ROGELIO ABERCA ET. AL G.R. No.

166216
Petitioners,
- versus -

MAJ. GEN. FABIAN VER ET. AL, Promulgated: March 14, 2012
Respondents.
x -----------------------------------------------------------------------------------------------------x

The Facts

The factual and procedural antecedents were succinctly recited by the CA as

follows:

On 25 January 1983, several suspected subversives who were arrested

and detained by the military filed a complaint for damages with the Regional
Trial Court of Quezon City against Gen. Fabian Ver, then AFP Chief of Staff,
and the other subordinate officers. The case was docketed as Civil Case No.
37487 and assigned to Branch 95.

Defendants-appellants, through their counsel, the then Solicitor

General Estelito Mendoza, filed a motion to dismiss which was granted by the
trial court and ordered the case dismissed in the order dated November 8,
1983.

While the case was pending in the Supreme Court, the so-called EDSA
revolution took place. As a result, the defendants-appellants lost their official
positions and were no longer in their respective office addresses as
appearing in the record. Also, in the meantime, the case was re-raffled to
Branch 107.

On April 15, 1988, the Supreme Court rendered a decision annulling

and setting aside the assailed orders and remanded the case to the trial
court for further proceedings.

However, trial could not proceed immediately because on June 11,

1988, the record of the case was destroyed when fire razed the City
Hall of Quezon City. It was only on October 9, 1989 when plaintiffs-appellees
sought a reconstitution of the record of the case. The said petition for
reconstitution was set for hearing on October 27, 1989. However, there is
nothing in the record to show that defendants-appellants or their counsel
were notified. For lack of an opposition, the petition for reconstitution was
granted in an order dated March 12, 1990.

On August 15, 1990, plaintiffs-appellees filed a motion praying that

defendants-appellants be required to file their answer. Instead of complying
with the order of August 17, 1990, plaintiffs-appellees filed a motion to
declare defendants-appellants in default.

On October 1, 1990, former Solicitor General Mendoza filed a

manifestation informing the trial court that his appearance as defendants-
appellants counsel terminated when he ceased to be Solicitor General and
that he was not representing them in his private capacity. On his part,
Solicitor General Chavez finally filed on December 11, 1990 a notice of
withdrawal of appearance, citing Urbano v. Go, where the Supreme Court
said that the Office of the Solicitor General (OSG) is not authorized to
represent a public official at any stage of a criminal case or in a civil suit for
damages arising from a felony.

In an order dated December 27, 1990, the trial court denied plaintiffs-
appellees motion to declare defendants-appellants in default pointing out
that defendants-appellants were not duly notified of the decision of the
Supreme Court. Plaintiffs-appellees moved to reconsider the order dated
December 27, 1990 but was denied.

For failure of the plaintiffs-appellees to comply with the orders

dated August 17, 1990 and December 27, 1990, the trial court dismissed the
case without prejudice in its order dated March 7, 1991. Subsequently,
however, in an order dated June 4, 1991, the trial court set aside the order of
dismissal and reinstated the case. It also approved plaintiffs-appellees
request to serve the notice to file answer or responsive pleading by
publication.

No answer was filed by defendants-appellants within the period stated

in the notice. On motion of plaintiffs-appellees, the trial court in its order
dated December 5, 1991 declared defendants-appellants in default and
directed plaintiffs-appellees to present their evidence ex-parte. [4]

Ruling of the RTC

On February 19, 1993, the RTC handed down a decision in favor of the
petitioners.

The Ruling of the CA

On July 31, 2003, the CA rendered a decision reversing and setting

aside the RTC decision and ordering the case remanded to the RTC for further
proceedings. The CA ruled that the RTC committed four (4) errors in declaring
the respondents in default and proceeding to hear the case. The RTC
committed its first error when it abandoned the proper modes of service of
notices, orders, resolutions or judgments as the petitioners failed to comply
with its order dated August 17, 1990, directing them to report the addresses
and whereabouts of the respondents so that they could be properly notified.
The second error was the failure of the RTC to avail of substituted service
after failing to effect personal service or service by mail. It perpetrated
its third error when it authorized service by publication after dismissing the
case for failure of the petitioners to furnish the current addresses of the
respondents. The fourth error was committed when the respondents were
declared in default because they were not duly notified and, therefore, were
denied due process.

Not satisfied, the petitioners come to this Court praying for the reversal
and setting aside of the CA decision.

ISSUES:

Whether of not that the Court of Appeals erred in reversing and setting
aside the default judgment rendered by the Regional Trial Court;

Whether of not the Regional Trial Court erred when it authorized

service by publication after dismissing the case for failure of the petitioners
to furnish the current addresses of the respondents;
HELD:
First Issue:

No. The basic question is whether the constitutional right to procedural

due process was properly observed or was unacceptably violated in this case
when the respondents were declared in default for failing to file their answer
within the prescribed period and when the petitioners were allowed to
present their evidence ex-parte.

Section 1, Article III of the 1987 Constitution guarantees that:

No person shall be deprived of life, liberty, or property

without due process of law nor shall any person be denied the
equal protection of the law.

Procedural due process is that which hears before it condemns, which

proceeds upon inquiry and renders judgment only after trial. It contemplates
notice and opportunity to be heard before judgment is rendered affecting
one's person or property.[12]

Moreover, pursuant to the provisions of Section 5(5) of Article VIII of

the 1987 Constitution,[13] the Court adopted and promulgated the following
rules concerning, among others, the protection and enforcement of
constitutional rights, pleading, practice and procedure in all courts:

Rule 13
SEC. 5. Modes of service. Service of pleadings, motions,
notices, orders, judgments and other papers shall be made either
personally or by mail.

SEC. 6. Personal service. Service of the papers may be

made by delivering personally a copy to the party or his counsel,
or by leaving it in his office with his clerk or with a person having
charge thereof. If no person is found in his office, or his office is
not known, or he has no office, then by leaving the copy,
between the hours of eight in the morning and six in the evening,
at the partys or counsels residence, if known, with a person of
sufficient age and discretion then residing therein.

SEC. 7. Service by mail. Service by registered mail shall be

made by depositing the copy in the office, in a sealed envelope,
plainly addressed to the party or his counsel at his office, if
known, otherwise at his residence, if known, with postage fully
prepaid, and with instructions to the postmaster to return the
mail to the sender after ten (10) days if undelivered. If no
registry service is available in the locality of either the sender or
the addressee, service may be done by ordinary mail.

SEC. 8. Substituted service. If service of pleadings,

motions, notices, resolutions, orders and other papers cannot be
made under the two preceding sections, the office and place of
residence of the party or his counsel being unknown, service may
be made by delivering the copy to the clerk of court, with proof
of failure of both personal service and service by mail. The
service is complete at the time of such delivery.
 The above rules, thus, prescribe the modes of service of pleadings,
motions, notices, orders, judgments, and other papers, namely: (1) personal
service; (2) service by mail; and (3) substituted service, in case service
cannot be effected either personally or by mail.

The Rules of Court has been laid down to insure the orderly conduct of
litigation and to protect the substantive rights of all party litigants. It is for
this reason that the basic rules on the modes of service provided under Rule
13 of the Rules of Court have been made mandatory and, hence, should be
strictly followed.

Second Issue:

Yes.

As correctly ruled by the CA:

There is nothing in the Rules that authorizes publication of

a notice of hearing to file answer. What is authorized to be
published are: (1) summons, and (2) final orders and judgments.

The above-quoted provision cannot be used to justify the

trial courts action in authorizing service by publication. Firstly,
what was published was not a final order or judgment but a
simple order or notice to file answer. Secondly, even granting
that the notice to file answer can be served by publication, it is
explicit in the Rule that publication is allowed only if the
defendant-appellant was summoned by publication. The record is
clear that defendants-appellants were not summoned by
publication.

The basic rules on modes of service of pleadings, motions, notices,

orders, judgments, and other papers are mandatory in nature and, therefore,
must be strictly observed. The Court is not unaware of the inherent power of
courts to control its proceedings. Nonetheless, the exercise of such inherent
power must not violate basic court procedures. More importantly, it must not
disregard ones basic constitutional right to procedural due process.

On countless occasions, the Court ruled that, generally, judgments by

default are looked upon with disfavor and are frowned upon as contrary to
public policy. An example here would be the case of Regalado P. Samartino v.
Leonor B. Raon.

As a final point, this Court commiserates with the petitioners plight and
cry for justice. They should not be denied redress of their grievances. The
Court, however, finds Itself unable to grant their plea because the
fundamental law clearly provides that no person shall be deprived of life,
liberty and property without due process of law.

WHEREFORE, the petition is DENIED.

*****************************

G.R. No. 205249 October 15, 2014

SPOUSES BENEDICT and SANDRA MANUEL, Petitioners,
vs.
RAMON ONG, Respondent.

Facts:
Respondent Ramon Ong (Ong) filed with the Regional Trial Court of La
Trinidad, Benguet a complaint for accion reivindicatoria. Ong charged the
Spouses Manuel with having constructed improvements - through force,
intimidation, strategy, threats, and stealth - on a property he supposedly
owned.

Ong filed with the Regional Trial Court a motion to declare the Spouses
Manuel in default. Sheriff Joselito Sales attempted to personally serve
summons on the Spouses Manuel at their address in Lower Bacong, Loacan,
Itogon, Benguet. Spouses Manuel, however, requested that service be made
at another time considering that petitioner Sandra Manuel 's mother was
then critically ill. Sheriff Sales made another attempt at personal service to
petitioner Sandra Manuel but she refused to sign and receive the summons
and the complaint. Sheriff Sales was thus prompted to merely tender the
summons.

As the Spouses Manuel failed to file their answer within the required
15-day period, Ong asked that they be declared in default.

RTC issued an order granting Ong's motion to declare the Spouses

Manuel in default. RTC also granted motion for ex-parte presentation of
evidence. Spouses Manuel filed a motion to lift the order of default. They
claimed that it is the siblings of petitioner Sandra Manuel who resided in
Lower Bacong, Itogon, Benguet so summons could not have been properly
served on them in the former address.
RTC denied the motion to lift order of default.

Issue:
Whether or not the Spouses Manuel may be granted relief from the
order of default.

Held:
No. The requisites for declaring a party in default were satisfied by
respondent Ong.
1. the claiming party must file a motion asking the court to declare the
defending party in default;
2. the defending party must be notified of the motion to declare him in
default;
3. the claiming party must prove that the defending party has failed to
answer within the period provided by the Rule.

It is not disputed that Ong filed a motion to declare the Spouses Manuel in
default. It is also not disputed that the latter filed their answer after the
fifteen-day period had lapsed. It is similarly settled that the Spouses Manuel
were notified that a motion to declare them in default had been filed.

Not only were the requisites for declaring a party in default satisfied, the
Spouses Manuels motion to lift order of default was also shown to be
procedurally infirm. To lift the order of default, there are 3 requirements:
1. the motion to lift order of default;
 2. an affidavit showing the involved ground - fraud, accident, mistake or
excusable negligence;
3. the party's meritorious defense or defenses.

In this case, the Court of Appeals noted that the Spouses Manuels motion
to lift order of default was not made under oath. We add that this motion was
not accompanied by an affidavit of merit specifying the facts which would
show that their non-filing of an answer within fifteen (15) days from March
16, 2010 was due to fraud, accident, mistake, or excusable negligence.

Failing both in making their motion under oath and in attaching an

affidavit of merits, the Spouses Manuels motion to lift order of default must
be deemed pro-forma. It is not even worthy of consideration.

*****************************

G.R. No. 173559 January 7, 2013

LETICIA DIONA, represented by her Attorney-in-Fact, MARCELINA

DIONA, Petitioner,
vs.
ROMEO A. BALANGUE, SONNY A. BALANGUE, REYNALDO A.
BALANGUE, and ESTEBAN A. BALANGUE, JR., Respondents.

Facts:

Respondents Romeo Balangue, Sonny Balangue Reynaldo Balangue

and Esteban Balangue, Jr. obtained a loan from petitioner Leticia Diona
payable in six months and secured by a Real Estate Mortgage 6 over their
202-square meter property located in Marulas, Valenzuela. When the debt
became due, respondents failed to pay notwithstanding demand. Thus,
petitioner filed with the RTC a Complaint.

Respondents were served with summons thru respondent Sonny A.

Balangue. On October 15, 1999, with the assistance of Atty. Arthur C. Coroza
of the Public Attorneys Office, they filed a Motion to Extend Period to Answer.
Despite the requested extension, however, respondents failed to file any
responsive pleadings. Thus, upon motion of the petitioner, the RTC declared
them in default and allowed petitioner to present her evidence ex parte.10

The Regional Trial Court rendered its decision in favor of the petitioner.

Subsequently, petitioner filed a Motion for Execution, 13 alleging that

respondents did not interpose a timely appeal despite receipt by their former
counsel of the RTCs Decision. Before it could be resolved, however,
respondents filed a Motion to Set Aside Judgment claiming that not all of
them were duly served with summons. According to the other respondents,
they had no knowledge of the case because their co-respondent Sonny did
not inform them about it. They prayed that the RTCs Decision be set aside
and a new trial be conducted.

The RTC ordered the issuance of a Writ of Execution to implement its

Decision in favor of the petitioners. However, since the writ could not be
satisfied, petitioner moved for the public auction of the mortgaged property,
which the RTC granted.

Respondents then filed a Motion to Correct/Amend Judgment and To

Set Aside Execution Sale, claiming that the parties did not agree in writing on
any rate of interest and that petitioner merely sought for a 12% per annum
interest in her Complaint. Surprisingly, the RTC awarded 5% monthly interest
(or 60% per annum) from March 2, 1991 until full payment. Resultantly, their
indebtedness inclusive of the exorbitant interest from March 2, 1991 to May
22, 2001 ballooned from P124,400.00 to P652,000.00.

In an Order, the RTC granted respondents motion and accordingly

modified the interest rate awarded from 5% monthly to 12% per annum.
Then on August 2, 2002, respondents filed a Motion for Leave To
Deposit/Consign Judgment Obligation21 in the total amount of P126,650.00.22

Displeased with the RTCs May 7, 2002 Order, petitioner elevated the
matter to the CA via a Petition for Certiorari 23under Rule 65 of the Rules of
Court. On August 5, 2003, the CA rendered a Decision 24 declaring that the
RTC exceeded its jurisdiction in awarding the 5% monthly interest but at the
same time pronouncing that the RTC gravely abused its discretion in
subsequently reducing the rate of interest to 12% per annum. Petitioner
sought reconsideration, which was denied by the CA in its June 26, 2006
Resolution.29

Issue:

Whether or not the Regional Trial Court is correct in declaring

respondents in default.

Held:

No. It is understandable for the respondents not to contest the default

order for, as alleged in their Comment, "it is not their intention to impugn or
run away from their just and valid obligation." 45 Nonetheless, their waiver to
present evidence should never be construed as waiver to contest patently
erroneous award which already transgresses their right to due process, as
well as applicable jurisprudence.

Respondents former counsel was grossly negligent in handling the

case of his clients; respondents did not lose ordinary remedies of new trial,
petition for relief, etc. through their own fault.

Ordinarily, the mistake, negligence or lack of competence of counsel

binds the client.1wphi1 This is based on the rule that any act performed by
a counsel within the scope of his general or implied authority is regarded as
an act of his client. A recognized exception to the rule is when the lawyers
were grossly negligent in their duty to maintain their clients cause and such
amounted to a deprivation of their clients property without due process of
law.46 In which case, the courts must step in and accord relief to a client who
suffered thereby.47

The manifest indifference of respondents former counsel in handling

the cause of his client was already present even from the beginning. It
should be recalled that after filing in behalf of his clients a Motion to Extend
Period to Answer, said counsel allowed the requested extension to pass
without filing an Answer, which resulted to respondents being declared in
default. His negligence was aggravated by the fact that he did not question
the awarded 5% monthly interest despite receipt of the RTC Decision on
November 13, 2000. Even the RTC candidly admitted that it "made a glaring
mistake in directing the defendants to pay interest on the principal loan at
5% per month which is very different from what was prayed for by the
plaintiff."50

"A lawyer owes entire devotion to the interest of his client, warmth and
zeal in the maintenance and defense of his rights and the exertion of his
utmost learning and ability, to the end that nothing can be taken or withheld
from his client except in accordance with the law." 51 Judging from how
respondents former counsel handled the cause of his clients, there is no
doubt that he was grossly negligent in protecting their rights, to the extent
that they were deprived of their property without due process of law.

Indeed, this Court is appalled by petitioners invocation of the doctrine

of immutability of judgment. Petitioner does not contest as she even admits
that the RTC made a glaring mistake in awarding 5% monthly
interest.55 Amazingly, she wants to benefit from such erroneous award. This
Court cannot allow this injustice to happen.
*************************************

G.R. No. 200134 August 15, 2012

ROBERTO OTERO,

Petitioner,

vs.
ROGER TAN, Respondent.

FACTS:

A Complaint for collection of sum of money and damages was filed by

Roger Tan (Tan) with the Municipal Trial Court in Cities (MTCC), Cagayan de
Oro City on July 28, 2005 against Roberto Otero (Otero). Tan alleged that on
several occasions from February 2000 to May 2001, Otero purchased on
credit petroleum products from his Petron outlet in Valencia City, Bukidnon in
the aggregate amount of P 270,818.01. Tan further claimed that despite
several verbal demands, Otero failed to settle his obligation.

Despite receipt of the summons and a copy of the said complaint,

which per the records of the case below were served through his wife Grace
R. Otero on August 31, 2005, Otero failed to file his answer with the MTCC.

Tan filed a motion with the MTCC to declare Otero in default for his
failure to file his answer. Otero opposed Tans motion, claiming that he did
not receive a copy of the summons and a copy of Tans complaint. Hearing
on the said motion was set on January 25, 2006, but was later reset to March
8, 2006, Otero manifesting that he only received the notice therefor on
January 23, 2006. The hearing on March 8, 2006 was further reset to April 26,
2006 since the presiding judge was attending a convention. Otero failed to
appear at the next scheduled hearing, and the MTCC issued an order
declaring him in default. The MTCC rendered a Decisionin favor of Tan. The
MTCC opined that Oteros failure to file an answer despite notice is a tacit
admission of Tans claim.

Otero appealed to the RTC, asserting that the MTCCs disposition is

factually baseless and that he was deprived of due process.

The RTC rendered a Judgment6 affirming the MTCC Decision.

Otero then filed a petition for review with the Court of Appeals
asserting that both the RTC and the MTCC erred in giving credence to the
pieces of evidence presented by Tan in support of his complaint.
 The CA rendered the assailed Decision which denied the petition for
review filed by Otero. In rejecting Oteros allegation with regard to the
genuineness and due execution of the statements of account presented by
Tan, the CA held that any defense which Otero may have against Tans claim
is already deemed waived due to Oteros failure to file his answer.

Oteros Motion for Reconsideration was denied by the CA.

Hence, the instant petition.

Issue:

Whether or not Otero, having been declared in default by the MTCC,

may, in the appellate proceedings, still raise the failure of Tan to authenticate
the statements of account which he adduced in evidence;

The Courts Ruling

The petition is denied.

Held:

No. The effect of a defendants failure to file an answer within the time
allowed therefor is primarily governed by Section 3, Rule 9 of the Rules of
Court, viz:

Sec. 3. Default; declaration of. If the defending party fails to

answer within the time allowed therefor, the court shall, upon
motion of the claiming party with notice to the defending party,
and proof of such failure, declare the defending party in default.
Thereupon, the court shall proceed to render judgment granting
the claimant such relief as his pleading may warrant, unless the
court in its discretion requires the claimant to submit evidence.
Such reception of evidence may be delegated to the clerk of
court.

A defendant who fails to file an answer may, upon motion, be declared

by the court in default. Loss of standing in court, the forfeiture of ones right
as a party litigant, contestant or legal adversary, is the consequence of an
order of default. A party in default loses his right to present his defense,
control the proceedings, and examine or cross-examine witnesses. He has no
right to expect that his pleadings would be acted upon by the court nor may
be object to or refute evidence or motions filed against him.14

Nonetheless, the fact that a defendant has lost his standing in court for
having been declared in default does not mean that he is left sans any
recourse whatsoever. In Lina v. CA, et al., 15 this Court enumerated the
remedies available to party who has been declared in default, to wit:
 a) The defendant in default may, at any time after discovery
thereof and before judgment, file a motion, under oath, to set
aside the order of default on the ground that his failure to answer
was due to fraud, accident, mistake or excusable neglect, and
that he has meritorious defenses; (Sec 3, Rule 18)

b) If the judgment has already been rendered when the

defendant discovered the default, but before the same has
become final and executory, he may file a motion for new trial
under Section 1(a) of Rule 37;

c) If the defendant discovered the default after the judgment has

become final and executory, he may file a petition for relief
under Section 2 of Rule 38; and

d) He may also appeal from the judgment rendered against him

as contrary to the evidence or to the law, even if no petition to
set aside the order of default has been presented by him. (Sec.
2, Rule 41)

Indeed, a defending party declared in default retains the right to

appeal from the judgment by default. However, the grounds that may be
raised in such an appeal are restricted to any of the following: first, the
failure of the plaintiff to prove the material allegations of the complaint;
second, the decision is contrary to law; and third, the amount of judgment is
excessive or different in kind from that prayed for. In these cases, the
appellate tribunal should only consider the pieces of evidence that were
presented by the plaintiff during the ex parte presentation of his evidence.

Otero, in his appeal from the judgment by default, asserted that Tan
failed to prove the material allegations of his complaint. He contends that
the lower courts should not have given credence to the statements of
account that were presented by Tan as the same were not authenticated. He
points out that Betache, the person who appears to have prepared the said
statements of account, was not presented by Tan as a witness during the ex
parte presentation of his evidence with the MTCC to identify and
authenticate the same. Accordingly, the said statements of account are mere
hearsay and should not have been admitted by the lower tribunals as
evidence.

******************

SECOND DIVISION
 PHILIPPINE NATIONAL BANK, G.R. No. 177931
Petitioner,
Promulgated:
- versus - December 8, 2008

DEANG MARKETING CORPORATION

and BERLITA DEANG,
Respondents.
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

Facts:

Deang Marketing Corporation (DMC), et al. filed before the Regional Trial Court (RTC) a
complaint against Philippine National Bank (PNB) for reformation of contract and specific
performance claiming that the dacion en pago arrangement forged by them already transformed
DMCs loan obligation.

Summons was served on PNB requiring it to Answer until May 5, 2006. DMC subsequently filed
a Motion to Declare PNB in Default. The RTC thereafter received a Motion for Extension of
Time to File Answer. On May 16, 2006, RTC granted PNBs Motion. DMC filed a Motion for
Reconsideration of RTCs order denying their Motion to Declare PNB in default. The RTC
denied such motion. DMC subsequently assailed RTCs Orders of May 16, 2006 and August 9,
2006 via certiorari to the Court of Appeals (CA). The CA annulled the RTCs orders.

ISSUE:

Whether or not the CA erred in declaring PNB in default

HELD:

No. PNBs Motion for Extension of Time to File Answer was laden with glaring lapses. It had,
following the reglementary 15-day period after service of summons (unless a different period is
fixed by the court), until May 5, 2006 within which to file an Answer or appropriate pleading. It
filed the Motion for Extension, however, via a private courier on May 14, 2006, which was
received by the trial court on May 15, 2006 or ten days late.

It is a basic rule of remedial law that a motion for extension of time to file a pleading must be
filed before the expiration of the period sought to be extended. The courts discretion to grant a
motion for extension is conditioned upon such motions timeliness, the passing of which renders
the court powerless to entertain or grant it. Since the motion for extension was filed after the
lapse of the prescribed period, there was no more period to extend.

PNB was not candid enough to aver in the Motion for Extension that the period had lapsed, as it
still toyed with the idea that it could get away with it. The allegations therein were crafted as if
the said motion was timely filed. Notably, the May 16, 2006 Order expressed no inkling that the
motion was filed out of time. The trial court either was deceived by or it casually disregarded the
apparent falsity foisted by petitioner.

In denying DMCs Motion for Reconsideration of its grant of PNBs Motion for Extension, the
RTC ruled that it was inclined to reconsider or lift an order of default. By such ruling, the trial
court preempted the dictates of orderly procedure by unduly anticipating and signifying a slant
toward the remedies and arguments yet to be availed of and raised by PNB.

In the present case, no satisfactory reason was adduced to justify the tardiness of the Answer and
no compelling reason was given to justify its admission. The intention to delay was rather
obvious. The Court thus finds PNBs negligence inexcusable, as the circumstances behind and
the reasons for the delay are detestable.