THIRD DIVISION
G.R. No. 210284. July 07, 2021
JAV CORPORATION, Petitioner, v. PAULA FOODS CORPORATION, Respondent.
D E C I S I O N
INTING, J.:
Before the Court is a Petition for Review on Certiorari1 under Rule 45 of the Rules of Court filed by JAV Corporation (JAV) seeking to set aside the Decision2 dated January 31, 2013 and the Resolution3 dated November 21, 2013 of the Court of Appeals (CA) in CA-G.R. SP No. 102675. The CA Decision granted the Petition for Annulment of Judgment4 of Paula Foods Corporation (PFC) and declared void the Decision5 dated April 23, 2001 of Branch 255, Regional Trial Court (RTC), Las Piñas City in Civil Case No. 95-039. The Resolution, on the other hand, denied JAV's Motion for Reconsideration6 dated February 21, 2013.
"It is understood by the First Party [JAV] that Mr. Steve F. Serranilla represents the Second Party pending completion and registration of the corporation being organized. The First Party hereby agrees to substitute Mr. Steve F. Serranilla with the corporation as soon as the same is duly registered;"11chanRoblesvirtualLawlibraryOn August 5, 1995, the parties likewise executed a Memorandum of Agreement12 (MOA) stipulating that Serranilla would provide and formulate the raw meat materials for JAV, and that he would only charge JAV for the manufacturing cost of the raw materials.13chanRoblesvirtualLawlibrary
The plaintiff strongly opposed the substitution on the ground that even before the registration of the defendant's corporation, the defendant already violated important features of their lease contract by defrauding the plaintiff of its supposed income, to the damage and prejudice of the plaintiff. It alleged that "the substitution of the alleged corporation for the defendant at this time, after he has personally, thru fraud, deceit and trickeries enriched himself at the expense of the plaintiff and in the process causing millions of pesos of damages to the latter, is a fraudulent maneuver to free himself of liability for his said wrongful acts and shift the same to a corporation which clearly does not have the financial capability to answer for such damages". It further alleged that "it has now become clear that even the incorporation in the lease agreement of this provision on substitution (par. 10) was part of this grand plot."Serranilla filed a Motion for Reconsideration (Re Order Dated April 19, 2000) dated May 12, 2000.30 However, pending the resolution of his motion, Serranilla filed an Urgent Motion to Inhibit31 praying that Judge Florentino M. Alumbres (Judge Alumbres) of the RTC inhibit himself from the case due to his alleged bias and prejudice, gross ignorance of the law, and grave abuse of authority and discretion.
This accusation of the plaintiff is so serious and although the same has not yet been substantiated by concrete proof, the Court entertains doubt on the sincerity of the defendant in incorporating par. 10 in their lease agreement. Thus, pending final determination by the Court of the issues raised in the principal action for rescission of the contract, it is inclined to deny the motion for substitution.
WHEREFORE, and in the light of the foregoing, the motion for substitution filed by the defendant Steve F. Serranilla is hereby denied for lack of merit.
SO ORDERED.29chanRoblesvirtualLawlibrary
The issue at hand is whether or not the April 19, 2000 order of the public respondent denying petitioner's motion for substitution showed bias and prejudice of the said judge against him.Serranilla and PFC moved to reconsider the CA Decision dated January 25, 2001, but the CA denied the motion in the Resolution dated February 21, 2001 in CA G.R. SP No. 61784.
x x x There is absolutely nothing wrong, much less can it be a ground for disqualification, when the judge expresses his opinion or doubts on the credibility of the evidence or the trustworthiness of witnesses because it is precisely his job to evaluate and weigh them. "To be a ground for disqualification, bias and prejudice must be shown to have stemmed from an extrajudicial source, and result in an opinion on the merits on the same basis other than what the judge learned from his participation in the case" x x x. Such is not the case here. There is no showing at all, that the public respondent has any interest whatsoever in Civil Case No. LP-95-039. Everything is premised on Serranilla's suspicion and "perceived bias" which is a product of his imagination.38chanRoblesvirtualLawlibrary
WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the defendant as follows:Aggrieved, Serranilla appealed to the CA. The appeal was docketed as CA-G.R. CV No. 73056.42chanRoblesvirtualLawlibrary
1. Declaring the Agreement dated August 2, 1995 (Exhibit "A") and the Memorandum of Agreement dated August 5, 1995 (Exhibit "B") rescinded and null and void;cralawlawlibrary
2. Ordering the defendant to pay to the plaintiff the sum of P13,827,629.79, representing the latter's lost income from August 5, 1995 to April 23, 2001, with interest thereon at the rate of 12% per annum from the date of this decision until fully paid;cralawlawlibrary
3. Ordering the defendant to pay to the plaintiff the sum of P5,302,235.82, the value of the lost machineries, furnitures [sic] and office equipment with interest thereon at the rate of 12% per annum from the date of his decision until fully paid;cralawlawlibrary
4. Ordering the defendant to pay to the plaintiff the sum of P100,000.00 as and for attorney's fees, and the cost of this suit;cralawlawlibrary
5. Defendant's counterclaim is hereby dismissed for being unmeritorious.
SO ORDERED.41chanRoblesvirtualLawlibrary
The owners of the building that JAV was using as a factory may be the ones who evicted the latter therefrom for non-payment of rentals but the latter's predicament stemmed from his sub-lessee's ([Se]rranilla) non-compliance with their lease agreement and MOA with JAV. Serranilla impresses that his non-payment of rentals to JAV is justified, by the latter's non-payment of the meat products that the former delivered. Evidence, however, shows that JAV's refusal was justified in that the billings sent to him by the former were erroneous. Consequently, Serranilla should be held liable not only for his unpaid rentals on the property but also for the income lost by JAV.Serranilla moved for reconsideration of the CA Decision dated August 28, 2006 and prayed that he again be substituted by PFC in the case. However, the CA denied Serranilla's motion for reconsideration in its Resolution45 dated December 22, 2006, stating as follows:
x x x Serranilla did not pay his monthly obligation to JAV; stopped supplying meat products to the latter; and, to make matters worse, took over the business of JAV. For which reason, We find JAV's claim, that the totality of Serranilla's acts shows [sic] that he, right from the start, entered into business with the same for the sole purpose of usurping the former's business[.]44chanRoblesvirtualLawlibrary
On the Defendant-Appellant's prayer that Paula Foods Corporation be made the defendant in herein case in his stead, suffice it to say that nothing was presented by the former to convince Us to order that he be substituted by a stranger to herein suit. In fact, there is even no showing that the corporation sought by the Defendant-Appellant to be made his substitute is aware of the latter's prayer.46chanRoblesvirtualLawlibrarySerranilla and JAV both appealed to the Court via a petition for review on certiorari under Rule 45. JAV's petition in G.R. No. 176045 prayed that it be entitled to the amount of P5,302,235.82, representing the value of its lost machinery, furniture, and office equipment, which the CA deleted in its Decision dated August 28, 2006. On the other hand, Serranilla's petition in G.R. No. 175899, assailed among others, the CA's failure to allow him to be substituted by PFC, the alleged real party in interest in Civil Case No. 95-039.
[A]s the only party to the agreements other than respondent [JAV], there is indeed basis in petitioner's claim that it was an indispensable party to the action for rescission because there would be no final determination that could be had without it as it was precisely PFC's obligations that were sought to be rescinded.56chanRoblesvirtualLawlibraryThe CA further held that because PFC was not made a party defendant to the case, the RTC Decision dated April 23, 2001 may be annulled on the ground of lack of jurisdiction over an indispensable party. It brushed aside JAV's contentions: (1) that the Petition for Annulment of Judgment is barred by res judicata, holding that an action for annulment of judgment precludes the defense of res judicata; and (2) that the issue of the proper party defendant in the action for rescission of contract was already resolved in CA-G.R. SP No. 61784. The CA held that CA-G.R. SP No. 61784 dealt with the issue of whether Judge Alumbres of the RTC gravely abused his discretion in refusing to inhibit himself on the ground of bias and partiality and not the issue of whether PFC was the real party defendant in the case.57chanRoblesvirtualLawlibrary
x x x intervention is not the proper remedy because the same presupposes that the indispensable parties to the action have already been duly impleaded and a third person has a legal interest in the matter in litigation or the success of either of the parties or both. In the action before the trial court, PFC is the indispensable party. Thus, the remedy of intervention would not have squarely resolved the predicament of PFC. Neither could PFC intervene on appeal before this Court in CA-G.R. SP No. 73056, as a motion for intervention must be filed before rendition of judgment. Under the circumstances, the instant petition is the more appropriate remedy available to PFC.58chanRoblesvirtualLawlibraryThus, the petition before the Court.
PFC is already precluded to file the Petition for Annulment of Judgment. |
It is an important fundamental principle in Our judicial system that every litigation must come to an end. Access to the courts is guaranteed. But there must be a limit thereto. Once a litigant's rights have been adjudicated in a valid final judgment of a competent court, he should not be granted an unbridled license to come back for another try. The prevailing party should not be harassed by subsequent suits. For, if endless litigations were to be encouraged, unscrupulous litigants will multiply in number to the detriment of the administration of justice.60chanRoblesvirtualLawlibraryBy way of exception, annulment of judgment is a remedy in law independent of the case where the judgment sought to be annulled was rendered, where the purpose of such action is to have the final and executory judgment set aside so that there will be a renewal of litigation.61 It is an exception to the final judgment rule, an extraordinary remedy, and it will not so easily and readily lend itself to abuse by parties aggrieved by final judgments.62 By virtue of its exceptional character, the action is restricted exclusively to the grounds specified in the rules, namely, (1) extrinsic fraud and (2) lack of jurisdiction.63 Further, the remedy may not be invoked (1) where the party has availed himself of the remedy of new trial, appeal, petition for relief or other appropriate remedy and lost therefrom, or (2) where he has failed to avail himself of those remedies through his own fault or negligence.64
The Court in G.R. No. 147291 affirmed the CA Decision in CA-G.R. SP No. 61784 affirming the RTC's denial of Serranilla's motion to be substituted by PFC. |
The issue at hand is whether or not the April 19, 2000 order of the public respondent denying petitioner's motion for substitution showed bias and prejudice of the said judge against him.After the CA denied Serranilla and PFC's Motion for Reconsideration, Serranilla and PFC elevated the case to the Court via a Petition for Review on Certiorari in G.R. No. 147291. However, in a Resolution dated April 4, 2001, "the Court Resolved to DENY the petition for failure of petitioners to show that a reversible error had been committed by the appellate court."69chanRoblesvirtualLawlibraryx x x x
x x x Such is not the case here. There is no showing at all, that the public respondent has any interest whatsoever in Civil Case No. LP-95-039. Everything is premised on Serranilla's suspicion and perceived bias which is a product of his imagination.67chanRoblesvirtualLawlibraryx x x x
Wherefore, premises considered, the instant petition is hereby DENIED for utter lack of merit.
SO ORDERED.68chanRoblesvirtualLawlibrary
The RTC Decision in Civil Case No. 95-039 in favor of JAV and as against Serranilla was affirmed by the CA and subsequently by the Court. |
PFC failed to prove the existence of any of the grounds of a Petition for Annulment of Judgment. |
SEC. 2. Grounds for annulment. - The annulment may be based only on the grounds of extrinsic fraud and lack of jurisdiction.There is extrinsic fraud when the unsuccessful party had been prevented from exhibiting fully his case, by means of fraud or deception practiced on him by his opponent, as by keeping him away from court, or where the defendant never had knowledge of the suit, being kept in ignorance by the acts of the plaintiff.70chanRoblesvirtualLawlibrary
Extrinsic fraud shall not be a valid ground if it was availed of, or could have been availed of, in a motion for new trial or petition for relief.
The filing of the above-mentioned Motion to Dismiss, without invoking the lack of jurisdiction over the person of the respondents, is deemed a voluntary appearance on the part of the respondents under the aforequoted provision of the Rules. The same conclusion can be drawn from the filing of the Supplemental Motion to Dismiss and Reply to the Comment on the Motion to Dismiss dated November 13, 2000 which alleged, as an additional ground for the dismissal of petitioners complaint, the failure of plaintiffs to pay the required filing fee again but failed to raise the alleged lack of jurisdiction of the court over the person of the respondents.76chanRoblesvirtualLawlibraryHere, Serranilla did not file a motion to dismiss invoking the RTC's lack of jurisdiction over his person. Instead, he filed a motion praying that PFC substitute him as party defendant in the case. Through his filing of the Motion for Substitution, Serranilla voluntarily appeared in court and sought affirmative relief. As a consequence, the RTC had acquired jurisdiction over his person.
Non-Joinder of PFC as an indispensable party in Civil Case No. 95-039 is not a ground to annul the RTC Decision Dated April 23, 2001. |
PFC has no personality to institute the annulment of judgment proceedings to nullify the RTC Decision Dated April 23, 2001 in Civil Case No. 95-039. |
Endnotes:
* Designated additional member per Special Order No. 2833 dated June 29, 2021.
1 Rollo, pp. 7-38.
2 Id. at 39-68; penned by Associate Justice Elihu A. Ybañez with Associates Justice Celia C. Librea-Leagogo and Ramon M. Bato, Jr., concurring.
3 Id. at 69-70.
4 CA rollo, Vol. I, pp. 2-72.
5 Id. at 74-84; penned by Judge Florentino M. Alumbres of Branch 255, Regional Trial Court (RTC), Las Piñas City.
6 CA rollo, Vol. III, pp. 1316-1320.
7 Rollo, p. 40.
8 Id. at 41.
9 Id.
10 CA rollo, Vol. I, pp. 153-155.
11 Id. at 154.
12 CA rollo, Vol. II, pp. 659-661.
13 Id. at 659.
14 CA rollo, Vol. I, p. 208.
15 CA rollo, Vol. II, p. 648.
16 CA rollo, Vol. I, p. 243.
17 Rollo, pp. 45-46.
18 Id. at 45.
19 CA rollo, Vol. I, pp. 346-359; penned by Judge Ester Tuazon Villarin.
20 Rollo, p. 49.
21 CA rollo, Vol. II, pp. 645-655.
22 Rollo, p. 47.
23 CA rollo, Vol. II, p. 651.
24 CA rollo, Vol. I, pp. 278-279.
25 Id. at 334.
26 Id. at 335-336-A.
27 Id.
28 Id. at 405-406.
29 Id.
30 Id. at 407-432.
31 Id. at 434-444.
32 Id. at 449.
33 Id. at 451.
34 Rollo, p. 51.
35 CA rollo, Vol. I, pp. 548-555; penned by Associate Justice Eliezer R. De Los Santos with Associate Justices Goderdo A. Jacinto and Bernardo P. Abesamis concurring.
37 Id. at 555.
38 Id. at 553.
39 Id. at 556.
40 Id.
41 Id. at 74-84.
41 Id. at 83-84.
42 Rollo, p. 53.
43 CA rollo, Vol. I, pp. 476-492; penned by Associate Justice Normandie B. Pizzaro with Associate Justices Eliezer R. De Los Santos and Aurora Santiago-Lagman, concurring.
44 Id. at 486-487.
45 Id. at 494-496.
46 Id. at 496.
47 Id. at 497-498.
50 Id. at 499-500.
51 Id. at 557-558.
52 Rollo, p. 54.
53 CA rollo, Vol. I, p. 501.
54 Id. at 2-72.
55 Rollo, pp. 39-68.
56 Id. at 59.
57 Id. at 64-65.
58 Id. at 66.
57 Delfino v. Millan, G.R. No. 235707 (Notice), October 16, 2019.
58 Id., citing Bañares II v. Balising, 384 Phil. 567, 582 (2000).
59 246 Phil. 245 (1988).
60 Id. at 253, citing Pacquin, v. The Court of Appeals, et al., 200 Phil. 516, 521 (1982).
61 Delfin v. Millan, supra note 57.
62 Id.
63 Id.
64 Id.
67 CA rollo, Vol. I, p. 553.
68 Id. at 555.
69 Id. at 556.
68 CA rollo, Vol. III, p. 1235.
69 CA rollo, Vol. I, p. 501.
70 Heirs of the Late Sps. Balaganas v. Registry of Deeds-Tarlac City, 561 Phil 579, 586 (2007), citing Republic of the Phils. v. Heirs of Sancho Magdato, 394 Phil. 123, 429 (2000).
71 Duremdes v. Jorilla, G.R. No. 234491, February 26, 2020.
72 Id., citing Yuk Ling Ong v. Co, 755 Phil. 158, 165 (2015), further citing Pinausukun Seafood House, Roxas Blvd., Inc. v. Far East Bank & Trust Co., et al., 725 Phil. 19 (2014).
73 People's General Insurance Corp. v. Guansing, G.R. No. 204759, November 14, 2018.
74 G.V. Florida Transport, Inc. v. Tiara Commercial Corp., 820 Phil, 235, 252 (2017), citing National Petroleum Gas, Inc., et al. v. RCBC, 766 Phil. 696, 723 (2015).
75 611 Phil. 705 (2009).
76 Id. at 715.
77 See Travel Wide Associated Sales (Phils.), Inc. v. CA, 276 Phil. 219, 224 (1991).
78 Section 17 of Rule 3 of the 1997 Revised Rules of Civil Procedure:
SECTION 17. Death of Party. - After a party dies and the claim is not thereby extinguished the court shall order, upon proper notice, the legal representative of the deceased to appear and to be substituted for the deceased, within a period of thirty (30) days, or within such time as may be granted. If the legal representative fails to appear within said time, the court may order the opposing party to procure the appointment of a legal representative of the deceased within a time to be specified by the court, and the representative shall immediately appear for and on behalf of the interest of the deceased. The court charges involved in procuring such appointment, if defrayed by the opposing party, may be recovered as costs. The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or administrator and the court may appoint guardian ad litem for the minor heirs.
79 Heirs of Faustino Mesina, et al. v. Heirs of Domingo Fian, Sr. et al., 708 Phil 327, 334 (2013), citing In the Matter of the Heirship (Intestate Estates) of the late Hermogenes Rodriguez, et al. v. Robles, 653 Phil. 396, 404 (2010), further citing Lotte Phil. Co., Inc. v. Dela Cruz, 502 Phil. 816, 820-821 (2005).
80 American President Lines, Ltd. v. Malayan Insurance Co., Inc., G.R. No. 198258 (Notice), June 6, 2019, citing Section 2, Rule 3 of the 1997 Revised Rules of Civil Procedure.
81 Id.
82 Id.cralawredlibrary