THIRD DIVISION
[G.R. No. 139882. August 16, 2000]
ORIENTAL ASSURANCE CORPORATION, petitioner, vs. SOLIDBANK
CORPORATION, respondent.
D E C I S I O N
PANGANIBAN, J.:
The retroactive
application, of procedural rules to pending cases is well settled. Hence, the
1997 Rules of Civil Procedure, which require the payment of docket fees upon
the filing of the notice of appeal, applies to the present case.
The
Case
Before us is a
Petition for Review on Certiorari under Rule 45, assailing the March 8,
1999[1] and the June 4, 1999[2] Resolutions of the Court of Appeals (CA). The first
Resolution reads as follows:
"The Court
considers the appeal of Leonila Cui and Oriental Assurance Corporation
ABANDONED and DISMISSED for their failure to pay the required docket fees
(Section 1 [c], Rule 50 of the 1997 Rules of Civil Procedure, as
amended.)" (emphasis in the original)
The second
Resolution denied petitioner's Motion for Reconsideration.
The
Facts
Petitioner Oriental
Assurance Corporation issued Fire Insurance Policy No. F-92/22733-D, insuring
the stock of finished and/or unfinished products including raw materials,
machinery and equipment belonging to Wear Me Garments Manufacturing, Inc. (Wear
Me). The policy insured against loss and/or damage by fire from March 20, 1991
to March 20, 1992. The policy was subsequently renewed for another year from
March 20, 1992 to March 20, 1993 under Renewal Receipt No. 40948. A Memorandum
stating that the policy was "[m]ade further subject to MORTGAGEE CLAUSE in
favor of SOLIDBANK CORPORATION"' was typewritten on the face of the
receipt.
On April 27, 1993,
petitioner issued another Fire Insurance Policy (No. F-93-40690-D) insuring the
same items of Wear Me from March 20, 1993 to March 20, 1994.
On July 12, 1993, a
fire broke out at the factory of Wear Me, destroying a major portion of the
insured properties. Wear Me submitted to petitioner and its co-insurers[3] a Notice of Loss for the value of the damaged
properties. The claims were denied.
As holder of trust
receipts over the burned goods, Solidbank Corporation sent an undated telegram
to petitioner, asking the latter to pay the proceeds of Fire Insurance Policy
No. F-92/22733-D. Petitioner refused to comply, because the Policy did not
contain a mortgagee clause in favor of Solidbank.
Before the Regional
Trial Court of Manila (RTC),[4] respondent then instituted Civil Case No. 94-70505
against petitioner and Wear Me; as well as Angelita Amparo Go and Arnold A. Go,
Leonila Cui, and Prudential Guarantee and Assurance Inc. Acting favorably on
respondent's Motion for Summary Judgment,[5] the RTC rendered a Decision,[6] the dispositive part of which reads:
"WHEREFORE,
premises considered, judgment is hereby rendered in favor of the plaintiff and
against the defendants as follows:
1.1 Holding that
the plaintiff is entitled to be paid under the loan of P1.2 Million and under
the five trust receipts the sum of P4,797, 294.83, plus interests and other
charges form December 29, 1992, until fully paid;
1.2 Holding
defendant WEAR ME, Angelita Amparo Go and spouse, Arnold A. Go, jointly and
severally liable to pay the plaintiff the above amounts;
1.3 Prudential
Guarantee and Assurance, Inc., and Oriental Assurance Corporation, are held
jointly and severally liable to pay the plaintiff, together with defendants
WEAR ME, Angelita Amparo Go and her spouse, Arnold A. Go, the above amounts but
limited to the extent of the insurance coverage representing the insurance
coverage assigned to Solidbank Corporation under the two (2) fire insurance
policies;
1.4 Leonila Cui is
held jointly and severally liable to the plaintiff, together with all the other
defendants, but only with respect to the loan of P1.2 million and the accrued
interest and penalties.
2. Ordering all
the defendants jointly and severally to pay the plaintiff a sum equal to 10% of
the amounts above payable plus the costs of the suit."[7]
On August 18, 1995,
respondent filed a Motion for Execution pending appeal. It was opposed by
petitioner, which filed a Motion for Reconsideration of the RTC Decision.
Subsequently, the
trial court issued an Omnibus Order granting the Motion for Execution and
denying the Motion for Reconsideration. On October 23, 1995, petitioner
appealed. the RTC Decision and Omnibus Order to the Court of Appeals. It should
be added that before elevating the records of the case to the appellate court,
the RTC granted respondent's Motion to Stay Execution Pending Appeal Based on
Supersedeas Bond.
As earlier
mentioned, the CA denied petitioner's appeal and subsequent Motion for
Reconsideration. Hence, this recourse to this Court.[8]
The
Issue
In its Memorandum,
petitioner submits for the consideration of this Court this lone issue:
"xxx
[W]hether or not the Court of Appeals x x x committed reversible error in
giving retroactive effect to Section 1 (c) of Rule 50 of the 1997 Rules of
Civil Procedure [dismissing] petitioner's appeal for failure of the petitioner
to pay the appellate court docket and other lawful fees."[9]
The
Court's Ruling
The Petition is
devoid of merit.
Sole
Issue: Retroactive Effect of Rules of Procedure
According to both
parties, the sole controversy is the retroactive application of Section 1 (c),
Rule 50 of the 1997 Rules of Court, which provides:
"SECTION 1.
Grounds for dismissal of appeal. -- An appeal may be dismissed by the Court
of Appeals, on its own motion or on that of the appellee, on the following
grounds:
xxx................................xxx................................xxx
(c) Failure of the
appellant to pay the docket and other lawful fees as provided in section 5 of
Rule 40[10] and section 4 of Rule 41;"
Section 4 of Rule
41 in turn reads:
"SEC. 4. Appellate
court docket and other lawful fees. -- Within the period for taking an
appeal, the appellant shall pay to the clerk of the court which rendered the
judgment or final order appealed from, the full amount of the appellate court
docket and other lawful fees. Proof of payment of said fees shall be
transmitted to the appellate court together with the original record or the
record on appeal."
Petitioner contends
that these Rules cannot be given retroactive effect because such action would
impair its "vested" rights under the old Rules.[11] The latter required an appellant to pay the docket
fees within fifteen days from the receipt of notice from the CA clerk of court
that the record on appeal has been received.
The retroactive
application of procedural rules to pending cases is undoubtedly well settled.[12] Petitioner even admits this in its efforts to reason
out its case.[13] For this reason alone, the present Petition should
be dismissed.
Even assuming that
it is entitled to the aforecited right, the CA's dismissal of the appeal still
stands.
Counsel's Negligence
In Arambulo v.
CA,[14] a case in which the required notice invoked by
herein petitioner was sent to the wrong counsel, we held:
"Both the
Withdrawal of Appearance of Atty. Jimenez and the Appearance of Atty. Pineda
are undeniably found in the original record of Civil Case No. 5301 and are
explicitly referred to in the Summary Index in the record of CA-G.R. CV No.
32348. And since the withdrawal of Atty. Jimenez had taken effect upon its
filing before the trial court on 12 February 1991, the notice to pay the docket
and other fees sent to him by the Judicial Records Division of the Court of
Appeals on 4 March 1991 was thus void or otherwise ineffective. Receipt thereof
by him did not operate as notice to the Arambulos. It is a fact on record that
no notice to pay the docket fee was sent to and received by Atty. Pineda,
therefore, the 15-day period to pay the required docket fee did not even
commence to run." (emphasis ours)
Even if we assume
that petitioner is entitled to the notice mentioned in the old Rules, the
appeal may be dismissed nonetheless, due to petitioner and its counsel's
negligence in inquiring on the status of the appeal. Again, Arambulo is
illuminating, as shown below:
"Nevertheless,
the appeal can be dismissed, not on the basis of the respondent Court of
Appeals' error but on a different ground for which Atty. Pineda must answer. As
the new counsel for petitioners, it was incumbent upon him, consistent with
his duty to serve his client with competence and diligence, to inquire either
from the trial court or the appellate court about the status of the appeal
since he had not received any notice to pay the docketing and other fees
despite the lapse of several months from the time he entered his appearance. While
he had every reason to expect that the office of the Clerk of Court of the
Court of Appeals would faithfully comply with Sections 2(3) and 3, Rule 4 of
the Revised Internal Rules of the Court of Appeals on the issuance of notice to
the parties to pay the docketing and other fees, his failure to receive the
notice for so long a time should have alarmed him to the possibility that
something must have gone awry somewhere." (Emphasis ours)
Indeed, it is the
duty[15] of petitioner's counsel to check the status of a
pending appeal.[16] This duty is even more compelling in this case
because the appeal had been pending for over three years,[17]and counsel had not received any notice to pay the
required docket and other lawful fees. These circumstances should have
compelled to action petitioner's counsel, whose reason for the delay was flimsy
and unacceptable. Erroneous and irrelevant is the allegation that "[t]he
long pendency of petitioner's appeal was due to the filing by Prudential of the
petition for certiorari and the filing by the respondent of the motion to
dismiss the appeal."[18] We stress that the relevant matter is the failure of
petitioner to check the status of its appeal. Under the circumstances, it is
bound by the negligence of its counsel.[19]
In view of the
foregoing conclusion, the parties' lengthy discussions of the merits of the
appealed case need not be ruled upon.
WHEREFORE, the Petition is DENIED and the assailed
Resolutions AFFIRMED. Costs against petitioner.
SO ORDERED.
Melo,
(Chairman), Vitug, Purisima, and Gonzaga-Reyes,
JJ., concur.
[1] Rollo, p. 112; penned by Justice Angelina
Sandoval Gutierrez and concurred in by Justices Romeo A. Brawner and Martin S.
Villarama Jr.
[2] Rollo, p. 116.
[3] Namely, Blue Cross Insurance, Inc., Central Surety
& Insurance Co., Cibeles Insurance Corporation, Liberty Insurance
Corporation, Philippine British Assurance Co., Philippine First Insurance Co.,
Commonwealth Insurance Inc., Pioneer Asia Insurance Corporation, Prudential
Guarantee & Assurance Inc., Reliance Surety & Insurance Co., and Western
Guaranty Corporation.
[4] Branch 49, presided by Judge Salvador P. De Guzman
Jr.
[5] This was actually a Supplemental Motion for Summary
Judgement submitted together with an Omnibus Motion for Reconsideration of the
Order dated February 23, 1995, denying the first Motion for Summary Judgment.
[6] Dated July 27, 1995.
[7] RTC Decision, p. 9; rollo, p. 90.
[8] The case was deemed submitted for resolution on May
12, 2000, upon receipt by this Court of Respondent’s Memorandum, signed by
Atty. Maximino Z. Banaga Jr. of De los Reyes Banaga Briones & Associates.
Petitioner’s Memorandum, signed by Atty. Alejandro P. Ruiz Jr., was received
earlier on April 28, 2000.
[9] Memorandum for Petitioner, p. 7; rollo, p.
182.
[10] The Supreme Court En Banc Resolution dated February
17, 1998 inserted "section 5 of Rule 40."
[11] These
are §§4 and 5, Rule 46 of the old Rules of Court, which provide:
"SEC.
4. Notice of receipt of record. -- The clerk upon receiving the record
on appeal shall cause a notice of that fact to be served on the parties.
"SEC. 5. Duty
of appellant upon receipt of notice. -- It shall be the duty of the
appellant, within fifteen (15) days from the date of the notice referred to in
the preceding section, to pay to the clerk of the Court of Appeals the fee for
the docketing of the appeal, and within sixty (60) days from such notice to
submit to the court forty (40) printed copies of the record on appeal, together
with proof of service of fifteen (15) printed copies thereof upon the
appellee."
[12] See People v. Sumilang, 77 Phil 764, December
18, 1946; Alday v. Camilon, 120 SCRA 521, January 31, 1983; Lim Law v.
Olympic Sawmill Co., 129 SCRA 439, May 28, 1984; Bernardo v. CA, 168
SCRA 439, December 14, 1988; Duremdes v. Commission on Elections, 178
SCRA 746, October 27, 1989; Ocampo v. CA, 180 SCRA 27, December 8, 1989;
People’s Financing Corp. v. CA, 192 SCRA 34, December 4, 1990; Aris
(Phil.) Inc. v. NLRC, 200 SCRA 246, August 5, 1991; Asset Privatization
Trust v. CA, 229 SCRA 627, February 3, 1994; Del Rosario v. CA,
241 SCRA 519, February 21, 1995; Diu v. CA, 251 SCRA 472, December 19,
1995.
[13] Petitioner’s Memorandum, pp. 10-11; rollo, pp.
185-186.
[14] 226 SCRA 589, 599, September 17, 1993, per Davide
Jr., J. (Now CJ)
[15] Canon 18 of the Code of Professional Responsibility
provides: "A lawyer shall serve his client with competence and
diligence."
[16] Arambulo v. CA, supra. See Estella v.
CA, 185 SCRA 732, May 28, 1990, cited in respondent’s Memorandum.
[17] The notice of appeal was filed on October 24, 1995
(October 23, 1995, according to respondent). The CA Resolution dismissing the
appeal was received by petitioner on March 24, 1999.
[18] Petitioner’s Memorandum, p. 13; rollo, p. 188.
[19] Reyes v. CA, 189 SCRA 46, August 24, 1990.