DO-ALL METALS INDUSTRIES, G.R. No. 176339
INC., SPS. DOMINGO LIM and
LELY KUNG LIM,
Petitioners, Present:
CARPIO, J., Chairperson,
- versus - NACHURA,
PERALTA,
BERSAMIN,* and
ABAD, JJ.
SECURITY
BANK CORP.,
TITOLAIDO
E. PAYONGAYONG,
EVYLENE
C. SISON, PHIL.
INDUSTRIAL
SECURITY Promulgated:
AGENCY
CORP. and GIL SILOS,
Respondents. January
10, 2011
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ABAD, J.:
This case is about the propriety of
awarding damages based on claims embodied in the plaintiff’s supplemental
complaint filed without prior payment of the corresponding filing fees.
The Facts and the Case
From 1996 to 1997, Dragon Lady
Industries, Inc., owned by petitioner spouses Domingo Lim and Lely Kung Lim
(the Lims) took out loans from respondent Security Bank Corporation (the Bank)
that totaled P92,454,776.45.
Unable to pay the loans on time, the Lims assigned some of their real
properties to the Bank to secure the same, including a building and the lot on
which it stands (the property), located at M. de Leon St., Santolan, Pasig
City.[1]
In 1998 the Bank offered to lease the
property to the Lims through petitioner Do-All Metals Industries, Inc. (DMI)
primarily for business although the Lims were to use part of the property as
their residence. DMI and the Bank
executed a two-year lease contract from October 1, 1998 to September 30, 2000
but the Bank retained the right to pre-terminate the lease. The contract also provided that, should the
Bank decide to sell the property, DMI shall have the right of first refusal.
On December 3, 1999, before the lease
was up, the Bank gave notice to DMI that it was pre-terminating the lease on
December 31, 1999. Wanting to exercise
its right of first refusal, DMI tried to negotiate with the Bank the terms of
its purchase. DMI offered to pay the
Bank P8 million for the property but the latter rejected the offer,
suggesting P15 million instead.
DMI made a second offer of P10 million but the Bank declined the
same.
While the negotiations were on going,
the Lims claimed that they continued to use the property in their
business. But the Bank posted at the
place private security guards from Philippine Industrial Security Agency
(PISA). The Lims also claimed that on
several occasions in 2000, the guards, on instructions of the Bank
representatives Titolaido Payongayong and Evylene Sison, padlocked the
entrances to the place and barred the Lims as well as DMI’s employees from
entering the property. One of the guards
even pointed his gun at one employee and shots were fired. Because of this, DMI was unable to close
several projects and contracts with prospective clients. Further, the Lims alleged that they were
unable to retrieve assorted furniture, equipment, and personal items left at
the property.
The Lims eventually filed a complaint
with the Regional Trial Court (RTC) of
The Bank denied, on the other hand, that
its guards harassed DMI and the Lims. To
protect its property, the Bank began posting guards at the building even before
it leased the same to DMI. Indeed, this
arrangement benefited both parties. The
Bank alleged that in October of 2000, when the parties could not come to an
agreement regarding the purchase of the property, DMI vacated the same and
peacefully turned over possession to the Bank.
The Bank offered no objection to the
issuance of a TRO since it claimed that it never prevented DMI or its employees
from entering or leaving the building.
For this reason, the RTC directed the Bank to allow DMI and the Lims to
enter the building and get the things they left there. The latter claimed, however, that on entering
the building, they were unable to find the movable properties they left
there. In a supplemental complaint, DMI
and the Lims alleged that the Bank surreptitiously took such properties,
resulting in additional actual damages to them of over P27 million.
The RTC set the pre-trial in the case
for December 4, 2001. On that date,
however, counsel for the Bank moved to reset the proceeding. The court denied the motion and allowed DMI
and the Lims to present their evidence ex parte. The court eventually reconsidered its order
but only after the plaintiffs had already presented their evidence and were
about to rest their case. The RTC
declined to recall the plaintiffs’ witnesses for cross- examination but allowed
the Bank to present its evidence.[3] This prompted the Bank to seek relief from
the Court of Appeals (CA) and eventually from this Court but to no avail.[4]
During its turn at the trial, the
Bank got to present only defendant Payongayong, a bank officer. For repeatedly canceling the hearings and
incurring delays, the RTC declared the Bank to have forfeited its right to
present additional evidence and deemed the case submitted for decision.
On September 30, 2004 the RTC
rendered a decision in favor of DMI and the Lims. It ordered the Bank to pay the plaintiffs P27,974,564.00
as actual damages, P500,000.00 as moral damages, P500,000 as
exemplary damages, and P100,000.00 as attorney’s fees. But the court absolved defendants
Payongayong, Sison, Silos and
The Bank moved for reconsideration of
the decision, questioning among other things the RTC’s authority to grant
damages considering plaintiffs’ failure to pay the filing fees on their
supplemental complaint. The RTC denied
the motion. On appeal to the CA, the
latter found for the Bank, reversed the RTC decision, and dismissed the
complaint as well as the counterclaims.[5] DMI and the Lims filed a motion for
reconsideration but the CA denied the same, hence this petition.
The Issues Presented
The
issues presented in this case are:
1. Whether
or not the RTC acquired jurisdiction to hear and adjudicate plaintiff’s
supplemental complaint against the Bank considering their failure to pay the
filing fees on the amounts of damages they claim in it;
2. Whether
or not the Bank is liable for the intimidation and harassment committed against
DMI and its representatives; and
3. Whether
or not the Bank is liable to DMI and the Lims for the machineries, equipment,
and other properties they allegedly lost after they were barred from the
property.
The Court’s Rulings
One. On the issue of jurisdiction, respondent Bank
argues that plaintiffs’ failure to pay the filing fees on their supplemental
complaint is fatal to their action.
But what the plaintiffs failed to pay
was merely the filing fees for their Supplemental Complaint. The RTC acquired jurisdiction over
plaintiffs’ action from the moment they filed their original complaint
accompanied by the payment of the filing fees due on the same. The plaintiffs’ non-payment of the additional
filing fees due on their additional claims did not divest the RTC of the
jurisdiction it already had over the case.[6]
Two. As to the claim that Bank’s representatives
and retained guards harassed and intimidated DMI’s employees and the Lims, the
RTC found ample proof of such wrongdoings and accordingly awarded damages to
the plaintiffs. But the CA disagreed,
discounting the testimony of the police officers regarding their investigations
of the incidents since such officers were not present when they happened. The CA may be correct in a way but the
plaintiffs presented eyewitnesses who testified out of personal knowledge. The police officers testified merely to point
out that there had been trouble at the place and their investigations yielded
their findings.
The Bank belittles the testimonies of
the petitioners’ witnesses for having been presented ex parte before the clerk of court.
But the ex parte hearing,
having been properly authorized, cannot be assailed as less credible. It was the Bank’s fault that it was unable to
attend the hearing. It cannot profit
from its lack of diligence.
Domingo Lim and some employees of DMI
testified regarding the Bank guards’ unmitigated use of their superior strength
and firepower. Their testimonies were
never refuted. Police Inspector Priscillo
dela Paz testified that he responded to several complaints regarding shooting
incidents at the leased premises and on one occasion, he found Domingo Lim was
locked in the building. When he asked
why Lim had been locked in, a Bank representative told him that they had
instructions to prevent anyone from taking any property out of the
premises. It was only after Dela Paz
talked to the Bank representative that they let Lim out.[7]
Payongayong, the Bank’s sole witness,
denied charges of harassment against the Bank’s representatives and the
guards. But his denial came merely from
reports relayed to him. They were not
based on personal knowledge.
While the lease may have already
lapsed, the Bank had no business harassing and intimidating the Lims and their
employees. The RTC was therefore correct
in adjudging moral damages, exemplary damages, and attorney’s fees against the
Bank for the acts of their representatives and building guards.
Three. As to
the damages that plaintiffs claim under their supplemental complaint, their
stand is that the RTC committed no error in admitting the complaint even if
they had not paid the filing fees due on it since such fees constituted a lien
anyway on the judgment award. But this
after-judgment lien, which implies that payment depends on a successful
execution of the judgment, applies to cases where the filing fees were
incorrectly assessed or paid or where the court has discretion to fix the
amount of the award.[8] None of these circumstances obtain in this
case.
Here, the supplemental complaint
specified from the beginning the actual damages that the plaintiffs sought
against the Bank. Still plaintiffs paid
no filing fees on the same. And, while
petitioners claim that they were willing to pay the additional fees, they gave
no reason for their omission nor offered to pay the same. They merely said that they did not yet pay
the fees because the RTC had not assessed them for it. But a supplemental complaint is like any
complaint and the rule is that the filing fees due on a complaint need to be
paid upon its filing.[9] The rules do not require the court to make
special assessments in cases of supplemental complaints.
To aggravate plaintiffs’ omission,
although the Bank brought up the question of their failure to pay additional
filing fees in its motion for reconsideration, plaintiffs made no effort to
make at least a late payment before the case could be submitted for decision,
assuming of course that the prescription of their action had not then set it
in. Clearly, plaintiffs have no excuse
for their continuous failure to pay the fees they owed the court. Consequently, the trial court should have
treated their Supplemental Complaint as not filed.
Plaintiffs of course point out that
the Bank itself raised the issue of non-payment of additional filing fees only
after the RTC had rendered its decision in the case. The implication is that the Bank should be
deemed to have waived its objection to such omission. But it is not for a party to the case or even
for the trial court to waive the payment of the additional filing fees due on
the supplemental complaint. Only the
Supreme Court can grant exemptions to the payment of the fees due the courts
and these exemptions are embodied in its rules.
Besides, as correctly pointed out by
the CA, plaintiffs had the burden of proving that the movable properties in
question had remained in the premises and that the bank was responsible for
their loss. The only evidence offered to
prove the loss was Domingo Lim’s testimony and some undated and unsigned
inventories. These were self-serving and
uncorroborated.
WHEREFORE, the
Court PARTIALLY GRANTS the petition
and REINSTATES with modification the
decision of the P500,000.00 as moral damages, P500,000.00
as exemplary damages, and P100,000.00 for attorney’s fees. The Court DELETES the award of actual damages of P27,974,564.00.
SO ORDERED.
ROBERTO A. ABAD
Associate Justice
WE
CONCUR:
ANTONIO T. CARPIO
Associate Justice
ANTONIO EDUARDO B. NACHURA
DIOSDADO M. PERALTA
Associate Justice Associate Justice
LUCAS P. BERSAMIN
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 T. CARPIO
Associate Justice
Chairperson, Second Division
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.
RENATO
C. CORONA
Chief Justice
* Designated as additional member in lieu of Associate Justice Jose Catral Mendoza, per raffle dated January 10, 2011.
[1] Covered by Transfer Certificate of Title 79603.
[2] Docketed as Civil Case 68184.
[3] Order of the RTC dated May 10, 2002 and Resolution of the RTC dated August 5, 2002; records, Volume 1, pp. 317-318 and 340-341, respectively.
[4] The appeals were docketed as CA-G.R. SP 73520 and G.R. 161828, respectively.
[5] In the decision of the Court of Appeals dated October 10, 2006 in CA-G.R. CV 85667, penned by Associate Justice Normandie B. Pizarro and concurred in by Associate Justices Amelita G. Tolentino and Jose Catral Mendoza, now a member of this Court; CA rollo, pp. 151-168.
[6] See PNOC Shipping and Transport Corporation v. Court of Appeals, 358 Phil. 38, 62 (1998).
[7] TSN, January 18, 2002, pp. 3-4.
[8] Rules of Court, Rule 141, Section 2 (Fees in Lien).
[9] Section 1 (Payment of Fees) in relation to Section 7 (Fees collectible by the Clerks of Regional Trial Courts for filing an action).