Republic of the
Supreme Court
FIRST DIVISION
MILAGROS
SIMON and G.R.
NO. 148273
LIBORIO
BALATICO,
Petitioners, Present:
PANGANIBAN,
C.J.
(Chairperson)
- versus - YNARES-SANTIAGO,
AUSTRIA-MARTINEZ,
CALLEJO,
SR., and
CHICO-NAZARIO,
JJ.
GUIA
W. CANLAS, Promulgated:
Respondent. April 19, 2006
x-
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D E C I S I O N
AUSTRIA-MARTINEZ,
J.:
Before
the Court is a petition for review on certiorari
of the Decision[1] of the
Court of Appeals (CA) dated
The
factual background of the case is as follows:
On
P220,000.00 secured by a real estate mortgage[2]
over her paraphernal property, a 748-square meter parcel of land located at San
Nicolas, Victoria, Tarlac, covered by Transfer Certificate of Title (TCT) No.
139884; the loan was payable within a
period of three years or until September 18, 1990; Milagros defaulted in the
payment of the loan and repeated demands for payment went unheeded, prompting
the filing of a case in court.[3]
On
On
On
On
On
Edgar died during the pendency of the
case. On
On
Thereafter, trial on the merits
ensued with respondent presenting her witnesses, namely: Nelson Nulud, the
records custodian of the Registry of Deeds of Tarlac; Aurelia, the third-party
defendant and one of the instrumental witnesses to the real estate mortgage; and
respondent herself. When petitioners’ turn came, they presented Crisostomo
Astrero, the other instrumental witness to the real estate mortgage.
On
On
On
On
On July 1, 1998, Atty. Sedico
formally filed his Entry of Appearance with Urgent Ex-Parte Motion to Reset,
praying that the hearing scheduled on July 2, 1998 be reset to August 12, 1998 due
to conflict of schedule and his trial calendar for July is fully occupied, as
well as to give him more time to study the case since he had just been
retained.[20]
On
On
At the scheduled hearing on
Sixteen days later, on
WHEREFORE,
the plaintiff having substantiated her claim by a preponderance of evidence,
this Court hereby renders judgment in her favor, ordering the defendants to pay
the plaintiff within a period of ninety (90) days from the entry of judgment
hereof, the following sums of:
(1)
P220,000.00, representing the principal obligation plus interest thereof
of 12% per annum from the filing of the complaint until fully paid;
(2)
P30,000.00 as attorney’s fees; and
(3)
The costs of suit.
It
is further adjudged that in the event defendants default in the payment of the
above determined amounts, Lot No. 2763, with an area of 748 square meters
situated in San Nicolas, Victoria, Tarlac and covered by Transfer Certificate
of Title No. 13984 – Tarlac Registry, particularly identified and described in
the Real Estate Mortgage contract (Exhibit “A”), shall be sold at public
auction to satisfy this judgment.
SO
ORDERED.[24]
The RTC held that Milagros executed a
deed of real estate mortgage in favor of Edgar and she received the
consideration for the mortgage in the amount of P220,000.00;
that petitioners’ inaction for three years before the filing of the complaint
against them to protest the alleged non-receipt of the consideration for the
mortgage casts serious doubts on their claim; and that the deed of real estate
mortgage was duly notarized and assumed the character of a public instrument.
On
Dissatisfied, petitioners filed an
appeal with the CA. On P220,000.00
was actually received by Milagros per the testimony of Aurelia; that
petitioners slept on their rights, if they had any, since they never lifted a
finger to protect and preserve their alleged rights and interests; and that the
mortgaged property is not conjugal property but the exclusive property of Milagros
which she could validly dispose of or encumber without her husband’s consent.
The CA merely noted that the RTC
failed to dispose of petitioners’ third-party complaint and without any further
discussion, dismissed the third-party complaint in the dispositive
portion of its decision, to wit:
WHEREFORE, the Decision appealed from is hereby AFFIRMED in toto as to the main case. The third-party complaint is hereby DISMISSED.
SO ORDERED.[28]
Hence, the present petition for
review on certiorari anchored on the
following Assignment of Errors:
1.
THE RESPONDENT COURT OF APPEALS ERRED AND ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION OR IN EXCESS OF
JURISDICTION WHEN IT UPHELD THE VALIDITY OF THE QUESTIONED REAL ESTATE MORTAGE
EVEN AS THERE WAS LACK OF CONSIDERATION AND THAT THE SAME WAS EXECUTED THROUGH
FRAUDULENTLY [sic] SCHEME;
2.
THE RESPONDENT COURT OF APPEALS ERRED AND ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION OR IN EXCESS OF
JURISDICTION WHEN IT RULED THAT THE DUE EXECUTION OF THE REAL ESTATE MORTGAGE
WAS ADMITTED WHILE WHAT WAS ADMITTED ONLY IS ITS EXECUTION;
3.
THE RESPONDENT COURT OF APPEALS ERRED AND ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION OR IN EXCESS OF
JURISDICTION WHEN IT RULED THAT THE SUBJECT REAL PROPERTY IS PARAPHERNAL EVEN
AS EXISTING LAW AND JURISPRUDENCE HAD CONSIDERED IT CONJUGAL OR ABSOLUTE
COMMUNITY OF PROPERTY;
4.
THE RESPONDENT COURT OF APPEALS ERRED AND ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION OR IN EXCESS OF
JURISDICTION WHEN IT RULED THAT DESPITE OF [sic] HAVING DENIED PETITIONER TO BE
REPRESENT [sic] BY A COUNSEL OF CHOICE DUE PROCESS IS SATISFIED.[29]
Petitioners contend that the real
estate mortgage was fraudulently executed and there was lack of consideration but
material facts relating thereto were not fully ventilated because the RTC
denied petitioners’ motion to reset the hearing. They maintain that they never admitted the due
execution of the real estate mortgage, but only its execution or existence. They further insist that the mortgaged
property is conjugal, not paraphernal, and therefore, Milagros could not
dispose of or encumber without her husband’s consent; and the CA disregarded
Article 99[30] of the
Family Code which provides that all the property owned by the spouses at the
time of the celebration of the marriage or acquired thereafter forms part of
the community property. Lastly, they submit that while they were given the
opportunity to secure the services of a new counsel to defend them, the RTC’s
apathy to the plight of petitioners’ counsel on the latter’s conflict of
schedule amounted to stripping such right to counsel and denial of due process.
For her part, respondent contends
that the petition should be dismissed outright for impleading the CA as
respondent, despite the clear directive of the 1997 Rules of Civil Procedure
against it. She further points out that
the petition lacks verification, a certification
against forum shopping, a copy of the assailed CA decision, and it fails to
raise any specific question of law but only presents and discusses an “assignment
of errors.”
In any event, even if these procedural
defects are disregarded, respondent argues that petitioners were not denied due
process when the RTC denied their motion for postponement since they were duly
accorded all the opportunities to be heard and to present their evidence to
substantiate their defense but they forfeited this right for not appearing in
court together with their counsel at the scheduled hearings. They also aver
that the real estate mortgage is valid and duly executed and the mortgaged
property is the paraphernal property of Milagros such that she can validly
dispose of or encumber it without her husband’s consent.
Anent the procedural
defects raised by respondent, the Court agrees that the correct procedure, as
mandated by Section 4, Rule 45 of the 1997 Rules of Civil Procedure, is not to
implead the lower court which rendered the assailed decision.[31]
However, impleading the lower court as respondent in the petition for review on
certiorari does not automatically
mean the dismissal of the appeal but merely authorizes the dismissal of the
petition.[32] Besides, formal defects in
petitions are not uncommon. The Court has encountered previous petitions
for review on certiorari that
erroneously impleaded the CA. In those cases, the Court merely called the
petitioners’ attention to the defects and proceeded to resolve the case on
their merits.[33]
The Court finds no reason
why it should not afford the same liberal treatment in this case. While unquestionably,
the Court has the discretion to dismiss the appeal for being defective, sound
policy dictates that it is far better to dispose of cases on the merits, rather
than on technicality as the latter approach may result in injustice.[34]
This is in accordance with Section 6, Rule 1 of the 1997 Rules of Civil
Procedure[35]
which encourages a reading of the procedural requirements in a manner that will
help secure and not defeat justice.[36]
As to respondent’s claim
that the petition lacks verification, a certification against forum shopping
and a copy of the assailed CA decision, the Court has carefully examined the rollo of the case and found them to be
attached to the petition.[37]
Anent respondent’s submission
that the petition failed to raise a question of law, the Court disagrees. For a question to be one of law, it
must not involve an examination of the probative value of the evidence
presented by the litigants or any of them.[38]
Petitioners’ contention that they were denied substantive due process is a pure
question of law.[39]
As a rule, the grant or
denial of a motion for postponement is addressed to the sound discretion of the
court, which should always be predicated on the consideration that more than
the mere convenience of the courts or of the parties in the case, the ends of
justice and fairness should be served thereby. After all, postponements and continuances are part and parcel of
our procedural system of dispensing justice.”[40]
When no substantial rights are affected and the intention to delay is not
manifest with the corresponding motion to transfer the hearing having been
filed accordingly, it is sound judicial discretion to allow the same to the end
that the merits of the case may be fully ventilated.[41] Thus,
in considering motions for postponements, two things must be borne in mind: (1)
the reason for the postponement, and (2) the merits of the case of the movant.[42] Unless
grave abuse of discretion is shown, such discretion will not be interfered with
either by mandamus or appeal.[43]
In the present case, there are
circumstances that justify postponement of the
It cannot be disputed that the case
has been pending since
The Court
is as aware as anyone of the need for the speedy disposition of cases. However, it must be emphasized that speed alone is not the chief
objective of a trial. It is the careful
and deliberate consideration for the administration of justice, a genuine
respect for the rights of all parties and the requirements of procedural due
process, and an adherence to this Court’s standing admonition that the
disposition of cases should always be predicated on the consideration that more
than the mere convenience of the courts and of the parties in the case, the ends of justice and fairness would be
served thereby. These are more
important than a race to end the trial.[50] Indeed, court litigations are primarily for
the search for truth, and a liberal interpretation of the rules by which both
parties are given the fullest opportunity to adduce proofs is the best way to
ferret out such truth.[51]
Ironically, the precipitate action of
the RTC prolonged the litigation and unnecessarily delayed the case, in the
process, causing the very evil it apparently sought to avoid. Instead of
unclogging dockets, it has actually increased the workload of the justice
system as a whole. Such action does not inspire public confidence in the
administration of justice.
Moreover, it is noted
that petitioners filed a third-party complaint which the RTC simply disregarded.
On the other hand, the CA, while stating in its Decision that “[a]ll thus told,
we find no reversible error in the judgment of the trial court, except that it
failed to dispose of the third-party complaint,”[52] it simply proceeded to dismiss
the third-party complaint in the dispositive portion of herein assailed
decision, without giving any reason or justification therefor.
As to the effect of
petitioners’ admission of the due execution of the real estate mortgage during
the pre-trial conference, it must be noted that in Benguet Exploration, Inc. v. Court of Appeals,[53] this Court
ruled that the admission of the genuineness and due execution of a document simply
means that the party whose signature it bears admits that he voluntarily signed
the document or it was signed by another for him and with his authority; that
at the time it was signed it was in words and figures exactly as set out in the
pleading of the party relying upon it; that the document was delivered; and
that any formalities required by law, such as a seal, an acknowledgment, or
revenue stamp, which it lacks, are waived by him. However, it does not preclude
a party from arguing against it by evidence of fraud, mistake, compromise,
payment, statute of limitations, estoppel and want of
consideration. Petitioners therefore are not barred from presenting evidence
regarding their claim of want of consideration.
It bears stressing that the matter of absence
of consideration and alleged fraudulent scheme perpetuated by third-party defendants,
being evidentiary, should be threshed out in a proper trial. To deny
petitioners their right to present evidence constitutes a denial of due
process, since there are issues that cannot be decided without a trial of the
case on the merits.
Ordinarily,
when there is sufficient evidence before the Court to enable it to resolve the
fundamental issues, the Court will dispense with the regular procedure of
remanding the case to the lower court, in order to avoid further delays in the
resolution of the case.[54] However, a remand in
this case, while time-consuming, is necessary, because the proceedings had in
the RTC are grossly inadequate to settle factual issues. Petitioners were unduly
deprived of the full opportunity to present evidence on the merits of their defense
and third-party complaint.
Considering
the foregoing, the Court need not delve on the other issues raised by
petitioners. Suffice it to say that such
matters are best decided by the RTC only after full reception of petitioners’
evidence.
WHEREFORE, the present
petition is GRANTED. The assailed
Decision dated May 23, 2001 of the Court of Appeals and the Decision dated July
31, 1998 of the Regional Trial Court, Branch 65, Tarlac City in Civil Case No.
7384, are REVERSED and SET ASIDE.
The case is REMANDED to the said Regional Trial Court for
reception of petitioners’ evidence and further proceedings.
No pronouncement as to
costs.
SO
ORDERED.
MA. ALICIA AUSTRIA-MARTINEZ
Associate
Justice
WE CONCUR:
ARTEMIO
V. PANGANIBAN
Chief Justice
Chairperson
CONSUELO YNARES-SANTIAGO ROMEO J. CALLEJO, SR.
Associate Justice Associate Justice
MINITA
V. CHICO-NAZARIO
Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution,
it is hereby certified that the conclusions in the above Decision were reached
in consultation before the case was assigned to the writer of the opinion of
the Court’s Division.
ARTEMIO
V. PANGANIBAN
Chief Justice
[1] Penned by Associate Justice Delilah Vidallon-Magtolis (now retired) and concurred in by Associate Justices Teodoro P. Regino (now retired) and Josefina Guevara-Salonga.
[2] Records, p. 4.
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17]
[18] Stated in the Order as “Angel”, id. at 196.
[19]
[20]
[21]
[22]
[23]
[24]
[25]
[26]
[27] CA rollo, p. 52.
[28]
[29] Rollo, p. 11.
[30] Should be Article 91.
[31] SEC. 4. Contents of petition. – The petition shall be filed in eighteen (18) copies, with the original copy intended for the court being indicated as such by the petitioner; and shall (a) state the full name of the appealing party as the petitioner and the adverse party as respondent, without impleading the lower courts or judges thereof either as petitioners or respondents; x x x (Emphasis supplied)
[32] SEC. 5. Dismissal or denial of petition. – The failure of the petitioner to comply with any of the foregoing requirements regarding the payment of the docket and other lawful fees, deposit for costs, proof of service of the petition, and the contents of and the documents which should accompany the petition shall be sufficient ground for the dismissal thereof. x x x (Emphasis supplied)
[33] Bejoc v. Cabreros, G.R. No. 145849, July 22, 2005, 464 SCRA 78, 80; Miguel v. JCT Group, Inc., G.R. No. 157752, March 16, 2005, 453 SCRA 529, 531; Villamor v. National Power Corporation, G.R. No. 146735, October 25, 2004, 441 SCRA 329, 330; Payongayong v. Court of Appeals, G.R. No. 144576, May 28, 2004, 430 SCRA 210, 212; Asia Traders Insurance Corporation v. Court of Appeals, G.R. No. 152537, February 16, 2004, 423 SCRA 114, 118; Hanil Development Co., Ltd. v. Court of Appeals and M.R. Escobar Explosive Engineers, Inc. v. Court of Appeals, 414 Phil. 267, 273 (2001).
[34] Gutierrez v. Cabrera, G.R. No. 154064, February 28, 2005, 452 SCRA 521, 529; Armed Forces of the Philippines Mutual Benefit Association, Inc. v. Court of Appeals, 370 Phil. 150, 166 (1999).
[35] SEC. 6. Construction. – These Rules shall be liberally construed in order to promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding.
[36] Gutierrez
v. Cabrera, supra note 34, at 529-530; Paras v.
Baldado, G.R. No. 140713,
[37] Rollo, p. 17 (Verification and Certification), p. 53 (CA Decision).
[38] Microsoft Corporation v. Maxicorp, Inc., G.R. No. 140946, September 13, 2004, 438 SCRA 224, 232; Manila Bay Club Corp. v. Court of Appeals, 315 Phil. 805, 820 (1995).
[39] See Autencio v. Mañara, G.R. No. 152752,
[40] People v. Leviste, 325 Phil. 525, 534
(1996); De Guia
v. Guerrero, Jr., A.M. No. RTJ-93-1099,
[41] People
v. Leviste, supra.
[42] De Guzman v. Elbinias, G.R.
No. 57395,
[43] People
v. Leviste, supra note 40; Intestate
Estate of the Late Ricardo P. Presbitero, Sr. v.
Court of Appeals, G.R. No. 102432, January 21, 1993, 217 SCRA 372, 381; Garces v. Valenzuela, G.R. No. 55226, February
28, 1989, 170 SCRA 745, 749.
[44] Records, pp. 197, 201.
[45]
[46]
[47]
[48]
[49]
[50] Habana v. National Labor Relations Commission, 372 Phil. 873, 881 (1999);
Reyes v. Court of Appeals, 335 Phil.
206, 217 (1997); De Guzman v. Elbinias,
supra note 42, at 245; Amberti v. Court of Appeals, G.R No.
L-41808,
[51] Acance
v. Court of Appeals, G.R. No. 159699,
[52] CA rollo, p. 64.
[53] G.R. No. 117434,
[54] National Commercial Bank of Saudi
Arabia v. Court of Appeals, G.R. No. 124267,