Republic of the
Supreme Court
THIRD DIVISION
|
SPS. MOISES and CLEMENCIA ANDRADA, Petitioners, - versus
- PILHINO SALES CORPORATION, represented by its Branch Manager, JOJO S. SAET, Respondent. |
G.R. No. 156448 Present:
BRION, Acting Chairperson,* BERSAMIN, ABAD,** VILLARAMA, JR., and SERENO, JJ. Promulgated: February 23, 2011 |
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D E C I S I O N
BERSAMIN, J.:
An appeal by petition for review on certiorari under Rule 45 shall raise
only questions of law. Thus, the herein petition for review must fail for
raising a question essentially of fact.
Antecedents
On
P240,863.00, plus interest and incidental charges (Civil
Case No. 20,489-90). Upon Pilhino’s application, the RTC issued a writ of
preliminary attachment, which came to be implemented against a Hino truck and a
Fuso truck both owned by Jose Andrada, Jr. However, the levies on attachment
were lifted after Jose filed a counter-attachment bond.
In due course, the RTC rendered a
decision against Jose Andrada, Jr. and his wife. Pilhino opted to enforce the
writ of execution against the properties of the Andradas instead of claiming against
the counter-attachment bond considering that the premium on the bond had not been
paid. As a result, the sheriff seized the Hino truck and sold it at the ensuing
public auction, with Pilhino as the highest bidder. However, the Hino truck could
not be transferred to Pilhino’s name due to its having been already registered
in the name of petitioner Moises Andrada. It appears that the Hino truck had been
meanwhile sold by Jose Andrada, Jr. to Moises Andrada, which sale was unknown
to Pilhino, and that Moises had mortgaged the truck to BA Finance Corporation
(BA Finance) to secure his own obligation.
BA
Finance sued Moises Andrada for his failure to pay the loan (Civil Case No.
5117). After a decision was rendered in the action in favor of BA Finance, a writ
of execution issued, by which the sheriff levied upon and seized the Hino truck
while it was in the possession of Pilhino and sold it at public auction, with BA
Finance as the highest bidder.
Consequently,
Pilhino instituted this action in the RTC in Davao City against Spouses Jose
Andrada, Jr. and Maxima Andrada, Spouses Moises Andrada and Clemencia Andrada,
Jose Andrada, Sr., BA Finance, Land Transportation Office (in Surallah, South
Cotabato), and the Registrar of Deeds of General Santos City to annul the following:
(a) the deed of sale between Jose
Andrada, Jr. and Moises Andrada; (b) the
chattel mortgage involving the Hino truck between Moises Andrada and BA
Finance; (c) the deed of conveyance executed
by Jose Andrada, Jr. in favor of his father, Jose Andrada, Sr., involving a
hard-top jeep; and (d) the certificate
of registration of the Hino truck in the name of Moises Andrada as well as the
registration of the chattel mortgage with the Registry of Deeds of General
Santos City. The action was docketed as Civil Case No. 21,898-93.
Of
the Andradas who were defendants in Civil Case No. 21,898-93, only Moises
Andrada and his wife filed their responsive pleading. Later on, Jose Andrada,
Jr. and his wife and Pilhino submitted a compromise agreement dated
Moises
Andrada and his wife averred as defenses that they had already acquired the
Hino truck from Jose Andrada, Jr. free from any lien or encumbrance prior to
its seizure by the sheriff pursuant to the writ of execution issued in Civil
Case No. 20,489-90; that their acquisition had been made in good faith,
considering that at the time of the sale the preliminary attachment had already
been lifted; and that Pilhino’s recourse was to proceed against the
counter-attachment bond.
For
its part, BA Finance claimed lack of knowledge of the truth of the material
allegations of the complaint of Pilhino; and insisted that the Hino truck had
been validly mortgaged to it by Moises Andrada, the lawful owner, to secure his
own valid obligation.
On
WHEREFORE, judgment is rendered dismissing this case insofar as the spouses Moises Andrada and Clemencia Andrada, Jose Andrada, Sr. and BA Finance Corporation, now accordingly BA Savings Bank, including the counterclaims.
SO ORDERED.
Spouses
Moises and Clemencia Andrada appealed the decision rendered on March 25, 1998
to the extent that the RTC thereby: (a)
dismissed their counterclaim; (b) declared
that the deed of sale of the Hino truck between Jose Andrada, Jr. and Moises
Andrada had been simulated; and (c) approved
the compromise agreement between Pilhino and Spouses Jose Andrada, Jr. and
Maxima Andrada.
On
WHEREFORE, the judgment appealed from is AFFIRMED with the modification that the sale of the Hino truck by defendant Jose Andrada, Jr. in favor of defendant-appellant Moises Andrada is declared valid, subject to the rights of BA Finance as mortgagee and highest bidder.
SO ORDERED.
Spouses Moises and Clemencia Andrada
are now before the Court via petition
for review on certiorari to pose the
following issues: [3]
1.
Whether or not Pilhino
should be held liable for the damages the petitioners sustained from Pilhino’s
levy on execution upon the Hino truck under Civil Case No. 20,489-90; and
2.
Whether or not Pilhino
was guilty of bad faith when it proceeded with the levy on execution upon the
Hino truck owned by Moises Andrada.
Ruling
We find no merit in the petition for
review.
The
petitioners assail the decision promulgated by the CA to the extent that it
denied their claim for the damages they had sought by way of counterclaim. They
anchored their claim on Article 21 of the Civil
Code, which provides that “any person who willfully causes loss or
injury to another in a manner that is contrary to morals, good customs or
public policy shall compensate the latter for damage.”
Article 21 of the Civil Code, in conjunction with Article
19 of the Civil Code, is part of the
cause of action known in this jurisdiction as “abuse of rights.” The elements of
abuse of rights are: (a) there is a
legal right or duty; (b)
exercised in bad faith; and (c) for
the sole intent of prejudicing or injuring another.[4]
In its assailed decision, the CA
found that Pilhino had acted in good faith in bringing Civil Case No. 21,898-93
to annul the deed of sale involving the Hino truck executed by Jose Andrada,
Jr. in favor of Moises Andrada, considering that Pilhino had “believed that the
sale in favor of defendants-appellants [had been] resorted to so that Jose
Andrada [might] evade his obligations.”[5] The CA concluded that no remedy was available
for any damages that the petitioners sustained from the filing of Civil Case
No. 21,898-93 against them because “the law affords no remedy for such damages
resulting from an act which does not amount to a legal injury or wrong.”[6]
Worthy to note is that the CA’s
finding and conclusion rested on the RTC’s own persuasion that the sale of the
Hino truck to Moises Andrada had been simulated.[7]
Yet, the petitioners still insist in
this appeal that both lower courts erred in their conclusion on the absence of
bad faith on the part of Pilhino.
We cannot side with the petitioners.
Their insistence, which represents their disagreement with the CA’s declaration
that the second and third elements of abuse of rights, supra, were not established, requires the consideration and review of factual issues. Hence,
this appeal cannot succeed, for an appeal by petition for review on certiorari cannot determine factual
issues. In the exercise of its power of review, the Court is not a trier of facts and does not
normally undertake the re-examination of the evidence presented by the
contending parties during the trial. Perforce, the findings of fact by the CA
are conclusive and binding on the Court. This restriction of the review to
questions of law has been institutionalized in Section 1, Rule 45 of the Rules of Court, viz:
Section 1. Filing of petition with Supreme Court. — A party desiring to appeal by certiorari from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition shall raise only questions of law which must be distinctly set forth. (1a, 2a)[8]
It is true that the Court has, at
times, allowed exceptions from the restriction. Among the recognized exceptions
are the following, to wit:[9]
(a) When the
findings are grounded entirely on speculation, surmises, or conjectures;
(b) When the inference made is manifestly
mistaken, absurd, or impossible;
(c) When there is grave abuse of discretion;
(d) When the judgment is based on a
misapprehension of facts;
(e) When the findings of facts are conflicting;
(f) When in making its findings the CA went beyond
the issues of the case, or its findings are contrary to the admissions of both
the appellant and the appellee;
(g) When the
CA’s findings are contrary to those by the trial court;
(h) When the findings are conclusions without
citation of specific evidence on which they are based;
(i) When the facts set forth in the petition as
well as in the petitioner’s main and reply briefs are not disputed by the
respondent;
(j) When the findings of fact are premised on the
supposed absence of evidence and contradicted by the evidence on record; or
(k) When the CA manifestly overlooked certain
relevant facts not disputed by the parties, which, if properly considered,
would justify a different conclusion.
However, the circumstances of this
case do not warrant reversing or modifying the findings of the CA, which are
consistent with the established facts. Verily, the petitioners did not prove the
concurrence of the elements of abuse of rights.
The petitioners further seek
attorney’s fees based on Article 2208 (4) of the Civil Code, which provides that “in the absence of stipulation, attorney’s
fees and expenses of litigation, other than judicial costs, cannot be
recovered, except xxx (4) in cases of clearly
unfounded civil action or proceeding against the plaintiff xxx.”
The petitioners are not entitled to
attorney’s fees.
It is well accepted in this
jurisdiction that no premium should be placed on the right to litigate and that
not every winning party is entitled to an automatic grant of attorney’s fees.[10] Indeed,
before the effectivity of the new Civil
Code, such fees could not be recovered in the absence of a stipulation.[11] It was only with the advent of the
new Civil Code that the right to
collect attorney’s fees in the instances mentioned in Article 2208 was
recognized,[12] and such fees are now included in
the concept of actual damages.[13] One
such instance is where the defendant is guilty of gross and evident bad faith
in refusing to satisfy the plaintiff’s plainly valid, just and demandable
claim.[14] This is a corollary of the general
principle expressed in Article 19 of the Civil
Code that everyone must, in the performance of his duties, observe honesty
and good faith and the rule embodied in Article 1170 that anyone guilty of
fraud (bad faith) in the performance of his obligation shall be liable for
damages.
But, as
noted by the Court in Morales v. Court of
Appeals,[15] the award of attorney’s fees is the
exception rather than the rule. The power of a court to award attorney’s fees
under Article 2208 of the Civil Code
demands factual, legal, and equitable justification; its basis cannot be left
to speculation and conjecture.[16]
The general rule is that attorney’s fees cannot be recovered as part of damages
because of the policy that no premium should be placed on the right to
litigate.[17]
Herein, the element of bad faith on
the part of Pilhino in commencing and prosecuting Civil Case No. 21,898-93,
which was necessary to predicate the lawful grant of attorney’s fees based on
Article 2208 (4) of the Civil Code,
was not established. Accordingly, the petitioners’ demand for attorney’s fees
must fail.
WHEREFORE, we
deny the petition for review on certiorari
for its lack of merit, and affirm the decision of the Court of Appeals.
SO ORDERED.
LUCAS P. BERSAMIN
Associate Justice
WE CONCUR:
ARTURO D. BRION
Associate Justice
Acting Chairperson
ROBERTO A. ABAD MARTIN
S. VILLARAMA, JR.
Associate Justice Associate Justice
MARIA
Associate Justice
A T T E S T A T I O N
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.
ARTURO D. BRION
Associate Justice
Acting Chairperson
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 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
* Acting Chairperson in lieu of Justice
Conchita Carpio Morales who is on leave per Special Order No. 925 dated
** Additional member per Special Order No. 926
dated
[1] Rollo, pp. 32-40.
[2]
[3]
[4] Albenson Enterprises Corp. v. Court of Appeals, G.R. No. 88694, January 11, 1993, 217 SCRA 16, 25.
[5] Rollo, p. 80.
[6] Ibid.
[7]
The evidence adduced by the plaintiff is
convincing that the DEED OF SALE OF A MOTOR VEHICLE (Exh. “K”) executed by Jose
Andrada, Jr. in favor of his brother Moises was simulated to put it beyond the
reach of his creditors, especially the plaintiff, considering that the
purported consideration for the Hino truck was only P50,000.00; and that
only three days after the purported sale, Moises Andrada was able to secure a
loan from the BA Finance in the amount of P235,632.00 by giving the Hino
truck as collateral; and that thereafter, Jose Andrada, Jr. continued to
operate the Hino truck in hauling for Dole Philippines. This finding by this Court
is notwithstanding the Special Power of Attorney executed by Moises Andrada in
favor of Jose Andrada, Jr. and the former’s explanation about his not having
yet an approved franchise from the LTFRB. It is hard to believe that, after
selling the Hino truck to Moises for only P50,000.00 even when it was
being utilized in his hauling business with Dole Philippines, Jose Andrada, Jr.
would agree to continue to operate it in that same business for the benefit of
Moises Andrada, the buyer! Why did he sell it to him for P50,000.00 only
in the first place?
[8] The rule, which has been amended by A.M.
No. 07-7-12-SC, effective
Section 1. Filing of petition with Supreme Court. —A party desiring to appeal by certiorari from a judgment, final order or resolution of the Court of Appeals, the Sandiganbayan, the Court of Tax Appeals, the Regional Trial Court or other courts, whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition may include an application for a writ of preliminary injunction or other provisional remedies and shall raise only questions of law, which must be distinctly set forth. The petitioner may seek the same provisional remedies by verified motion filed in the same action or proceeding at any time during its pendency.
[9] Sampayan v. Court of Appeals, G.R. No. 156360, January 14, 2005, 448 SCRA 220; Insular Life Assurance Company, Ltd. v. Court of Appeals, G.R. No. 126850, April 28, 2004, 428 SCRA 79; Langkaan Realty Development, Inc. v. United Coconut Planters Bank, G.R. No. 139437, December 8, 2000, 347 SCRA 542, 549; Nokom v. National Labor Relations Commission, G.R. No. 140043, July 18, 2000, 336 SCRA 97; Commissioner of Internal Revenue v. Embroidery and Garments Industries (Phil.), Inc., G.R. No. 96262, March 22, 1999, 305 SCRA 70; Sta. Maria v. Court of Appeals, G.R. No. 127549, January 28, 1998, 285 SCRA 351.
[10]
[11] Firestone Tire & Rubber Co. of the Phils. v. Ines Chaves & Co., Ltd., supra.
[12] See Reyes v. Yatco, 100 Phil. 964 (1957); Tan Ti v. Alvear, 26 Phil. 566 (1914); Castueras v. Bayona, 106 Phil. 340.
[13] Fores v. Miranda, 105 Phil. 266 (1959).
[14] Article 2208 (5), Civil Code.
[15] G. R. No. 117228,
[16] Citing Scott
Consultants & Resource Development Corporation v. Court of Appeals,
G.R. No. 112911,
[17] Citing Firestone Tire & Rubber Co. of the Phils. v. Ines Chaves & Co., Ltd., G.R. No. L-17106, October 19, 1966, 18 SCRA 356, 358; Philippine Air Lines v. Miano, G.R. No. 106664, March 8, 1995, 242 SCRA 235, 240.