Republic of the
Supreme Court
THIRD DIVISION
THE INSULAR LIFE ASSURANCE G.R.
NO. 137884
COMPANY, LTD.,
Petitioner,
Present:
AUSTRIA-MARTINEZ, J.,
Acting Chairperson,
- versus - TINGA,*
CHICO-NAZARIO,
NACHURA,
and
REYES,
JJ.
TOYOTA BEL-AIR, INC., Promulgated:
Respondent.
March 28, 2008
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- x
D E C I S I O N
AUSTRIA-MARTINEZ,
J.:
Before the Court is a Petition for
Review on Certiorari under Rule 45 of the Rules of Court, assailing the
Decision[1]
dated September 30, 1998 of the Regional Trial Court (RTC), Branch 148, Makati City in Civil Case No. 98-2075 which nullified the
Writ of Execution dated August 12, 1998 issued by the Metropolitan
Trial Court (MeTC), Branch 63, Makati City in
Civil
Case No. 59089, and the RTC Order[2]
dated
The principal issue raised in the
present petition pertains to the propriety of the decision of the RTC in
declaring as void the writ of execution issued by the MeTC
and in ordering the consignation of rentals.
Being pure questions of law, direct resort to this Court is proper under
Section 2(c), Rule 41 of the Rules of Court.
The factual antecedents of the case
are as follows:
Toyota Bel-Air,
Inc. (
On
WHEREFORE, judgment is hereby
rendered in favor of [Insular Life] and against [
1.
and all persons claiming possession of the premises
through [
2.
to pay reasonable compensation at the rate of P585,640.00
a month until possession of the subject premises is surrendered to the
[Insular Life].
3.
to pay attorney's fees in the sum of P50,000.00;
4.
to pay expenses of litigation in the amount of P20,000.00;
5. to pay the costs of the suit.
SO ORDERED.[6] (Emphasis
supplied).
On
On
WHEREAS,
in a certain action for “EJECTMENT” of the following described premises, to
wit: a parcel of Land and Building located at Pasong Tamo, Makati City under TCT No.
64737 of the Registry of Deeds of Rizal, x x x judgment was rendered on the
3rd day of July,1998 that [Insular Life] and all persons claiming
under him/her/them have restitution of the premises and also that he/she/they
recover the sum of P585,640.00 a month from April 15, 1997 until
possession of the subject premises is surrendered to plaintiff; to recover the
sum of P50,000.00 as and for attorney's fees; P20,000.00 as
expenses of litigation and costs of suit.[12] x
x x (Emphasis supplied)
Subsequently, the Deputy Sheriff of
the MeTC executed the writ by levying on
On P585,640.00 by the inclusion of the phrase “from
On
On
On P585,640.00 as of
On P1,171,280.00 in
favor of Insular Life and to submit the case for decision.[18]
The amount of P1,171,280.00 represented the
reasonable compensation for the months of July and August 1998.
Five days later, or on
discretion in
issuing the Writ of Execution dated August 12, 1998 by giving retroactive
effect to the reasonable compensation judgment of P585,640.00 by
inserting the date “April 15, 1997” which was not provided for in the dispositive portion of the MeTC
Decision; that the clarificatory order issued by the MeTC did not cure the ambiguity in the decision since it
omitted the phrase “a month” as originally stated in the Decision; that
considering the Writ of Execution is void, the
levy effected by the Sheriff is also void; and that consignation of
rentals is proper since Toyota has been in possession of the property since
July 3, 1998.
On
On P585,640.00
a month as of
On
On
I
THE RTC COMMITTED A GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OR IN EXCESS OF ITS JURISDICTION IN VOIDING THE WRIT OF EXECUTION ISSUED BY THE MTC.
i.
THE WRIT OF EXECUTION IS IN HARMONY WITH THE INTENT,
SPIRIT AND TERMS OF THE MTC'S DECISION DATED
ii. THE WRIT OF EXECUTION IS VALID AND ENFORCEABLE.
iii. THE RTC SANCTIONED TBA'S CRAFTY CIRCUMVENTION OF THE RULES.
II
ASSUMING ARGUENDO THAT THE MTC EXCEEDED ITS
JURISDICTION IN ORDERING IN THE WRIT OF EXECUTION THAT THE REASONABLE
COMPENSATION BE COMPUTED FROM
III
THE RTC COMMITTED A GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OR IN EXCESS OF ITS JURISDICTION IN ORDERING IN THE CERTIORARI PROCEEDING A QUO THE CONSIGNATION OF RENTALS.
IV
THE RTC COMMITTED A GRAVE ABUSE OF DISCRETION
TANTAMOUNT TO LACK OR IN EXCESS OF ITS JURISDICTION IN NOT DISMISSING THE
CERTIORARI PETITION A QUO FOR TBA (PETITIONER BELOW) HAD A PLAIN, SPEEDY AND
ADEQUATE REMEDY IN THE COURSE OF LAW AND DID NOT AVAIL OF THE SAME.[25]
Insular Life contends that the case
falls within the recognized exceptions to the rule that only the dispositive portion of the decision controls the execution
of judgment; that the pleadings, findings of fact and conclusion of law
expressed in the text of the MeTC's Decision dated
July 13, 1998 should be resorted to, to clarify the ambiguity in the dispositive portion of the decision; that the intent to
order payment of rent as reasonable compensation from April 15, 1997, when
possession became unlawful, can be inferred from the text of the decision; that
the RTC should not have nullified the entire Writ of Execution since only the
matter of reasonable compensation from April 15, 1997 was at issue; that
consignation of rentals was improper since the office of a writ of certiorari
is to correct defects in jurisdiction solely and the legal requisites for a valid consignation were not present; and
that Toyota failed to resort to available remedies before availing itself of
the extraordinary remedy of certiorari. On the matter of the compromise
agreement, Insular Life reiterated that the agreement was a conditional
compromise agreement which was voided for
Toyota claims that the parties had
entered into a Compromise Agreement dated May 7, 1999 whereby Toyota was obligated to pay Insular Life P8
million under the following terms and conditions: (a) the delivery of 3 Toyota
vehicles worth P1.5 million; (b) the issuance of 12 postdated corporate
checks to answer for the balance of P6.5 million in 12 monthly
installments; and (c) the posting of a surety bond which shall guarantee
payment of installments.[27] Toyota insists that the Compromise Agreement
dated May 7, 1999 should be given effect considering that the preconditions
contained in the Compromise Agreement were complied with, or at the very least
substantially complied with;[28]
and prayed that the case should be remanded to the lower court for the purpose
of approving the Compromise Agreement dated May 7, 1999.[29]
In a Resolution dated
In its Compliance[31]
dated March 24, 2003, the RTC found that Toyota failed to comply with
conditions in the Compromise Agreement dated May 7, 1999 relating to the
issuance of the 12 postdated corporate checks and the posting of a surety bond;
that the postdated checks were not accepted since they were drawn from Toyota's
garnished Metrobank account; that the checks could
have been encashed had Insular Life lifted the
garnishment; that the surety bond was rejected for not having been issued by a
surety company that is among Insular Life's list of acceptable surety
companies; that as substitute collateral, Toyota offered a Bukidnon
real property but Insular Life turned it down since the owner's duplicate of
title could not be found and the property was not owned by Toyota but by three
corporations; that a subsequent
reconstitution of the title and the authorization by the three co-owner
corporations to mortgage the Bukidnon real property
and to use it to stand as security for the postdated checks failed to entice
Insular Life to accept the proposal; and that Toyota acted in good faith in
dealing with Insular Life when it tried to comply with the conditions in the
Compromise Agreement.
By Resolution[32]
dated
In its Supplemental Memorandum,[33]
Insular Life maintains that Toyota failed to comply with the conditions
relating to the postdated checks and the surety bond; that the garnishment of
Toyota's bank accounts was a known fact; that it would have been absolutely
foolhardy for Insular Life to cause the immediate lifting of the garnishment
upon Toyota's mere delivery to it of the postdated checks; that the lifting of the
garnishment is one of the
consequences
once all the conditions of the compromise are met; that Toyota admitted in a
Letter dated May 21, 1999 to Insular Life its inability to comply with the
surety bond requirement; that Toyota's good faith is immaterial; that Toyota
cannot claim substantial compliance since it failed to comply with the
conditions of the Compromise Agreement.
On the other hand, in its Supplemental Memorandum,[34]
Toyota submits that it substantially complied with the terms of the Compromise
Agreement since the compromised amount was reduced from P8 million to P6.5
million upon delivery of the three Toyota vehicles worth P1.5 million;
that it could have complied with the requirement of the delivery of 12
postdated checks had Insular Life lifted the garnishment on Toyota's bank
accounts effected by virtue of the Writ of Execution dated August 12, 1998;
that since the Writ of Execution was voided by the RTC, the garnishment was
also nullified; and that Insular Life's unjustified refusal to give due course
to the postdated checks, by not lifting the garnishment, prevented said checks from being encashed.
It is necessary to resolve the matter involving the efficacy of the
Compromise Agreement between the parties before the merits of the petition can
be discussed.
Jurisprudence teaches us that when a contract is subject to a suspensive condition, its birth or effectivity
can take place only if and when the event which constitutes the condition
happens or is fulfilled,[35]
and if the suspensive condition does not take place,
the parties would stand as if the conditional obligation has never existed.[36]
In this case, the Compromise Agreement clearly stipulates that it shall
become valid and binding only upon the occurrence of all the conditions in the
agreement, to wit:
2. This Agreement when signed by the parties shall take effect and shall become valid and binding only upon the occurrence of all of the following based on a certification or acknowledgment certified and issued by INSULAR LIFE:
2.1 transfer of ownership and delivery of the aforementioned three (3) motor vehicles in favor of INSULAR LIFE in accordance with the provisions of Section 1.1. hereof;
2.2. TBA's execution, issuance and delivery of twelve (12) post-dated TBA corporate checks signed by ROBERT L. YUPANGCO in favor of INSULAR LIFE in accordance with the provisions of this Agreement;
2.3. the
issuance of the Surety Company and delivery of the Bond in the amount of PESOS:
SIX MILLION FIVE HUNDRED THOUSAND (P6,5000,000.00) to and in favor of
INSULAR LIFE under this Agreement.[37]
x x x (Emphasis supplied)
Thus, the issuance of 12 postdated checks and the posting of a surety
bond are positive suspensive conditions of the
Compromise Agreement, the non-compliance with which was not a breach, casual or
serious, but a situation that prevented the obligation under the Compromise
Agreement from acquiring obligatory force.
For its non-fulfillment, there was no contract or agreement to speak of,
Besides, even if Insular Life accepted the postdated checks,
And now on the merits of the petition.
The Court finds the petition impressed with merit for the following
reasons:
First, the RTC
erred in giving due course to
While there are exceptions to the rule, such as where the order
complained of is void for being violative of due
process; or there are special circumstances which warrant immediate and more direct
action; or the lower court has taken an unreasonably long time to resolve the
motions before it and a further delay would prejudice the party concerned; or
the motion will raise the same point which has already been squarely stated
before the court; or the proceeding in which the order occurred is a patent
nullity, as the court acted without jurisdiction, Toyota failed to show that
any of the exceptions apply.
Second, while
the general rule is that the portion of a decision that becomes the subject of
execution is that ordained or decreed in the dispositive
part thereof, there are recognized exceptions to this rule: (a).where there is ambiguity or uncertainty, the body
of the opinion may be referred to for purposes of construing the judgment, because
the dispositive part of a decision must find support
from the decision’s ratio decidendi;[43] and (b).where
extensive and explicit discussion and settlement of the issue is found in the
body of the decision.[44]
Considering the circumstances of the instant case, the Court finds that
the exception to the general rule applies to the instant case. The RTC should
have referred to the body of the decision for purposes of construing the
reasonable compensation judgment, because the dispositive
part of a decision must find support from the decision’s ratio decidendi. Findings of the court
are to be considered in the interpretation of the dispositive
portion of the judgment.[45]
Indeed, to grasp and delve into the true intent and meaning of a
decision, no specific portion thereof should be resorted to - the decision must
be considered in its entirety.[46] The
Court may resort to the pleadings of the parties, its findings of fact and
conclusions of law as expressed in the body of the decision to clarify any
ambiguities caused by any inadvertent omission or mistake in the dispositive portion thereof.[47]
In Reinsurance Company of the
Orient, Inc. v. Court of Appeals,[48] the Court held:
In Republic Surety and Insurance Company, Inc. v. Intermediate Appellate Court, the Court applying the above doctrine said:
x x x We
clarify, in other words, what we did affirm. What is involved here is not what
is ordinarily regarded as a clerical error in the dispositive
part of the decision of the Court of First Instance, which type of error is
perhaps best typified by an error in arithmetical computation. At the same
time, what is involved here is not a correction of an erroneous judgment or dispositive portion of a judgment. What we believe is
involved here is in the nature of an inadvertent omission on the part of the
Court of First Instance (which
should have been noticed by private respondent’s counsel who had prepared the
complaint), of what might be described as a logical follow-through of
something set forth both in the body of the decision and in the dispositive portion thereof: the inevitable follow-through, or translation into, operational or
behavioral terms, of the annulment of the Deed of Sale with Assumption of
Mortgage, from which petitioners’ title or claim of title embodied in TCT
133153 flow.[49]
(Emphasis supplied)
In the present case, the omission of
the award of payment of rental from
The claim of [Toyota] that notice
to vacate was made on them only on December 9, 1997 is belied by Exhibits C, D,
E and F which are attached to the affidavit of Januario
Flores, the Asst. Vice-President of [Insular Life]. These exhibits are letters written by Asst.
Vice-President Flores to Mr. Isidro Laforteza
Vice-President of [
The existence of
Exh. “F” negates that an implied lease was
established between [Insular Life] and [
x x x x
[Toyota], having enjoyed the use
and possession of the leased property over the objection of [Insular Life] x x x [Insular Life] is entitled to
reasonable compensation of Five Hundred Eighty Five Thousand Six Hundred Forty
Pesos (P585,640.00) a month until possession
thereof is returned to [Insular Life] which amount is double the amount of the
last monthly rental paid by [Toyota] to [Insular Life].[50] x
x x (Emphasis supplied).
Third, the RTC erred in granting
The only issue involved in the RTC was whether the writ of execution
issued by the MeTC was issued in excess of
jurisdiction.
The determination of the propriety of consignation as ordered by the RTC is
a factual matter which by the weight of judicial precedents cannot be
inquired
into by the RTC in a petition for certiorari. The sole office of the
writ of certiorari is the correction of errors of jurisdiction including
the commission of grave abuse of discretion amounting to lack or excess of
jurisdiction.
Nevertheless, in the interest of prompt disposition of the present case,
the Court opts to resolve the question whether consignation is proper under the
undisputed circumstances.
Consignation is the act of depositing the thing due with the court or
judicial authorities whenever the creditor cannot accept or refuses to accept
payment and it generally requires a prior tender of payment.[56] In order that consignation may be
effective, the debtor must show that: (1) there was a debt due; (2) the
consignation of the obligation was made because the creditor to whom tender of
payment had been made refused to accept it or was absent or incapacitated, or
because several persons claimed to be entitled to receive the amount due, or
because the title to the obligation was lost; (3) previous notice of the
consignation was given to the person interested in the performance of the
obligation; (4) the amount due was placed at the disposal of the court; and (5)
after the consignation had been made, the person interested was notified
thereof.[57] Failure in any of these requirements
is enough ground to render a consignation ineffective.
In the present case,
Finally, the Court cannot help but call the RTC’s
attention to the prejudice it has wittingly or unwittingly caused Insular Life
by voiding the entire writ of execution when what was assailed was simply the
inclusion of the phrase “from April 15, 1997” in the reasonable compensation
judgment of the MeTC. The order for
The factual milieu of the present case demonstrates eloquently that
Ironically, the precipitate action of the RTC in giving due course to
WHEREFORE, the
petition is hereby GRANTED. The
Decision dated September 30, 1998 and Order dated March 5, 1999 of the Regional
Trial Court, Branch 148, Makati City are REVERSED
and SET ASIDE. The Writ of Execution
dated
Double costs against petitioner.
MA.
ALICIA AUSTRIA-MARTINEZ
Associate
Justice
Acting Chairperson
WE
CONCUR:
DANTE
O. TINGA
Associate Justice
MINITA V.
Associate Justice Associate Justice
RUBEN T. REYES
Associate Justice
ATTESTATION
I
attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
MA.
ALICIA AUSTRIA-MARTINEZ
Associate Justice
Acting Chairperson, Third Division
C
E R T I F I C A T I O N
Pursuant
to Section 13, Article VIII of the Constitution, and the Division Acting Chairperson’s
attestation, it is hereby certified that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer of
the opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
* In lieu of
Justice Consuelo Ynares-Santiago, per Special Order
No. 497, dated
[1] Penned by Judge Oscar B. Pimentel, rollo, p. 215.
[2] Rollo, p. 267.
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17]
[18]
[19]
[20]
[21]
[22]
[23]
[24]
[25]
[26] Memorandum of Petitioner, rollo, p. 351.
[27] Manifestation and Motion, id. at 276-277.
[28] Explanation with Supplemental Memorandum, id. at 412.
[29] Manifestation and Motion, id. at 398.
[30]
[31]
[32]
[33]
[34]
[35] Insular Life Assurance Co., Ltd. v. Young, 424 Phil. 675, 694 (2002); Heirs of Spouses Sandejas v. Lina, 403 Phil. 926, 940 (2001); Mortel v. Kassco, Inc., 401 Phil. 580, 587 (2000); Cheng v. Genato, 360 Phil. 891, 904-905 (1998).
[36] Insular Life Assurance
[37] Rollo, p. 427.
[38] See Sacobia Hills Development Corporation v. Ty, G.R. No. 165889, September 20, 2005, 470 SCRA 395, 403-404; Rayos v. Court of Appeals, G.R. No. 135528, July 14, 2004, 434 SCRA 365, 379; Lacanilao v. Court of Appeals, 330 Phil. 1074, 1080 (1996).
[39] Insular Life Assurance Company,
Ltd. v. Young, supra note 35; Agcaoili
v. Government Service Insurance System, G.R. No. L-30056,
[40] Rules of Court, Rule 65, Sec. 1.
[41] Cochingyan, Jr. v. Judge Cloribel, 167 Phil. 106, 133 (1977).
[42] See Flores v. Sangguniang Panlalawigan of Pampanga, G.R. No. 159022, February 23, 2005, 452 SCRA 278, 282; Metro Transit Organization, Inc. v. Court of Appeals, 440 Phil. 743, 752 (2002).
[43] Ong Ching Kian Chung v.
[44] Ong Ching Kian Chung v. China National Cereals Oil and Foodstuffs Import and Export Corp., supra note 43; Auyong Hian (Hong Whua Hang) v. Court of Tax Appeals, 158 Phil. 123, 135 (1974); Millare v. Millare, 106 Phil. 293, 298-299 (1959).
[45] Ong Ching Kian Chung v. China National Cereals Oil and Foodstuffs Import and Export Corp., supra note 43; Aguirre v. Aguirre, 157 Phil. 449,455 (1974).
[46] Telefunken Semiconductors
Employees
[47] Heirs of Ferry Bayot v. Baterbonia, G.R. No. 142345, August 13, 2004, 436 SCRA 471, 475; Reinsurance Company of the Orient, Inc. v. Court of Appeals, G.R. No. 61250, June 3, 1991, 198 SCRA 19, 29.
[48] Supra note 47.
[49]
[50] MeTC
Decision, rollo, pp.
106-107.
[51] Land Bank of the
[52] Estares v. Court of Appeals, G.R. No. 144755, June 8, 2005, 459 SCRA 604, 621; Almuete v. Andres, 421 Phil. 522, 531 (2001).
[53]
[54] Commissioner of
Internal Revenue v. Court of Appeals, 327 Phil.
1, 41 (1996); Garcia, Jr. v. Ranada, Jr., G.R. No. L-60935,
[55] Commissioner of Internal Revenue v. Court of Appeals, supra note 54; Gold City Integrated Port Services, Inc. v. Intermediate Appellate Court, G.R. Nos. 71771-73, March 31, 1989, 171 SCRA 579, 584.
[56] Banco Filipino Savings and Mortgage Bank v. Diaz, G.R. No. 153134, June 27, 2006, 493 SCRA 248, 262-263; Pabugais v. Sahijwani, 467 Phil. 1111, 1118 (2004); Legaspi v. Court of Appeals, 226 Phil. 24, 29 (1986); Limkako v. Teodoro, 74 Phil. 313 (1943).
[57] Civil Code, Articles 1256-1258; B.E. San Diego, Inc. v. Alzul, G.R. No. 169501, June 8, 2007, 524 SCRA 402, 429-430; Banco Filipino Savings and Mortgage Bank v. Diaz, supra note 56, at 263; Pabugais v. Sahijwani, supra note 56; Soco v. Militante, 208 Phil. 151, 160 (1983); Ponce de Leon v. Santiago Syjuco, Inc., 90 Phil. 311, 317-318 (1951).