LORETA
AGUSTIN CHONG, G.R. No. 148280
also known as LORETA GARCIA
AGUSTIN,
Petitioner, Present:
- versus - Ynares-Santiago, J. (Chairperson),
Austria-Martinez,
Chico-Nazario, and
Nachura, JJ.
THE
HONORABLE COURT OF
APPEALS, SPOUSES
PEDRO and Promulgated:
ROSITA DE GUZMAN and FORTUNE
DEVELOPMENT
CORPORATION,
Respondents.
x
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x
YNARES-SANTIAGO, J.:
This petition for review on
certiorari assails the September 14, 2000 Decision[1] of
the Court of Appeals in CA-G.R. CV No. 47487, which affirmed the August 8, 1994
Decision[2] of
the Regional Trial Court of Manila, Branch 7 in Civil Case No. 89-50138
dismissing petitioner’s complaint, and ordering her to pay P50,000.00 as
moral damages, P10,000.00 as attorney’s fees and costs of the suit, as
well as the May 28, 2001 Resolution which denied petitioner’s motion for
reconsideration.
On
Petitioner alleged that she is the
common-law wife of Augusto Chong; that on
“A parcel of land (Lot 1 Block 4, of
the consolidation-subdivision plan (LRC) Pcs-18730, being a portion of the
consolidation of Lot 4522 and 4524, Parañaque Cadastre, Lots 1 & 2 (LRC)
Psd-169203) L.R.C. Rec. Nos. N-27442, N-27463, N-13960), situated in the Barrio
of San Dionisio, Province of Rizal, containing an area of TWO HUNDRED SIXTY SIX
(266) square meters, more or less.”
She further alleged that by virtue of
a special power of attorney she executed in favor of Augusto, the latter sold
the subject lot to respondent-spouses under the Transfer of Rights and
Assumption of Obligation dated January 30, 1984 allegedly for P80,884.95
which petitioner or Augusto never received, thus, said sale is null and void
for lack of consideration; and that despite repeated demands, respondent-spouses
refused to turn over the possession of the subject lot to petitioner.
Petitioner
likewise denied selling the house constructed on the subject lot to respondent-spouses
for P25,000.00, claiming that she could not have executed the Deed of
Sale because at the time it was allegedly notarized on
Petitioner also claimed that she is
the owner of a house located at 1191 P. Zapanta, Singalong, Manila; that
without her knowledge and consent, respondent-spouses rented said house to
other persons and collected rent; and that despite repeated demands, respondent-spouses
refused to return the possession of the house as well as the rentals collected
therefrom.
Petitioner prayed that the Transfer
of Rights and Assumption of Obligation as well as the Deed of Sale be declared
null and void; that respondent-spouses be ordered to turn over the possession
of the houses and lots in Parañaque and Singalong to petitioner; and that
respondents indemnify her for actual, moral and exemplary damages as well as
attorney’s fees.
Respondent-spouses moved to dismiss[4]
the complaint for failure to state a cause of action but it was denied by the
trial court. On
During the pre-trial, respondent-spouses
orally moved for leave of court to file an amended answer which was granted. On
In their amended answer, respondent-spouses
asserted that the Transfer of Rights and Assumption of Obligation was supported
by sufficient consideration; that they paid P125,000.00, and not P25,000.00
as alleged by petitioner, for the house on the subject lot; that the Deed of
Sale over the house constructed on the subject lot was signed by petitioner on
February 22, 1987 while she was still in the country but it was notarized only
on February 24, 1987 or after she had left to work abroad; that petitioner failed
to allege or submit any actionable document to prove her claim of ownership;
that the house located in Singalong is owned by respondent-spouses; and that petitioner’s
complaint is malicious and baseless which entitles them to actual, moral,
exemplary and nominal damages, as well as attorney’s fees.
After trial on the merits, the trial
court rendered a Decision finding thus:
The
Court is convinced that the document entitled Transfer of Rights and Assumption
of Obligation is sufficiently supported by valuable consideration. The evidence
presented by the [respondent-spouses] has shown that for the house and lot
[respondent-spouses] paid almost P480,000.00 and this definitely is more
than sufficient compensation for the house and lot in question. The Court
believes, considering the evidence on record, that [petitioner] on P25,000.00 from Pedro de Guzman before she left for Hongkong.
Unfortunately, the document was not notarized on that day but two days
thereafter. The Court also believes that it was the [respondent- spouses] who
paid the sum of P105,000.00, the obligation of Augusto Chong and [petitioner]
to Rosario Cabelin and as a consequence, all the documents pertaining thereto
were given to the [respondent-spouses] by Rosario Cabelin. The Court also notes
that [petitioner] and Augusto Chong could not even agree as to who was indebted
to Rosario Cabelin. [Petitioner] tried to deny that she was indebted to Rosario
Cabelin while Augusto Chong claimed that it was [petitioner] who was indebted
to
The
Court, therefore, considering those inconsistencies of the [petitioner] and her
paramour refuses to believe their testimonies.
On
the other hand, the Court finds the testimony of [respondent Pedro de Guzman]
and his witnesses to be believable and consistent with the evidence received by
it.
It
is clear from the aforementioned discussion that [petitioner] has failed to
prove by a preponderance of evidence her causes of action against
[respondents]. On the other hand, [respondents] have shown the baselessness of
the complaint filed by [petitioner].
WHEREFORE,
premises considered, judgment is rendered for [respondents] by dismissing the
complaint and sentencing [petitioner] to pay the [respondents] P50,000.00
as moral damages plus P10,000.00 as attorney’s fees, plus costs of suit.[9]
Petitioner appealed to the Court of
Appeals which rendered the assailed Decision affirming in toto the decision of the trial court.
Hence, the instant petition.
Petitioner raises four issues, to
wit: (1) whether the trial court erred in admitting respondent-spouses’ amended
answer in violation of Section 3, Rule 10 of the Rules of Court, (2) whether
petitioner was deprived of due process when during the pre-trial, respondent-spouses
failed and refused to furnish her copies of the documents that they intended to
present, in violation of Section 6, Rule 18 of the Rules of Court, (3) whether
the trial court erred in not finding that the Transfer of Rights and Assumption
of Obligation dated January 30, 1984 was void or, in the alternative, unenforceable
as against petitioner.
Petitioner claims that the trial
court erred in granting respondent-spouses’ oral manifestation or motion for
leave to file an amended answer. She argues that respondent-spouses should have
filed a written motion for leave to file an amended answer, pursuant to Section
3,[10] Rule
10 of the Rules of Court. She argues
that the purpose of the rule is to help the trial court determine whether the proposed
amendments constitute substantial amendments to their original answer and whether
the motion is intended to delay the proceedings, as well as to give the adverse
party an opportunity to be heard.
The contention lacks merit.
The trial court allowed respondent-spouses
to amend their answer after it observed that their original answer merely
contained specific denials without clearly setting forth, as far as practicable,
the truth of the matter upon which they rely to support such denial as required
under Section 10,[11]
Rule 8 of the Rules of Court. Further,
after denying the material allegations in the Complaint, respondent-spouses merely
stated in their original answer that “[a]ll other arguments embodied in [their
prior] motion to dismiss are reiterated as part of the special and affirmative
defenses herein.”[12] Under these conditions, the trial court justifiably
deemed it necessary for respondent-spouses to amend their answer in order to
sufficiently clarify the issues to be tried and thereby expedite the
proceedings. In granting respondent-spouses’
motion to file an amended answer, the trial court acted within its discretion pursuant
to Section 2, Rule 18 of the Rules of Court:
SEC. 2. Nature and purpose. – The pre-trial is mandatory. The court shall consider:
x x
x x
(c) The necessity or desirability of
amendments to the pleadings;
Trial court allowed the filing of an
amended answer to avoid multiplicity of suits, to determine the real
controversies between the parties and to decide the case on the merits without
unnecessary delay, all of which form the bases for the liberality of the rule
in allowing amendments to pleadings.[13] This was in consonance with the basic tenet that
the Rules of Court shall be liberally construed to promote the just, speedy and
inexpensive disposition of every action.[14]
Petitioner next asserts that during
the pre-trial, respondent-spouses did not furnish her with copies of the
documents that they intended to present, in violation of Section 6,[15]
Rule 18 of the Rules of Court. Petitioner
claims that she was denied due process and that the trial court gave respondent-
spouses undue advantage during the trial of this case.
Petitioner’s contention lacks merit.
The records show that respondent-spouses’
Pre-Trial Brief[16] dated
Petitioner’s main contention rests on
the alleged nullity or, in the alternative, unenforceability of the Transfer of
Rights and Assumption of Obligation dated
We agree with the findings of the lower
courts that the parties voluntarily executed the Transfer of Rights and
Assumption of Obligation dated P55,000.00 to P105,000.00, Augusto, again acting as
petitioner’s attorney-in-fact, executed a Deed of Sale with Right to Repurchase[23]
dated
Sometime in December 1983, P105,000.00 provided petitioner will transfer
her rights over the subject lot to them.
Thus, after respondent-spouses had paid Rosario, Augusto, acting under
the aforementioned Special Power of Attorney, executed a Transfer of Rights and
Assumption of Obligation[25]
dated
Petitioner asserts, however, that the
Transfer of Rights and Assumption of Obligation is null and void because it lacked
valuable consideration. She claims that
she executed the Special Power of Attorney in favor of Augusto with the
understanding that the subsequent transfer of the subject lot to respondent-spouses
would be merely simulated (“kunwarian”).[28] She claims that respondent-spouses and her
nieces enticed her into executing the Special Power of Attorney because Augusto
might sell the subject lot while petitioner is abroad and use the proceeds
thereof to support his children with his legal wife.[29]
Thus, petitioner agreed to execute the Special Power of Attorney in favor of
Augusto for the sole purpose of transferring the subject lot in the name of
respondent-spouses through a simulated sale.
We are not persuaded.
If petitioner believes that Augusto
would appropriate the property during her absence, then she should not have
executed the Special Power of Attorney in his favor authorizing him to dispose of
the subject lot. If it was truly her
intention to prevent Augusto from disposing the subject lot, then she could
have simply retained the rights over the subject lot in her name or directly
transferred the same to the name of respondent- spouses before she left for
Petitioner’s claim that Augusto was
not empowered to dispose of the subject lot in order to pay off an alleged debt
she owed to
Petitioner likewise admitted that
In fine, the evidence on record
sufficiently established that petitioner’s rights over the subject lot were
validly transferred to respondent-spouses in consideration of the latter’s payment
of petitioner’s debts to
Lastly,
petitioner impugns the jurisdiction of the Pasay City RTC in Civil Case No.
1102-P on the ground that it never acquired jurisdiction over her person
because summons were allegedly not properly served on her, and that she never
authorized Augusto to enter into the compromise agreement in said case on her
behalf. According to petitioner, she was in
Petitioner’s contention must likewise
fail.
A judgment based on a compromise
agreement is a judgment on the merits wherein the parties have validly entered
into stipulations and the evidence was duly considered by the trial court that
approved the agreement.[41] It is immediately executory and not appealable
unless set aside on grounds of nullity under Article 2038[42] of
the Civil Code,[43] and has
the effect of a judgment of the court.[44] Further, well-entrenched is the rule that a
party may attack the validity of a final and executory judgment through three
ways:
The first
is by petition for relief from judgment under Rule 38 of the Revised Rules of
Court, when judgment has been taken against the party through fraud, accident,
mistake or excusable negligence, in which case the petition must be filed
within sixty (60) days after the petitioner learns of the judgment, but not
more than six (6) months after such judgment was entered. The second is by direct action to annul and
enjoin the enforcement of the judgment. This remedy presupposes that the
challenged judgment is not void upon its face, but is entirely regular in form,
and the alleged defect is one which is not apparent upon its face or from the
recitals contained in the judgment. x x
x ‘under accepted principles of law and practice, long recognized in American
courts, the proper remedy in such case, after the time for appeal or review has
passed, is for the aggrieved party to bring an action enjoining the judgment,
if not already carried into effect; or if the property has already been
disposed of, he may institute suit to recover it.’ The third is either a direct action, as certiorari,
or by a collateral attack against the challenged judgment
(which is) void upon its face, or that the nullity of the judgment is apparent
by virtue of its own recitals. As aptly
explained by Justice Malcolm in his dissent in Banco Español-Filipino v.
Palanca, supra, ‘A judgment which is void upon its face, and which
requires only an inspection of the judgment roll to demonstrate its want of
vitality is a dead limb upon the judicial tree, which should be lopped off, if
the power so to do exists.’
In the case at bar, the want of
jurisdiction of the Pasay RTC in Civil Case No. 1102-P due to the alleged non-service
of summons has not been established by petitioner. The judgment based on compromise agreement
made therein was likewise not established as being void upon its face. Except for the self-serving allegation that
she was in
Petitioner bewails that the records
of Civil Case No. 1102-P was destroyed due to a fire that gutted the
At
any rate, whether or not petitioner was properly served with summons in Civil
Case No. 1102-P, and that Augusto was not authorized to enter into the
Compromise Agreement dated July 25, 1983 on her behalf, will not affect the
outcome of this case. There is
sufficient evidence on record to establish that petitioner impliedly ratified
the compromise agreement as well as the other documents executed pursuant
thereto. Implied ratification may take
various forms such as by silence or acquiescence; by acts showing approval or
adoption of the contract; or by acceptance and retention of benefits flowing
therefrom.[51]
In the instant case, petitioner claimed
that she learned of the transfer of the subject lot to respondent-spouses as
part of the settlement in the collection suit in May 1985;[52] however,
she did not take steps to immediately assail the alleged unauthorized transfer
of the same. She failed to adequately
explain why she waited four years later or until 1989 to file the subject
complaint to annul the aforesaid documents. More importantly, instead of asserting her
rights over the subject lot after
discovering the alleged fraudulent and unauthorized transfer of the same to
respondent-spouses in May 1985, petitioner subsequently sold the house constructed on the subject lot also
to respondent-spouses on P25,000.00. This act runs counter to the reaction of one
who discovers that his or her property has been fraudulently conveyed in favor
of another. Indubitably, this act only
fortifies the previous finding that petitioner has authorized and consented to,
or, at the very least, ratified the sale of the subject lot to respondent-spouses
to pay off her debts to Rosario.
Petitioner alleges that the Deed of
Sale[53] dated
The trial court and the Court of
Appeals found otherwise. They gave
credence to the claim of respondent Pedro de Guzman that petitioner signed the Deed
of Sale and received the P25,000.00 consideration therefor on P122,000.00 as additional
consideration for the house built on the subject lot. Thereafter, petitioner’s son and sister signed
an Annotation[57] dated
It was established that petitioner
received valuable consideration for the sale of the house on the subject lot. Concededly,
the notarization of the deed was defective as respondent Pedro de Guzman
himself admitted that the deed was notarized only two days after petitioner had
signed the deed and at which time she was already in
Based on the foregoing, we are
satisfied that the sale of the subject lot and the house built thereon was made
for valuable consideration and with the consent of petitioner. Consequently, we affirm the findings of the
lower courts which upheld the validity of the transfer of petitioner’s rights
over the subject lot as well as the sale of the house built thereon in favor of
respondent-spouses.
Anent petitioner’s claim that she is
the owner of another house located at 1191 P. Zapanta, Singalong,
WHEREFORE, the
petition is DENIED. The September 14, 2000 Decision of the Court
of Appeals in CA-G.R. CV No. 47487 which affirmed the August 8, 1994 Decision
of the Regional Court of Manila, Branch 7, in Civil Case No. 89-50138,
dismissing the complaint, and ordering petitioner to pay P50,000.00 as
moral damages, P10,000.00 as attorney’s fees and costs of the suit, and its
May 28, 2001 Resolution denying petitioner’s motion for reconsideration, are AFFIRMED.
Costs against petitioner.
SO ORDERED.
CONSUELO
YNARES-SANTIAGO
Associate Justice
WE
CONCUR:
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
MINITA V. CHICO-NAZARIO ANTONIO
EDUARDO B. NACHURA
Associate Justice Associate Justice
ATTESTATION
I
attest 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.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
CERTIFICATION
Pursuant
to Section 13, Article VIII of the Constitution and the Division Chairperson’s
Attestation, 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.
REYNATO S. PUNO
Chief Justice
[1] Rollo, pp. 18-29. Penned by Associate Justice Conchita Carpio-Morales
(now a member of this Court) and concurred in by Associate Justices Teodoro P.
Regino and Perlita J. Tria Tirona.
[2]
Records, pp. 599-620. Penned by Judge
Enrico A. Lanzanas.
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
SEC. 3. Amendments by leave of court.
– Except as provided in the next preceding section, substantial amendments may
be made only upon leave of court. But such leave may be refused if it appears
to the court that the motion was made with intent to delay. Orders of the court
upon the matters provided in this section shall be made upon motion filed in
court, and after notice to the adverse party, and an opportunity to be heard.
[11]
SEC. 10. Specific denial. – A defendant must specify each material
allegation of fact the truth of which he does not admit and, whenever
practicable, shall set forth the substance of the matters upon which he relies
to support his denial x x x.
[12]
Records, p. 53.
[13] Shaffer v.
[14] Rules Of Court, Rule 1, Section 6.
[15]
SEC. 6. Pre-trial brief. – The
parties shall file with the court and serve on the adverse party, in such
manner as shall ensure their receipt thereof at least three (3) days before the
date of the pre-trial, their respective pre-trial briefs which shall contain,
among others:
x x x x
(d) The
documents or exhibits to be presented, stating the purpose thereof;
[16]
Records, pp. 94-100.
[17]
[18]
[19]
[20]
Exhibit “4”, records, p. 462.
[21]
[22]
Exhibit “5”, records, pp. 463-464.
[23]
Exhibit “3”, id. at 459-461.
[24]
Exhibit “2”, id. at 457-458.
[25]
Exhibit “9”, id. at 475.
[26]
Exhibit “10”, id. at 476.
[27]
Exhibit “13”, id. at 491.
[28]
TSN, October 15, 1990, p. 17.
[29]
[30]
TSN, August 19, 1993, p. 24.
[31]
[32] Nunga v. Viray, 366 Phil. 155, 160
(1999).
[33] Sales v. Court of Appeals, G.R. No.
40145, July 29, 1992, 211 SCRA 858, 865.
[34]
TSN, October 18, 1990, p. 8.
[35]
TSN, November 20, 1990, p. 19.
[36]
TSN, October 18, 1990, p. 24.
[37] TSN,
August 30, 1993, pp. 5, 13.
[38]
Exhibit “17”, records, p. 498.
[39] Shopper’s
Paradise Realty and Development Corp. v. Roque, G.R. No. 148775, January
13, 2004, 419 SCRA 93, 99.
[40] Civil Code, Article 1910 states:
The
principal must comply with all the obligations which the agent may have
contracted within the scope of his authority.
As for any
obligation wherein the agent has exceeded his power, the principal is not bound
except when he ratifies it expressly or tacitly.
[41] Romero v. Tan, G.R. No. 147570, February
27, 2004, 424 SCRA 108, 123.
[42]
The provision reads in part:
Art. 2038.
A compromise in which there is mistake, fraud, violence, intimidation, undue
influence, or falsity of documents, is subject to the provisions of Article
1330 of this Code.
[43] Romero v. Tan, supra note 41.
[44] Lacson, Sr. v. Delgado, 111 Phil. 952, 955
(1961).
[45]
SEC. 16. Residents temporarily out of the
Philippines. – When any action is commenced against a defendant who
ordinarily resides within the
[46]
SEC. 15. Extraterritorial service. –
When the defendant does not reside and is not found in the Philippines, and the
action affects the personal status of the plaintiff or relates to, or the
subject of which is, property within the Philippines, in which the defendant
has or claims a lien or interest, actual or contingent, or in which the relief
demanded consists, wholly or in part, in excluding the defendant from any
interest therein, or the property of the defendant has been attached within the
Philippines, service may, by leave of court, be effected out of the Philippines
by personal service as under Section 6; or by publication in a newspaper of
general circulation in such places and for such time as the court may order, in
which case a copy of the summons and order of the court shall be sent by
registered mail to the last known address of the defendant, or in any other
manner the court may deem sufficient. Any order granting such leave shall
specify a reasonable time, which shall not be less than sixty (60) days after
notice, within which the defendant must answer.
[47] Rollo, p. 158.
[48]
AN ACT TO PROVIDE AN ADEQUATE PROCEDURE FOR THE RECONSTITUTION OF THE RECORDS
OF PENDING JUDICIAL PROCEEDINGS AND BOOKS, DOCUMENTS, AND FILES OF THE OFFICE
OF THE REGISTER OF DEEDS, DESTROYED BY FIRE OR OTHER PUBLIC CALAMITIES, AND FOR
OTHER PURPOSES.
[49]
SEC. 5. Inherent powers of courts. –
Every court shall have power:
x x x x
(h) To
authorize a copy of a lost or destroyed pleading or other paper to be filed and
used instead of the original, and to restore, and supply deficiencies in its
records and proceedings.
[50] Feria v. Court of Appeals, 382 Phil.
412, 425 (2000).
[51] Metropolitan Waterworks and Sewerage System
v. Court of Appeals, 357 Phil. 966, 985-986 (1998).
[52]
TSN, October 21, 1993, p. 14.
[53]
Exhibit “18”, records, pp. 502-503.
[54] Rollo, p. 28.
[55]
TSN, February 19, 1991, p. 5.
[56]
Exhibit “16”, records, p. 497.
[57]
[58]
Section 1 of Public Act No. 2103, otherwise known as the Notarial Law,
provides:
Sec. 1.
(a) The acknowledgment shall be before a notary public or an officer duly
authorized by law of the country to take acknowledgments of instruments or
documents in the place where the act is done. The notary public or the officer
taking the acknowledgment shall certify that the person acknowledging the
instrument or document is known to him and that he is the same person who
executed it, acknowledged that the same is his free act and deed. The
certificate shall be made under the official seal, if he is by law required to
keep a seal, and if not, his certificate shall so state.
[59] Gamido v. New Bilibid Prisons Officials, 312 Phil. 100, 104-105
(1995).
[60]
Art. 1358. The following must appear in a public document:
(1) Acts
and contracts which have for their object the creation, transmission,
modification or extinguishment of real rights over immovable property; sales of
real property or of an interest therein are governed by Articles 1403, No. 2,
and 1405;
[61] Cenido v. Spouses Apacionado, 376 Phil.
801, 818 (1999).
[62] Civil Code, Article 1358 in relation to
Article 1357; Del Castillo v. Escarella,
26 Phil. 409, 414 (1913).
[63] Cenido v.
Spouses Apacionado, supra note 61
at 820-821.
[64]
Records, p. 88.
[65]
[66]
[67] Umpoc v.
Mercado, G.R. No. 158166, January 21, 2005, 449 SCRA 220, 238.