THIRD DIVISION
G.R. No. 193945, June 22, 2015
REMINGTON INDUSTRIAL SALES CORPORATION, Petitioner, v. MARICALUM MINING CORPORATION, Respondents.
D E C I S I O N
REYES, J.:
WHEREFORE, judgment is hereby rendered in favor of [Remington], ordering the defendants [MMIC], [PNB], [DBP], Nonoc Mining and Industrial Corporation, [Maricalum], Island Cement Corporation and Asset Privatization Trust to pay, jointly and severally, the sum of P920,755.95, representing the principal obligation, including the stipulated interest as of June 22, 1984, plus ten [percent] (10%) surcharge per annum by way of penalty, until the amount is fully paid; the sum equivalent to 10% of the amount due as and for attorney's fees; and to pay the costs.All of the defendants appealed the decision, docketed as CA-G.R. SP No. 27720, and on October 6, 1995, the CA affirmed the RTC decision.6
SO ORDERED.5cralawlawlibrary
WHEREFORE, the petition is GRANTED. The decision of the [CA] dated October 6, 1995 and its Resolution promulgated on August 29, 1996 is REVERSED and SET ASIDE. The original complaint filed in the [RTC] in CV Case No. 84-25858 is hereby DISMISSED.Thereafter, the Court rendered its Decision13 dated October 12, 2001 in the PNB case, likewise reversing the CA Decision dated October 6, 1995, to wit:chanroblesvirtuallawlibrary
SO ORDERED.12 (Emphasis ours)
WHEREFORE, the Court REVERSES the decision of the [CA] and in lieu thereof, enters the judgment DISMISSING the complaint of [Remington] in Civil Case No. 84-25858, [RTC], Branch 19, Manila, as against defendants [PNB] and [DBP].On February 10, 2003, the CA rendered a Decision15 in CA-G.R. SP No. 65209 affirming the RTC Order dated March 9, 2001 granting Remington's motion for execution. The CA ruled that the respective appeals filed by the PNB and DBP did not inure to the benefit of their co-defendants, including Maricalum, who did not appeal, and nor can it be deemed to be an appeal of such co-defendants from the judgment against them. The CA further stated that the appeals interposed by PNB and DBP, in no way, prevented the decision in CA-G.R. SP No. 27720 from becoming final and executory as against Maricalum and the other defendants, notwithstanding the fact that all of said defendants were held solidarity liable in said decision.
No costs.
SO ORDERED.14 (Emphasis ours)
WHEREFORE, the petition is GRANTED. The February 10, 2003 Decision and the May 21, 2003 Resolution in CA-G.R. SP No. 65209 of the [CA] are REVERSED and SET ASIDE and the March 9, 2001 and May 10, 2001 Orders of the [RTC] in Civil Case No. 84-25858 are ANNULLED.Remington moved for reconsideration but the same was denied by the Court in a Resolution dated June 30, 2008. This prompted Maricalum to file a motion for restitution and supplemental motion before the RTC,19 which is now the subject of the present petition.chanRoblesvirtualLawlibrary
No costs.
SO ORDERED.18cralawlawlibrary
The writ of execution having been issued by this Court with neither any restraining order nor injunction against said issuance way back on March 9, 2001, at a time the decision of this Court dated April 10, 1990, as affirmed by the [CA] in its decision of October 6, 1995, had become final and executory as far as movant [Maricalum] is concerned, it would certainly be against the law and equity for this Court now to grant movant's motion and supplemental motion for restitution of the amount garnished by the sheriff pursuant to said final and executory decision of this Court against said movant, the execution of which was a matter of right on plaintiffs part and a ministerial duty on the part of this Court to order. As claimed by plaintiff in its rejoinder of September 22, 2008, the execution was only partially satisfied in view of the several incidental expenses inherent in the process of implementation thereof leaving a balance of about P1,501,138.69 unsatisfied, but which plaintiff can no longer execute against said movant on account of the decision of the Supreme Court in G.R. No. 158332.Maricalum's motion for reconsideration was denied by the RTC on July 30, 2009, causing it to file a petition for certiorari with the CA, docketed as CA-G.R. SP No. 110178.22
The execution implemented by the Sheriff was based on a valid Order (March 9, 2001) by virtue of the motion for execution filed by plaintiff against movant, xxx. In the interest of justice, fair play and equity, the execution which had been effectuated by the sheriff can no longer be disturbed. The law and principles of equity must be applied. The effects of a valid order, as an operative fact, cannot be invalidated and disregarded, said effects being valid accomplished acts.21 (Emphasis deleted)
WHEREFORE, the appealed Orders dated December 19, 2008 and July 30, 2009 are ANNULLED and SET ASIDE. Private respondent [Remington] is ordered to RETURN and RESTITUTE to petitioner [Maricalum] the garnished amounts of P920/755.95 and P32,256.48, with interest thereon at twelve (12%) percent per annum until fully satisfied.Remington's motion for reconsideration24 was also denied by the CA in the assailed Resolution25 dated September 30, 2010.
SO ORDERED.23cralawlawlibrary
In support thereof, Remington points out that the RTC decision in Civil Case No. 84-25858 and the CA decision in CA-G.R. SP No. 27720 had long become final and executory; therefore, it was the ministerial duty of the RTC, as it did, to issue the writ of execution in favor of Remington. Moreover, Remington argues that Maricalum's penchant for unending litigation is untenable as it is contrary to the avowed principle of immutability of final and executory judgments, that is, Remington seeks to achieve a total departure from what has already been settled in specific cases. Further, Remington contends that the alleged "supervening events" as an exception to the principle of immutability of final judgments does not apply in the present case. According to Remington, what CA termed "supervening events" are not supervening but actually succeeding events since the writ of execution had already been implemented and had become an accomplished fact long ago or way back in May 2001 and any supervening event no longer exist to prevent such implementation of the writ already executed in that year.27I.
THE HONORABLE [CA] ERRED IN ANNULLING AND SETTING ASIDE THE ORDERS DATED DECEMBER 19, 2008 AND JULY 30, 2009 OF THE [RTC] OF MANILA, BRANCH 19.cralawlawlibraryII.
THE HONORABLE [CA] ERRED IN ORDERING IN ITS DECISION OF APRIL 26, 2010 THE RETURN AND RESTITUTION TO [MARICALUM] OF THE GARNISHED AMOUNTS OF P920.755.95 AND P32,256.48.cralawlawlibraryIII.
THE HONORABLE [CA] EQUALLY ERRED IN ORDERING PAYMENT OF INTEREST IN THE AFORESAID RATE AT 12 % PER ANNUM.26cralawlawlibrary
The adjudication rendered in DBP v. CA and PNB v. CA is plain: [Remington] has no cause of action against DBP, PNB and their transferees, including [Maricalum], for they are corporate entities separate and distinct from [MMIC], and cannot be held liable for the latter's obligations to [Remington]. No compelling reason exists to discard the veil of their corporate fiction because the acquisition through foreclosure sale by DBP and PNB of the properties of [MMIC] was mandated by law, and their transfer of said properties to various corporations, including [Maricalum], for management and operation thereof was legitimate.Notably, the Court ruled in DBP that its acquisition of MMIC's properties and its subsequent transfer were legitimate, and Remington's remedy was to enforce its lien on the unpaid purchase price it sold to MMIC through a proper liquidation proceeding. Meanwhile, PNB ruled that Remington has no cause of action against PNB and the latter is not liable to Remington for MMIC's unpaid goods and merchandise as the obligation to pay remains with MMIC. Both cases ordered the dismissal of the complaint filed in Civil Case No. 84-25858.
The foregoing adjudication is conclusive even upon this Court, more so, the CA.34 (Citation omitted and emphasis ours)
[T]he dismissal in DBF v. CA of the complaint filed in Civil Case No. 84-25858 constitutes a supervening event as it virtually blotted out the April 10, 1990 RTC Decision rendered therein. No vested right accrued from said RTC Decision in favor of private respondent; no ministerial duty impelled the CA to allow execution thereof.36 (Citation omitted and emphasis ours)Certainly, the subsequent issuance of the Court's judgment in Maricalum created a substantial change in the rights of Remington as against Maricalum, and rendered the prior execution of the RTC decision unjust and inequitable. Restitution, therefore, must be made as a matter of course, for to rule otherwise would make the Court's rulings in DBP, PNB and Maricalum hollow, leaving Maricalum holding the proverbial "empty bag."
SEC. 5. Effect of reversal of executed judgment. Where the executed judgment is reversed totally or partially, or annulled, on appeal or otherwise, the trial court may, on motion, issue such orders of restitution or reparation of damages as equity and justice may warrant under the circumstances. (Emphasis ours)The Rules of Court provides for restitution according to equity, in case the executed judgment is reversed on appeal.37 When the executed decision is reversed, the premature execution is considered to have lost its legal bases.38 The situation necessarily requires equitable restitution to the party prejudiced thereby.39 The phrase "on appeal or otherwise" in Section 5 of Rule 39 specifically permits the application of restitution or reparation in cases where a judgment is reversed or annulled, not only on appeal but also through some other appropriate action filed for that purpose.
II. With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:And, in addition to the above, judgments that have become final and executory prior to July 1, 2013, shall not be disturbed and shall continue to be implemented applying the rate of interest fixed therein.46 (Emphasis ours and italics in the original)
- When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.
- When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages, except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code), but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case, be on the amount finally adjudged.
- When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 6% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.
Pilipinas Bank v. Court of Appeals,47 meanwhile, ruled that the rates of interest prescribed by the MB is also applicable to restitution cases where money is transferred from one person to another and the obligation to return the same or a portion thereof is subsequently adjudged in.48 Consequently, the interest imposed by the CA must be modified in order to conform to the prevailing rate imposed by the BSP-MB and clarified by recent jurisprudence.cralawred
WHEREFORE, the petition is DENIED. The Decision dated April 26, 2010 and Resolution dated September 30, 2010 of the Court of Appeals in CA-G.R. SP No. 110178 are hereby AFFIRMED with the MODIFICATION in that the amount to be returned by Remington Industrial Sales Corporation to Maricalum Mining Corporation shall earn interest at the rate of twelve percent (12%) per annum, to be computed from the time Maricalum Mining Corporation filed its Motion for Restitution dated August 4, 2008 with the Regional Trial Court until June 30, 2013. Thereafter, it shall earn interest at the rate of six percent (6%) per annum until fully satisfied.
SO ORDERED.chanroblesvirtuallawlibrary
Velasco, Jr., (Chairperson), Peralta, Villarama, Jr., and Jardeleza, JJ., concur.
Endnotes:
1 Penned by Associate Justice Vicente S.E. Veloso, with Associate Justices Francisco P. Acosta and Danton Q. Bueser concurring; rollo, pp. 43-57.
2 Id. at 78-80.
3 Id. at 44-45.
4 Id. at 45.
5 Id.
6 Id. at 46.
7 Hereinafter referred to as PNB case.
8 Hereinafter referred to as DBP case.
9Rollo, p. 46.
10 Id. at 47.
11 415 Phil. 538 (2001).
12 Id. at 553.
13 419 Phil. 480 (2001).
14 Id. at 493.
15Rollo, pp. 36-40.
16 Id. at 48. Hereinafter referred to as Maricalum case.
17Maricalum Mining Corp. v. Remington Industrial Sales Corp., 568 Phil. 219 (2008).
18 Id. at 232.
19Rollo, p. 49.
20 Id. at 49-50.
21 Id. at 51.
22 Id.
23 Id. at 56-57.
24 Id. at 58-75.
25 Id. at 78-80.
26 Id. at 18-19.
27 Id. at 23-24.
28 Id. at 119.
29Gomez v. Hon. Presiding Judge, RTC, Br. 15, Ozamis City, 319 Phil. 555, 562 (1995); Johnson & Johnson (Phils.), Inc., v. CA, 330 Phil. 856, 871 (1996).
30Natalia Realty, Inc. v. Court of Appeals, 440 Phil. 1, 23 (2002).
31Dy v. Bibat-Palamos, G.R. No. 196200, September 11, 2013, 705 SCRA 613, 626.
32Silverio, Jr. v. Filipino Business Consultants, Inc., 504 Phil. 150, 162 (2005).
33 Supra note 17.
34 Id. at 231-232.
35Sps. Bulaong v. Gonzales, 672 Phil. 315, 338 (2011).
36 Supra note 17, at 232.
37Legaspi v. Spouses Ong, 498 Phil. 167, 189 (2005).
38Urban Bank, Inc. v. Peña, 675 Phil. 474 578 (2011)
39 Id.
40 49 Phil. 349 (1926).
41 Id. at 357.
42 G.R.No. 189871, August 13, 2013, 703, SCRA 439.
43Fil-Estate Properties, Inc. v. Ronquillo, G.R. No. 185798, January 13, 2014, 713 SCRA 91, 102.
44Federal Builders, Inc. v. Foundation Specialists, Inc., G.R. No. 194507, September 8, 2014.
45 G.R. No. 97412, July 12, 1994, 234 SCRA 78.
46 Supra note 42, at 457-458.
47 G.R. No. 97873, August 12, 1993, 225 SCRA 268.
48 Id. at 276.