SECOND DIVISION
|
SPOUSES AZUCENA B. CORPUZ AND RENATO S. CORPUZ, Petitioners, - versus - CITIBANK,
N.A. AND HON. RAUL B. VILLANUEVA as Presiding Judge of Branch 255, Regional
Trial Court in Las Respondents. x- - - - - - - - - - - - - - - - - - - - - - - - - x CITIBANK, N.A., Petitioner, - versus - SPOUSES AZUCENA B. CORPUZ AND RENATO S. CORPUZ,
Respondents. |
G.R. No. 175677
Present: QUISUMBING, J., Chairperson, CARPIO MORALES, CHICO-NAZARIO, LEONARDO-DE CASTRO, and PERALTA,* JJ.
G.R. No. 177133
Promulgated: July
31, 2009 |
x - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
D E C I S I O N
CARPIO MORALES, J.:
The facts which spawned the filing of
the present consolidated petitions are as follows:
Azucena Corpuz (Azucena) was a
cardholder of Citibank Mastercard No. 5423-3925-5788-2007 and Citibank VISA
Card No. 4539-7105-2572-2001 both issued by Citibank, N.A. (Citibank). Each card had a credit limit of P40,000.00. In view of her then impending official
business trip to Europe, Azucena paid in full on December 7, 1998 her monthly
charges[1] on
both credit cards via checks and also made advance check payments
of P20,000.00 on December 8, 1998 for her VISA Card, and another P20,000.00
for her Mastercard on December 14, 1998, to cover future transactions.[2]
While in
Informed of the incidents via
overseas telephone calls to
Upon her return to the country,
Azucena wrote Citibank on P3,175.00 at the time.[5] Citibank did not respond to the letter, however,
drawing Azucena to write Citibank for the cancellation of the cards.[6]
Citibank still sent billing
statements to Azucena, however, charging her interest charges and late payment
penalties.[7] Only after Azucena’s counsel informed
Citibank of imminent legal remedies[8] on
her part did Citibank indulge Azucena with a written explanation why her credit
cards were not honored in
Azucena and Renato (hereafter the spouses)
later filed on
To the Complaint, Citibank filed a
motion to dismiss for improper venue.[10] The spouses opposed the motion and moved to
have Citibank declared in default.[11] Branch 255 of the RTC, by Order of September
28, 2000, denied the motion to dismiss as well as the motion to declare Citibank
in default.[12]
Citibank thus filed its Answer with Compulsory
Counterclaim.[13] After an exchange of pleadings ─ reply,
rejoinder and sur-rejoinder ─ by the parties, and the issues having been joined,
the trial court set the case for pre-trial conference[14] on
May 5, 2003 during which the spouses and their counsel failed to appear,
despite notice. On Citibank’s counsel’s
motion, the trial court, by Order[15]
of even date, dismissed the spouses’ Complaint and directed Citibank to present
evidence on its Compulsory Counterclaim.
The spouses moved for the reconsideration
of the trial court’s
about [the pre-trial] and include the same in his calendar because . . . the
pre-trial was still far away.”
The spouses’ motion for
reconsideration was denied by Order of
The spouses assailed the trial
court’s Order dismissing their Complaint via petition for certiorari before the Court of Appeals, docketed as CA-G.R. SP No. 80095. During
the pendency of this petition or on
Citibank re-filed on
Citibank having failed to present
evidence within 30 days from its receipt[22] on
In the meantime or on
[the spouses] did not come forward with the most persuasive of reasons for the relaxation of the rules. We cannot consider the following excuses to be valid and justifiable: 1) the failure to note down the date of pre-trial was because the date of resetting was three months away; 2) the [spouses’] counsel was beset with heavy case load and conflict of schedule; 3) the instant case was a personal case of [spouses’] counsel and not one of the cases assigned by the office where he worked which was the reason why his secretary failed to calendar the pre-trial; and 4) [spouses], being members of the bar, were also busy with their own cases. (Underscoring supplied)
The spouses and Citibank moved for
reconsideration and partial reconsideration, respectively, of the appellate
court’s
Section 3, Rule 17 provides that if a complaint is dismissed due to the fault of the plaintiff, such dismissal is “without prejudice to the right of the defendant to prosecute his counterclaim in the same or in a separate action. Under this new innovation, the dismissal of the complaint due to the fault of plaintiff does not necessarily carry with it the dismissal of the counterclaim, compulsory or otherwise. In fact, the dismissal of the complaint is without prejudice to the right of defendants to prosecute the counterclaim. In this case, the private respondent bank, after moving that the case against it be dismissed for failure of the petitioners to prosecute, properly moved that it be allowed to present evidence ex-parte on its counterclaim. (Citations omitted; emphasis and underscoring supplied)
The spouses’ motion for
reconsideration of the appellate court’s Resolution of
In the meantime, the appellate court,
by Decision of
By Resolution of
RE G.R. NO. 175677: The spouses assert that their non-appearance
at the pre-trial may be excused if there is a valid cause such as when a party
forgets the date of the pre-trial; that the merits of their case should have
been considered when their Complaint was dismissed; that Sections 4 and 5 of
Rule 18 on pre-trial and Section 3 of Rule 17 on dismissal due to the fault of the
plaintiff provide for different and distinct sanctions, citing Pinga v. Heirs of German Santiago; and
that certiorari was their proper
remedy before the appellate court as the trial court’s order was not in accord
with Section 5 of Rule 18 or even with Section 3 of Rule 17.[28]
The Court denies the spouses’
petition.
Section 5[29]
of Rule 18 provides that the dismissal of an action due to the plaintiff’s
failure to appear at the pre-trial shall be with prejudice, unless otherwise
ordered by the court. In this case, the
trial court deemed the plaintiffs-herein spouses as non-suited and ordered the
dismissal of their Complaint. As the
dismissal was a final order, the proper remedy was to file an ordinary appeal
and not a petition for certiorari. The spouses’ petition for certiorari was thus properly dismissed by
the appellate court.
Procedural infirmities aside, this Court took a considered
look at the spouses’ excuse to justify their non-appearance at the pre-trial
but found nothing exceptional to warrant a reversal of the lower courts’ disposition
thereof.
Counsel for the spouses admit having
failed to inform his clients of the scheduled pre-trial because he forgot to
note the same in his calendar and eventually forgot about it due to “heavy
workload.” The spouses eventually admitted
too having received the notice of pre-trial.[30] Azucena, who is a lawyer herself, advanced
the reason that she forgot about the scheduled pre-trial owing to her then
forthcoming retirement at the Office of the Solicitor General to thus press her
to accomplish her assigned work including winding up all administrative matters
in the office prior to her leaving.
While Section 4[31] of Rule 18 of the Rules of Court allows as an
exception a valid cause for the
non-appearance of a party at the pre-trial, the instances cited by the spouses
and their counsel hardly constitute compelling exigencies or situations which
warrant occasional flexibility of litigation rules.
In Quelnan v.
VHF Philippines[32]
where the counsel for the therein petitioner failed to calendar a scheduled
pre-trial in his diary, the Court held that:
The alleged failure of petitioner’s counsel to record the scheduled
pre-trial in his 1997 diary to justify his absence at the pre-trial cannot
amount to excusable negligence. To
constitute excusable negligence, the absence must be due to petitioner’s
counsel’s failure to take the proper steps at the proper time, not in
consequence of his carelessness, inattention or willful disregard of the
process of the court, but in consequence of some unexpected or unavoidable
hindrance or accident. (Underscoring in the original)
Petitioner’s counsel’s failure to record the date of pre-trial in his
1997 diary reflects his carelessness, his failure to heed his responsibility of
not neglecting a legal matter entrusted to him,
especially given the fact that he was given a Special Power of Attorney to
represent petitioner in the pre-trial and trial of the case and that the
repeated resettings of the pre-trial for a period of 1 year and more than 10
months had unduly prolonged the disposition of petitioner’s complaint which was
filed in 1994 yet.
Petitioner’s counsel must know that pre-trial is mandatory. Being
mandatory, the trial court has discretion to declare a party non-suited. Absent a showing of grave abuse in
the trial court’s exercise thereof, as in the case at bar, appellate
courts will not interfere.[33]
(Citations omitted; underscoring and emphasis supplied)
As
for the spouses’ assertion that Section 5 of Rule 18 “does not give the defendant
[Citibank in this case] the alternative remedy of prosecuting its Counterclaim,
whether compulsory or permissive, in the same or separate action because there
is no longer any pending action where he can prosecute his claim,” consideration
thereof has been rendered unnecessary by, as will be dealt with shortly, this
Court’s denial of Citibank’s motion for reconsideration of the dismissal of its
herein petition. Suffice it to state
that the spouses’ view, apparently established in BA Finance v. Co,[34]
had long been abandoned by the Court.
In
the 2006 case of Pinga v. Heirs of German
Santiago,[35] the
Court, after noting the observations of Justice Florenz Regalado in his
separate opinion in BA Finance on
Section 3 of Rule 17 which section, for convenience, is again quoted,[36] viz:
SEC. 3. Dismissal due to fault of plaintiff. – If, for no justifiable cause, the plaintiff fails to appear on the date of the presentation of his evidence in chief on the complaint, or to prosecute his action for an unreasonable length of time, or to comply with these Rules or any order of the court, the complaint may be dismissed upon motion of the defendant or upon the court’s own motion, without prejudice to the right of the defendant to prosecute his counterclaim in the same or in a separate action. This dismissal shall have the effect of an adjudication upon the merits, unless otherwise declared by the court. (Emphasis and underscoring supplied),
explained:
x x x x
Section 3, [of Rule 17] on the other hand, contemplates a dismissal not procured by plaintiff, albeit justified by causes imputable to him and which, in the present case, was petitioner’s failure to appear at the pre-trial. This situation is also covered by Section 3, as extended by judicial interpretation, and is ordered upon motion of defendant or motu proprio by the court. Here, the issue of whether defendant has a pending counterclaim, permissive or compulsory is not of determinative significance. The dismissal of plaintiff’s complaint is evidently a confirmation of the failure of evidence to prove his cause of action outlined therein, hence the dismissal is considered, as a matter of evidence, an adjudication on the merits. This does not, however, mean that there is likewise such an absence of evidence to prove defendant’s counterclaim although the same arises out of the subject matter of the complaint which was merely terminated for lack of proof. To hold otherwise would not only work injustice to defendant but would be reading a further provision into Section 3 and wresting a meaning therefrom although neither exists even by mere implication. x x x x. (Emphasis and italics in the original; underscoring supplied)[37]
Besides, Section 5 of Rule 18 which
is, for convenience, again requoted,[38] provides:
SEC. 5. Effect of failure to appear. ─ The failure of the plaintiff to appear [at the pre-trial] when so required pursuant to the next preceding section shall be cause for dismissal of the action. The dismissal shall be with prejudice, unless otherwise ordered by the court. A similar failure on the part of the defendant shall be cause to allow the plaintiff to present his evidence ex parte and the court to render judgment on the basis thereof.,
must be read in conjunction with the
above-quoted Section 3 of Rule 17.
Thus, in Perkin Elmer Singapore v. Dakila Trading,[39]
the Court, discussing the application of the dictum in Pinga to situations outside of Section 3 of Rule 17, held:
It
is true that the aforesaid declaration of the Court refers to instances covered
by Section 3, Rule 17 of the 1997 Revised Rules of Civil Procedure on dismissal
of the complaint due to fault of the plaintiff.
Nonetheless, it does not also preclude the application of the same to
the instant case just because the dismissal of respondent’s [plaintiff’s] Complaint
was upon the instance of the petitioner[-defendant] who correctly argued lack
of jurisdiction over its person.[40]
As the failure of the spouses to
appear at the pre-trial amounted to a failure to comply with the Rules or any
order of the court, the dismissal of their Complaint was essentially due to
their fault and the therein defendant
Citibank could still prosecute its Counterclaim in the same or in a
separate action.
RE G.R. NO. 177133: As stated early on, this Court, by
Resolution of
The pending petition with the Court of Appeals does not automatically suspend the proceedings in the lower court. Under Section 7, Rule 65 of the 1997 Rules of Civil Procedure it provides that unless a temporary restraining order or writ of preliminary injunction was issued, the proceedings of the principal case is never suspended.
x x x x
Citibank already knew of the denial [by Order
of
Citibank contends that the appellate court issued two
conflicting decisions in CA G.R. SP No. 80095 (the subject of G.R. No. 175677)
and CA G.R. CV No. 86401 (the subject of G.R. No. 177133) where “one ruling hold[s]
that [Citibank] can prosecute its counterclaims and another ruling hold[s] that
it cannot prosecute the same counterclaims;”[42] that the trial court’s order for it to present
evidence on its Counterclaim “did not acquire finality for being an incomplete
order as it failed to provide the period within which the ex parte presentation . . . should be completed;”[43] that
the trial court erred in denying its motion to defer the presentation of
evidence on its Counterclaim for lack of notice of hearing considering that a
hearing on an ex parte motion is not
required;[44] and
that the motion for deferment was filed out of deference to the appellate court
where the spouses’ petition involving the same parties was then still pending.[45]
The Court denies Citibank’s Motion for
Reconsideration.
To be sure, there is no
conflict in the appellate court’s rulings in CA G.R. SP No. 80095 and CA G.R.
CV No. 86401. The appellate court ruled in
CA G.R. SP No. 80095 that Citibank could still prosecute its Counterclaim, while
it ruled in CA G.R. CV No. 86401 that Citibank’s right to present evidence thereon
had lapsed, hence, it denied Citibank’s motion to defer and dismissed its
Counterclaim.
Complementary as they
are, the appellate court’s rulings essentially resolved that Citibank could present
evidence on its Counterclaim but within the 30-day period, as mandated by the
trial court.
The trial court’s Order of September
17, 2003, which reiterated its earlier May 5, 2003 Order, is not an incomplete
order as it is clear that Citibank was “allowed to present its evidence [ex parte] on its counterclaim within the
30-day period provided therein reckoned anew from the date of receipt
hereof.” The Order plainly mentioned the
allowable period when Citibank was to present its evidence. As to when the ex parte presentation of evidence would terminate, the branch clerk
of court, as the commissioner in such a proceeding,[46]
has discretion thereon.
It bears noting that Citibank never
attempted to present even just initial evidence within the 30-day period ordered
by the trial court, despite receipt
of such Order on
It bears noting furthermore that Citibank
did not seek reconsideration of the trial
court’s Order of February 13, 2004 denying its ex parte motion to present evidence, and it was only after more
than five months or on August 4, 2005 when it, again, belatedly filed a motion for reconsideration of the June 30, 2005
Order dismissing its Counterclaim.
As for Citibank’s faulting the trial
court for denying its motion for deferment for lack of notice of hearing, it
does not lie, given that Citibank
re-filed the same motion, this time with the requisite notice of hearing. Clearly, it is estopped from raising this issue.
AT ALL EVENTS, the appellate court was
correct in its finding that the trial court did not commit any reversible error
in proceeding with the case as no restraining order or injunction was issued in
CA G.R. SP No. 80095. Section 7 of Rule
65 of the Rules of Court, as amended, provides that a petition for certiorari shall not interrupt the
course of the principal case unless the public respondent is enjoined from
further proceeding with the case.[47]
WHEREFORE, the
petition for review in G.R. No. 175677
is DENIED for lack of merit.
Petitioner’s motion for
reconsideration in G.R. No. 177133
is DENIED for lack of merit.
Costs against petitioners in both
petitions.
SO ORDERED.
CONCHITA
CARPIO MORALES
Associate Justice
WE CONCUR:
LEONARDO A. QUISUMBING
Associate Justice
Chairperson
|
MINITA V. CHICO-NAZARIO Associate Justice |
TERESITA
J. LEONARDO-DE CASTRO Associate Justice |
DIOSDADO M. PERALTA
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.
LEONARDO
A. QUISUMBING
Associate
Justice
Chairperson
CERTIFICATION
Pursuant to
Section 13, Article VIII of the Constitution, and the Division Chairperson’s
Attestation, I certify 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
* Additional member per Special
Order No. 664 dated
[1] Amounting to P18,288.40 and
P30,402.70 for her Citibank MasterCard and VISA accounts, respectively.
[2] Records, p. 3.
[3] Ibid.
[4]
[5]
[6]
[7]
[8]
[9]
A review of our records shows that on
Posted
purchases after Nov. 15 stmt. -
16,355.45
Pending
transactions* - 1,074.47
TOTAL 35,718.32
Similarly, Ms. Corpuz’s outstanding
balance for her Citibank VISA was P41,041.35 vs. her credit line of
P40,000.00. This was broken down as
follows:
P30,402.70
Posted
purchases after Nov.30 stmt -
9,768.65
Pending
transactions* - 870.00
TOTAL
41,041.35
x x x x
We also noted that Ms. Corpuz made check
payments of P18,288.40 and P30,402.70 last December 7, 1998 for her Citibank
MasterCard and VISA accounts, respectively, but these were not immediately
available due to the 3-working day clearing period. The said payments were only credited to her
account on
x x x x.
[10]
[11]
[12]
[13]
[14] Due to supervening events the
pre-trial conference had been reset on various dates,
[15] Records, p. 237.
[16]
[17]
[18]
[19]
[20]
[21]
[22]
[23]
[24] Rollo (G.R. No. 175677), pp. 43-57; Penned by Associate Justice Mariflor P. Punzalan Castillo with Associate Justices Elvi John S. Asuncion and Noel G. Tijam concurring.
[25]
[26] Rollo (G.R. No. 177133), p. 299.
[27]
[28] Rollo (G.R. No. 175677), pp. 29-30.
[29] SEC. 5. Effect of failure to appear. – The failure of the plaintiff to appear [at the pre-trial] when so required pursuant to the next preceding section shall be cause for dismissal of the action. The dismissal shall be with prejudice, unless otherwise ordered by the court. A similar failure on the part of the defendant shall be cause to allow the plaintiff to present his evidence ex parte and the court to render judgment on the basis thereof.
[30] Vide: records, p. 235.
[31] SEC. 4. Appearance of parties. – It shall be the duty of the parties and their counsel to appear at the pre-trial. The non-appearance of a party may be excused only if a valid cause is shown therefor or if a representative shall appear in his behalf fully authorized in writing to enter into an amicable settlement, to submit to alternative modes of dispute resolution, and to enter into stipulations or admissions of facts and of documents. (Underscoring supplied)
[32] G.R. No. 145911, 433 SCRA 631 (2004).
[33]
[34] G.R. No. 105751, 224 SCRA 163 (1993). In this case, the Court ruled that the dismissal of the complaint for non-appearance of plaintiff at the pre-trial, upon motion of the defendant, carried with it the dismissal of their compulsory counterclaim.
[35] G.R. No. 170354,
[36] Earlier quoted under note 26.
[37]
[38] Earlier quoted in note 30.
[39] G.R. No. 172242,
[40]
[41] Rollo (G.R. No. 177133), pp.45-53; Penned by Associate Justice Juan Q. Enriquez Jr. with Associate Justices Ruben T. Reyes (now a retired Associate Justice of the Court) and Vicente S.E. Veloso concurring.
[42] Rollo (G.R. No. 177133), p. 305.
[43]
[44]
[45]
[46] Section 9 of Rule 31 of the Rules states that: SEC. 9. Judge to receive evidence; delegation to clerk of court. – The judge of the court where the case is pending shall personally receive the evidence to be adduced by the parties. However, in default or ex parte hearings, and in any case where the parties agree in writing, the court may delegate the reception of evidence to its clerk of court who is a member of the bar. The clerk of court shall have no power to rule on objections to any question or to the admission of exhibits, which objections shall be resolved by the court upon submission of his report and the transcripts within ten (10) days from termination of the hearing.
[47] SEC.7. Expediting proceedings; injunctive relief. – x x x
The public respondent shall proceed with the principal case within ten (10) days from the filing of a petition for certiorari with a higher court or tribunal, absent a temporary restraining order or a preliminary injunction, or upon its expiration. Failure of the public respondent to proceed with the principal case may be a ground for an administrative charge.