G.R. No. 153998

Republic of the Philippines

Supreme Court

Manila

SECOND DIVISION

JORGE L. TIANGCO, THE HEIRS OF ENRIQUE L. TIANGCO, GLORIA T. BATUNGBACAL, NARCISO L. TIANGCO and SILVINO L. TIANGCO,

Petitioners,

- versus -

LAND BANK OF THE PHILIPPINES,

Respondent.

G.R. No. 153998

Present:

VELASCO, JR.,*J.,

NACHURA,** J., Acting

Chairperson,

PERALTA,

MENDOZA, and

SERENO,*** JJ.

Promulgated:

October 6, 2010

x-------------------------------------------------------------------------------------x

D E C I S I O N

PERALTA, J.:

Before the Court is a special civil action for certiorari seeking to set aside the Resolutions dated October 5, 2001[1] and June 4, 2002[2] of the Court of Appeals (CA) in CA-G.R. CV No. 61676. The October 5, 2001 Resolution denied petitioners' Motion to Dismiss respondent's appeal, while the June 4, 2002 Resolution denied petitioners' Motion for Reconsideration.

The facts of the case are as follows:

On August 11, 1994, herein petitioners filed a Complaint[3] for “Fixing and Payment of Land Compensation and Annulment of Titles & Emancipation Patents” with the Regional Trial Court (RTC) of Bataan against the Secretary of Agrarian Reform, the Register of Deeds of Bataan and some private individuals, identified as their tenants.

The Complaint was later amended to implead as additional defendant herein respondent, Land Bank of the Philippines (LBP).[4]

Pertinent portions of petitioners' Amended Complaint alleged as follows:

3. Plaintiffs [herein petitioners] are the registered owners of a parcel of land situated at Cupang, Balanga Bataan, with an area of 141,716 square meters, more or less, covered by Transfer Certificate of Title No. T-111310 and declared for tax purposes under Tax Declaration No. 323371. x x x

x x x x

5. Private defendants LAURIANO BAUTISTA, FORTUNATO TOLENTINO, DIONISIO ALONZO, DOMINGO REYES, ALFREDO Q. ESTACAMENTO, BIENVENIDO A. VASQUEZ, JOSE BAUTISTA, MOISES G. QUIROZ and ROGELIO S. BAUTISTA were agricultural tenants on the above-described parcel of land, tilling distinct and separate portions thereof with different areas.

6. x x x, unknown to plaintiffs, Emancipation Patents (EPs) were issued to private defendants by the Secretaries of Agrarian Reform, predecessor in office of defendant SECRETARY OF AGRARIAN REFORM, after which Transfer Certificate of Title were issued to private defendants by defendant Register of Deeds of Bataan, x x x.

7. The issuance of the Emancipation Patents and the Transfer Certificates of Title to private defendants was unlawful because plaintiffs, who are the owners of the land distributed to the tenants by defendant SECRETARY OF AGRARIAN REFORM through his predecessors in office and subsequently titled in their names by defendant REGISTER OF DEEDS OF BATAAN, and who did not consent to the transfer of possession and ownership, have not been compensated for the value of said land. x x x

x x x x

8. As a matter of fact, the reasonable value of plaintiffs' land at which they should be compensated has not even been determined, and until the same is determined and fixed, plaintiffs cannot hope to be compensated, but in the meantime, oppressively against plaintiffs-landowners, private defendants are in possession and do not pay lease rentals to plaintiffs. x x x[5]

In his Answer,[6] the Secretary of the Department of Agrarian Reform (DAR) denied the material allegations in the Amended Complaint and contended that the case should be dismissed for failure of the plaintiffs to exhaust administrative remedy. The DAR Secretary contended that petitioners failed to bring the case before the DAR Adjudication Board (DARAB) which has primary, original and appellate jurisdiction to determine and adjudicate all agrarian disputes involving the implementation of the Comprehensive Agrarian Reform Program.

On the other hand, the private individuals, who were impleaded in their capacity as tenants, contended in their Answer that the Emancipation Patents were regularly issued to them by the DAR after the land has been valued in accordance with laws, rules and regulations then prevailing, and that petitioners, as landowners, have been paid the value thereof through the LBP financing scheme. The tenants further averred that petitioners are already estopped from questioning the value of the land after they failed to challenge it when the property was being valued in accordance with laws and other guidelines.[7]

The LBP also denied the material allegations in the Amended Complaint contending that in cases of land transfer claims covered by Presidential Decree No. 27 and Executive Order No. 228, the government agency which has direct responsibility in valuing lands is the DAR and not the LBP; the reason why petitioners have not yet been paid their claims is because of their refusal to comply with the administrative requirements needed for such payment; and, contrary to petitioners' allegations, they received lease rentals from the farmer-beneficiaries named in the Emancipation Patents.[8]

After due proceedings, the RTC issued its Decision[9] dated June 9, 1998, the dispositive portion of which reads as follows:

WHEREFORE, let the land of the plaintiffs be appraised at Thirty Pesos (P30.00), Philippine Currency, per square meter to be paid to the plaintiffs, without any pronouncement as to costs.

SO ORDERED.[10]

After their Motions for Reconsideration were denied, the LBP, the DAR and the group of tenants filed their respective appeals with the CA by filing Notices of Appeal[11] in accordance with Rule 41 of the Rules of Court.

In a Resolution[12] dated July 13, 1999, the CA dismissed the appeal of the tenants for their failure to pay the docket and other lawful fees. On the other hand, the CA required the LBP and the DAR to file their respective Appeal Briefs.[13]

The LBP and the DAR moved for extension of time to file their Briefs.[14] Their motion was granted.[15]

In its Motion[16] dated May 21, 2001, the LBP again moved for extension of time to file its Brief.

On June 25, 2001, the CA issued a Resolution[17] granting LBP's motion and giving it another extension of twenty days to file its Brief. The CA, in the same Resolution, also noted the Brief which was filed prior to the grant of the said motion.

Thereafter, herein petitioners filed a Motion for Reconsideration[18] of the June 25, 2001 Resolution of the CA contending that the appellate court committed error in granting the said motion, because at the time the LBP filed its motion for extension dated May 21, 2001, the period originally granted by the CA had already expired.

Subsequently, on July 12, 2001, herein petitioners filed a Motion to Dismiss Appeals and to Suspend Period for Filing Appellees' Brief,[19] contending that the LBP's proper mode of appeal should have been a petition for review and not an ordinary appeal, that the LBP failed to serve on petitioners two copies of its Appellant's Brief, and that the LBP failed to seasonably file the said Brief.

On August 14, 2001, the CA issued a Resolution[20] considering the appeal of DAR as abandoned and dismissed the same for the latter's failure to file its Appeal Brief within the extended period granted by the court. In the same Resolution, the LBP was required to file its Comment on petitioners' Motion to Dismiss Appeals. The LBP complied and filed its Comment.[21] Petitioners also filed their Reply.[22]

On October 5, 2001, the CA rendered the presently assailed Resolution[23] denying herein petitioners' Motion to Dismiss the appeal of the LBP.

Petitioners filed their Motion for Reconsideration, but the CA denied it in its Resolution[24] dated June 4, 2002.

Hence, the present petition for certiorari based on the following grounds:

I. THE APPEALED JUDGMENT HAS LONG BECOME FINAL AND EXECUTORY DUE TO RESPONDENT LBP'S FAILURE TO FILE A PETITION FOR REVIEW.

x x x x

II. RESPONDENT LBP FAILED TO SERVE ON PETITIONERS TWO (2) COPIES OF ITS APPELLANT'S BRIEF.

x x x x

III. RESPONDENT LBP MUST BE DEEMED NOT TO HAVE FILED A BRIEF BY ITS FAILURE TO FILE ONE WITHIN THE REGLEMENTARY PERIOD.[25]

Petitioners contend that the proper mode or remedy that should have been taken by the LBP in assailing the Decision of the RTC, acting as a Special Agrarian Court, is a petition for review and not an ordinary appeal.

The Court does not completely agree.

This same issue was squarely addressed and settled by the Court in Land Bank of the Philippines v. De Leon,[26] wherein it was ruled that a petition for review is indeed the correct mode of appeal from decisions of Special Agrarian Courts. Therein, the Court held that “Section 60 of Republic Act No. 6657 clearly and categorically states that the said mode of appeal should be adopted.”

However, in a Resolution[27] issued by the Court en banc, dated March 20, 2003, which ruled on the motion for reconsideration filed by the LBP, the Court clarified that its decision in De Leon shall apply only to cases appealed from the finality of the said Resolution. The Court held:

x x x LBP pleads that the subject Decision should at least be given prospective application considering that more than 60 similar agrarian cases filed by LBP via ordinary appeal before the Court of Appeals are in danger of being dismissed outright on technical grounds on account of our ruling herein. This, according to LBP, will wreak financial havoc not only on LBP as the financial intermediary of the Comprehensive Agrarian Reform Program but also on the national treasury and the already depressed economic condition of our country. Thus, in the interest of fair play, equity and justice, LBP stresses the need for the rules to be relaxed so as to give substantial consideration to the appealed cases.

x x x x

On account of the absence of jurisprudence interpreting Sections 60 and 61 of RA 6657 regarding the proper way to appeal decisions of Special Agrarian Courts, as well as the conflicting decisions of the Court of Appeals thereon, LBP cannot be blamed for availing of the wrong mode. Based on its own interpretation and reliance on [a ruling issued by the CA holding that an ordinary appeal is the proper mode], LBP acted on the mistaken belief that an ordinary appeal is the appropriate manner to question decisions of Special Agrarian Courts.

Hence, in the light of the aforementioned circumstances, we find it proper to emphasize the prospective application of our Decision dated September 10, 2002. A prospective application of our Decision is not only grounded on equity and fair play, but also based on the constitutional tenet that rules of procedure shall not impair substantive rights.

x x x x

We hold that our Decision, declaring a petition for review as the proper mode of appeal from judgments of Special Agrarian Courts, is a rule of procedure which affects substantive rights. If our ruling is given retroactive application, it will prejudice LBP's right to appeal because pending appeals in the Court of Appeals will be dismissed outright on mere technicality thereby sacrificing the substantial merits thereof. It would be unjust to apply a new doctrine to a pending case involving a party who already invoked a contrary view and who acted in good faith thereon prior to the issuance of said doctrine.

x x x x

WHEREFORE, the motion for reconsideration dated October 16, 2002 and the supplement to the motion for reconsideration dated November 11, 2002 are PARTIALLY GRANTED. While we clarify that the Decision of this Court dated September 10, 2002 stands, our ruling therein that a petition for review is the correct mode of appeal from decisions of Special Agrarian Courts shall apply only to cases appealed after the finality of this Resolution.

SO ORDERED.[28]

In the present case, the LBP filed its Notice of Appeal on September 1, 1998. Thus, pursuant to the ruling that De Leon shall be applied prospectively from the finality of this Court’s Resolution dated March 20, 2003, the appeal of the LBP, which was filed prior to that date, could, thus, be positively acted upon.

Petitioners also assert that the LBP's appeal filed with the CA should have been dismissed on the ground that the LBP failed to serve two copies of its Appellant’s Brief to petitioners. Petitioners argue that under Section 7, Rule 44 of the Rules of Court, the appellant is required to serve two copies of his Brief on the appellee and that, in relation with the said Rule, one of the grounds for dismissing an appeal under Section 1(e), Rule 50 of the same Rules is the failure of the appellant to serve and file the required number of copies of his Brief or Memorandum within the time provided by the Rules.

The Court is not persuaded.

Indeed, Section 7,[29] Rule 44 of the Rules of Court requires the appellant to serve two copies of the appellant's brief to the appellee. However, the failure to serve the required number of copies does not automatically result in the dismissal of the appeal. Thus, this Court held in Philippine National Bank v. Philippine Milling Co., Inc.[30] that:

[P]ursuant to Section 1 of Rule 50 of the Rules of Court, “(a)n appeal may be dismissed by the Court of Appeals, on its own motion or on that of the appellee” upon the ground, among others, of “(f)ailure of the appellant x x x to serve and file the required number of copies of his brief,” within the reglementary period. Manifestly, this provision confers a power and does not impose a duty. What is more, it is directory, not mandatory.[31]

The CA has, under the said provision of the Rules of Court, discretion to dismiss or not to dismiss respondent’s appeal. Although said discretion must be a sound one, to be exercised in accordance with the tenets of justice and fair play, having in mind the circumstances obtaining in each case, the presumption is that it has been so exercised.[32] It is incumbent upon herein petitioners, as actors in the case at bar, to offset this presumption. Yet, the records before the Court do not satisfactorily show that the CA has committed grave abuse of discretion in not dismissing the LBP's appeal.

There is no question that the LBP was only able to serve on petitioners one copy of its appellant's brief. However, settled is the rule that a litigant's failure to furnish his opponent with a copy of his appeal brief does not suffice to warrant dismissal of that appeal.[33] In such an instance, all that is needed is for the court to order the litigant to furnish his opponent with a copy of his brief. In the instant case, with much less reason should the LBP's appeal be dismissed, because petitioners were served with the LBP's brief, albeit only one copy was given to them. The Court would be dwelling too much on technicality if the appeal is dismissed simply on the ground that LBP failed to furnish petitioners with two copies, instead of only one, of its appeal brief. Indeed, there is no showing, and the Court finds none in the instant petition, that such procedural lapse on the part of the LBP resulted in material injury to the latter.

Lastly, the Court does not agree with petitioners' contention that the CA committed grave abuse of discretion in not dismissing the LBP's appeal on the ground that the latter failed to file its Appellant's Brief on time.

In The Government of the Kingdom of Belgium v. Court of Appeals,[34] the Court laid down the basic rules with respect to the issue of non-filing of appellant's brief with the CA and its consequences, to wit:

(1) The general rule is for the Court of Appeals to dismiss an appeal when no appellant’s brief is filed within the reglementary period prescribed by the rules;

(2) The power conferred upon the Court of Appeals to dismiss an appeal is discretionary and directory and not ministerial or mandatory;

(3) The failure of an appellant to file his brief within the reglementary period does not have the effect of causing the automatic dismissal of the appeal;

(4) In case of late filing, the appellate court has the power to still allow the appeal; however, for the proper exercise of the court’s leniency it is imperative that:

(a) the circumstances obtaining warrant the court’s liberality;

(b) that strong considerations of equity justify an exception to the procedural rule in the interest of substantial justice;

(d) there is no contention that the appellees’ cause was prejudiced;

(e) at least there is no motion to dismiss filed.

(5) In case of delay, the lapse must be for a reasonable period; and

(6) Inadvertence of counsel cannot be considered as an adequate excuse as to call for the appellate court’s indulgence except:

(a) where the reckless or gross negligence of counsel deprives the client of due process of law;

(b) when application of the rule will result in outright deprivation of the client’s liberty or property; or

In this regard, the Court's pronouncement in Natonton v. Magaway[36] is apropros:

As held by the Court in Gregorio v. Court of Appeals (70 SCRA 546 [1976]), “(T)he expiration of the time to file brief, unlike lateness in filing the notice of appeal, appeal bond or record on appeal is not a jurisdictional matter and may be waived by the parties. Even after the expiration of the time fixed for the filing of the brief, the reviewing court may grant an extension of time, at least where no motion to dismiss has been made. Late filing or service of briefs may be excused where no material injury has been suffered by the appellee by reason of the delay or where there is no contention that the appellee's cause was prejudiced.”

Technically, the Court of Appeals may dismiss an appeal for failure to file appellant's brief on time. However, the dismissal is directory, not mandatory. It is not the ministerial duty of the court to dismiss the appeal. The failure of an appellant to file his brief within the time prescribed does not have the effect of dismissing the appeal automatically. The court has discretion to dismiss or not to dismiss an appellant's appeal. It is a power conferred on the court, not a duty. The discretion must be a sound one, to be exercised in accordance with the tenets of justice and fair play, having in mind the circumstances obtaining in each case.

We observe that petitioners' arguments are based on technical grounds. While indeed respondents did not file their brief seasonably, it was not mandatory on the part of the Court of Appeals to dismiss their appeal. As held by this Court in the above-cited cases, late filing of brief may be excused. In other words, the dismissal of respondents' appeal on that ground is discretionary on the part of the Appellate Court.

Significantly, there is no showing that petitioners suffered a material injury or that their cause was prejudiced when respondents failed to submit their brief promptly. What is clear is that the latter incurred delay in the filing of their brief because when the deadline fell due, they were not yet represented by a new counsel.

The Rules of Court was conceived and promulgated to set forth guidelines in the dispensation of justice, but not to bind and chain the hand that dispenses it, for otherwise, courts will be mere slaves to or robots of technical rules, shorn of judicial discretion. That is precisely why courts, in rendering justice, have always been, as they in fact ought to be, conscientiously guided by the norm that on the balance, technicalities take a backseat to substantive rights, and not the other way around. As applied to the instant case, in the language of then Chief Justice Querube Makalintal, technicalities "should give way to the realities of the situation.” (Emphasis supplied.)[37]

It is true that in the instant case, petitioners filed a motion to dismiss. However, the same was submitted only after the CA had already granted the LBP's motion for extension of time to file its brief and such brief was already filed with the appellate court.

In Aguam v. Court of Appeals,[38] this Court excused a delay of nine (9) days in the filing of a motion for extension of the appellant's brief holding that:

In the higher interest of justice, considering that the delay in filing a motion for extension to file appellant's brief was only for nine (9) days, and normally, the Court of Appeals would routinely grant such extension, and the appellant's brief was actually filed within the period sought, the better course of action for the Court of Appeals was to admit appellant's brief.

Lapses in the literal observance of a rule of procedure will be overlooked when they arose from an honest mistake, when they have not prejudiced the adverse party. The Court can overlook the late filing of the motion for extension, if strict compliance with the rules would mean sacrificing justice to technicality.[39]

Based on the abovequoted ruling, with more reason should the LBP's delay in filing its second motion for extension be excused, because such delay was only for five days. Moreover, the LBP was able to file its Appellant's Brief within the second period of extension granted by the CA.

In the same manner, in Heirs of Victoriana Villagracia v. Equitable Banking Corporation,[40] the petitioners therein failed to file their Appellant's Brief with the CA within the reglementary period. They also failed to file their motion for extension before the expiration of the time sought to be extended. In relaxing the application of the procedural rules and, thus, allowing the appeal to be reinstated, the Court held as follows:

However, in the instant case, we are of the view that the ends of justice will be better served if it is determined on the merits, after full opportunity is given to all parties for ventilation of their causes and defenses, rather than on technicality or some procedural imperfections. It is far better to dispose of the case on the merits, which is a primordial end, rather than on a technicality that may result in injustice. While it is desirable that the Rules of Court be faithfully observed, courts should not be too strict with procedural lapses that do not really impair the proper administration of justice. The rules are intended to ensure the proper and orderly conduct of litigation because of the higher objective they seek, which is the attainment of justice and the protection of substantive rights of the parties.In Republic v. Imperial [362 Phil. 466], the Court, through Mr. Chief Justice Hilario G. Davide, Jr., stressed that the filing of the appellant's brief in appeals is not a jurisdictional requirement. But an appeal may be dismissed by the CA on grounds enumerated under Rule 50 of the Rules of Court. The Court has the power to relax or suspend the rules or to except a case from their operation when compelling reasons so warrant, or when the purpose of justice requires it. What constitutes good and sufficient cause that will merit suspension of the rules is discretionary upon the court.

In the case at bench, without touching on the merits of the case, there appears a good and efficient cause to warrant the suspension of the rules. Petitioners' failure to file the appeal brief within the extended period may have been rendered excusable by force of circumstances. Petitioners had to change their counsel because he was appointed judge of the Municipal Circuit Trial Court. Their new counsel had to go over the six (6) volumes of the records of the case to be able to file an intelligent brief. Thus, a few days of delay in the filing of the motion for extension may be justified. In addition, no material injury was suffered by the appellees by reason of the delay in the filing of the brief.

Dismissal of appeals on purely technical grounds is not encouraged. The rules of procedure ought not to be applied in a very rigid and technical sense, for they have been adopted to help secure, not override, substantial justice. Judicial action must be guided by the principle that a party-litigant should be given the fullest opportunity to establish the merits of his complaint or defense rather than for him to lose life, liberty, honor or property on technicalities. When a rigid application of the rules tends to frustrate rather than promote substantial justice, this Court is empowered to suspend their operation.[41]

In the instant case, the LBP's delay in filing its Appellant's Brief is justified by the fact that the Legal Services Department of the LBP underwent re-organization resulting in the retirement and transfer of the remaining lawyers, cases and personnel from one department to another as well as in the merger and dissolution of other departments within the LBP. In its Manifestation, which petitioners did not dispute, the LBP claimed that by reason of the abovementioned re-organization, the lawyer handling the present case actually received a copy of the Resolution of the CA setting the deadline for the filing of its Appellant's Brief only on May 21, 2001, four days after the expiration of the period granted by the CA. Besides, there is no indication that the LBP intended to delay the proceedings, considering that it only filed two motions for extension to file its brief.

As adverted to by this Court in De Leon, the dismissal of the LBP's appeal, together with the other appeals it had filed, will have a great impact not only on the LBP as the financial intermediary of the Comprehensive Agrarian Reform Program, but also on the national treasury and the already depressed economic condition of our country. In other words, the instant case is impressed with public interest. As such, and in the interest of substantial justice, the Court finds that the same must be decided on the merits.

Based on the foregoing discussions, the Court finds that the CA did not commit grave abuse of discretion in denying petitioners' motion to dismiss respondent LBP's appeal.

WHEREFORE, the instant petition is DISMISSED for lack of merit. The Resolutions of the Court of Appeals, dated October 5, 2001 and June 4, 2002 in CA-G.R. CV No. 61676, are AFFIRMED. The case is REMANDED to the Court of Appeals, which is DIRECTED to continue with the proceedings therein and to terminate the same with reasonable dispatch.

SO ORDERED.

DIOSDADO M. PERALTA

Associate Justice

WE CONCUR:

PRESBITERO J. VELASCO, JR.

Associate Justice

ANTONIO EDUARDO B. NACHURA JOSE CATRAL MENDOZA

Associate Justice Associate Justice

Acting Chairperson

MARIA LOURDES P.A. SERENO

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.

ANTONIO EDUARDO B. NACHURA

Associate Justice

Second Division, Acting Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division Acting 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.

RENATO C. CORONA

Chief Justice

* Designated as an additional member in lieu of Senior Associate Justice Antonio T. Carpio, per Special Order No. 897, dated September 28, 2010.

** Per Special Order No. 898, dated September 28, 2010.

*** Designated as an additional member in lieu of Associate Justice Roberto A. Abad, per Special Order No. 903, dated September 28, 2010.

[1] Penned by Associate Justice Hilarion L. Aquino, with Associate Justices Cancio C. Garcia (a retired member of this Court) and Edgardo P. Cruz, concurring; rollo, pp. 114-118.

[2] Id. at 124-125.

[3] Records, pp. 1-5.

[11] Id. at 345, 347 and 350, respectively.

[14] Id. at 50-51 and 53-54, respectively.

[25] Rollo, pp. 10-14.

[26] 437 Phil. 347, 356 (2002).

[27] Land Bank of the Philippines v. De Leon, 447 Phil. 495 (2003).

[28] Id. at 500-505. (Emphasis supplied)

[29] Sec. 7. Appellant's brief. - It shall be the duty of the appellant to file with the court, within forty-five (45) days from receipt of the notice of the clerk that all the evidence, oral and documentary, are attached to the record, seven (7) copies of his legibly typewritten, mimeographed or printed brief, with proof of service of two (2) copies thereof upon the appellee.

[30] 136 Phil. 212 (1969).

[31] Id. at 215. (Emphasis supplied.)

[32] Yuchengco v. Court of Appeals, G.R. No. 165793, October 27, 2006, 505 SCRA 716, 721, citing Philippine National Bank v. Philippine Milling Co., Inc., supra note 29.

[33] Trinidad Go, etc. v. Vicente Velez Chaves, etc., G.R. No. 182341, April 23, 2010.

[34] G.R. No. 164150, April 14, 2008, 551 SCRA 223.

[36] G.R. No. 147011, March 31, 2006, 486 SCRA 199.

[38] 388 Phil. 587 (2000).

[40] G.R. No. 136972, March 28, 2008, 550 SCRA 60.