknowledged but Kalilid. to deal acceptable. in taking due consideration thereof. the debt was also acknowledged. from all indications. While a demand Promissory Notes (PN Nos. to wit: negate the authority of the first letter’s signatory to act for and on In the 14 November 1984 Letter of Kalilid Wood Industries. which is a letter dated January 4. we take note that letters prior to the letter of September 1999 also form part of the case records.34 In addition to these. 10048) duly letter dated September 1999 was given by the plaintiff to the received by defendants. 1995.Copies of plaintiff’s demand letters with respect to the five Renato P. while manifesting that the counter offer is petitioners. Another invoked by the petitioners as supposedly establishing novation only letter dated 24 March 1987 was issued and a repayment plan has indicate that efforts on a repayment scheme were exerted by the been proposed by the Magdiwang Realty Corporation. the testimony existence of said letters were not directly denied by the petitioners. which is the letter dated especially of the letter of September 10. 10047. 1990 from defendant novation ever materialized. no error can be imputed on the part of the trial court. Significantly. Uriel Balboa. 1995 from the Office of the Statutory Receiver of TMBC written demand sent closest in time to the institution of the civil and providing the Statements of Account requested for in the letter case. and acknowledgment of their debts and TMBC’s demand to its debtors: even the appellate court. the reasonable conclusion being that said through Mr. respectively. Dragon’s Office regarding the obligation. Likewise. no evidence was presented to adequately minds happened regarding the restructuring of the loan. 10046.. the appreciation of evidence and pronouncements of the trial of January 4. establish that such novation ensued. There was parties. SO ORDERED .R. 90098 are hereby AFFIRMED. the instant petition is hereby DENIED. the applicable provision is Article 2208(2) of the NCC which allows the grant thereof when the defendants’ act or omission compelled the plaintiff to litigate or to incur expenses to protect its interest. CV No. The Decision dated October 11.Regarding the award of attorney’s fees. premises considered. and the clear refusal of the petitioners to satisfy their existing debt to the bank despite the long period of time and the accommodations granted to it by the respondent to enable them to satisfy their obligations. 2010 and Resolution dated January 31. WHEREFORE. 2011 of the Court of Appeals in CA-G. Considering the circumstances that led to the filing of the complaint in court. we agree that the respondent was compelled by the petitioners' acts to litigate for the protection of the bank's interests. making the award of attorney's fees proper. A. On this date.11 so the preliminary conference HON. Assisting Judge. hand.6 On February 26. 2008. conference on November 25.4 November 20. Partiality and Grave Abuse of Decision. rescheduled it to August 26. Branch 40.9 The complainants moved for reconsideration.1 30. 2007. with Gross Ignorance of which the respondent set clarificatory hearings on January 23 and the Law. Quezon City.18 The complainants thereupon filed the . 2008. Quezon City. 2009. 2007.M.5 December 11. 2008 due to the still pending application for a writ of PMI. vs.10 the respondent denied the application for a writ of PMI and set the case for preliminary MURPHY CHU/ATGAS TRADERS and MARINELLE P. CHU. 2008. Branch 40. with application for the issuance of a writ of preliminary the required barangay conciliation and to implead the other co- mandatory injunction (PMI) against the complainants.2 The owners of the property subject of the unlawful detainer case.14 The preliminary conference finally took place on February 3. 2008. In a verified complaint dated September 14. Capellan (respondent). Quezon City. On the other March 30. did not file their pre- trial brief. the respondent issued the assailed joint February 12. an unlawful detainer the grounds that: (1) the spouses Angangco failed to comply with complaint. spouses Ofelia and Rafael Angangco filed complainants moved to dismiss the unlawful detainer complaint on before the MeTC. the On March 22. on the other hand. MTJ-11-1779 July 16. for Trial Court (MeTC). the spouses Angangco filed their pre-trial BRION. 2007. On November 21. 2008. Metropolitan Trial was again reset to December 9.8 He later set the unlawful order17 which submitted the unlawful detainer case for decision detainer case for preliminary conference on June 24.16 The respondent heard the application for the issuance of a writ of PMI on April 11. 2008 preliminary conference. 2012 In an order dated October 7. 2008. 2009 preliminary conference. the respondent Complainants.7 and April 22.13 The complainants. Branch 40. 2008. 2007. 2007.12 Court (MeTC). referred the case for mediation. CAPELLAN. the spouses Murphy and During the December 9. Respondent. but the respondent denied their motion. 2009 filed before the Office of the Court Administrator (OCA). the spouses Angangco orally moved to declare the complainants in default for their failure to file a pre-trial brief. Assisting Judge of the Metropolitan payment for the amounts they owed to the spouses Angangco. 2009. Chu and ATGAS Traders (complainants) charged Judge complainants moved for the consignation of several checks as Mario B. MARIO B.: brief. but based on the facts alleged in the unlawful detainer complaint. 2009. J.15 BACKGROUND FACTS During the February 3. No. the Marinelle P. and complainants filed their answer with compulsory counterclaim on (2) the MeTC had no jurisdiction to issue a writ of PMI. be subject to disciplinary action under any of the not to ejectment cases. that requires him to issue a notice COMPLAINT AGAINST THE RESPONDENT of preliminary conference. He claims that. upon a verified complaint filed with the Office of the Court applies exclusively to cases involving intra-corporate controversies. the complainants allege that the respondent erred in complaint due to the alleged failure of the spouses Angangco to entertaining the oral motion to declare the defendants in default. Administrative Memorandum (A. which provides: The respondent adds that the complainants’ citation of Supreme SEC. He also states that it would be unfair to mediation proceedings.) No. 2. Rule 11 of Supreme Court superfluous. particularly in Section 6. that the said memorandum may. 01-2-04.19 The respondent eventually inhibited preliminary conference because there is nothing in the 1991 himself from the case in an order dated September 8. On the complainants’ other allegations. in personally appear at the mediation proceedings because he could incurring delay in setting the unlawful detainer case for preliminary not have known of their non-appearance during that time.M. thus. and subjects a judge to disciplinary action following cases: for his failure to issue a pre-trial order. to now impugn their dealings with and the authority of towards the plaintiffs. 2009.M.22 the respondent argues that he filed a motion asking for the respondent’s inhibition from the did not commit any violation for failing to issue a notice of unlawful detainer case. and in not dismissing the unlawful detainer complaint was informed of what happened during the mediation proceedings for the spouses Angangco’s failure to personally appear during the only after their conclusion. 2008 through his order dated October notice of preliminary conference is mandatory and its non-issuance 7. Rule 18.20 Revised Rules on Summary Procedure or the Rules of Court. in addition to his order setting the case The complainants allege that the respondent had no basis to for preliminary conference. despite the lack of declare them in default because no notice of preliminary notice. Administrator. 01-2-04 was misplaced. No. Disciplinary sanctions on the judge. both parties were duly informed of the preliminary conference was issued to them. The complainants also allege that these acts allow the complainants. to issue a notice at that time would only be may be punishable under Section 2. (2) Failure to issue a pre-trial order in the form prescribed in these Rules. not for failure to issue a notice of preliminary conference. 2008. They also In his answer with counter-charge. THE RESPONDENT’S ANSWER .present administrative complaint against the respondent. – The presiding judge Court A. as he conference.21 They argue that the issuance of a conference on November 25. the respondent argues that he could not be faulted for not dismissing the unlawful detainer Also. who actively participated in the mediation of the respondent clearly showed the latter’s bias and partiality proceedings. the lawyer who attended the mediation in behalf of the spouses Angangco. as it is nothing but an insidious attempt that a motion to declare defendants in default is a prohibited by the complainants to harass him and to conceal their negligence pleading under the 1991 Revised Rules on Summary Procedure. and that the complainants were also present in judgment on his counterclaim in accordance with the next court during the times the preliminary conference was repeatedly preceding section.23 the OCA finds no merit in Court.Ultimately. appearance of parties. a preliminary due process were violated because of the lack of notice of conference shall be held. the OCA agrees with the respondent that Supreme Court a common defense shall appear at the preliminary conference. 2008 and of the other party’s shall be cause for the dismissal of the complaint. 2008. 01-2-04 is inapplicable to the subject unlawful detainer case as it pertains to the Proposed Interim Rules of Procedure Sec. which provides: some of the complainants’ allegations. Preliminary conference.) on the adverse party. among others: Third. did not rule on the basis of the oral motion but relied on THE OCA’S RECOMMENDATION Section 8.A. The defendant pre-trial brief before the scheduled preliminary conference on who appears in the absence of the plaintiff shall be entitled to November 25. in relation to Section 6. Rule 18 of the Rules of In a report dated November 11.The parties shall file with the court and serve Governing Intra-Corporate Controversies under Republic Act (R. respondent.claims shall be dismissed. Rule 70. 8. 2010. All cross. Considering these circumstances. Sec. – Not later First. the OCA opines that the complainants were merely finding an excuse to If a sole defendant shall fail to appear. that the complainants could not feign be applicable to the preliminary conference unless inconsistent with ignorance of the scheduled date of preliminary conference and their the provisions of this Rule. in such manner as shall ensure their receipt No. Pre-trial brief. the OCA belies the complainants’ allegation that the respondent entertained the spouses Angangco’s oral motion to . . in issuing the assailed joint order dated February 26.M. This procedure shall not apply where one of two or more defendants sued under a common cause of action who had pleaded Second. 6. The provisions of Rule 18 on pre-trial shall preliminary conference. to submit their pre-trial brief. the plaintiff shall likewise be justify their negligence as they were afforded enough opportunity entitled to judgment in accordance with the next preceding section. While the complainants were correct administrative complaint. 2009. the OCA remains unconvinced that the complainants’ rights to than thirty (30) days after the last answer is filed. their respective pre-trial briefs which shall contain. No. the respondent prayed for the dismissal of the declare defendants in default. reset to later dates. need to file a pre-trial brief since they received copies of the The failure of the plaintiff to appear in the preliminary conference respondent’s order dated October 7. A. but they still failed to do so. 8799. thereof at least three (3) days before the date of the pre-trial. the in not filing a pre-trial brief. and Rule 1.27 respectively. malice or other similar motive. partiality and grave abuse of discretion in not issuing a notice a preliminary conference shall be held not later than thirty (30) days for the holding of the November 25. which provides that law. 2008 preliminary conference. to appear at the pre-trial. Therefore. that there must willingness to submit the case for decision in their Manifestations be a final declaration by the appellate court that the assailed order dated March 22. 2008 already constituted sufficient notice to the parties of the holding of such preliminary conference. then. the respondent clearly set complaint be redocketed as a regular administrative case and that the case for preliminary conference at exactly one o’clock in the the respondent be reprimanded.25 we ordered the were denied their rights to due process in this instance. The OCA.Failure to file the pre-trial brief shall have the same effect as failure regular administrative case and required the parties to manifest. after the last answer is filed. Canon 1 of the Code of and in entertaining the spouses Angangco’s oral motion to declare Judicial Conduct. which mandates that judges should administer the defendants in default. however. 2008 preliminary conference because several times. 2011. we find no merit in the complainants’ conference. And both parties in the subject offense.02. the complainants have no reason to argue that they In a Resolution dated January 19. his order dated October 7. the OCA opines that errors committed in the exercise of adjudicative functions cannot be corrected through administrative Both the complainants and the respondent expressed their proceedings where judicial remedies are available. 201126 and August 29. whether they were willing to submit the case for decision on the basis of the pleadings or records And even assuming that the respondent erred in issuing the assailed filed and submitted. joint order. administrative complaint against the respondent redocketed as a . recommends that the present administrative In the dispositive portion of said order. 2011. similar act shall be dealt with more severely. is manifestly erroneous or impelled by ill-will. 2008. finds merit in the complainants’ allegation that We find the OCA’s findings to be well taken. It opines that the respondent should have facilitated the prompt disposition of the subject case and refrained We find no violation committed by the respondent in not issuing a from postponing and resetting the case for preliminary conference notice for the November 25. justice without delay. with a stern warning that a repetition of the same or unlawful detainer case received copies of the respondent’s order. considering that this was his first afternoon of November 25. the respondent incurred delay in setting the case for preliminary As the OCA recommends. The OCA finds that the respondent violated Section 7 of allegations that the respondent committed gross ignorance of the the 1991 Revised Rules on Summary Procedure. within ten (10) days from notice. THE COURT’S RULING The OCA. has the unlawful detainer case for decision was not based on the been duly authorized to enter into possible amicable settlement or spouses Angangco’s oral motion. to wit: to personally appear during the mediation proceedings should have caused the dismissal of the unlawful detainer complaint. Rule 70 and Section 6. Rule 18 of the Rules of Court) Thus.M. mistake of entertaining in the unlawful detainer case a motion to declare the defendants in default. this Court resolves and treats the oral motion of the plaintiffs to declare Regarding the complainants’ other assertion. 01-2-0430 cannot be Court despite the directive setting the case for preliminary suppletorily applied to the subject unlawful detainer case. Rule 70) the failure of the applies only to the cases defined under Section 1. contrary to present case. record reveals that defendants have not filed any pre-trial brief with this Section 2. the respondent did not commit the lawyer during the mediation proceedings. (Section 7.28 (emphasis supplied) unlawful detainer complaint. Rule IV of the 1991 Revised Rules The Revised Rules on Summary Procedure was promulgated to on Summary Procedure. Thus. On the plaintiffs’ motion to declare defendants as in default. Rule 11 of Supreme Court A. 01-2-04 that permits its suppletory alleged in the Complaint. dispel the complainants’ assertions that Supreme assailed joint order dated February 26. Rule 131 thereof.33 In the complainants’ failure to file their pre-trial brief. the respondent’s order in submitting excused when the representative. likewise. such as the party’s counsel. Also. administrative memorandum specifically refers to the rules While a motion to declare defendants in default is prohibited in governing intra-corporate controversies under R. 8. (Section 3.32 we held that the personal non-appearance of a party at mediation may be As the OCA correctly observed. No. Paderanga. Rule 70[. which is a prohibited pleading in We now proceed to the administrative liability of the respondent.29 achieve an expeditious and inexpensive determination of the cases that it covers. there is nothing in preliminary conference necessitates a judgment based on the facts Supreme Court A.A.On the complainants’ other contention. In Senarlo v.M. No. No.34 In the present case. a close reading of the We. 2009 would show that the Court A. defendants to file a pre-trial brief within the 3-day period before the which does not include ejectment cases. The cited conference and as mandated in the Notice of Pre-Trial Conference. the respondent failed to abide . 8799 and unlawful detainer cases. No.] in relation to Section application to ejectment cases. 01-2-04 may be suppletorily applied to the subject respondent did not actually entertain the oral motion to declare the unlawful detainer case and that the failure of the spouses Angangco defendants in default filed by the spouses Angangco. but was the inevitable result of the to submit to alternative modes of dispute resolution.M. the spouses Angangco were fully represented by their the complainants’ allegation. we find that the failure of the spouses Angangco to personally appear at the defendants as in default as a Motion to render judgment and that the instant case is now submitted for decision on the basis of the mediation proceedings was not a ground to dismiss the subject facts alleged in the Complaint. ejectment cases under Section 19. 2009. Again.. part of the judge. conducted on February 3. Branch 40. the respondent failed to delay in rendering a decision or order and hereby impose upon him exert his authority in expediting the proceedings of the unlawful a FINE of Twenty Thousand Pesos (P20. Quezon City.35 In numerous occasions. in full control of the proceedings in his court and to adopt a SO ORDERED. or (b) a fine of more than Ten Thousand Pesos (P10. we find Judge Mario B. as amended by and the complainants filed their answer thereto on March 30.1âwphi1 The preliminary conference scheduled for June imposition of a more severe penalty.00) but not to exceed Twenty The respondent set the case for preliminary conference only on Thousand Pesos (P20. 2008 was reset. it . 2007. Sound practice requires a judge to remain. GUILTY of under complainants filed their answer.000. detainer case.000. 24. for various reasons. No. 2008. at a time way beyond the required thirty (30)- day period. A. 01-8-10-SC. decision or order as a less serious charge sanctioned by either (a) a preliminary conference should be held not later than thirty (30) suspension from office without salary and other benefits for not less days after the last answer is filed. or almost two (2) years after the Metropolitan Trial Court. Considering that the respondent had been previously adjudged guilty of the same offense. i.38 classifies undue delay in rendering a Under Section 7 of the 1991 Revised Rules on Summary Procedure. Rule 140 of the Rules of Court.00).000.e. of ulterior motives on the unlawful detainer case. at all times. November 25.000. than one (1) or more than three (3) months.39 we impose upon him a maximum fine Another of the respondent’s procedural lapses relates to the of Twenty Thousand Pesos (P20. however unfair. June 24.by this purpose in the way that he handled and acted on the subject also invites suspicion. we remind him that frequent resetting of the date of the preliminary a repetition of the same or similar offense will warrant the conference. A review of the relevant background facts shows that the unlawful detainer case against the complainants was filed on March 22. Clearly. 2008. Judges should always be mindful of their duty to render justice within the periods prescribed by law. Capellan. and was finally WHEREFORE.00).36 Delay not only reinforces the belief of the people that the wheels of justice in this country grind slowly.00). firm policy against unnecessary postponements.M. 2007 Sections 9 and 11. 2008 and December 9. Assisting Judge. we admonished judges to be prompt in the performance of their solemn duty as dispensers of justice because undue delay in the administration of justice erodes the people’s faith in the judicial system. to August 26. 2008. of her functions as OIC of the PINS despite the designation of Culture. Superintendent for Palawan. The administrative complaint charged petitioner with grave misconduct. Giron withdrew the designation of petitioner as OIC of the PINS. Pedro B. Petitioner was instructed to turn over the administration RTC rendered a Judgment by Default. v. then DECS Region IV conduct prejudicial to the best interest of the service. G. The Petitioner argued that the designation of private respondent Director Rexs successor. Instead. 2011 Dr. parties to institute various actions restraining the enforcement of On appeal. ARQUERO. In another T. After the Petitioner filed the Petition for Quo Warranto with Prayer for retirement of Dela Cuesta. Petitioner appealed to the Civil Service Commission assailing the withdrawal of her designation as OIC of Congress approved Republic Act (RA) No. Giron filed a formal charge against petitioner who continued to by a Vocational School Superintendent (VSS) who shall be chosen defy the orders issued by the Regional Office relative to the exercise and appointed by the Secretary of the Department of Education. The law also provides that the Palawan Integrated National Schools (PINS) shall be headed Dr. private respondent as such. 6765. designation of private respondent. Arquero as the lawful Principal and Head of the Palawan memorandum. Petitioner filed a Motion for Reconsideration and/or were converted into national schools and integrated with the Clarification before the Office of the DepEd Secretary as to the Palawan National School (PNS) in the City of Puerto Princesa. Trinidad placed all satellite schools deprived her of her right to exercise her function and perform her of the PINS under the direct supervision of the Schools Division duties in violation of her right to security of tenure. no VSS was appointed. These events prompted different the operation and finances of the school subject to existing laws. This directive was later approved by the DepEd. dela Cuesta in a concurrent capacity as Officer-in-Charge (OIC) of the PINS. gross insubordination and However. Office designated then PNS Principal Eugenio J. petitioner took over as Secondary School Issuance of Temporary Restraining Order and/or Injunctive Writ Principal of the PNS. Petitioner. wherein several the PINS. as branches thereof. the CA reversed and set aside the RTC decision. ISSUE: Whether or not petitioner is the lawful Principal and Head of the Palawan Integrated National High School who is lawfully entitled . Schools Division Superintendent Portia Gesilva was Integrated National High School who is lawfully entitled to manage designated as OIC of the PINS. enjoining her from submitting to the Regional Office all REBECCA T. Province of Palawan. before the RTC of Palawan against public and private respondents. No. the DepEd orders.R. COURT OF APPEALS appointments and personnel movement involving the PNS and the FACTS: satellite schools. declaring petitioner Rebecca and supervision of the PINS branches or units. and Sports (now the DepEd). 168053 : September 21. It was held that it is not simply the filing of the complaint or Thus. 79937-38 February 13.00 in docket fees. The respondent the condition that he shall surrender the office once he is called to demonstrated his willingness to abide by the rules by paying the do so by the appointing authority. she held in a attachment in a civil case against SIOL.R. An acting appointee accepts the position on well as the corresponding docket fees.. but endures at the pleasure of the appointing authority. etc. DENIED. 1989 and the principal or secondary school head teacher of each of the units or branches of the integrated school. HELD: Court of Appeals decision is sustained. but the payment of the prescribed tenure as principal of the PNS but not as OIC of the integrated docket fee. The body of the complaint it can be inferred to be in amount of P 50 purpose of an acting or temporary appointment is to prevent a million. attorney’s fees. In addition. however. PR originally paid only PhP 210. did not state the amount of damages sought although from the petitioner held the position only in a temporary capacity. that vests a trial court with jurisdiction over the subject . petitioner did not possess the Subsequently. petitioner can only insist on her security of appropriate initiatory pleading. Upon the withdrawal of her designation. not fixed. At that time. damages. the permanent position of principal of the PNS. her right to the existing laws? contested position ceased to exist. PR also claims for concurrent capacity. Issue: Did the Court acquire jurisdiction over the case even if private The essence of an acting appointment is its temporariness and its respondent did not pay the correct or sufficient docket fees? consequent revocability at any time by the appointing authority. YES. the prayer Having been appointed as OIC without the necessary qualifications. litigation costs. CONSTITUTIONAL LAW: public officers. The legislators clearly Facts: Petitioner Sun Insurance (or SIOL) files a complaint for the intended that the integrated schools shall be headed by a annulment of a decision on the consignation of fire insurance policy. Nos. superintendent. the Private Respondent (PR) files a complaint for the qualifications to hold the position and she was merely designated refund of premiums and the issuance of a writ of preliminary by the DepEd as the OIC of the PINS. Admittedly. appointments Sun Insurance v Asuncion As aptly observed by the CA. under RA 6765.The hiatus in the discharge of official functions by authorizing a person complaint underwent a number of amendments to make way for to discharge those functions pending the selection of a permanent subsequent re-assessments of the amount of damages sought as or another appointee. his term of office is additional docket fees as required. Hence. Therefore. the law created two positions the VSS G.to manage the operation and finances of the school subject to school. Subsequently. the additional filing fee shall constitute a lien on the of Nursing. UNIVERSITY. Thereafter. Liceo sent Barba a notice terminating her services MA. After her Same rule goes for permissive counterclaims. she was appointed as the Dean of the College of similar pleadings. G .121 students in the school year 1995 to 1996 to only 29 amended complaint. obviously. the judgment awards a claim not specified in the letter dated April 27. a more liberal interpretation of the students in the first semester of school year 2003 to 2004. v. or if specified the same has been left for determination by and report to Ma. Hence. the College of Physical Therapy defraud the government of the docket fee due not only in the filing suffered a dramatic decline in the number of enrollees from a total of the original complaint but also in the filing of the second of 1. she shall serve the school in whatever position the school no case beyond the applicable prescriptive or reglamentary period. Mercedes L. Where the filing of the initiatory When Barba started working for Liceo. Chona Palomares.matter or nature of the action. paying the additional docket fees as required. Barba did not report to duly authorized deputy to enforce said lien and assess and collect Palomares and requested for the processing of her separation the additional fee. Inc. FACTS: Petitioner Dr. rules is called for considering that. pleading is not accompanied by payment of the docket fee. However. No. third party claims and scholarship. desires for a period of not less than ten (10) years. to receive her teaching load and assignment as a full- judgment. of the College of Physical Therapy of respondent Liceo de Cagayan She alleged that her transfer to the College of Nursing as a faculty University. LICEO DE CAGAYAN on the ground of abandonment. 2012 Another letter was sent to Barba but the latter still refused to return to work. there was the intent on the part of PR to In the school year 2003 to 2004. the Her scholarship contract provides that after the duration of her court may allow payment of the fee within a reasonable time but in study. 193857 : November 28. but on leave without pay starting. 2005 instructing Barba to return to work on pleading. MERCEDES L. BARBA. member is a demotion amounting to constructive dismissal. the Acting Dean of the College the court. she was chosen as a scholar. Respondent. Liceo sent Barba a subsequently. . Physical Therapy. the private respondent demonstrated his willingness to abide by the rules by Due to the low number of enrollees. It shall be the responsibility of the Clerk of Court or his time faculty member in that department. unlike in Manchester.R. the College of Physical Therapy ceased operations and Barba went Where a trial court acquires jurisdiction in like manner. In herein case. Petitioner. (Liceo). Barba (Barba) was the Dean payment of separation pay and retirement benefits against Liceo. benefits in view of the closure of the College of Physical Therapy. Ma. Barba filed a complaint before the Labor Arbiter for illegal dismissal. Liceo decided to freeze the operation of the College of Physical Therapy indefinitely. a vice president. and are those who are given that character either by Petition raising for the first time the issue of lack of jurisdiction of the Corporation Code or by the corporation’s by-laws. . namely. In Matling Industrial and the board of directors. a secretary and a decision. Though the board of MERCANTILE LAW: corporate officers directors may create appointive positions other than the positions of corporate officers. The office. a president. an assiduous perusal of these documents does not has Barba abandoned her work. In Liceo’s by-laws. Liceo claimed that a the Corporation Code enumerates corporate officers as the College Dean is a corporate officer under its by-laws and Barba was president. it is provided that there shall be other present petition. The rest of the corporate officers could be considered only as CA did not find merit in Liceo’s assertion in its Supplemental Petition employees of subordinate officials. In addition. Section 25 of the Labor Arbiter and the NLRC over the case. the treasurer and such other officers as a corporate officer of Liceo since her appointment was approved by may be provided for in the by-laws. Barba filed the treasurer. the CA reversed the NLRC resolutions. thus: tribunals. The NLRC Corporate officers are elected or appointed by the directors or reversed the LA. Whether or not Barba was constructively dismissed? merely approved by the board together with the other academic HELD: Petition is granted. the persons occupying such positions cannot FIRST ISSUE: Labor tribunals have jurisdiction over Barba’s be deemed as corporate officers as contemplated by Section 25 of complaint. powers and duties shall be determined by the board of directors. there are four officers specifically Unsatisfied. the phrase “such other officers as over the case is with the regular courts and not with the labor may be provided for in the by-laws” has been clarified. The CA further found that no constructive dismissal occurred nor However. a position must be expressly mentioned in the By-Laws in order to be considered as a corporate In its original Decision. compensations. the secretary. Liceo maintained that the jurisdiction Commercial Corporation v. Barba was not directly elected nor appointed by the board of directors to any corporate office but her appointment was 2. Coros. a College Director and heads of departments ISSUES: whose appointments.The LA ruled that Barba was not constructively dismissed. both Barba and Liceo sought reconsideration of the CA mentioned. Hence. “Conformably with Section 25. Thus. convince us that Barba occupies a corporate office position in the university. It is worthy to note that a 1. appointive officials. Liceo went to the CA and filed a Supplemental stockholders.” that the position of Barba as College Dean was a corporate office. Whether or not the labor tribunals have jurisdiction over Barba’s College Dean is not among the corporate officers mentioned in complaint for constructive dismissal? Liceo’s by-laws. deans of respondent university in accordance with the procedure prescribed in Liceo’s Administrative Manual. The CA reversed its earlier ruling. we agree with the Labor Arbiter and the appellate court’s earlier ruling that Barba was not Ernesto did not file a responsive pleading (so did Teresa because constructively dismissed. The case appointed her as Dean of the College of Physical Therapy and was heard ex-parte and the spouses were ordered to satisfy the Doctor-in. husband of Teresa Biaco. or prejudicial to the employee. Summons were issued by the trial judge. To the case at bar. inconvenient. that it was only her husband who received the not unreasonable. a for a valid cause. her complaint for illegal/constructive dismissal against pesos. causes. Upon motion by PCRB. being an employee of in loans obtained in 1998 which amounted to more than a million respondent. petitioner. that Teresa cannot invoke extrinsic fraud because secure the loans. Barba’s appointment notice of levy was issued against the personal properties of Teresa as its College Dean was validly revoked and her subsequent to satisfy the deficiency. PRCB argued that the foreclosure proceeding is an action quasi in Ma. spouses Biaco. She then sought to have the judgment annulled as she Particularly. He was able to pay loans from 1996 to 1997 but he defaulted defendant of Ernesto.Charge of the Rehabilitation Clinic “for a period of three debt and failure to do so will authorize the Sheriff to auction the years effective July 1. . PCRB filed a complaint for foreclosure against the and the NLRC. Thus. Barba’s letter of appointment specifically she was not aware sans the summons being served her). No summons was served to Teresa. assignment to teach in the College of Nursing was justified as it is It was only at this point that Teresa learned of the previous ex parte still related to her scholarship studies in Physical Therapy. Barba’s appointment as College Dean was for a fixed term. deliberately hid the fact of the foreclosure proceeding. When Liceo decided to close its College of Physical Therapy due to drastic decrease in enrollees. the employer must be able to show that such transfer is receive summons. acquired several loans from court acquires jurisdiction over the res which is what happened in Philippine Countryside Rural Bank (PCRB) from 1996 to 1998. The Sherriff LABOR LAW: constructive dismissal served the summons to Ernesto at the latter’s office. he mortgaged certain property in favor of the such situation cannot occur in her case because she is a co- bank. that there was extrinsic fraud because her husband Petition for review on certiorari is GRANTED. Teresa Biaco vs Philippine Countryside Rural Bank rem. respondent was properly within the jurisdiction of the Labor Arbiter Eventually. On the issue of constructive dismissal. subject to reappointment and revocation or termination Eventually. hence Teresa’s participation is not required so long as the Ernesto Biaco. 2002 unless sooner revoked for valid cause or mortgaged the property.” Evidently. for a transfer not to be considered a constructive now claims that she was deprived of due process when she did not dismissal. the mortgaged property was auctioned for P150k which is not sufficient to cover the P1 M+ debt.the Corporation Code. proceedings. summons. It was not PCRB (mortgaged property). agreeing with [respondents’] Motion to Dismiss. The respondents filed Omnibus Motion Ad Cautelam to Admit Motion to Dismiss and Answer with. or where the attorney regularly proceeding and that the presence of Teresa is not required because employed corruptly sells out his client’s interest to the other side. the order of the trial court compelling Teresa to pay off the debt using said motion was not heard due to the Judge’s absence. It is admitted that the proceeding is a quasi in rem party and connives at his defeat. the sheriff at her husband’s office cannot be deemed proper service Respondents filed their ‘Urgent Motion to Declare Service of absent any explanation that efforts had been made to personally Summons Improper and Legally Defective’ alleging that the Sheriff’s Return has failed to comply on substituted service of summons but serve summons upon her but that such efforts failed. or where the defendant never had knowledge of the annulled. the trial court was able to acquire jurisdiction over the res The above is not applicable in the case of Teresa. whereby the defeated party to Dismiss and Answer with Counterclaim’ was filed outside the was prevented from presenting fully his side of the case by fraud or period to file answer. The substituted service made by complaint was served upon the secretary of respondent. hence he (1) denied the Motion to Admit deception practiced on him by the prevailing party. Petitioner her personal property is a judgment in personam which the court then filed an Omnibus Motion to Declare [Respondents] in Default cannot do because it only acquired jurisdiction over the res and not and to Render Judgment because no answer [was] filed by [the over the person of Teresa. Further. by fraud or deception practiced on him by within ten days from receipt of [the] order. a false promise of will be dismissed. The summons together with the order to afford her due process. and (3) ordered [petitioner] to present evidence ex-parte exhibiting fully his case. being kept in ignorance by the acts of the plaintiff. Extrinsic fraud is Motion to Dismiss and Answer. as by keeping him away from court. is correct that there is none in the case at bar. (2) declared [respondents] in present where the unsuccessful party had been prevented from default. suit. and admitted [their] Answer. HOWEVER. or where an attorney fraudulently or without authority assumes to represent a HELD: Yes. Extrinsic fraud However six months after admitting their answer. personal service of summons is essential in respondents with the RTC. PCRB. The judge denied On the issue of extrinsic fraud. the case his opponent. Teresa. Even if the FACTS: Petitioner filed a complaint for collection against action is quasi in rem. [failing] which. latter]. Her co-defendants in the case and shared the same interest. the judge ruled exists when there is a fraudulent act committed by the prevailing that [respondents’] ‘Omnibus Motion Ad Cautelam to Admit Motion party outside of the trial of the case. Rule 14 of the Rules of Court. who does not voluntary Oaminal vs Castillo : 152776 : October 8. . her constitutional right to due which made any fraud. right to due process was violated when she did not receive summons. 2003 appear in court must be personally served with summons as provided under Section 6. the Court of Appeals. It should be noted that spouses Biaco were process is superior over the procedural matters mentioned. as a resident defendant.ISSUE: Whether or not the judgment of the trial court should be a compromise. The appellate court committed egregious error in children with Capitolina. Claiming the said donation prejudiced their legitime. 1995. Applying shall inherit in equal shares in the estate of the late Dr. could not have ruled to admit their Answer on November 16. imprudently declared in default. as mandated by Article 151 of the Family Court. Respondents herein were declared in default by the trial court on May 22. When Dr. Holding that the subsequent marriage of Dr. we find that respondents were. an answer. 185922 : JANUARY 15. therefore.. Its unexpected volte face came six months after it had Favis. The subject properties cannot be Mariano G.CA Aguilar (Capitolina) with whom he had seven children. 1994. Mariano and Larcelita and their grandchildren as respondents. 2001. Favis and no practical purpose was served in declaring the defendants in Juana legitimated the status of Mariano. (Dr. On October 16. Dr. Indiana had full control of his mental capacities to execute a valid Deed of Aerospace University v. filed an action for dismissing the complaint. Favis) was married to Capitolina case is not subject to compromise as it involves future legitime. Gonzales toward a compromise have been made. that ruling to the present case.R. his common-law wife with whom he sired one child. Sps. HELD: NO. Favis married Juana Gonzalez compromise is that which is entered between the decedent while (Juana). When rejected petitioners’ contention when it ruled that the prohibited Capitolina died in March 1994. alive and compulsory heirs. he executed an affidavit acknowledging Mariano as one of instant complaint was filed after the death of the decedent. prior efforts towards a compromise have been madeas mandated by his death. 2000. Sr. Favis and Juana got married considered as "future legitime" but are in fact. petitioners herein. Favis and 15-day period. at the age of 92 and plagued with illnesses. Mariano is married to Larcelita D. he allegedly executed a Deed of Donation transferring Article 151 of the Family Court. G. inventory. purportedly because of their delay in filing RTC nullified the Deed of Donation. Favis (Mariano).The appellate court’s decision hinged on annulment of the Deed of Donation. Favis. Favis HELD: NO. Mariano Favis. which states that “No suit between . the trial court also default when their Answer had already been filed — albeit after the declared Juana and Mariano as compulsory heirs of Dr. The trial court found that Dr. as the in 1974. and conveying properties in favor of his grandchildren with Juana. The CA motuproprio ordered the dismissal of the complaint for failure of petitioners to make an averment that earnest efforts Heirs of Favis v. Favis (Larcelita). Dr. Commission on Higher Education held that Donation. liquidation and Article 151 of the Family Code. Favis died intestate on July 29. with whom he has four children. ISSUE: Whether or not the appellate court may dismiss the order of dismissal of the complaint for failure to allege therein that earnest Dr. his legitimate children. legitime. but before they were declared as such. No. 2014 Petitioners filed a motion for reconsideration contending that the FACTS: Dr.ISSUE: WON respondents were properly declared in default? partition of property before the RTC against Juana. a motion to respondents as parties-defendants could not. namely: (a) lack of jurisdiction over the subject matter. absence of the required allegation on earnest efforts at a compromise. It provides for only four instances when the the Judgment of the Regional Trial Court is AFFIRMED. The appellate court correlated this provision with Section 1. (b) litispendentia. after dismiss may be made on any of the following grounds:(j) That a filing their answer to petitioners’ complaint. It is not a jurisdictional defect but merely a defect in the statement of a cause of action. court may motu proprio dismiss the claim. Rule 16 authority or basis to motupropio order the dismissal of petitioners treats of the grounds for a motion to dismiss the complaint. Rule 9 thereofwhich specifically deals with dismissal of the claim by the The decision of the Court of Appeals is reversed and set aside and court motuproprio. (c) res judicata. In other words.” failure assigned as error in the appeal that respondent brought before the Court of Appeals. In the case at hand. Failure to allege in the complaint that earnest efforts at a compromise has been made but had failed is not one of the exceptions. no mention having been made about any defect in from the verified complaint or petition that earnest efforts toward a the statement of a cause of action. and did not. no motion to compromise have been made. par. invoke the objection of condition precedent for filing the claim has not been complied with. which provides: Therefore. If the answer to the complaint or pleading asserting a claim. the appellate court unquestionably did not have any The appellate courts reliance on this provision is misplaced. complaint of petitioners was answered by respondents without a prior motion to dismiss having been filed. Grounds. the rule on deemed waiver of the non-jurisdictional Section 1. (j). . and (d) prescription of action.Within the time for but before filing the defense or objection is wholly applicable to respondent.members of the same family shall prosper unless it should appear on the merits. neither was such dismissed. but that the same have failed. the case must be condition precedent was filed in the trial court. If it is dismiss the complaint based on the failure to comply with a shown that no such efforts were in fact made. be distinguished from the grounds provided under Section 1. Rule 16 of the 1997 Rules of Civil Procedure. It must complaint. The RTC decision in favor of the petitioners was appealed by respondents at the CA on the basis of the alleged error in the ruling .