Outline: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

Lesson for August 30, 2014

Effect of Failure to Plead

1.

Effect of failure to plead - Rule 9

a) Failure to plead defenses and objections - Sec. 1, Rule 9
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Garcia v. Mathis, G.R. No. L-48577, September 30, 1980

b) Failure to plead a compulsory counterclaim and cross-claim - Sec. 2, Rule 9

-

2.

Meliton v. CA, G.R. No. 101883, December 11, 1992

Default - Sec. 3, Rule 9

a) When a declaration of default is proper
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Rosario v. Alonzo, G.R. No. L-17330, June 29, 1963

b) Effect of an order of default - Sec. 3(a), Rule 9

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Co v. Acosta, G.R. No. 64591, January 17, 1985

Boticano v. Chu, G.R. No. L-58036, March 16, 1987

c) Relief from an order of default - Sec. 3(b), Rule 9

-

Denso (Phil.), Inc. v. IAC, G.R. No. 75000, February 27, 1987

Lina v. CA, G.R. No. L-63397, April 9, 1985

d) Effect of a partial default - Sec. 3(c), Rule 9

-

Lim Tanhu v. Ramolete, G.R. No. L-40098, August 29, 1975

e) Extent of relief - Sec. 3(d), Rule 9

Pascua v. Hon. Florendo, G.R. No. L-39047, April 30, 1985

f)

Actions where default is not allowed - Sec. 3(e), Rule 9

Dela Cruz v. Hon. Ejercito, G.R. No. L-40895, November 6, 1975

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Case Digest: Rule 9 Effect of Failure to Plead

Failure to plead defenses and objections - Sec. 1, Rule 9
GARCIA vs MATHIS
G.R. No. L-48577, September 30, 1980

CIVIL PROCEDURE
abandoned his special appearance and voluntarily
submitted himself to the jurisdiction of the court.
Petition, dismissed.

Facts:
In Civil Case No. D-4097 of the CFI of Pangasinan,
presided by the respondent judge, Sulpicio Garcia, the
petitioner herein, sued Colonel Paul C. Mathis in his
capacity as Base Commander, CAFB, acting for and in
behalf of the United States of America.
The complaint alleged that Garcia was a civilian
employee at Clark Air Force Base from May 26, 1949, to
August 23, 1956, when he was dismissed for alleged
bribery and collusion. He prayed inter alia that he be
reinstated to his former position, and paid back wages,
moral damages, attorney's fees and costs of the suit.
Defendant
Mathis
entered
a special
appearance and filed a motion for the dismissal of the
complaint upon the ground that the trial court had no
jurisdiction over his person because he was being sued as
the representative of a foreign sovereign "which has not
consented and does not now consent to the maintenance
of the present suit."
On June 7, 1978, the respondent judge issued an
Order, that the cause of action has already prescribed,
because paragraphs 3 and 5 of the complaint alleged that
the services of the plaintiff has been terminated on August
23, 1956.
Issue:
Whether or not respondent judge committed a
grave abuse of discretion amounting to lack of jurisdiction
when he dismissed the complaint on the ground of
prescription which Mathis did not raise in any of his
pleadings.
Held:
GR: Action will not be held to have prescribed if
prescription is not expressly invoked.
XPN: When the plaintiff's own allegations in his complaint
show clearly that the action has prescribed.
The plaintiff's action had prescribed for he alleged
that he was removed on August 23, 1956 but the case was
filed only on November 18, 1977, after a lapse of more
than 21 years. Prescinding, therefore, the defense of
jurisdiction which is apparently meritorious, the complaint
was properly dismissed.
It is not incorrect to state that because of the
special appearance which Mathis had entered, he was
constrained to confine himself to showing that the trial
court did not have jurisdiction over his person and had to
exclude all other non-jurisdictional grounds in his motion
to dismiss otherwise he could be deemed to have

Failure to plead a compulsory counterclaim and crossclaim - Sec. 2, Rule 9

MELITON vs CA
G.R. No. 101883, December 11, 1992
Facts:
Nelia Ziga, in her own behalf and as attorney-infact of Alex A. Ziga and Emma A. Ziga-Siy, filed a complaint
(Civil Case No. RTC 88-1480 of the RTC of Naga City)
against petitioner Lydia Meliton for rescission of a contract
of lease over a parcel of land.
Petitioner, as lessee, failed to deposit the one
month rental and to pay the monthly rentals due; that her
construction of a concrete wall and roof on the site of a
demolished house on the leased premises without the
lessor's written consent; and here unauthorized sublease
of the leased property to a third party.
Lydia Meliton filed an answer to the complaint
denying the material averments and setting up three
counterclaims for recovery of the value of her kitchenette
constructed on the leased parcel of land and which was
demolished by Ziga.
The RTC, on motion of Ziga contending that her
cause of action had already become moot and academic
by the expiration of the lease contract, dismissed the
complaint. The counterclaims of Meliton were also
dismissed for non-payment of the docket fees, ergo the
trial court's holding that thereby it had not acquired
jurisdiction over the same.
Spouses Meliton filed a complaint against Ziga for
recovery of the same amounts involved and alleged in
their counterclaims.
Ziga filed a motion to dismiss the complaint on
the ground that the cause of action was barred by prior
judgment. This was denied on the ground that the
dismissal of the petitioner's counterclaim is not an
adjudication on the merits as the court did not acquire
jurisdiction over the counterclaims for failure of Meliton to
pay the docket fees, hence the said dismissal does not
constitute a bar to the filing of the later complaint. Zigas
MR was denied.
Ziga filed a petition for certiorari with the SC. The
case was referred to the CA.

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Case Digest: Rule 9 Effect of Failure to Plead

CA granted the petition, and reversed the RTC
Decision. The respondents' counterclaim against the
petitioner is a compulsory counterclaim, it having arisen
out of or being necessarily connected with the transaction
or occurrence subject matter of the petitioner's complaint.
The failure of the respondents to seek a reconsideration of
the dismissal of their counterclaim or to take an appeal
therefrom rendered the dismissal final. Such dismissal
barred the prosecution of their counterclaim by another
action.
Hence, this petition.
Issues:
(1) Whether or not the counterclaims of petitioners are
compulsory in nature. YES
(2) Whether or not petitioners, having failed to seek
reconsideration of or to take an appeal from the order of
dismissal of their counterclaims, are already barred from
asserting the same in another action. NO
Held:
1. Whether or not the counterclaims of petitioners are
compulsory in nature. YES
Section 4 of Rule 9 of the Rules of Court, a
counterclaim is compulsory if (a) it arises out of, or is
necessarily connected with, the transaction or occurrence
which is the subject matter of the opposing party's claim;
(b) it does not require for its adjudication the presence of
third parties of whom the court cannot acquire
jurisdiction; and (c) the court has jurisdiction to entertain
the claim.
To determine whether the counterclaim is
compulsory or permissive, the "one compelling test of
compulsoriness" is the logical relationship between the
claim alleged in the complaint and that in the
counterclaim, that is, where conducting separate trials of
the respective claims of the parties would entail a
substantial duplication of effort and time, as where they
involve many of the same factual and/or legal issues.
In the Civil Case No. 88-1480, all the requisites of
a compulsory counterclaim are present. Zigas complaint
was for rescission of the contract of lease due to Lydia
Meliton's breach of her obligations under the said
contract. On the other hand, Melitons counterclaims were
for damages for unlawful demolition of the improvements
she introduced pursuant to her leasehold occupancy of the
premises, as well as for the filing of that civil suit which is
contended to be clearly unfounded. Both the claims arose
from the same contract of lease. The two actions are but
the consequences of the reciprocal obligations imposed by

CIVIL PROCEDURE
law upon and assumed by the parties under their lease
contract.
In actions for ejectment or for recovery of
possession of real property, it is well settled that the
defendant's claims for the value of the improvements on
the property or necessary expenses for its preservation are
required to be interposed in the same action as
compulsory couterclaims.
CA correctly held that the counterclaims of
petitioners are compulsory in nature.
2. Whether or not petitioners, having failed to seek
reconsideration of or to take an appeal from the order of
dismissal of their counterclaims, are already barred from
asserting the same in another action. NO
In order that a prior judgment will constitute a
bar to a subsequent case, the following requisites must
concur: (1) The judgment must be final; (2) The judgment
must have been rendered by a court having jurisdiction
over the subject matter and the parties; (3) The judgment
must be on the merits; and (4) There must be between the
first and second actions, identity of parties, of subject
matter, and of causes of action.
Civil Case No. RTC 88-1480 was dismissed upon
motion of Ziga under Section 2 of Rule 17. Dismissal is
without prejudice, except when otherwise stated in the
motion to dismiss or when stated to be with prejudice in
the order of the court. The order of dismissal of the first
case was unqualified, hence without prejudice and,
therefore, does not have the effect of an adjudication on
the merits. On a parity of rationale, the same rule should
apply to a counterclaim duly interposed and which is
likewise dismissed but not on the merits.
In the same order of dismissal of the complaint,
the counterclaims of petitioners were dismissed by reason
of the fact the court a quo had not acquired jurisdiction
over the same for non-payment of the docket fees. On
that score, the said dismissal was also without prejudice,
since a dismissal on the ground of lack of jurisdiction does
not constitute res judicata, there having been no
consideration and adjudication of the case on the merits.
The dismissal of the case without prejudice
indicates the absence of a decision on the merits and
leaves the parties free to litigate the matter in a
subsequent action as though the dismissal action had not
been commenced. The discontinuance of a case not on the
merits does not bar another action on the same subject
matter. Evidently, the prior dismissal of herein petitioners'
counterclaims is not res judicata and will not bar the filing
of another action based on the same causes of action.
CA decision, reversed and set aside.

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Case Digest: Rule 9 Effect of Failure to Plead

When a declaration of default is proper
ROSARIO vs ALONZO
G.R. No. L-17330, June 29, 1963
Facts:
This is an action for partition of two parcels of
lands (in Ilocos Sur).
Plaintiffs: alleged that the said parcels of land belonged to
the conjugal partnership of their late father, Hilario
Rosario and Juana Alonzo, his second wife.
Defendants: alleged that out of the proceeds of the sale of
cattle they had inherited from their deceased father, Eleno
Manzano, they purchased the first parcel of land and had
been in possession thereof as owners for more than 20
years and paying the realty tax thereon; while the second
parcel of land was acquired through occupation and
homestead by Juana Alonzo and Roberto Hilario who had
in possession thereof as owners for more than 20 years
and also paying the realty tax thereon; that Hilario, the
second husband of Juana, was blind for 30 years and could
not have earned money to purchase any parcel of land;
thus, the action of the plaintiffs was reckless, groundless
and barred by statute of limitations; further prayed for the
dismissal of the complaint and payment of P300 as for
damages.
The parties submitted a partial agreed statement
of facts and reserved the right to present evidence. The
hearing was set, however, the defendants and their
counsel failed to appear. The plaintiffs rested its case after
presentation of their exhibits. The trial court rendered
judgment in favor of the plaintiffs. A motion for
reconsideration was filed by the defendants but it was
denied for no affidavit of merit was attached to the
motion. Another motion was filed for the setting aside of
the judgment and leave to present evidence. It was again
denied based on the first ground. The defendants
appealed to CA, which dismissed the aforesaid appeal.
Thus, a petition for certiorari was filed to SC, but in its
Resolution, set aside the CA resolution, and remanded the
case to CA for judgment on the merits. The CA certified the
case to SC based on the grounds that the petitioners raised
legal questions only. Hence, this petition.
Issue:
Whether or not the declaration of default is
proper NO
Held:
Having answered the complaint filed by the
appellees, the appellants were not and could not be in
default. The appellants complaint that in refusing to

CIVIL PROCEDURE
relieve their counsel from the effects and consequences of
his failure to appear and defend their case, the lower court
committed, a grave injustice to their prejudice, for they
contend that such failure was due to his forgetfulness and
oversight.
Although the two motions for reconsideration
were sworn to by the attorney, for the appellants, still
such motions were not "accompanied with affidavits
showing the fraud, accident, mistake, or excusable
negligence relied upon, and the facts constituting the
petitioner's good and substantial cause of action or
defense, as the case may be, which he may prove if his
petition be granted," provided for and required in section
3 of Rule 38, as Rules of Court.
The order appealed from is affirmed, with costs
against the appellants.

Effect of an order of default - Sec. 3(a), Rule 9

CO vs ACOSTA
G.R. No. 64591, January 17, 1985
Facts:
Pepsi Cola Bottling Company of the Philippines,
Inc. (PEPSI), through Mr. C.M. Aboitiz issued three
purchase orders addressed to CTC Appliance Center for
12,000 units of refrigerators valued at P35,322,900.00.
Petitioner Rufino Co is the proprietor of the Center.
In a formal deed of assignment, petitioner Co
assigned his rights and interests to the three purchase
orders and to the money value of the deliveries made or to
be made thereunder to respondent Refrigerations
Industries, Inc. (RII).
PEPSI wrote a letter to the private respondents
informing them that it took notice of the assignments of
the purchase orders by the petitioner and stated that it
was not recognizing the same.
In the course of time, 10,000 units of refrigerators
were delivered and paid. No problem arose from these
10,000 units.
PEPSI wrote a letter to the petitioner requesting
the delivery of 1,000 units of refrigerators and stating that
PEPSI will be talking directly to respondent RII through Mr.
Dominador Gana on the matter of storage fees.
From March 23, 1981 to May 21, 1981 PEPSI
received 1,000 units of refrigerators directly from
respondent RII. The total invoice price of these units was
P2,907,535.00.

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Case Digest: Rule 9 Effect of Failure to Plead

Private respondent RII sent a letter of demand to
PEPSI. PEPSI wrote private respondent RII acknowledging
receipt of the demand letter but stating that it does not
recognize and does not feel bound by the petitioners
assignment of the purchase orders. Private respondent RII
sent another letter of demand to PEPSI demanding
payment of the P2,907,535.00 within five days. PEPSI
informed respondent RII that there is no legal basis for the
demand and no reason for PEPSI to pay the 1,000 units. It
added further that respondent RIIs recourse is against the
petitioner.
Failing to collect from PEPSI, private respondent
RII sent a letter of demand to the petitioner demanding
payment, but the latter refused and failed to pay. Private
respondent RII and Delta Motors Corporation filed a civil
case for a sum of money with attachment before the Court
of First Instance of Rizal, against Pepsi Cola Bottling
Company of the Philippines, Inc. and petitioner Rufino Co.
Private respondents filed a formal ex-parte
motion to dismiss the complaint against PEPSI. Attached to
the motion is an instrument entitled "Joint Release,
Waiver and/or Quitclaim" which covenants that Delta
Motors, RII, and PEPSI mutually agreed to release and
forever discharge each other from any and all liabilities or
causes of action arising out of the transaction involving the
1,000 units of refrigerators in order to maintain
harmonious business relations among the parties.
The respondent court issued an order, on
plaintiffs motion, dismissing the complaint against the
defendant PEPSI.
The private respondents filed an ex-parte motion
to declare the petitioner Rufino Co in default for having
failed to file his answer.
The respondent court issued an order declaring
Rufino Co in default and RII is allowed to present its
evidence ex-parte. The respondent court rendered its
decision in favor of the plaintiffs and against the defendant
Rufino Co, ordering the latter to pay the former the sum of
P2,907,535.00 plus the legal rate of interest therein from
date of demand; the sum of P200,000.00 as and by way of
attorneys fees; plus the costs of suit.
Petitioner Co filed a "Petition for Relief from
Judgment".
Pending resolution of the petitioners petition for
relief from judgment, the respondent court issued a writ of
execution and, as a consequence, virtually all of the
petitioners real properties were levied upon on execution
and advertised for sale at public auction.
The petitioner filed a motion for a restraining
order to restrain the writ of execution and thereafter, filed
an urgent motion for resolution of his petition for the
issuance of a restraining order.

CIVIL PROCEDURE
The petitioner again filed an urgent
supplementary motion for a restraining order pending the
resolution of his petition for relief or a motion to dismiss
the case.
The petitioner filed still another urgent motion for
resolution of his petition for the issuance of a restraining
order pointing out that the respondent court had not
resolved his motion even as the date of sale in the sheriffs
notice for the sale on execution of his properties was only
a few days away.
The respondent court issued the following order
denying, for lack of merit, the "Petition for Relief from
Judgment" and the "Petition for the Issuance of a
Restraining Order filed by Rufino Co.
Supreme Court (SC) issued a temporary
restraining order enjoining the respondent Regional Trial
Court from taking further action in this civil case, more
particularly from taking any further proceedings relative to
the writ of execution in this civil case, until further orders.
Issue:
Considering that under the allegations of the
complaint, both the defendants PEPSI and Co are
indispensable parties, sued under a common cause of
action, may the plaintiff move to dismiss the case against
the PEPSI without notice to defendant Co? Yes
Held:
The petitioner contends that he and PEPSI are
indispensable parties sued under a common cause of
action and that if the complaint is dismissed insofar as
PEPSI is concerned, the court should have ordered also the
dismissal of the case insofar as it affects the petitioner.
According to him, it does not matter that the dismissal is
upon the evidence presented by the plaintiff or upon the
latters mere desistance, for in both instances, a lack of
sufficient legal basis must be the cause.
The private respondents state that the petitioner
is confusing the decision of the court a quo because
instead of questioning the order denying the petition for
relief from judgment, the petitioner assails the decision of
the court which has already become final and executory
with the writ of execution issued already being
implemented by the deputy sheriff.
Supreme Court agreed with the petitioner. The
private respondents complaint for a sum of money with
attachment against PEPSI and Co clearly shows that PEPSI
and the petitioner are indispensable parties to the case. In
fact the private respondents sued both PEPSI and the
petitioner under a common cause of action.
Likewise, the affidavit attached in support of the
complaint is framed in such a way that there can be no
doubt as to the intention of the private respondents in
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Case Digest: Rule 9 Effect of Failure to Plead

suing PEPSI and the petitioner herein as indispensable
parties.
SCs ruling in Lim Tanhu v. Hon. Ramolete is
applicable to the instant petition. The fact that in the case
of Lim Tanhu several defendants were declared in default
and the defenses set up by those who answered the
complaint were available to those who were in default,
while in the case at bar both PEPSI and the petitioner did
not answer the complaint, is of no moment because Lim
Tanhu cases ruling was based on the fact that all the
defendants therein were indispensable parties and the
plaintiff moved for the dropping of two defendants from
the complaint. The situation is similar to this case where
both PEPSI and Rufino Co were sued as indispensable
parties under a common cause of action, and on motion of
the private respondent PEPSI was dropped as a party
defendant.
Applying Tanhu ruling, SC found that the
respondent court erred in (1) declaring petitioner Co in
default; (2) in hearing the plaintiffs evidence ex-parte on
December 3, 1982; (3) in rendering the decision dated
March 9, 1983; (4) in issuing the writ of execution and in
having the petitioners properties levied upon in
execution; (5) in having them advertised for sale, and
consequently, (6) in ordering them sold to answer for the
private respondents claim. After the lower court dropped
PEPSI as a party defendant in Civil Case No. 42815, the
respondent court lost authority to act further in the case
insofar as the petitioner is concerned.

Effect of an order of default - Sec. 3(a), Rule 9

BOTICANO vs CHU
G.R. No. L-58036, March 16, 1987
Facts:
Petitioner Eliseo Boticano is the registered owner
of a Bedford truck with plate No. QC-870 which he was
using in hauling logs for a certain fee. One evening, while
loaded with logs, it was properly parked by its driver
Maximo Dalangin at the shoulder of the national highway
in Barrio Labi, Bongabon, Nueva Ecija when it was hit and
bumped at the rear portion by a Bedford truck bearing
plate No. QK-516 owned by private respondent Manuel
Chu, Jr. and driven by Jaime Sigua, the formers codefendant in this case. Manuel Chu, Jr. acknowledged
ownership thereof and agreed with petitioner to shoulder
the expenses of the repair of the damaged truck of the
latter.

CIVIL PROCEDURE
When Manuel Chu, Jr. failed to comply with
aforesaid agreement as well as to pay damages
representing lost income despite petitioners demands,
the latter (plaintiff in the lower court), filed a complaint at
the Court of First Instance against private respondent
Manuel Chu, Jr. and Jaime Sigua, both as defendants in a
civil case.
Summons was issued but was returned unserved
for defendant Jaime Sigua because he was no longer
connected with San Pedro Saw Mill, Guagua, Pampanga,
while another copy of the summons for Manuel Chu, Jr.
was returned duly served on him thru his wife Veronica
Chu at his dwelling house.
Petitioner moved to dismiss the case against
Jaime Sigua and to declare Manuel Chu, Jr. in default for
failure to file responsive pleadings within the reglementary
period. The motion was granted by the lower court in an
order allowing petitioner to adduce his evidence ex parte.
From the evidence adduced by the plaintiff
(petitioner), the trial court found that private respondent
Manuel Chu, Jr. is responsible for the fault and negligence
of his driver Sigua under Article 2180 of the Civil Code,
whose negligence and lack of due care was the immediate
and proximate cause of the damage to petitioners truck
and ruled in favor of plaintiff-petitioner.
On March 19, 1979 private respondent Manuel
Chu, Jr. filed with the trial court a "Notice of Appeal" and
an Urgent Motion for Extension of Time to File Record on
Appeal which was granted by the trial court on the same
date.
Atty. Hermenegildo D. Ocampo, counsel of record
of private respondent, filed a "Motion to Withdraw as
Counsel" while the new counsel Atty. Wilfredo G.
Laxamana entered his appearance and filed his record on
appeal.
Petitioner filed with the trial court a Motion to
Dismiss Appeal and for execution wherein private
respondents counsel personally appeared and opposed
petitioners motion. Petitioner filed his reply to opposition.
The trial court issued an order denying aforesaid motion.
The trial court issued another order approving private
respondents Record on Appeal.
Court of Appeals issued its decision setting aside
the appealed judgment for being null and void and its
order denying petitioners motion for reconsideration.
Hence, this petition.
Issue:
If the defendant in the Regional Trial Court has
been declared in default, may he appeal the default
judgment that may subsequently be rendered even if he
has not asked the RTC to set aside the declaration of
default? Yes!
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Case Digest: Rule 9 Effect of Failure to Plead

Held:
The answer is in the affirmative. However a
distinction must be made as to the effects of such appeal.
(a) If an appeal is made without first asking the
RTC to set aside the declaration of default, and the
appellate court sets aside on said declaration, all he can
get is a review of the RTCs default judgment without the
opportunity of having the higher court consider defense
evidence (for the simple reason that no evidence was even
adduced by him in the RTC) (Rule 41, sec. 2, par. 3, Rules of
Court).
(b) If upon the other hand, the defendant first
asks the RTC to set aside the declaration of default (Rule
18, secs. 2 and 3, Rules of Court), and he is able to prevail,
the declaration will be set aside, and he will now have the
opportunity to present his evidence in the RTC. Thus, even
if he finally loses in the RTCs subsequent decision, his
defense can be considered, when appeal is made to the
appellate tribunal. Of course, even if the default
declaration is not set aside despite his motion for the
setting aside, he will be entitled to all notices in the court
proceedings, and can file any pleading he may wish to file,
including the notice of appeal. (Rule 13, sec. 9, Rules of
Court).
Incidentally, the afore-mentioned rules apply to
default declarations in the Metropolitan Trial Courts, the
Municipal Trial Courts, and the Municipal Circuit Trial
Courts, for under Batas Pambansa Bilang 129, the said
inferior courts will follow the rules in the RTC. Note
however that in summary proceedings, there can be no
default declarations.
In the case at bar, there is no question that
summons was timely issued and received by private
respondent. In fact, he never denied actual receipt of such
summons but confined himself to the argument that the
sheriff should prove that personal service was first made
before resorting to substituted service.
This brings to the fore the question of procedural
due process. In Montalban v. Maximo, the Court ruled that
"The constitutional requirement of due process exacts that
the service be such as may be reasonably expected to give
the notice desired. Once the service provided by the rules
reasonably accomplishes that end, the requirement of
justice is answered; the traditional notions of fair play are
satisfied; due process is served."
Indeed, such construction is but fair, and in
accord with substantial justice. The burden on a plaintiff is
not to be enlarged with a restrictive construction desired
by the defendant.
Finally in a last ditch effort, private respondent
insists that there was no valid service of summons because
private respondent is a partner and general manager in
San Pedro Sawmill. Consequently the wife of private

CIVIL PROCEDURE
respondent to whom summons and complaint were
allegedly served not being partnership, cannot receive the
same under Section 13 of Rule 14 of the Rules of Court.
It has however been settled that actions must be
brought by the real parties in interest and against the
persons who are bound by the judgment obtained therein.
The title of the case both in the trial court, in the
Court of Appeals and in the Supreme Court shows that the
partnership is not a party. On the contrary, as previously
stated private respondent himself assumed the
responsibility of the accident and is now estopped to
disclaim the liabilities pertaining thereto.
From what has been discussed the following
conclusions are hereby made: jurisdiction was properly
acquired by the trial court over the person of respondent
thru both service of summons and voluntary appearance in
court; he was therefore properly declared in default for
not having filed any answer; despite respondents failure
to file a motion to set aside the declaration of default, he
has the right to appeal the default judgment but in the
appeal only the evidence of the petitioner may be
considered, respondent not having adduced any defense
evidence; the Supreme Court agreed with the findings of
fact by the trial court, the same being unrebutted.
WHEREFORE, the assailed decision and resolution
of the Court of Appeals are REVERSED and SET ASIDE, and
the decision of the then Court of First Instance (now
Regional Trial Court) of Nueva Ecija, Cabanatuan City in
Civil Case No. 6754 "Eliseo Boticano v. Manuel Chu, Jr. and
Jaime Sigua" is hereby REINSTATED.

Relief from an order of default - Sec. 3(b), Rule 9

DENSO (PHIL.), INC. vs IAC
G.R. No. 75000, February 27, 1987
Facts:
A fire broke out at the Nippondenso Building
which was owned by the Kayamanan Development
Corporation (KAYAMANAN), and was then under lease to
Denso (Phils), Inc. (DENSO). The fire caused extensive
damage. DENSO and its correspondent firm in Japan,
NIPPONDENSO, reportedly suffered losses amounting to
P6,131,976.65 and P682,212.58. On the other hand,
KAYAMANAN's loss was placed at P1,750,000.00.
KAYAMANAN instituted an action against DENSO
before the RTC for recovery of (a) unpaid rentals; (b) the
cost of repairing the damage caused by the fire to the
leased building, it being alleged that DENSO was bound to
bear said cost under their lease agreement; and (c)
unrealized monthly rents and attorney's fees.
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Case Digest: Rule 9 Effect of Failure to Plead

Summons was served on DENSO but summons
(together with the accompanying copy of the complaint)
was not referred by DENSO to its counsel until June 22,
1985. This prompted the latter to file on June 25, 1985 a
"MOTION FOR EXTENSION OF TIME TO FILE ANSWER,"
pleading the late referral, the need to attend to other legal
work of equal importance, as well as the time requirement
for study of the factual and legal points involved in the
action, and praying, in consequence, for an additional
period of 15 days from June 25 within which to present the
requisite responsive pleading. The motion closed with a
"Notice of Hearing" addressed to the Clerk of Court, asking
that the motion be submitted to the court for
consideration and approval immediately upon its receipt;
and a notation that a copy of the motion had been
furnished plaintiff KAYAMANAN's counsel.The copy of the
motion was actually received by KAYAMANAN's counsel
the following day, June 26, 1985 .
Motion for extension was denied. KAYAMANAN
presented an "Ex parte Motion to Declare Defendant in
Default" asserting that the reglementary period of 15 days
for DENSO to file answer had expired on June 25, 1985
without any answer having been filed, but making no
reference to DENSO's motion for extension which, as
above stated, had been received by it on June 26, 1985.
Judge Guadiz promulgated an Order deeming the motion
for default to be "well-taken," and accordingly declaring
DENSO in default and setting the reception of
KAYAMANAN's evidence ex-parte.
DENSO learned of the order of default and the
judgment by default. It then filed a verified motion for
reconsideration of said order and judgment. Acting
thereon, the Trial Court promulgated an Order setting
aside, "in the interest of substantial justice," the order of
default as well as the decision; but hearing was
rescheduled only for the presentation of defendant
DENSO's evidence, the Court explicitly stating that the
evidence already presented (by KAYAMANAN) would
remain on record "without the right of cross examination
on the part of the defendant." The hearing was set on
October 2, 1985 but at DENSO's instance, was rescheduled on October 24, 1985.
DENSO submitted its formal motion for
reconsideration praying for the right to cross-examine
KAYAMANAN's witnesses. The record does not show that
any opposition to the motion was ever filed. DENSO
received notice of the Order of the Court dated October
24, 1985 (the date of the hearing), denying its (DENSO's)
motion to be allowed to cross-examine KAYAMANAN's
witnesses, and scheduling the initial hearing for the
presentation of the defense witnesses.
DENSO then asked for deferment of the hearing
so that it might elevate this adverse ruling to a higher

CIVIL PROCEDURE
court. This was denied, and when DENSO declared itself as
not ready to proceed with the presentation of evidence,
the Court dictated an Order stating that "this being the
third time that defendant failed to present its evidence
notwithstanding the chance given to it, the 'Decision'
dated July 1, 1985 is revived."
Without awaiting service of the Order, DENSO
filed a petition for certiorari with the Intermediate
Appellate Court, praying for the annulment of the series of
orders of Judge Guadiz already referred to, starting with
the order of default of June 26, 1985 and culminating in
the order of January 9, 1986 reviving the judgment by
default.
The Intermediate Appellate Court (Fourth Special
Cases Division) considered the crucial issue to be "the
propriety or impropriety" of the order which, while setting
aside the previous order of default and the judgment by
default, prescribed that the evidence already presented
would remain in the record and denied petitioner the right
to cross-examine the respondent's witnesses who had
testified at the ex-parte hearing. It declared unnecessary
further consideration of the order of default and judgment
by default thus set aside, and limited its review of the
proceedings to the question of whether or not the
petitioner was properly denied the right of crossexamination.
Appellate Court ruled that the right of crossexamination, while a part of due process so that denial
thereof amounts to depriving a party of his day in court, is
nonetheless waivable; that since petitioner received copy
of the order setting the judgment by default aside and
scheduling the case for hearing only for reception of
defendant's evidence without right to cross-examine
plaintiff's witnesses but did not move for its
reconsideration after a lapse of 38 days, such inaction
amounted to a waiver of the claimed right to crossexamine; and, moreover, said motion for reconsideration
came too late because the order sought to be
reconsidered was by then already final, the applicable
period of appeal being only fifteen (15) days from notice of
said order, and that (in any event) DENSO was guilty of
laches.
Issue:
Whether or not IAC is correct.
Held:
No. The Decision of the Intermediate Appellate
Court under review is reversed and set aside.
The error in these pronouncements is
immediately apparent. They assume that the order in
question is a final-and appealable order, when it is in

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Case Digest: Rule 9 Effect of Failure to Plead

fact interlocutory. The distinction between final and
interlocutory orders is a well-settled one.
The concept of "final" judgment, as distinguished
from one which has "become final" (or "executory" as of
right [final and executory]), is definite and settled. A "final"
judgment or order is one that finally disposes of a case,
leaving nothing more to be done by the Court in respect
thereto, e.g., an adjudication on the merits which, on the
basis of the evidence presented at the trial, declares
categorically what the rights and obligations of the parties
are and which party is in the right; or a judgment or order
that dismisses an action on the ground, for instance, of res
judicata or prescription. Once rendered, the task of the
Court is ended, as far as deciding the controversy or
determining the rights and liabilities of the litigants is
concerned. Nothing more remains to be done by the Court
except to await the parties' next move (which among
others, may consist of the filing of a motion for new trial or
reconsideration, or the taking of an appeal) and ultimately,
of course, to cause the execution of the judgment once it
becomes 'final' or, to use the established and more
distinctive term, "final and executory." ...
xxx xxx xxx
Conversely, an order that does not finally dispose
of the case, and does not end the Court's task of
adjudicating the parties' contentions and determining their
rights and liabilities as regards each other, but obviously
indicates that other things remain to be done by the Court,
is "interlocutory," e.g., an order denying a motion to
dismiss under Rule 16 of the Rules, or granting a motion
for extension of time to file a pleading, or authorizing
amendment thereof, or granting or denying applications
for postponement, or production or inspection of
documents or things, etc. Unlike a "final" judgment or
order, which is appealable, as above pointed out, an
"interlocutory" order may not be questioned on appeal
except only as part of an appeal that may eventually be
taken from the final judgment rendered in the case.
That the order of September 3, 1985 was
interlocutory in character is beyond cavil. In setting aside
the order of default and the succeeding judgment by
default, it left the case open for further proceedings
before the Trial Court, not the least of which was the
reception of evidence for the petitioner. Therefore, it
could not become final in the sense that final judgments
become "final and executory." No appeal therefrom would
lie except in the context and as part of an appeal from a
subsequent final judgment on the merits, and a motion for
reconsideration thereof was not subject to the limiting
fifteen-day period of appeal prescribed for final judgments
or orders.
Neither will the Court consider laches as having
set in by reason of petitioner's allowing thirty-eight (38)

CIVIL PROCEDURE
days to pass before seeking a reconsideration of the order,
having in mind not only that such a relatively brief period
cannot by any reckoning be deemed an unreasonable
length of time, but also the fact that while laches is a
defense which operates independently of the statute of
limitations and is subject to no fixed periods, it is also
founded on equity and may be invoked only if the delay in
asserting a claim has worked a change in the conditions
such as would render unjust or inequitable the grant of the
relief sought.
Upon similar premises, this Court has consistently
held, since as early as in 1946, that motions for extension
of time to file record on appeal may be filed and passed
upon ex-parte, and the rulings on that point are applicable,
without differentiation, to motions for extension of time
to file answer.
While the order of default was in fact set aside by
the Trial Judge on motion of the petitioner, he failed to
afford petitioner the complete relief that the arbitrary and
improper issuance of said order and of the earlier order
denying the motion for extension clearly called for. Ideally,
the slate should have been wiped clean by setting aside
also the hearing at which the respondent presented its
evidence ex-parte, so that the parties would stand on even
terms with neither having the advantage of the other.
Instead, the Judge prescribed that the evidence presented
by the KAYAMANAN would remain in the record without
right on the part of DENSO to cross-examine the witnesses
who had already testified, and by necessary implication,
also denied DENSO the right to object to the documentary
evidence submitted by respondent. This, too, was abuse of
discretion. If a defendant is improperly declared in default
his time to answer not having expired because of a
timely ex-parte motion for extension he should be
entitled to relief which should consist not only in the
admission of his responsive pleading, but of the right to
cross-examine the witnesses presented and to object to
the exhibits offered in his absence, if not indeed to have
trial commence all over again. He should not, under these
circumstances, be penalized by loss of the right to crossexamine. This would be grossly unwarranted and unfair; it
would amount to a denial of due process.
The Appellate Court's observation that "*** it
cannot be denied that the petitioner had other remedies
at hand after the court a quo had set aside the questioned
Order of default and Default Judgment ***" It is
somewhat perplexing. Given the character of said orders,
particularly of the order of default, this Court is hard put to
conceive how DENSO could have acted to protect its rights
otherwise than as it did here, namely by exhausting all
recourse toward a reconsideration before the Trial Court
and then applying for corrective relief in the Intermediate
Appellate
Court.
The
petition
is
granted.
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Case Digest: Rule 9 Effect of Failure to Plead

Relief from an order of default - Sec. 3(b), Rule 9
LINA vs CA
G.R. No. L-63397, April 9, 1985
Facts:
Private respondent Northern Motors, Inc. filed
with the CFI Rizal (Pasig) a case for sum of money with
damages. Petitioner Alex Lina was served with summons
together with a copy of the complaint.
Then, when no answer or motion to dismiss was
filed by petitioner, Northern Motors, Inc. filed a motion to
declare him in default. The motion was set for hearing on
May 21, 1982.
Petitioner filed his opposition to the aforesaid
motion inviting attention to the fact that he had filed a
motion for extension of time to file responsive pleading
within the reglementary period.
Respondent judge (Hon. Pineda) issued an order
declaring Petitioner herein in default and allowing herein
private respondent to adduce its evidence ex parte.
Petitioner filed his answer to the complaint.
On July 28, 1982, respondent court rendered its
decision in favor of private respondent. Thereafter
petitioner filed a motion to set aside the said decision.
Respondent judge issued an order denying petitioner's
motion to set aside decision.
Petitioner filed with the CA a petition for
certiorari/prohibition.
CA denied the petition on the ground that: it is
conclusively assumed that the respondent court, in
resolving the motion to declare defendant in default, had
taken into consideration the motion for extension,
especially because the ground of petitioner's opposition to
the motion to declare defendant in default is the fact that
he had asked for extension of time to file responsive
pleading. Now, then, when the respondent court declared
the defendant in default, it is a clear and inevitable
implication, without the need of an express statement to
that effect, although it would have been more desirable,
that the motion for extension of nine to file responsive
pleading was denied. In other words, the Order of May 26,
1982 had the necessary and logical implication that the
petitioner's opposition to the motion to declare defendant
in default, based upon the ground that he had asked for
extension of time to file responsive pleading, was
disapproved or denied by the court.
Hence this petition.

CIVIL PROCEDURE
Held:
We agree with the CA. The granting of additional
time within which to file an answer to a complaint is a
matter largely addressed to the sound discretion of the
trial court. In the case at bar, it was on May 5, 1982 or 2
days before the expiration of the 15-dayreglementary
period given to defendant to file his responsive pleading
when petitioner moved for an extension of 20 days which
to file his answer. Upon motion of private respondent and
over the objection of petitioner, respondent judge issued
an order declaring petitioner in default.
Under the Rules of Court, the remedies available
to a defendant in the CFI are:
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 a
meritorious defense; (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)
Petitioner in this case did not avail himself of any
of the above remedies. Instead, he went to the appellate
court on certiorari/prohibition. On this point, respondent
appellate court aptly said: ... where the judgment
rendered by the respondent court is the one sought to be
annulled, a petition for relief, under Rule 38 of the
Revised Rules of Court, which is a remedy in the ordinary
course of law, could have been just as plain, adequate
and speedy as certiorari. Such a remedy could have been
granted by the respondent court. And if the respondent
court still denies the petition, then petitioner can take an
appeal on the order denying the petition, and in the
course of such appeal petitioner can also assail the
judgment and the merits upon the ground that it is
supported by the evidence, or it is contrary to law. Thus,
the petition is DISMISSED.

Issue/s:
Whether or not certiorari is proper in a case
where judgment by default was rendered without an order
of default being furnished petitioner and where
meritorious defenses exist.

meikimouse

Case Digest: Rule 9 Effect of Failure to Plead

Effect of a partial default - Sec. 3(c), Rule 9
LIM TANHU vs RAMOLETE
G.R. No. L-40098, August 29, 1975
Facts:
A complaint filed on February 9, 1971 by
respondent Tan Put only against the spouses-petitioners
Antonio Lim Tanhu and DyOchay. Subsequently, in an
amended complaint dated September 26, 1972, their son
Lim TeckChuan and the other spouses-petitioners Alfonso
Leonardo Ng Sua and Co Oyo and their son Eng Chong
Leonardo were included as defendants.
In the amended complaint, respondent Tan alleged
that she "is the widow of Tee Hoon Lim Po Chuan, who
was a partner in the commercial partnership, Glory
Commercial Company ... with Antonio Lim Tanhu and
Alfonso Ng Sua that "defendant Antonio Lim Tanhu,
Alfonso Leonardo Ng Sua, Lim TeckChuan, and Eng Chong
Leonardo, through fraud and machination, took actual and
active management of the partnership and although Tee
Hoon Lim Po Chuan was the manager of Glory Commercial
Company, defendants managed to use the funds of the
partnership to purchase lands and building's.
The admission of said amended complaint was
opposed by defendants upon the ground that there were
material modifications of the causes of action previously
alleged, but respondent judge nevertheless allowed the
amendment.
All of the included defendants filed single answer
with counterclaim, over the signature of their common
counsel, defendants denied specifically not only the
allegation that respondent Tan is the widow of Tee Hoon
because, according to them, his legitimate wife was
AngSiok Tin still living and with whom he had four (4)
legitimate children, a twin born in 1942, and two others
born in 1949 and 1965, all presently residing in Hongkong,
but also all the allegations of fraud and conversion quoted
above, the truth being, according to them, that proper
liquidation had been regularly made of the business of the
partnership and Tee Hoon used to receive his just share
until his death, as a result of which the partnership was
dissolved and what corresponded to him were all given to
his wife and children.
During the date set for the pre-trial, both of the two
defendants-spouses the Lim Tanhus and Ng Suas, did not
appear, for which reason, upon motion of plaintiff dated
February 16, 1973, in an order of March 12, 1973, they
were all "declared in DEFAULT as of February 3, 1973 when
they failed to appear at the pre-trial." They sought to hive
this order lifted thru a motion for reconsideration, but the
effort failed when the court denied it.
Thereafter, the trial started, but at the stage
thereof where the first witness of the plaintiff by the name

CIVIL PROCEDURE
of Antonio Nuez who testified that he is her adopted son,
was up for re-cross-examination, said plaintiff
unexpectedly filed a motion to drop Lim Teck and Eng
Chong (two amongst the several defendants in the case).
The motion to drop was granted.
Subsequently, another order was issued:
Considering that defendants Antonio Lim Tanhu and his
spouse DyOchay as well as defendants Alfonso Ng Sua and
his spouse Co Oyo have been declared in default for failure
to appear during the pre-trial and as to the other
defendants the complaint had already been ordered
dismissed as against them.
A hearing of plaintiffs evidence ex-parte was
scheduled. Upon learning of these orders on October 23,
1973, the defendant Lim Teck Cheng, thru counsel, Atty.
Sitoy, filed a motion for reconsideration thereof, and on
November 1, 1974, defendant Eng Chong Leonardo, thru
counsel Atty. Alcudia, filed also his own motion for
reconsideration and clarification of the same orders. These
motions were denied.
Respondent court rendered the impugned decision
but it does not appear when the parties were served
copies of this decision.
Subsequently, all the defendantsfiled a motion to
quash the order on the receipt of evidence ex parte.
Without waiting however for the resolution thereof, Lim
TeckChuan and Eng Chong Leonardo went to the Court of
Appeals with a petition for certiorari seeking the
annulment of the above-mentioned orders. The CA
dismissed the petition on the ground that it was
prematurely filed.
The petitioners now argue before the court that to
begin with, there was compulsory counterclaim in the
common answer of the defendants the nature of which is
such that it cannot be decided in an independent action
and as to which the attention of respondent court was
duly called in the motions for reconsideration. Besides,
and more importantly, under Section 4 of Rule 18,
respondent court had no authority to divide the case
before it by dismissing the same as against the nondefaulted defendants and thereafter proceeding to hear it
ex-parte and subsequently rendering judgment against the
defaulted defendants, considering that in their view, under
the said provision of the rules, when a common cause of
action is alleged against several defendants, the default of
any of them is a mere formality by which those defaulted
are not allowed to take part in the proceedings, but
otherwise, all the defendants, defaulted and not
defaulted, are supposed to have but a common fate, win
or lose. In other words, petitioners posit that in such a
situation, there can only be one common judgment for or
against all the defendant, the non-defaulted and the
defaulted.
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Case Digest: Rule 9 Effect of Failure to Plead

Thus, petitioners contend that the order of
dismissal of October 21, 1974 should be considered also as
the final judgment insofar as they are concerned, or, in the
alternative, it should be set aside together with all the
proceedings and decision held and rendered subsequent
thereto, and that the trial be resumed as of said date, with
the defendants Lim TeckChuan and Eng Chong Leonardo
being allowed to defend the case for all the defendants.
On the other hand, private respondent argues that
inasmuch as petitioners had been properly declared in
default, they have no personality nor interest to question
the dismissal of the case as against their non-defaulted codefendants and should suffer the consequences of their
own default.
Held:
Being declared in default does not constitute a
waiver of rights except that of being heard and of
presenting evidence in the trial court. According to Section
2, "except as provided in Section 9 of Rule 13, a party
declared in default shall not be entitled to notice of
subsequent proceedings, nor to take part in the trial." That
provision referred to reads: "No service of papers other
than substantially amended pleadings and final orders or
judgments shall be necessary on a party in default unless
he files a motion to set aside the order of default, in which
event he shall be entitled to notice of all further
proceedings regardless of whether the order of default is
set aside or not." And pursuant to Section 2 of Rule 41, "a
party who has been declared in default may likewise
appeal from the judgment rendered against him as
contrary to the evidence or to the law, even if no petition
for relief to set aside the order of default has been
presented by him in accordance with Rule 38.
defaulted defendant is not actually thrown out of
court. While in a sense it may be said that by defaulting he
leaves himself at the mercy of the court, the rules see to it
that any judgment against him must be in accordance with
law. The evidence to support the plaintiff's cause is, of
course, presented in his absence, but the court is not
supposed to admit that which is basically incompetent.
Although the defendant would not be in a position to
object, elementary justice requires that, only legal
evidence should be considered against him. If the evidence
presented should not be sufficient to justify a judgment for
the plaintiff, the complaint must be dismissed. And if an
unfavorable judgment should be justifiable, it cannot
exceed in amount or be different in kind from what is
prayed for in the complaint.
Where a complaint states a common cause of
action against several defendants and some appear to
defend the case on the merits while others make default,
the defense interposed by those who appear to litigate the

CIVIL PROCEDURE
case inures to the benefit of those who fail to appear, and
if the court finds that a good defense has been made, all of
the defendants must be absolved. In other words, the
answer filed by one or some of the defendants inures to
the benefit of all the others, even those who have not
seasonably filed their answer. The proper mode of
proceeding where a complaint states a common cause of
action against several defendants, and one of them makes
default, is simply to enter a formal default order against
him, and proceed with the cause upon the answers of the
others. The defaulting defendant merely loses his standing
in court, he not being entitled to the service of notice in
the cause, nor to appear in the suit in any way. He cannot
adduce evidence; nor can he be heard at the final hearing,
although he may appeal the judgment rendered against
him on the merits. (Rule 41, sec. 2.) If the case is finally
decided in the plaintiff's favor, a final decree is then
entered against all the defendants; but if the suit should
be decided against the plaintiff, the action will be
dismissed as to all the defendants alike.
It provides that when a complaint states a
common cause of action against several defendants, some
of whom answer, and the others make default, 'the court
shall try the case against all upon the answer thus filed and
render judgment upon the evidence presented by the
parties in court'. It is obvious that under this provision the
case is tried jointly not only against the defendants
answering but also against those defaulting, and the trial is
held upon the answer filed by the former; and the
judgment, if adverse, will prejudice the defaulting
defendants no less than those who answer. In other
words, the defaulting defendants are held bound by the
answer filed by their co-defendants and by the judgment
which the court may render against all of them. By the
same token, and by all rules of equity and fair play, if the
judgment should happen to be favorable, totally or
partially, to the answering defendants, it must
correspondingly benefit the defaulting ones, for it would
not be just to let the judgment produce effects as to the
defaulting defendants only when adverse to them and not
when favorable.

meikimouse

Case Digest: Rule 9 Effect of Failure to Plead

Extent of relief - Sec. 3(d), Rule 9
PASCUA vs HON. FLORENDO
G.R. No. L-39047, April 30, 1985
Facts:
Petitioners, as plaintiffs, filed a complaint for
reconveyance with damages against the private
respondents, spouses Clemente and Juliana Castro. The
latter, as defendants, in lieu of filing an answer, filed a
motion to dismiss the complaint on the grounds that the
complaint states no cause of action and that the same is
already barred by the statute of limitations.
The trial court denied the respondents' motion
after finding that the grounds relied upon by them did not
appear on the face of the complaint. The court
subsequently declared the respondents in default for their
having failed to file an answer within the reglementary
period. Thus, the petitioners proceeded to present their
evidence ex-parte.
Not satisfied with the trial court's decision,
petitioners elevated the case to this Court through this
petition. The petitioners ask us to examine the following
alleged errors of the respondent court:
The petitioners contend that the trial court acted
with grave abuse of discretion when, after hearing their
evidence presented ex-parte, the respondents having been
declared in default, it dismissed the case on the ground
that the action had already prescribed. When the same
ground was earlier raised, the court denied the motion to
dismiss filed by the respondents. The petitioners argue
that because of its denying the motion to dismiss, the trial
court is estopped from dismissing the case on the same
ground.
Petitioners further contend that the court's
conclusion that they had knowledge of the sale executed
by their deceased brother, Martin Pascua about twenty
years ago is based merely on surmises and conjectures
because, in reality, it was only in 1973 when they came to
learn of the deed of sale executed by their deceased
brother in 1951. In 1973, the deed was shown to them by
respondent Clemente Castro at the Agrarian office.
Therefore, the period of prescription should be counted
from the knowledge of the petitioners of the deed of sale
and not from the date it was executed.
Issue:
Whether or not the trial court erred in not
granting relief to plaintiffs although the defendants were
declared in default.
Held:
No. Petitioners' contention are without merit. The
petitioners raise as a second issue that the respondent

CIVIL PROCEDURE
court had no alternative but to grant the relief prayed for
in their complaint as this was evident in the tenor of the
summons issued by said court which in part stated: ... if
you fail to appear within the time aforesaid, the plaintiff
will take judgment against you by default and demand
from this Court the relief applied for in said complaint. ...
Petitioners also anchor their contention on Rule
18, Section 1 of the Rules of Court which provides:
Judgment by default.If the defendant fails to
answer within the time specified in these rules, the court
shall, upon motion of the plaintiff and proof of such
failure, declare the defendant in default. Thereupon the
court shall proceed to receive the plaintiff's evidence and
render judgment granting him such relief as the complaint
and the facts proven may warrant. This provision applies
where no answer is made to a counter-claim, cross-claim
or third-party complaint within the period provided in this
Rule.
Nowhere in the aforequoted provision nor in the
summons issued by the respondent court is it stated that
the petitioners are automatically entitled to the relief
prayed for, once the respondents are declared in default.
Favorable relief can be granted only after the
court has ascertained that the evidence offered and the
facts proven by the presenting party, petitioners in this
case, warrant the grant of the same. Otherwise, it would
be meaningless to require presentation of evidence if
everytime the other party is declared in default, a decision
would automatically be rendered in favor of the nondefaulting party and exactly according to the tenor of his
prayer. This is not contemplated by the Rules nor is it
sanctioned by the due process clause.

Actions where default is not allowed - Sec. 3(e), Rule 9

DELA CRUZ vs HON. EJERCITO
G.R. No. L-40895, November 6, 1975
Facts:
Milagros de la Cruz was charged with bigamy in
the Court of First Instance of Pampanga, Angeles City
Branch IV for having married Sergeant Dominick L. Gaccino
on September 15, 1973 while her prior marriage to
Teodoro G. David was undissolved.
Milagros de la Cruz filed in the same court at its
San Fernando Branch III a complaint for the annulment of
her marriage to Sergeant Gaccino on the ground of duress.
Judge Castaeda rendered a decision annulling the
marriage of Milagros de la Cruz to Gaccino. No appeal was
taken from that decision. It became final. In view of the
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Case Digest: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

annulment of her second marriage, Milagros de la Cruz

filed a motion to dismiss the bigamy charge. The private
prosecutor and the prosecuting fiscal opposed the motion.
Judge BienvenidoEjercito denied it on the ground
that the decision in the annulment case is not controlling
in the criminal case because the parties and the issues in
the two cases are not the same.
That refusal of Judge Ejercito to dismiss the
bigamy case, not withstanding the judicial pronouncement
that her second marriage was a nullity, prompted Milagros
de la Cruz to file the instant special civil action
of certiorari and prohibition.
Issue:
Whether or not the bigamy case became moot or
untenable after the second marriage, on which the
prosecution for bigamy is based, was annulled.
Held:
In the annulment case that the second marriage
contracted by Milagros de la Cruz with Sergeant Gaccino
was a nullity is determinative of her innocence and
precludes the rendition of a verdict that she committed
bigamy. To try the criminal case in the face of such a
finding would be unwarranted.
And even supposing arguendo that the decree
annulling the second marriage was questionable or
erroneous because it was issued in a judgment by default,
still that would not prevent the decree from having legal
effect. "An erroneous judgment is not a void judgment"

meikimouse

Full Text: Rule 9 Effect of Failure to Plead

G.R. No. L-48577 September 30, 1980
SULPICIO
A.
GARCIA, petitioner,
vs.
COLONEL PAUL C. MATHIS, in his capacity as Base Commander,
Clark Air Force Base (CAFB) or his SUCCESSOR, and the
HONORABLE COURT OF FIRST INSTANCE OF PANGASINAN,
Branch IV, Dagupan City, respondents.

ABAD SANTOS, J.:

Petition for certiorari to set aside the Order of the respondent
judge, dated June 4, 1978, dismissing petitioner's Complaint
against the private respondent and another Order, dated July 7,
1978, denying a motion to reconsider the aforesaid order.
The factual background can be briefly stated as follows.
In Civil Case No. D-4097 of the Court of First Instance of
Pangasinan presided by the respondent judge, Sulpicio Garcia,
the petitioner herein, sued Colonel Paul C. Mathis in his capacity
as Base Commander, CAFB, acting for and in behalf of the United
States of America. The complaint, which was filed on November
8, 1977, alleged that Garcia was a civilian employee at Clark Air
Force Base from May 26, 1949, to August 23, 1956, when he was
dismissed for alleged bribery and collusion. He prayed inter
alia that he be reinstated to his former position, and paid back
wages, moral damages, attorney's fees and costs of the suit.

CIVIL PROCEDURE
House, G.R. No. L-22675, March 28, 1969, 27 SCRA 766). In this
case the complaint shows clearly that the plaintiff's action had
prescribed for he alleged that he was removed on August 23,
1956 (par. 5) but the case was filed only on November 18, 1977,
after a lapse of more than 21 years. Prescinding, therefore, the
defense of jurisdiction which is apparently meritorious, the
complaint was properly dismissed.
It is not amiss to state here that because of the special
appearance which the defendant had entered, he was
constrained to confine himself to showing that the trial court did
not have jurisdiction over his person and had to exclude all other
non-jurisdictional grounds in his motion to dismiss otherwise he
could be deemed to have abandoned his special appearance and
voluntarily submitted himself to the jurisdiction of the court.
(Republic vs. Ker z Co., Ltd; G.R. No. L-21609, Sept. 29,1966, 18
SCRA 207).
WHEREFORE, finding the petition to be without merit, the same
is hereby dismissal without any special pronouncement as to
costs.
SO ORDERED.

The defendant Mathis entered a special appearance and filed a

motion for the dismissal of the complaint upon the ground that
the trial court had no jurisdiction over his person because he was
being sued as the representative of a foreign sovereign "which
has not consented and does not now consent to the maintenance
of the present suit."
On June 7, 1978, the respondent judge issued an Order as
aforesaid the text of which reads as follows:
Without considering the issue of jurisdiction
raised by the defendant in his motion to
dismiss the above-entitled case, the Court
finds that the cause of action has already
prescribed, because paragraphs 3 and 5 of
the complaint alleged that the services of the
plaintiff has been terminated on August 23,
1956.
WHEREFORE, the above-entitled case is
hereby dismissed.
The only issue in this case is whether or not the respondent judge
committed a grave abuse of discretion amounting to lack of
jurisdiction when he dismissed the complaint on the ground of
prescription which the defendant did not raise in any of his
pleadings.
It is true that an action will not be held to have prescribed if
prescription is not expressly invoked. However there are
exceptions to this rule and one of them is when the plaintiff's
own allegations in his complaint show clearly that the action has
prescribed. (Philippine National Bank vs. Pacific Commission

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Full Text: Rule 9 Effect of Failure to Plead

G.R. No. 101883 December 11, 1992
SPOUSES LYDIA and VIRGILIO MELITON,* petitioners,
vs.
COURT OF APPEALS and NELIA A. ZIGA, represented by her
Attorney-in-Fact RAMON A. AREJOLA,**respondents.

REGALADO, J.:
1

In its judgment in CA-G.R. No. 25091 promulgated on August 9,

1991, respondent Court of Appeals annulled and set aside the
orders dated February 22, 1991 and March 18, 1991 of the
Regional Trial Court of Naga City, Branch 27, in Civil Case No. RTC
89-1942 thereof and ordered the dismissal of petitioner's
complaint filed herein, hence this appeal bycertiorari.
On June 22, 1988, private respondent Nelia Ziga, in her own
behalf and as attorney-in-fact of Alex A. Ziga and Emma A. ZigaSiy, filed a complaint, docketed as Civil Case No. RTC 88-1480 of
2
the Regional Trial Court, Branch 27, Naga City, against herein
petitioner Lydia Meliton for rescission of a contract of lease over
a parcel of land situated at Elias Angeles Street, Naga City.
Alleged as grounds therefor were said petitioner's failure, as
lessee, to deposit the one month rental and to pay the monthly
rentals due; her construction of a concrete wall and roof on the
site of a demolished house on the leased premises without the
lessor's written consent; and here unauthorized sublease of the
leased property to a third party.
On July 29, 1988, petitioner Lydia Meliton filed an answer to the
complaint denying the material averments thereof and setting up
three counterclaims for recovery of the value of her kitchenette
constructed on the leased parcel of land and which was
demolished by private respondent, in the amount of P34,000.00;
the value of the improvements introduced in the kitchenette to
beautify it, in the amount of P10,000.00, plus the value of the
furniture and fixtures purchased for use in the kitchenette in the
amount of P23,000.00; and moral damages in the amount of
P20,000.00 aside from attorney's fees of P5,000.00 and P250.00
per court appearance, with litigation expenses in the amount of
3
P1,000.00.
On May 29, 1989, the trial court, on motion of private
respondent contending that her cause of action had already
become moot and academic by the expiration of the lease
contract on February 7, 1989, dismissed the complaint. The
counterclaims of petitioner Lydia Meliton were also dismissed for
non-payment of the docket fees, ergo the trial court's holding
4
that thereby it had not acquired jurisdiction over the same.
On December 6, 1989, petitioners Lydia Meliton and Virgilio
Meliton filed a complaint against private respondent for recovery
of the same amounts involved and alleged in their counterclaims
in Civil Case No. RTC 88-1480, which complaint was docketed as
5
Civil Case No. RTC 89-1942 and likewise assigned to Branch 27
of the same trial court.
On February 15, 1991, private respondent filed a motion to
dismiss the complaint on the ground that the cause of action
therein was barred by prior judgment in Civil Case No. RTC 881480, the order of dismissal wherein was rendered on May 29,
6
1989.

CIVIL PROCEDURE
On February 22, 1991, the court below denied private
respondent's motion to dismiss the complaint in Civil Case No.
RTC 89-1942 on the ground that the dismissal of the petitioner's
counterclaims in Civil Case No. RTC 88-1480 is not an
adjudication on the merits as the court did not acquire
jurisdiction over the counterclaims for failure of petitioner Lydia
Meliton to pay the docket fees, hence the said dismissal does not
7
constitute a bar to the filing of the later complaint.
Private respondent's motion for reconsideration of the foregoing
order was denied by the lower court for lack of merit in its order
of March 18, 1991. 8 Dissatisfied therewith, private respondent
filed a petition for certiorari with this Court. In our resolution
dated April 29, 1991, we referred this case to the Court of
Appeals for proper determination and disposition pursuant to
9
Section 9, paragraph 1, of B.P. Blg. 129, where it was docketed
as CA-G.R. SP No. 25093.
In a decision promulgated on August 9, 1991, the Court of
Appeals granted the petition, the pertinent part of which reads:
xxx xxx xxx
The respondents' counterclaim against the
petitioner in Civil Case No. RTC 88-1480
(Annex E, petition) is a compulsory
counterclaim, it having (arisen) out of or
being necessarily connected with the
transaction or occurrence subject matter of
the petitioner's complaint. The failure of the
respondents to seek a reconsideration of the
dismissal of their counterclaim or to take an
appeal therefrom rendered the dismissal
final. Such dismissal barred the prosecution
of their counterclaim by another action
(Section 4, Rule 9, Revised Rules of Court;
Javier vs. IAC, 171 SCRA 605).
The respondent Court, therefore, in issuing
the orders complained of (Annexes G and I,
petition), gravely abused its discretion
amounting to lack of jurisdiction.
WHEREFORE, the petition for certiorari is
GRANTED.
Accordingly,
the
orders
complained of (Annexes G and I, petition) are
annulled and set aside and the respondents'
complaint in Civil Case No. RTC 89-1942
before the respondent Court, DISMISSED.
Costs against the respondents, except the
10
respondent Court.
Petitioners are now before use, assailing the said judgment of the
Court of Appeals and praying for the annulment thereof.
The present petition requires the resolution of two principal
issues, to wit: (1) whether or not the counterclaims of petitioners
are compulsory in nature; and (2) whether or not petitioners,
having failed to seek reconsideration of or to take an appeal from
the order of dismissal of their counterclaims, are already barred
from asserting the same in another action.
1. Considering Section 4 of Rule 9 of the Rules of Court, a
counterclaim is compulsory if (a) it arises out of, or is necessarily
connected with, the transaction or occurrence which is the
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Full Text: Rule 9 Effect of Failure to Plead

subject matter of the opposing party's claim; (b) it does not
require for its adjudication the presence of third parties of whom
the court cannot acquire jurisdiction; and (c) the court has
jurisdiction to entertain the claim.
It has been postulated that while a number of criteria have been
advanced for the determination of whether the counterclaim is
compulsory or permissive, the "one compelling test of
compulsoriness" is the logical relationship between the claim
alleged in the complaint and that in the counterclaim, that is,
where conducting separate trials of the respective claims of the
parties would entail a substantial duplication of effort and time,
as where they involve many of the same factual and/or legal
issues.
The phrase "logical relationship" is given meaning by the purpose
of the rule which it was designed to implement. Thus, a
counterclaim is logically related to the opposing party's claim
where, as already stated, separate trials of each of their
respective claims would involve a substantial duplication of effort
and time by the parties and the courts. Where multiple claims
involve many of the same factual issues, or where they are
offshoots of the same basic controversy between the parties,
fairness and considerations of convenience and of economy
require that the counterclaimant be permitted to maintain his
11
cause of action.
In the aforesaid Civil Case No. 88-1480, all the requisites of a
compulsory counterclaim are present. The counterclaims, as this
term is now broadly defined, are logically related to the
complaint. Private respondent's complaint was for rescission of
the contract of lease due to petitioner Lydia Meliton's breach of
her obligations under the said contract. On the other hand,
petitioner's counterclaims were for damages for unlawful
demolition of the improvements she introduced pursuant to her
leasehold occupancy of the premises, as well as for the filing of
that civil suit which is contended to be clearly unfounded.
Both the claims therein of petitioners and private respondent
arose from the same contract of lease. The rights and obligations
of the parties, as well as their potential liability for damages,
emanated from the same contractual relation. Petitioners' right
to claim damages for the unlawful demolition of the
improvements they introduced on the land was based on their
right of possession under the contract of lease which is precisely
the very same contract sought to be rescinded by private
respondent in her complaint. The two actions are but the
consequences of the reciprocal obligations imposed by law upon
and assumed by the parties under their aforesaid lease contract.
That contract of lease pleaded by private respondent constitutes
the foundation and basis relied on by both parties for recovery of
their respective claims.
The relationship between petitioners' counterclaims and private
respondent's complaint is substantially the same as that which
exists between a complaint for recovery of land by the owner
and the claim for improvements introduced therein by the
possessor. As we have ruled, in actions for ejectment or for
recovery of possession of real property, it is well settled that the
defendant's claims for the value of the improvements on the
property or necessary expenses for its preservation are required
to be interposed in the same action as compulsory couterclaims.
In such cases, it is the refusal of the defendant to vacate or
surrender possession of the premises that serves as the vital link
in the chain of facts and events, and which constitutes the
transaction upon which the plaintiff bases his cause of action. It is

CIVIL PROCEDURE
likewise an "important part of the transaction constituting the
subject matter of the counterclaim" of defendant for the value of
the improvements or the necessary expenses incurred for the
preservation of the property. They are offshoots of the same
basic controversy between the parties, that is, the right of either
12
to the possession of the property.
On the foregoing considerations, respondent Court of Appeals
correctly held that the counterclaims of petitioners are
compulsory in nature.
2. Petitioners having alleged compulsory counterclaims, the next
point of inquiry is whether or not petitioners are already barred
from asserting said claims in a separate suit, the same having
been dismissed in the preceding one. The answer is in the
negative.
It is indeed the rule, embodied in Section 4, Rule 9 of the Rules of
Court, that a counterclaim not set up shall be barred if it arises
out of or is necessarily connected with the transaction or
occurrence that is the subject matter of the opposing party's
claim and does not require for its adjudication the presence of
third parties of whom the court cannot acquire jurisdiction.
However, said rule is not applicable to the case at bar.
Contrary to the claim of private respondent, it cannot be said
that therein petitioners failed to duly interpose their causes of
action as counterclaims in the previous action. Petitioners' claims
were duly set up as counterclaims in the prior case but the same
were dismissed by reason of non-payment of docket fees. The
ruling of respondent Court of Appeals to the effect that the
failure of petitioners to appeal or to move for reconsideration of
the said order of dismissal bars them from asserting their claims
in another action cannot be upheld.
Firstly, where a compulsory counterclaim is made the subject of a
separate suit, it may be abated upon a plea ofauter action
pendant or litis pendentia and/or dismissed on the ground of res
13
judicata, depending on the stage or status of the other suit.
Both defenses are unavailing to private respondent. The present
action cannot be dismissed either on the ground of litis
pendentia since there is no other pending action between the
same parties and for the same cause, nor on the ground of res
judicata.
In order that a prior judgment will constitute a bar to a
subsequent case, the following requisites must concur: (1) the
judgment must be final; (2) the judgment must have been
rendered by a court having jurisdiction over the subject matter
and the parties; (3) the judgment must be on the merits; and (4)
there must be between the first and second actions, identity of
14
parties, of subject matter, and of causes of action.
The first case, Civil Case No. RTC 88-1480, was dismissed upon
motion of private respondent, plaintiff therein, under Section 2
of Rule 17. Dismissal thereunder is without prejudice, except
when otherwise stated in the motion to dismiss or when stated
15
to be with prejudice in the order of the court. The order of
dismissal of the first case was unqualified, hence without
prejudice and, therefore, does not have the effect of an
adjudication on the merits. On a parity of rationale, the same rule
should apply to a counterclaim duly interposed therein and which
is likewise dismissed but not on the merits thereof.

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Full Text: Rule 9 Effect of Failure to Plead

Moreover, in the same order of dismissal of the complaint, the
counterclaims of herein petitioners were dismissed by reason of
the fact the court a quo had not acquired jurisdiction over the
same for non-payment of the docket fees. On that score, the said
dismissal
was
also
without
prejudice,
since a dismissal on the ground of lack of jurisdiction does not
16
constitute res judicata, there having been no consideration and
adjudication of the case on the merits.
The dismissal of the case without prejudice indicates the absence
of a decision on the merits and leaves the parties free to litigate
the matter in a subsequent action as though the dismissal action
17
had not been commenced. The discontinuance of a case not on
the merits does not bar another action on the same subject
18
matter. Evidently, therefore, the prior dismissal of herein
petitioners' counterclaims is not res judicata and will not bar the
filing of another action based on the same causes of action.
Secondly, a reading of the order of dismissal will show that the
trial court, in dismissing the complaint of private respondent, did
not intend to prejudice the claims of petitioners by barring the
subsequent judicial enforcement thereof. As stated therein,
"(t)he court in dismissing the counterclaim(s) has taken into
account the fact that a counterclaim partakes of the nature of a
19
complaint and/or a cause of action against the plaintiffs." This
is a clear indication, deducible by necessary implication, that the
lower court was aware of the fact that petitioners could avail of
the causes of action in said counterclaims in a subsequent
independent suit based thereon and that there was no legal
obstacle thereto. That this was the import and intendment of
that statement in its order dismissing petitioners' counterclaims
in Civil Case No. RTC 88-1480 was categorically confirmed by the
very same court, wherein Civil Case No. RTC 89-1942 was also
subsequently filed, in its assailed orders denying private
respondent's motion to dismiss the latter case on the ground
of res judicata.
This is also concordant with the rule governing dismissal of
actions by the plaintiff after the answer has been served as laid
down in Rule 17 of the Rules of Court, which is summarized as
follows: An action shall not be dismissed at the request of the
plaintiff after the service of the answer, except by order of the
court and upon such terms and conditions as the court deems
proper. The trial court has the judicial discretion in ruling on a
motion to dismiss at the instance of the plaintiff. It has to decide
whether the dismissal of the case should be allowed, and if so, on
20
what terms and conditions.
In dismissing private respondent's complaint, the trial court could
not but have reserved to petitioners, as a condition for such
dismissal, the right to maintain a separate action for damages.
Petitioners' claims for damages in the three counterclaims
interposed in said case, although in the nature of compulsory
counterclaims but in light of the aforesaid reservation in the
dismissal order, are consequently independent causes of action
which can be the subject of a separate action against private
respondent.
An action for damages specifically applicable in a lessor-lessee
relationship is authorized in Article 1659 of the Civil Code which
provides that:
Art. 1659. If the lessor or the lessee should
not comply with the obligations set forth in
articles 1654 and 1657, the aggrieved party
may ask for the rescission of the contract and

CIVIL PROCEDURE
indemnification for damages, or only the
latter, allowing the contract to remain in
force.
Paragraph 3 of Article 1654 of the same Code requires that the
lessor must "maintain the lessee in the peaceful and adequate
enjoyment of the lease for the entire duration of the
21
contract." The aggrieved party has the alternative remedies, in
case of contractual breach, of rescission with damages, or for
damages only, "allowing the contract to remain in force."
The act of private respondent in demolishing the structures
introduced by petitioners on the property leased and the
improvements therein during the existence of the lease contract
is a clear violation by her, as lessor, of her obligation mandated
by paragraph 3, Article 1654 of the Civil Code. The said violation
gave rise to a cause of action for damages in favor of herein
petitioners.
Lastly, even assuming arguendo that the bar under the rule on
compulsory counterclaims may be invoked, the peculiar
circumstances of this case irresistibly and justifiedly warrant the
relaxation of such rule.
The court a quo dismissed petitioners' counterclaims for nonpayment of docket fees pursuant to our then ruling inManchester
Development Corporation, et al. vs. Court of Appeals, et
22
al., before its modification. The failure of petitioners to seek
reconsideration of or to take an appeal from the order of
dismissal of the counterclaim should not prejudice their right to
file their claims in a separate action because they were thereby
made to understand and believe that their counterclaims were
merely permissive and could be the subject of a separate and
independent action. Under the Rules, there is no need to pay
23
docket fees for a compulsory counterclaim. The ruling
in Manchester applies specifically to permissive counterclaims
only, thereby excluding compulsory counterclaims from its
24
purview, and that was the ruling of the court below to which
the litigants therein submitted. Had the trial court correctly
specified that petitioners' counterclaims were compulsory,
petitioners could have objected to the dismissal sought by
private respondent on the ground that said counterclaims could
25
not remain pending for independent adjudication.
Furthermore, under the Manchester doctrine, the defect cannot
be cured by an amendment of the complaint or similar pleadings,
much less the payment of the docket fee. Hence, the only
remedy left for the petitioners was to file a separate action for
their claims and to pay the prescribed docket fees therein within
the applicable and reglementary period, which is what they did in
the case at bar in obedience and deference to the judicial
mandate laid down in their case. At any rate, the ambivalent
positions adopted by the lower court can be considered cured by
what we have construed as effectively a reservation in its order
of dismissal for the filing of a complaint based on the causes of
action in the dismissed counterclaims.
This, then, is one case where it is necessary to heed the
injunction that the rules of procedure are not to be applied in a
rigid and technical sense. After all, rules of procedure are used
only to help secure substantial justice. They cannot be applied to
prevent the achievement of that goal. Form cannot and should
26
not prevail over substance. Absent a specific requirement for
stringent application, the Rules of Court are to be liberally
construed to the end that no party shall be deprived of his day in
court on technicalities. The courts in our jurisdiction are tribunals
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Full Text: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

both of law and equity. Hence, under the antecedents of this

case, we are persuaded that even if only to approximate that
desirable measure of justice we are sworn to dispense, this
controversy should be resolved on the merits.
WHEREFORE, the questioned judgment of respondent Court of
Appeals is hereby REVERSED and SET ASIDE. Civil Case No. RTC
89-1942 is hereby REINSTATED and the Regional Trial Court of
Naga City, Branch 27, or wherever the case has been assigned, is
directed to proceed with deliberate dispatch in the adjudication
thereof.
SO ORDERED.

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G.R. No. L-17330

June 29, 1963

The errors assigned by the appellants in their brief are the

following:

VALENTINA ROSARIO, accompanied by her husband

ESTANISLAO
FIESTAN,
and MATILDE ROSARIO accompanied by her husband MACARIO
ABERO, plaintiffs-appellees,
vs.
JUANA ALONZO, QUINTIN MANZANO and DEMETRIA
MANZANO, defendants-appellants.
Manuel
A.
Argel
for
Antonio C. Amor for defendants-appellants.

CIVIL PROCEDURE

plaintiffs-appellees.

PADILLA, J.:
This is an action for partition of two parcels of land situated in
the barrio of Taguipuro, municipality of Bantay, province of Ilocos
Sur, accounting of the products thereof, and damages brought by
the plaintiffs against the defendants.
The plaintiffs claimed that the two parcels of land described in
the complaint belonged to the conjugal partnership of their late
father Hilario Rosario and Juana Alonzo, his second wife.
The defendants, on the other hand, alleged that they had
acquired by purchase the first parcel of land with the proceeds of
the sale of cattle they had inherited from their deceased father
Eleno Manzano, had been in possession of the same as owners
for more than twenty years and paying the realty tax thereon;
that Juana Alonzo and Roberto Rosario had acquired by
occupation and homestead the second parcel of land and had
been in possession thereof as owners for more than twenty years
and paying realty tax thereon; that Hilario Rosario, the second
husband of Juana Alonzo, prior to his demise was blind for thirty
years and could not have earned money to purchase any parcel
of land; and that the action by the plaintiffs, if any, was reckless,
groundless and barred by the statute of limitations; and upon
those grounds they prayed for the dismissal of the complaint,
damages in the sum of P300 and costs.

The lower court erred, with abuse of discretion, in

refusing to give due consideration to lift order of
default and set aside judgment rendered in pursuance
thereof.
The lower court, in refusing to relieve appellants'
counsel from the effects and consequences of his
failure to appear and defend appellants' case,
committed a grave injustice to the prejudice of the
substantial rights of the herein defendants-appellants,
thereby barring them from defending their case and
presenting evidence thereof sufficient to overcome the
proof adduced by plaintiffs-appellees during the trial of
the case.
Having answered the complaint filed by the appellees, the
appellants were not and could not be in default. The appellants
complaint that in refusing to relieve their counsel from the
effects and consequences of his failure to appear and defend
their case, the lower court committed, a grave injustice to their
prejudice, for they contend that such failure was due to his
forgetfulness and oversight. 1wph1.t
Although the two motions for reconsideration were sworn to by
the attorney, for the appellants, still such motions were not
"accompanied with affidavits showing the fraud, accident,
mistake, or excusable negligence relied upon, and the facts
constituting the petitioner's good and substantial cause of action
or defense, as the case may be, which he may prove if his
petition be granted," provided for and required in section 3 of
Rule 38, as Rules of Court.
The order appealed from is affirmed, with costs against the
appellants.

On 27 October 1954 the parties submitted a partial agreed

statement of facts and reserved the right to present evidence.
The hearing of the case was set for the 18th day of March 1955.
On that date the defendants and their attorney failed to appear.
After introducing Exhibits A, B, C and D, the attorney for the
plaintiffs rested his case. On 11 April 1955 the court rendered
judgment against the defendants, as prayed for by the plaintiffs
except the amount of damages. The defendants moved for
reconsideration of the judgment thus rendered but on 4 June
1955 the motion was denied. On 6 August, the defendants filed
another motion praying for the setting aside of the judgment and
leave to present evidence. On the same ground as the denial of
the first motion that no affidavit of merit had been attached to or
had accompanied the motion, the latter was denied. The
defendants appealed. On 12 April 1957 the Court of Appeals
dismissed
the
appeal
(CA-G.R. No. 16192-R).On petition for certiorari docketed as G.R.
No. L-12309, on 30 April 1959 this Court set aside the resolution
of the Court of Appeals of 12 April 1957 and remanded the case
to the Court of Appeals for judgment on the merits. On 13 May
1960 the latter certified the case to this Court on the ground that
the two errors assigned by the appellants in their brief raise legal
questions only.

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Full Text: Rule 9 Effect of Failure to Plead

G.R. No. L-64591 January 17, 1985
RUFINO
CO, petitioner,
vs.
HON. EFICIO B. ACOSTA, in his Official Capacity as Presiding
Judge; RTC, Branch CLV, Pasig, Metro Manila, and THE
REFRIGERATION INDUSTRIES, INC., and DELTA MOTORS
CORPORATION, respondents.
Camilo R. Flores and Cesar S. de Guzman for petitioner.

GUTIERREZ, JR., J.:

This is a petition for certiorari to annul and set aside (1) the
respondent court's decision dated March 9, 1983 ordering
petitioner Rufino Co to pay respondents Refrigeration Industries,
Inc. and Delta Motors Corporation the sum of P2,907,535.00 plus
the legal rate of interest thereon from the date of demand,
P200,000.00 as and by way of attorney's fees, and costs; (2) the
order of default dated November 22, 1982; (3) the ex-parte
presentation of the respondents' evidence made on December 3,
1983; and (4) the sheriff's sale pursuant to the March 9, 1983
decision and to issue an order extending the effects of the order
of dismissal of Civil Case No. 42815 dated November 26, 1980 to
herein petitioner.
On November 20, 1979, Pepsi Cola Bottling Company of the
Philippines, Inc. (hereinafter called PEPSI), through Mr. C.M.
Aboitiz issued three (3) purchase orders addressed to CTC
Appliance Center for 12,000 units of refrigerators valued at
P35,322,900.00. Petitioner Rufino Co is the proprietor of the
Center.
On November 21, 1979, in a formal deed of assignment,
petitioner Co assigned his rights and interests to the three
purchase orders and to the money value of the deliveries made
or to be made thereunder to respondent Refrigeration's
Industries, Inc. (hereinafter called R II).
On March 13, 1980, PEPSI wrote a letter to the private
respondents informing them that on March 9, 1981, it took
notice of the assignments of the purchase orders by the
petitioner and stated that it was not recognizing the same.
In the course of time, 10,000 units of refrigerators were delivered
and paid. No problem arose from these 10,000 units.
On March 18, 1981, PEPSI wrote a letter to the petitioner
requesting the delivery of 1,000 units of refrigerators not later
than March 31, 1981 and stating that PEPSI will be talking directly
to respondent RII through Mr. Dominador Gana on the matter of
storage fees.

CIVIL PROCEDURE
does not recognize and does not feel bound by the petitioner's
assignment of the purchase orders.
On June 24, 1981, private respondent RII sent another letter of
demand to PEPSI demanding payment of the P2,907,535.00
within five days,
On June 26, 1981, PEPSI informed respondent RII that there is no
legal basis for the demand and no reason for PEPSI to pay the
1,000 units, It added further that respondent RII's recourse is
against the petitioner.
On July 8, 1981, failing to collect from PEPSI, private respondent
RII sent a letter of demand to the petitioner demanding payment
of P2,907,535.00, but the latter refused and failed to pay.
On September 10, 1981, private respondent RII and Delta Motors
Corporation filed Civil Case No. 42815 for a sum of money with
attachment before Branch X of the Court of First Instance of
Rizal, against Pepsi Cola Bottling Company of the Philippines, Inc.,
and petitioner Rufino Co.
On November 26, 1981, the private respondents filed a formal
ex-parte motion to dismiss the complaint against PEPSI. Attached
to the motion is an instrument entitled "Joint Release, Waiver
and/or Quitclaim" which covenants that Delta Motors, RII, and
PEPSI mutually agreed to release and forever discharge each
other from any and all liabilities or causes of action arising out of
the transaction involving the 1,000 units of refrigerators in order
to maintain harmonious business relations among the parties. On
the same day, the respondent court issued an order which reads:
On motion of the plaintiff, the complaint
against the defendant Pepsi-Cola Bottling
Company of the Philippines, Inc. is hereby
DISMISSED.
On November 19, 1982, the private respondents filed an ex-parte
motion to declare the petitioner Rufino Co in default for having
failed to file his answer.
On November 22, 1982, the respondent court issued the
following order:
AS PRAYED FOR by plaintiff thru counsel,
defendant Rufino Co is hereby declared in
default and plaintiff is allowed to present its
evidence ex-parte on December 3, 1982 at
2:30 p.m.
On March 9, 1983, the respondent court rendered its decision,
the dispositive portion of which states:

On June 2, 1981, private respondent RII sent a letter of demand

to PEPSI.

WHEREFORE, premises considered judgment

is hereby rendered in favor of the plaintiffs
and against the defendant Rufino Co,
ordering the latter to pay the former the sum
of P2,907,535.00 plus the legal rate of
interest therein from date of demand; the
sum of P200,000.00 as and by way of
attorney's fees; plus the costs of suit.

On June 4, 1981, PEPSI wrote private respondent RII

acknowledging receipt of the demand letter but stating that it

On April 12, 1983, petitioner Co filed a "Petition for Relief from

Judgment" alleging:

From March 23, 1981 to May 21, 1981 PEPSI received 1,000 units
of refrigerators directly from respondent RII. The total invoice
price of these units was P2,907,535.00.

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1. That excusable negligence transpired
which prevented petitioner from availing the
usual and ordinary remedies under the law.
2. That petitioner has a valid and meritorious
defense and had he not been prevented from
presenting his evidence the decision could
have been different.
Pending resolution of the petitioner's petition for relief from
judgment, the respondent court issued a writ of execution dated
April 12, 1983, and as a consequence, virtually all of the
petitioner's real properties were levied upon on execution and
advertised for sale at public auction on July 15, 20, and 22, 1983.
On April 27, 1983 the petitioner filed a motion for a restraining
order to restrain the writ of execution.
On June 6, 1983, the petitioner filed an urgent motion for
resolution of his petition for the issuance of a restraining order.
On June 9, 1983, the petitioner again filed an urgent
supplementary motion for a restraining order pending the
resolution of his petition for relief or a motion to dismiss the
case.
On July 6, 1983, the petitioner filed still another urgent motion
for resolution of his petition for the issuance of a restraining
order pointing out that the respondent court had not resolved his
motion even as the date of sale in the sheriff's notice for the sale
on execution of his properties was only a few days away.
On July 13, 1983, the respondent court issued the following
order:
For lack of merit, the "Petition for Relief from
Judgment" and the "Petition for the Issuance
of a Restraining Order filed by defendant
Rufino Co" are hereby DENIED.
On August 31, 1983, we issued a temporary restraining order
enjoining the respondent Regional Trial Court of Pasig, Branch
CLV from taking further action in Civil Case No. 42815, more
particularly from taking any further proceedings relative to the
writ of execution in said civil case, until further orders.
The petitioner raises the following legal issues for our resolution:
I
CONSIDERING
THAT
UNDER
THE
ALLEGATIONS OF THE COMPLAINT, BOTH THE
DEFENDANTS
PEPSI
COLA
BOTTLING
COMPANY OF THE PHILIPPINES, INC.,
(HEREAFTER TO BE REFERRED TO AS PEPSI
FOR SHORT) and RUFINO CO ARE
INDISPENSABLE PARTIES, SUED UNDER A
COMMON CAUSE OF ACTION, MAY THE
PLAINTIFF MOVE TO DISMISS THE CASE
AGAINST THE PEPSI WITHOUT NOTICE TO
DEFENDANT RUFINO CO?
II

CIVIL PROCEDURE
AFTER THE HONORABLE COURT DISMISSED
THE CASE AGAINST PEPSI UPON THE EXPARTE MOTION OF THE PLAINTIFFS, DID THE
RESPONDENT HONORABLE COURT RETAIN
AUTHORITY TO ACT IN THE CASE AND ISSUE
ORDERS, SUCH AS THE ORDER DECLARING
THE DEFENDANT RUFINO CO IN DEFAULT
AND HEARING PLAINTIFF'S EVIDENCE EXPARTE, CONSIDERING THATPEPSI IS AN
INDISPENSABLE PARTY?
III
WHETHER OR NOT THE DECISION RENDERED
IN THIS CASE IS VALID CONSIDERING THAT
UPON THE DISMISSAL OF THE CASE AGAINST
PEPSI, THE RESPONDENT HONORABLE COURT
LOST AUTHORITY TO ACT FURTHER:
WHETHER OR NOT, IN CONSEQUENCE, THE
SHERIFF'S NOTICE TO SELL, AND THE
SUBSEQUENT SALES OF PETITIONER'S
PROPERTIES PRODUCED ANY LEGAL EFFECTS.
IV
WHETHER OR NOT THE BENEFITS OF THE
DISMISSAL OF THE CASE AGAINST PEPSI,
WHICH DISMISSAL HAS LONG BECOME FINAL
AND UNAPPEALABLE, SHOULD BE EXTENDED
TO THE PETITIONER RUFINO CO.
The petitioner contends that he and the Pepsi-Cola Bottling
Company of the Philippines, Inc. are indispensable parties sued
under a common cause of action and that if the complaint is
dismissed insofar as PEPSI is concerned, the court should have
ordered also the dismissal of the case insofar as it affects the
petitioner. According to him, it does not matter that the dismissal
is upon the evidence presented by the plaintiff or upon the
latter's mere desistance, for in both instances, a lack of sufficient
legal basis must be the cause.
On the other hand, the private respondents state that the
petitioner is confusing the decision of the court a quobecause
instead of questioning the order denying the petition for relief
from judgment, the petitioner assails the decision of the court
dated March 9, 1983 which has already become final and
executory with the writ of execution issued already being
implemented by the Deputy Sheriff of Rizal.
The private respondents argue that our ruling in Lim Tanhu v.
Hon. Ramolete (66 SCRA 425) is not applicable because there are
important facts which differentiate the Lim Tanhu case from the
instant petition. The respondents state that (1) in the case of Lim
Tanhu, the same cause of action was averred by several
defendants, some of whom were declared in default and some of
whom filed their answers. In the case at bar, they contend that
respondents RII's cause of action against the petitioner is entirely
different from its cause of action against PEPSI, the former being
the assignor of the purchase orders and the latter being the
maker of the purchase orders; (2) in the case of Lim Tanhu, some
of the defendants were declared in default, hence, the defenses
set up by those who answered the complaint were available to
the other defendants who were declared in default. In the case at
bar, both defendants Rufino Co and PEPSI did not answer the
complaint. It is argued that there are no defenses which can be
interposed by Rufino Co; (3) in the case of Lim Tanhu, a motion to
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lift the order of default was filed by the defaulting defendant,
while in the case at bar, no motion to lift order of default was
filed by defendant Rufino Co; and (4) in the case of Lim Tanhu, all
the defendants were indispensable parties while in the case at
bar, plaintiffs may file an action against any of the defendants for
the simple reason that a valid judgment can be rendered against
either of the two defendants.

CIVIL PROCEDURE
Refrigeration, and its keen desire to just setoff the debts of Rufino Co and not to pay a
single cent to Refrigeration and Delta, it is
clear that Pepsi was guilty of a fraud, bad
faith, and deceit in contracting the debt or
incurring the obligation, thereby prejudicing
and damaging Refrigeration and Delta in the
huge amount aforementioned.

We agree with the petitioner.

The private respondents' complaint for a sum of money with
attachment against PEPSI and Rufino Co clearly shows that PEPSI
and the petitioner are indispensable parties to the case. In fact
the private respondents sued both PEPSI and the herein
petitioner under a common cause of action. Paragraph 21 of the
complaint states that:
21. That both defendants are guilty of
conspiracy; connivance, unfair play, and foul
tactics because on the one hand, PEPSI
received and accepted the 1,000 refrigerators
from plaintiffs without the intention to pay
the latter but only with the intent to set off
the debts of Rufino Co. On the other hand,
Rufino Co refused to pay plaintiffs the price of
the 1,000 refrigerators despite due demand,
and he was happy that his debts or
obligations to PEPSI were set off or were
discounted by means not coming from his
pockets. In other words, both defendants
acting in concert and with a view to victimize
the hapless and unsuspecting plaintiffs made
simultaneous acts calculated to gain and to
profit from the loss and misfortune of
plaintiffs.
Likewise, the affidavit attached in support of the complaint is
framed in such a way that there can be no doubt as to the
intention of the private respondents in suing PEPSI and the
petitioner herein as indispensable parties. Paragraphs two (2)
and three (3) of said affidavit state:
2. That, however, in spite of Pepsi's rejection
and refusal to honor and to recognize the
assignment, Pepsi, as aforesaid received and
accepted the delivery to it by Refrigeration of
1,000 units of "Frigidaire" and "Sharp"
electric refrigerators of various sizes and
measurements. But Pepsi refused to pay the
invoice price of P2,907,535.00, because
Pepsi's intention was not to pay Refrigeration
and Delta but only to set off the
accountabilities and obligations of Rufino Co
to Pepsi. Upon formal demand by
Refrigeration and Delta upon Pepsi and
Rufino Co to pay for the 1,000 refrigerators;
both Pepsi and Rufino Co refused to pay,
without just or legal grounds:
3. That based on the Deed of Assignment
issued by Rufino Co in favor of Refrigeration
and Delta, and from the surrounding acts and
circumstances performed by Pepsi, especially
its acts in rejecting the assignment by Rufino
Co, its receiving and accepting the delivery of
1,000
units
of
refrigerators
from

Our ruling in Lim Tanhu v. Hon. Ramolete (66 SCRA 425) is

applicable to the instant petition. The fact that in the case of Lim
Tanhu several defendants were declared in default and the
defenses set up by those who answered the complaint were
available to those who were in default, while in the case at bar
both PEPSI and the petitioner did not answer the complaint, is of
no moment because our ruling in the Lim Tanhu case was based
on the fact that all the defendants therein were indispensable
parties and the plaintiff moved for the dropping of two
defendants from the complaint. The situation is similar to this
case where both PEPSI and Rufino Co were sued as indispensable
parties under a common cause of action, and on motion of the
private respondent PEPSI was dropped as a party defendant. We
held in the Lim Tanhu case that:
Stated differently, in all instances where a
common cause of action is alleged against
several defendants, some of whom answer
and the others do not, the latter or those in
default acquire a vested right not only to own
the defense interposed in the answer of their
codefendant or co-defendants not in default
but also to expect a result of the litigation
totally common with them in kind and in
amount whether favorable or unfavorable.
The substantive unity of the plaintiff's cause
against all the defendant is carried through to
its objective phase as ineluctably demanded
by the homogeniety and indivisibility of
justice itself. Indeed, since the singleness of
the cause of action also inevitably implies
that an the defendants are indispensable
parties, the court's power to act is integral
and cannot be split such that it cannot relieve
any of them and at the same time render
judgment against the rest. Considering the
tenor of the section in question, it is to be
assumed that when any defendant allows
himself to be in default knowing that his codefendant has already answered, he does so
trusting in the assurance implicit in the rule
that his default is in essence a mere formality
that deprives him of no more than the right
to take part in the trial and that the court
would deem anything done by or for the
answering defendant as done by or for him.
The presumption is that otherwise he would
not have seen to it that he would not be in
default. Of course, he has to suffer the
consequences of whatever the answering
defendant may do or fail to do, regardless of
possible adverse consequences, but if the
complaint has to be dismissed in so far as the
answering defendant is concerned it becomes
his inalienable right that the same be
dismissed also as to him. It does not matter
that the dismissal is upon the evidence
presented by the plaintiff himself or upon the
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latter's mere desistance, for in both
contingencies, the lack of sufficient legal basis
must be the cause. The integrity of the
common cause of action against all the
defendants and the indispensability of all of
them in the proceedings do not permit any
possibility of waiver of the plaintiff's right
only as to one or some of them, without
including all of them, and so, as a rule,
withdrawal must be deemed to be a
confession of weakness as to all. This is not
only elementary justice; it also precludes the
concomitant hazard that plaintiff might resort
to the kind of strategem practiced by private
respondent herein that resulted in totally
depriving petitioners of every opportunity to
defend themselves against her claim, which,
after all, as will be seen later in this opinion,
the record does not show to be invulnerable,
both in their factual and legal aspects, taking
into consideration the tenor of the pleadings
and the probative value of the competent
evidence which were before the trial court
when it rendered its assailed decision. Where
all the defendants are indispensable parties,
for which reason the absence of any of them
in the case would result in the court's losing
its competency to act validly, any
compromise that the plaintiff might wish to
make with any of them must, as a matter of
correct procedure, have to await until after
the rendition of the judgment, at which state
the plaintiff may then treat the matter of its
execution and the satisfaction of his claim as
variably as he might please. Accordingly, in
the case now before Us together with the
dismissal of the complaint against the nondefaulted defendants, the court should have
ordered also the dismissal thereof as to
petitioners.

CIVIL PROCEDURE
December 3, 1982 and the decision dated March 9, 1983. The
respondent court is ordered to extend the effects of the dismissal
of the complaint to petitioner Rufino Co. The respondent court is
permanently enjoined from taking any further action in said civil
case except as herein indicated.
SO ORDERED.

Applying the above-quoted ruling, we find that the respondent

court erred in (1) declaring petitioner Co in default; (2) in hearing
the plaintiff's evidence ex-parte on December 3, 1982; (3) in
rendering the decision dated March 9, 1983; (4) in issuing the
writ of execution and in having the petitioner's properties levied
upon in execution; (5) in having them advertised for sale, and
consequently, (6) in ordering them sold to answer for the private
respondents' claim. After the lower court dropped PEPSI as a
party defendant in Civil Case No. 42815, the respondent court
lost authority to act further in the case insofar as the petitioner is
concerned.
Furthermore, the private respondents' admission in their
complaint that the assignments made to them by the petitioner
are genuine, valid, and in accord with Article 1475 of the Civil
Code taken together with the joint waiver, release, or quitclaim
in favor of PEPSI which received and profited from the 1,000
refrigerators virtually absolve the petitioner from any and all
legal liability insofar as the purchase orders are concerned.
WHEREFORE, the petition is granted. The proceedings in the
respondent court in Civil Case No. 42815 subsequent to the
November 26, 1981 order dismissing the complaint as against
Pepsi-Cola Bottling Company of the Philippines, Inc., are hereby
annulled and set aside, particularly the ex-parte presentation of
private respondents' evidence against the petitioner on

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G.R. No. L-58036 March 16, 1987
ELISEO
vs.
MANUEL CHU, JR., respondent.

BOTICANO, petitioner,

Arturo N. Santos for petitioner.

Juan C. Limin for respondent.

PARAS, J.:
This is a petition for review on certiorari seeking to reverse and
set aside the following: (a) the decision of the Court of
Appeals * promulgated on March 31, 1981 in CA-G.R. No. 65287R entitled: "Eliseo Boticano, plaintiff-appellee v. Jaime Sigua,
defendant and Manuel Chu, Jr., defendant-appellant" which
holds that the defendant-appellant was not properly served with
summons and (b) the resolution denying petitioner's motion for
reconsideration of said decision.
The findings of fact of the trial court are as follows:
Petitioner Eliseo Boticano is the registered owner of a Bedford
truck with plate No. QC-870, T-Pilipinas '77 which he was using in
hauling logs for a certain fee. At 11:00 o'clock in the evening of
September 3, 1971, while loaded with logs, it was properly
parked by its driver Maximo Dalangin at the shoulder of the
national highway in Barrio Labi, Bongabon, Nueva Ecija when it
was hit and bumped at the rear portion by a Bedford truck
bearing plate No. QK-516, T-Pilipinas '77 owned by private
respondent Manuel Chu, Jr. and driven by Jaime Sigua, the
former's co-defendant in this case. Manuel Chu, Jr.
acknowledged ownership thereof and agreed with petitioner to
shoulder the expenses of the repair of the damaged truck of the
latter. (Decision, Civil Case No. 6754, Rollo, pp. 36-37).
When Manuel Chu, Jr. failed to comply with aforesaid agreement
as well as to pay damages representing lost income despite
petitioner's demands, the latter (plaintiff in the lower court), filed
a complaint on November 24, 1977 at the Court of First Instance
of Nueva Ecija, Branch VII at Cabanatuan City, against private
respondent Manuel Chu, Jr. (truck owner) and Jaime Sigua (his
driver) both as defendants in Civil Case No. 6754 "Eliseo Boticano
v. Manuel Chu, Jr. and Jaime Sigua" for damages. (Record on
Appeal, Rollo, pp. 45-47).
Summons was issued on December 12, 1977 but was returned
unserved for defendant Jaime Sigua because he was no longer
connected with San Pedro Saw Mill, Guagua, Pampanga, while
another copy of the summons for Manuel Chu, Jr. was returned
duly served on him thru his wife Veronica Chu at his dwelling
house.
On February 15, 1978 petitioner moved to dismiss the case
against Jaime Sigua and to declare Manuel Chu, Jr. in default for
failure to file responsive pleadings within the reglementary
period. The motion was granted by the lower court in an Order
dated September 4, 1978, allowing petitioner to adduce his
evidence ex parte on October 17, 1978. (Petition, Rollo, pp. 8-9).

CIVIL PROCEDURE
From the evidence adduced by the plaintiff (petitioner herein)
the trial court found that private respondent Manuel Chu, Jr. is
responsible for the fault and negligence of his driver Sigua under
Article 2180 of the Civil Code, whose negligence and lack of due
care was the immediate and proximate cause of the damage to
petitioner's truck and ruled in favor of plaintiff-petitioner.
The dispositive portion of the judgment reads:
WHEREFORE, judgment is hereby rendered in
favor of the plaintiff, Eliseo Boticano, and
against herein defendant, Manuel Chu, Jr.
ordering the latter as follows:
(a) To pay the plaintiff the sum of P6,970.00
representing actual damages;
(b) To pay the plaintiff the sum of P73,700.00
representing unrealized income for the nonuse of the plaintiff's damaged truck for the
period of eleven (11) months;
(c) To pay the plaintiff the sum of P2,000.00
for and as attorney's fees; and
(d) To pay the costs of this suit.
SO ORDERED.
Cabanatuan City, November 28, 1978. (Ibid,,
pp. 13-14).
On March 19, 1979 private respondent Manuel Chu, Jr. filed with
the trial court a "Notice of Appeal" and an Urgent Motion for
Extension of Time to file Record on Appeal which was granted by
the trial court on the same date.
On March 26, 1979, Atty. Hermenegildo D. Ocampo, counsel of
record of private respondent, filed a "Motion to Withdraw as
Counsel" while the new counsel Atty. Wilfredo G. Laxamana
entered his appearance on April 18, 1979 and filed his record on
appeal on the same date.
On May 4, 1979 petitioner filed with the trial court a Motion to
Dismiss Appeal and for execution which was set for hearing on
May 14, 1979 wherein private respondent's counsel personally
appeared and opposed petitioner's motion while on the latter
date petitioner filed his reply to opposition, after which on May
16, 1979 the trial court issued an order denying aforesaid motion,
while on May 22, 1979, the trial court issued another order
approving private respondent's Record on Appeal. (Rollo, pp. 910).
After the case was brought to the Court of Appeals and the
parties had filed their respective briefs, said Appellate Court
issued its decision on March 31, 1981, the dispositive portion of
which reads:
IN
VIEW
OF
THE
FOREGOING
CONSIDERATIONS the appealed judgment is
hereby set aside, for being null and void. This
case is directed to be remanded to the court
of origin; that appellant be properly served
with summons and a copy of the complaint;
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and that the necessary and appropriate
proceedings or action be taken thereafter, as
the circumstances and the case win warrant.
With costs against appellee.
SO ORDERED.
Judgment is set aside. (Rollo, p. 33)
On April 20, 1981, petitioner filed with the respondent Court of
Appeals a Motion for Reconsideration and on June 3, 1981 a
Supplemental Motion for Reconsideration. On August 28, 1981
respondent Court of Appeals issued an order denying petitioner's
Motion for Reconsideration. (Rollo, pp. 9-11).
Hence, this petition, with the following assigned errors:
1. THE RESPONDENT COURT OF APPEALS COMMITTED A
MISTAKE IN HOLDING THAT PRIVATE RESPONDENT MANUEL CHU
JR. WAS NOT PROPERLY SERVED WITH SUMMONS DESPITE THE
FACT THAT THE SUMMONS WAS SERVED TO HIM THROUGH HIS
WIFE;
2. THE RESPONDENT COURT OF APPEALS COMMITTED A
MISTAKE IN HOLDING THAT PRIVATE RESPONDENT DID NOT
VOLUNTARILY SUBMIT HIMSELF TO THE JURISDICTION OF THE
TRIAL COURT DESPITE HIS VOLUNTARY APPEARANCE, THRU
COUNSEL ON A FIXED DATE OF HEARING AND BY FILING WITH
THE LOWER COURT A NOTICE OF APPEAL, APPEAL BOND,
MOTION FOR EXTENSION OF TIME TO FILE RECORD ON APPEAL,
MOTION FOR WITHDRAWAL OF APPEARANCE, NOTICE OF
APPEARANCE, AND OPPOSITION TO MOTION TO DISMISS APPEAL
AND FOR ISSUANCE OF WRIT OF EXECUTION;
3. THE RESPONDENT COURT OF APPEALS ERRED IN NOT FINDING
THAT PRIVATE RESPONDENT HAS WAIVED ANY QUESTION ON
THE TRIAL COURT'S JURISDICTION OVER HIS PERSON BY HIS
DELIBERATE FAILURE AND REFUSAL TO SEEK RELIEF FROM THE
TRIAL COURT.
4. THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN
SETTING ASIDE THE JUDGMENT IN CIVIL CASE NO. 6754, COURT
OF FIRST INSTANCE OF CABANATUAN ClTY, BRANCH VII AND IN
DIRECTING THAT THE CASE BE REMANDED TO THE COURT OF
ORIGIN SO THAT APPELLANT CAN BE PROPERLY SERVED WITH
SUMMONS. (Petition, Rollo, pp. 12-23)
In compliance with the resolution of the Second Division of this
Court of October 12, 1981 (Rollo, p. 79-A) private respondent
filed his comment on November 13, 1981 (Rollo, pp. 84-87).
Petition er then filed a reply thereto in compliance with the
resolution of December 7, 1981 (Rollo, p. 39) after which the
petition was given due course in the resolution of February 8,
1982 and the parties were required to file their respective
memoranda (Rollo, p. 43). Petitioner filed his memorandum on
March 19, 1982 (Rollo, pp. 45-59) while private respondent filed
his memorandum on April 15, 1982 (Rollo, pp. 60-64). Thereafter,
in the resolution of April 30, 1982, the case was submitted for
decision. (Rollo, p. 65).
There is no dispute as to the facts of this case, as shown by the
admission of private respondent to the extent of making an
agreement with petitioner to shoulder the expenses of the repair
of the damaged truck of the latter and the findings of the Court

CIVIL PROCEDURE
of Appeals that petitioner's evidence fully supports the findings
of facts of the trial court as well as its judgment under appeal.
Neither does private respondent deny receipt of the summons in
question. The bone of contention appears to be in the manner of
service of said summons on the wife of private respondent at
their dwelling instead of on private respondent himself
personally.
Petitioner contends in favor of validity of such service while
private respondent maintains the opposite view which was
sustained by respondent Court of Appeals to the effect that the
Sheriff resorted to substituted service under Section 8, Rule 14 of
the Rules of Court, without first complying with the mode of
personal service required under Section 7 of the same Rule.
Thus, the principal issue which arises in this case which involves
an inquiry into procedural due process, is whether or not the
question of jurisdiction over the person of the defendant can be
raised for the first time on appeal.
The question has been answered in the negative by the Supreme
Court in a long line of decisions. In fact, one of the circumstances
considered by the Court as indicative of waiver by the defendantappellant of any alleged defect of jurisdiction over his person
arising from defective or even want of process, is his failure to
raise the question of jurisdiction in the Court of First Instance and
at the first opportunity. It has been held that upon general
principles, defects in jurisdiction arising from irregularities in the
commencement of the proceedings, defective process or even
absence of process may be waived by a failure to make
seasonable objections. (Castro v. Cebu Portland Cement Co., 71
Phil. 481 [1941] citing Machan v. De la Trinidad, 3 Phil. 684;
Vergara v. Laciapag 28 Phil. 439; U.S. v. Inductivo, 40 Phil. 84;
Soriano v. Ramirez, 44 Phil. 519). More recently, in reiteration of
the same principle, the Court ruled in Dalman v. City Court of
Dipolog City, Branch II, that as to the dismissal of the criminal
case, the question of jurisdiction which was never raised in said
case before the trial court cannot be done at this stage and level
(134 SCRA 244 [1985]).
Coming to the case at bar, it has been pointed out that during the
stages of the proceedings in the court below, defendantappellant could have questioned the jurisdiction of the lower
court but he did not.
It can of course be argued that the failure to question the lower
court's jurisdiction cannot be accounted against Chu for his
having been declared in default gave him no chance to
participate in the court deliberations and therefore no chance to
raise the jurisdictional issue, but then, he could have done so, in
the subsequent pleadings he filed. Besides, even assuming that
such failure cannot be taken against him, the fact is he had
VOLUNTARILY submitted himself to the court's jurisdiction.
On the contrary, private respondent voluntarily appeared thru
counsel in the trial court. He filed a Notice of Appeal, Appeal
Bond, Motion for Extension of Time to File Record on Appeal,
Record on Appeal, Motion for Withdrawal of Appearance, Notice
of Appearance and Opposition to Plaintiff's Motion to Dismiss
Appeal and for Issuance of a Writ of Execution. Not only did he
submit pleadings and motions, but he likewise appeared in
person, thru counsel in the hearing held on May 14, 1979 at 8:30
a.m. and orally argued in open court on the pending incident.
(Rollo, pp. 53-54).
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CIVIL PROCEDURE

Under Section 23, Rule 14 of the Rules of Court, the defendant's

voluntary appearance in the action shall be equivalent to service.
Thus, under this principle, it has been consistently held by the
Supreme Court that the defect of summons is cured by the
voluntary appearance of the defendant. (Infante v. Toledo and
Lanting, 44 Phil. 834 [1918]; Aguilos v. Sepulvede, 53 SCRA 274
[1973]; J.M. Tuazon & Co. v. Estabillo, 62 SCRA 1; Castro v. Cebu
Portland Cement Co., supra).

in the RTC. Note however that in summary proceedings, there

can be no default declarations.

The Court of Appeals is however of the view that from all the
actions and steps taken by the appellant no presumption can
arise that he voluntarily submitted himself to the jurisdiction of
the Court. In fact according to said Court, all of these actions
taken by the appellant are geared and mustered towards
contesting the court's jurisdiction over his person, or of attacking
the validity of the judgment on jurisdictional grounds. (Decision,
CA, G.R. No. 65287-R; Rollo, p. 31).

This brings to the fore the question of procedural due process.

In Montalban v. Maximo (22 SCRA 1077 [1968]) the Court ruled
that "The constitutional requirement of due process exacts that
the service be such as may be reasonably expected to give the
notice desired. Once the service provided by the rules reasonably
accomplishes that end, the requirement of justice is answered;
the traditional notions of fair play are satisfied; due process is
served."

It will be noted however, that the Notice of Appeal (Rollo, p. 38)

unmistakably indicates the reason for the appeal, which reads:

Indeed, such construction is but fair, and in accord with

substantial justice. The burden on a plaintiff is not to be enlarged
with a restrictive construction desired by the defendant. (Ibid., p.
1078).

2. That, the herein defendant is not

contented with the aforesaid Decision for it is
contrary to the evidence and the law and the
award of damages is so excessively
unsupported by any evidence to warrant the
same; hence, he is appealing said Decision to
the Hon. Court of Appeals, Manila, both on
questions of facts and law.
As clearly shown in the foregoing, the above-stated conclusion of
the Court of Appeals has evidently no basis.
Of equal importance is the question: if the defendant in the
Regional Trial Court (RTC) has been declared in default, may he
appeal the default judgment that may subsequently be rendered
even if he has not asked the RTC to set aside the declaration of
default? The answer is in the affirmative. However a distinction
must be made as to the effects of such appeal.
(a) If an appeal is made without first asking the RTC to set aside
the declaration of default, and the appellate court sets aside on
said declaration, all he can get is a review of the RTC's default
judgment without the opportunity of having the higher court
consider defense evidence (for the simple reason that no
evidence was even adduced by him in the RTC) (See Rule 41, sec.
2, par. 3, Rules of Court).
(b) If upon the other hand, the defendant first asks the RTC to set
aside the declaration of default (See Rule 18, secs. 2 and 3, Rules
of Court), and he is able to prevail, the declaration win be set
aside, and he will now have the opportunity to present his
evidence in the RTC. Thus, even if he finally loses in the RTC's
subsequent decision, his defense can be considered, when
appeal is made to the appellate tribunal. Of course, even if the
default declaration is not set aside despite his motion for the
setting aside, he will be entitled to all notices in the court
proceedings, and can file any pleading he may wish to file,
including the notice of appeal. (See Rule 13, sec. 9, Rules of
Court).
Incidentally, the afore-mentioned rules apply to default
declarations in the Metropolitan Trial Courts, the Municipal Trial
Courts, and the Municipal Circuit Trial Courts, for under Batas
Pambansa Bilang 129, the said inferior courts will follow the rules

In the case at bar, there is no question that summons was timely

issued and received by private respondent. In fact, he never
denied actual receipt of such summons but confined himself to
the argument that the Sheriff should prove that personal service
was first made before resorting to substituted service,

Finally in a last ditch effort, private respondent insists that there

was no valid service of summons because private respondent is a
partner and general manager in San Pedro Sawmill. Consequently
the wife of private respondent to whom summons and complaint
were allegedly served not being partnership, cannot receive the
same under Section 13 of Rule 14 of the Rules of Court.
It has however been settled that actions must be brought by the
real parties in interest and against the persons who are bound by
the judgment obtained therein. (Salmon and Pacific Commercial
Company v. Tan Cueco, 36 Phil. 557-558 [1917]).
The title of the case both in the trial court, in the Court of
Appeals and in this Court shows that the partnership is not a
party. On the contrary, as previously stated private respondent
himself assumed the responsibility of the accident and is now
estopped to disclaim the liabilities pertaining thereto.
From what has been discussed the following conclusions are
hereby made: jurisdiction was properly acquired by the trial court
over the person of respondent thru both service of summons and
voluntary appearance in court; he was therefore properly
declared in default for not having filed any answer; despite
respondent's failure to file a motion to set aside the declaration
of default, he has the right to appeal the default judgment but in
the appeal only the evidence of the petitioner may be
considered, respondent not having adduced any defense
evidence; We agree with the findings of fact by the trial court,
the same being unrebutted.
WHEREFORE, the assailed decision and resolution of the Court of
Appeals are REVERSED and SET ASIDE, and the decision of the
then Court of First Instance (now Regional Trial Court)of Nueva
Ecija, Cabanatuan City in Civil Case No. 6754 "Eliseo Boticano v.
Manuel Chu, Jr. and Jaime Sigua" is hereby REINSTATED. No
costs.
SO ORDERED.

meikimouse

Full Text: Rule 9 Effect of Failure to Plead

G.R. No. 75000 February 27, 1987
DENSO
(PHILS.),
INC., petitioner,
vs.
THE INTERMEDIATE APPELLATE COURT AND KAYAMANAN
DEVELOPMENT CORPORATION, respondents.

NARVASA, J.:
On June 23, 1984, at about 11 o'clock in the evening, a fire broke
out at the Nippondenso Building at Pasong Tamo Ext., Makati,
Metro Manila. The building was owned by the Kayamanan
Development Corporation (hereafter, simply referred to as
KAYAMANAN), and was then under lease to Denso (Phils), Inc.
(hereafter, simply DENSO). The fire caused extensive damage.
DENSO and its correspondent firm in Japan, NIPPONDENSO,
reportedly suffered losses amounting to P6,131,976.65 and
P682,212.58, respectively. On the other hand, KAYAMANAN's
1
loss was placed at P1,750,000.00.
A year or so later, KAYAMANAN instituted an action against
DENSO in the Regional Trial Court at Makati, which was docketed
as Civil Case No. 10768, for recovery of (a) unpaid rentals from
June, 1984 to March, 1985, amounting to an aggregate of
P471,546.69; (b) the cost of repairing the damage caused by the
fire to the leased building, it being alleged that DENSO was
bound to bear said cost under their lease agreement; and (c)
2
unrealized monthly rents and attorney's fees.
Summons was served on DENSO on June 10, 1985. It would
seem, however, that the summons (together with the
accompanying copy of the complaint) was not referred by DENSO
to its counsel until June 22, 1985. This prompted the latter to file
on June 25, 1985 a "MOTION FOR EXTENSION OF TIME TO FILE
ANSWER," pleading the late referral, the need to attend to other
legal work of equal importance, as well as the time requirement
for study of the factual and legal points involved in the action,
and praying, in consequence, for an additional period of 15 days
from June 25 within which to present the requisite responsive
3
pleading. The motion closed with a "Notice of Hearing"
addressed to the Clerk of Court, asking that the motion be
submitted to the court for consideration and approval
immediately upon its receipt; and a notation that a copy of the
4
motion had been furnished plaintiff KAYAMANAN's counsel. The
copy of the motion was actually received by KAYAMANAN's
5
counsel the following day, June 26, 1985 .
The motion for extension was however denied by Order of Judge
Teofilo Guadiz, Jr. dated June 26, 1985, "considering," according
to His Honor, "that there was no proof of service that plaintiff
6
received a copy of said motion." At 4 o'clock in the afternoon of
that same day, June 26, 1985, KAYAMANAN presented an "Ex
parte Motion to Declare Defendant in Default" asserting that the
reglementary period of 15 days for DENSO to file answer had
expired on June 25, 1985 without any answer having been filed,
but making no reference to DENSO's motion for extension which,
7
as above stated, had been received by it on June 26, 1985. On
the same day, June 26, l985, Judge Guadiz promulgated an Order
deeming the motion for default to be "well-taken," and
accordingly declaring DENSO in default and setting the reception
of KAYAMANAN's evidence ex-parte on the following day, June
8
27, 1985, at 2 o'clock in the afternoon. At that appointed date
and time, the Court-did receive KAYAMANAN's evidence exparte; and four (4) days later, on July 1, 1985,Judge Guadiz

CIVIL PROCEDURE
rendered judgment by default, sentencing DENSO to pay to
KAYAMANAN P471,546.69 as accumulated monthly rentals and
cost of services from June, 1984 to March 1985; P2,856,000.30 as
the reasonable cost of repair of the "damage building" (sic); and
9
10% of the total amounts awarded, as attorney's fees.
While all this was happening, and evidently in complete
ignorance thereof, DENSO's counsel drew up its answer to the
complaint, which was completed on July 5, 1985 and filed on July
8, 1985. To this pleading were appended copies of letters from
DENSO to KAYAMANAN appealing for a 30% rental rebate due
to the prejudicial consequences of the fire of June 23, 1984;
giving notice of the termination of the lease on May 12, 1985;
and formally turning over the leased premisses-as well a copy of
10
the Police Arson Investigation Report of the fire.
Inevitably, DENSO learned of the order of default and the
judgment by default. It then filed on August 2, 1985 a verified
11
motion for reconsideration of said order and judgment. Acting
thereon, the Trial Court promulgated an Order dated September
3, 1985, setting aside, "in the interest of substantial justice," the
order of default dated June 26, 1985 as well as the decision dated
July 1, 1985; but hearing was rescheduled only for the
presentation of defendant DENSO's evidence, the Court explicitly
stating that the evidence already presented (by KAYAMANAN)
would remain on record "without the right of cross examination
12
on the part of the defendant." The hearing was set on October
2, 1985 but at DENSO's instance, was re-scheduled on October
24, 1985.
At the hearing on October 24, 1985, DENSO orally asked the
Court to reconsider its Order of September 3, 1985 and accord it
the opportunity to cross-examine KAYAMANAN's witnesses, who
had given their testimony ex-parte. The Court opted to give
13
DENSO time to move formally for reconsideration and reset
the hearing to November 21, 1985 (which was again reset on
January 9, 1986 because the Judge was on official leave in
14
November).
DENSO submitted its formal motion for reconsideration dated
November 4, 1985 praying for the right to cross-examine
15
KAYAMANAN's witnesses on November 6, 1985. The record
does not show that any opposition to the motion was ever filed.
Two days later, however, on November 8, 1985, DENSO received
notice of the Order of the Court dated October 24, 1985 (the
date of the hearing), denying its (DENSO's) motion to be allowed
to cross-examine KAYAMANAN's witnesses, and scheduling the
initial hearing for the presentation of the defense witnesses on
16
November 21, 1985. Four days afterwards, on November 12,
1985, the Court promulgated another Order, denying DENSO's
motion for reconsideration of November 4, 1985 for lack of
merit. According to the Court:
What is important is that defendant is
afforded the opportunity to present its
evidence and thus enable the Court to see
the other side of the coin, the defendant
being offered a chance to present its
evidence in the Order dated September 3,
17
1985.
DENSO submitted not however receive a copy of his Order of
November 12, 1985 until January 9, 1986, the day finally set (by
the Court) for the reception of its evidence. At this time, DENSO
drew the Court's attention to its motion for reconsideration of
November 4, 1985 which, as far as it knew, was yet unresolved.
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Full Text: Rule 9 Effect of Failure to Plead

DENSO was thereupon furnished with a copy of the Order of
November 12, 1985. DENSO then asked for deferment of the
hearing so that it might elevate this adverse ruling to a higher
18
court. This was denied, and when DENSO declared itself as not
ready to proceed with the presentation of evidence, the Court
dictated an Order stating that "this being the third time that
defendant failed to present its evidence notwithstanding the
19
chance given to it, the 'Decision' dated July 1, 1985 is revived."
Without awaiting service of the Order dictated on January 9,
1986, DENSO filed on January 15, 1986 a petition for certiorari
with the Intermediate Appellate Court, docketed as AC-G.R. SP
No. 08150, praying for the annulment of the series of orders of
Judge Guadiz already referred to, starting with the order of
default of June 26, 1985 and culminating in the order of January
9, 1986 reviving the judgment by default.
The Intermediate Appellate Court (Fourth Special Cases Division)
considered the crucial issue to be "the propriety or impropriety"
of the order of September 3, 1985 which, while setting aside the
previous order of default and the judgment by default,
prescribed that the evidence already presented would remain in
the record and denied petitioner the right to cross-examine the
respondent's witnesses who had testified at the ex-parte hearing.
It declared unnecessary further consideration of the order of
default and judgment by default thus set aside, and limited its
review of the proceedings to the question of whether or not the
20
petitioner was properly denied the right of cross-examination.
On that question the Appellate Court ruled that the right of
cross-examination, while a part of due process so that denial
thereof amounts to depriving a party of his day in court, is
nonetheless waivable; that since petitioner received on
September 16, 1985 copy of the order of September 3, 1985
setting the judgment by default aside and scheduling the case for
hearing only for reception of defendant's evidence without right
to cross-examine plaintiff's witnesses but did not move for its
reconsideration until October 24, 1985, or after a lapse of 38
days, such inaction amounted to a waiver of the claimed right to
cross-examine; and, moreover, said motion for reconsideration
came too late because the order sought to be reconsidered was
by then already final, the applicable period of appeal being only
21
fifteen (15) days from notice of said order, and that (in any
22
event) DENSO was guilty of laches.
The error in these pronouncements is immediately apparent.
They assume that the order in question is a final-and appealable
order, when it is in fact interlocutory. The distinction between
final and interlocutory orders is a well-settled one.
The concept of "final" judgment, as
distinguished from one which has "become
final" (or "executory" as of right [final and
executory]), is definite and settled. A "final"
judgment or order is one that finally disposes
of a case, leaving nothing more to be done by
the Court in respect thereto, e.g., an
adjudication on the merits which, on the
basis of the evidence presented at the trial,
declares categorically what the rights and
obligations of the parties are and which party
is in the right; or a judgment or order that
dismisses an action on the ground, for
instance, of res judicata or prescription. Once
rendered, the task of the Court is ended, as
far as deciding the controversy or

CIVIL PROCEDURE
determining the rights and liabilities of the
litigants is concerned. Nothing more remains
to be done by the Court except to await the
parties' next move (which among others, may
consist of the filing of a motion for new trial
or reconsideration, or the taking of an
appeal) and ultimately, of course, to cause
the execution of the judgment once it
becomes 'final' or, to use the established and
more distinctive term, "final and executory."
...
xxx xxx xxx
Conversely, an order that does not finally
dispose of the case, and does not end the
Court's task of adjudicating the parties'
contentions and determining their rights and
liabilities as regards each other, but obviously
indicates that other things remain to be done
by the Court, is "interlocutory," e.g., an order
denying a motion to dismiss under Rule 16 of
the Rules, or granting a motion for extension
of time to file a pleading, or authorizing
amendment thereof, or granting or denying
applications for postponement, or production
or inspection of documents or things, etc.
Unlike a "final" judgment or order, which is
appealable, as above pointed out, an
"interlocutory" order may not be questioned
on appeal except only as part of an appeal
that may eventually be taken from the final
23
judgment rendered in the case.
That the order of September 3, 1985 was interlocutory in
character is beyond cavil. In setting aside the order of default and
the succeeding judgment by default, it left the case open for
further proceedings before the Trial Court, not the least of which
was the reception of evidence for the petitioner. Therefore, it
could not become final in the sense that final judgments become
"final and executory." No appeal therefrom would lie except in
the context and as part of an appeal from a subsequent final
judgment on the merits, and a motion for reconsideration
thereof was not subject to the limiting fifteen-day period of
appeal prescribed for final judgments or orders.
Neither will the Court consider laches as having set in by reason
of petitioner's allowing thirty-eight (38) days to pass before
seeking a reconsideration of the order, having in mind not only
that such a relatively brief period cannot by any reckoning be
deemed an unreasonable length of time, but also the fact that
while laches is a defense which operates independently of the
statute of limitations and is subject to no fixed periods, it is also
founded on equity and may be invoked only if the delay in
asserting a claim has worked a change in the conditions such as
would render unjust or inequitable the grant of the relief sought.
In order t hat the defense of laches may
prosper, the following elements must be
present: (1) conduct on the part of
defendant, or one under whom he claims,
giving rise to the situation complained of, (2)
delay in asserting complainant's right after
knowledge or notice of defendant's conduct
and an opportunity to sue, (3) lack of
knowledge or notice on the part of the
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Full Text: Rule 9 Effect of Failure to Plead

defendant that complainant would assert the
right on which he bases suit, and (4) injury or
prejudice to defendant in the event relief is
24
accorded. ***
*** (I)t must be realized that, unlike
prescription, the defense of laches is not
dependent on the existence of a statutory
period of limitation. It can be invoked without
reckoning any specific or fixed period; it is
sufficient that there be an unreasonable and
unexplained delay in bringing the action that
its maintenance would already constitute
inequity or injustice to the party claiming it.
25
***
No perceivable prejudice would attach to the respondent if the
petitioner were allowed to cross-examine the witnesses it has
presented. If said witnesses told the truth, respondent has
nothing to fear from their cross-examination, the effect of which
would only be to enhance their credibility.
Petitioner's motion for reconsideration of the order of
September 3, 1985, therefore, hardly deserved the short shrift
that it received from the Intermediate Appellate Court because it
was in no sense untimely, and neither lapse of a statutory period
nor laches could correctly be invoked to justify the summary
refusal to inquire into the antecedents of said order. What that
Court considered to be moot and academic an inquiry into the
merits of Judge Guadiz's separate orders of June 26, 1985
denying the motion for extension of time to file answer and
declaring the petitioner in default lay precisely at the heart of
the matter before it and now before this Court. Both orders were
premised on what the Judge perceived to be a failure to comply
with the rule that notice of motions must be served by the
movant on all parties concerned at least three (3) days prior to
26
the hearing thereof. What His Honor evidently overlooked-and
this was error-was that the rule on notice is not unqualifiedly
applicable to all motions, and that there are motions which may
be heard ex-parte, as the Rules themselves clearly
27
acknowledge. Among the latter class of motions are precisely
those seeking extension of time to plead, and the reason these
are not strictly held to the requirement of notice is that they are
non-contentious and do not as a rule involve the substantial
rights of the other parties in the suit.
* * * The motion for extension of time within
which a party may plead is not a litigated
motion where notice to the adverse party is
necessary to afford the latter an opportunity
to resist the application, but an exparte motion' made to the court in behalf of
one or the other of the parties to the action,
in the absence and usually without the
knowledge of the other party or parties.' As 'a
general rule, notice of motion is required
where a party has a right to resist the relief
sought by the motion and principles of
natural justice demand that his rights be not
affected without an opportunity to be heard.
It has been said that "ex-parte motions are
frequently permissible in procedural matters,
and also in situations and under
circumstances of emergency; and an
exception to a rule requiring notice is

CIVIL PROCEDURE
sometimes made where notice or the
resulting delay might tend to defeat the
28
objection (sic) of the motion."
Upon similar premises, this Court has consistently held, since as
29
early as in 1946, that motions for extension of time to file
record on appeal may be filed and passed upon ex-parte, and the
rulings on that point are applicable, without differentiation, to
motions for extension of time to file answer.
Petitioner's motion for extension of time to file answer was,
therefore, improperly denied for lack of proof of service on the
respondent, said motion having been seasonably filed and, as
already fully shown, there being no impediment to its being
heard ex-parte. No pretense is made that the motion was denied
as having been filed merely for delay, but even if that ground
were read into the otherwise clear terms of the order of denial
which do not even hint thereat, it would still be belied by the fact
that what was sought was only an extension of
the originalreglementary period as well as that prima
facie meritorious reasons were pleaded for the desired
30
extension. The petitioner's answer, alleging defenses which, if
established, could defeat the respondent's claim, wholly or in
part, was filed well within the period of extension prayed for. All
these considered, the order declaring petitioner in default for
alleged failure to timely file answer was clearly arbitrary; it ought
not to have been issued and should be struck down.
While the order of default was in fact set aside by the Trial Judge
on motion of the petitioner, he failed to afford petitioner the
complete relief that the arbitrary and improper issuance of said
order and of the earlier order denying the motion for extension
clearly called for. Ideally, the slate should have been wiped clean
by setting aside also the hearing at which the respondent
presented its evidence ex-parte, so that the parties would stand
on even terms with neither having the advantage of the other.
Instead, the Judge prescribed that the evidence presented by the
KAYAMANAN would remain in the record without right on the
part of DENSO to cross-examine the witnesses who had already
testified, and by necessary implication, also denied DENSO the
right to object to the documentary evidence submitted by
respondent. This, too, was abuse of discretion. If a defendant is
improperly declared in default his time to answer not having
expired because of a timely ex-parte motion for extension he
should be entitled to relief which should consist not only in the
admission of his responsive pleading, but of the right to crossexamine the witnesses presented and to object to the exhibits
offered in his absence, if not indeed to have trial commence all
over again. He should not, under these circumstances, be
penalized by loss of the right to cross-examine. This would be
grossly unwarranted and unfair; it would amount to a denial of
due process.
The Appellate Court's observation that "*** it cannot be denied
that the petitioner had other remedies at hand after the court a
quo had set aside the questioned Order of default and Default
31
Judgment ***" It is somewhat perplexing. Given the character
of said orders, particularly of the order of default, this Court is
hard put to conceive how DENSO could have acted to protect its
rights otherwise than as it did here, namely by exhausting all
recourse toward a reconsideration before the Trial Court and
then applying for corrective relief in the Intermediate Appellate
Court.
WHEREFORE, the petition is granted. The Decision of the
Intermediate Appellate Court under review is reversed and set
meikimouse

Full Text: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

aside. Petitioner's answer to the respondent's complaint in Civil

Case No. 10768 is ordered admitted. All the orders issued in said
case and complained of in the petition, the judgment by default
rendered therein, and theex-parte proceeding of June 27, 1985 at
which the respondent presented its evidence are vacated. Civil
Case No. 10768 shall stand for proceedings de novo as if only
complaint and answer had been filed therein. Costs against the
respondent.
SO ORDERED.

meikimouse

Full Text: Rule 9 Effect of Failure to Plead

G.R. No. L-63397 April 9, 1985
ALEX
LINA, petitioner,
vs.
THE HONORABLE COURT OF APPEALS; HONORABLE GREGORIO
PINEDA, as Presiding Judge of the Court of First Instance of
Rizal, Branch XXI at Pasig; and NORTHERN MOTORS,
INC., respondents.
Olalia, Cabrera, Aguila & Bautista Law Office for private
respondent.

RELOVA, J.:
Appeal by certiorari from the decision of the then Court of
Appeals in CA-G.R. No. 14943-SP, dated November 29, 1982,
affirming (a) the order of default issued by respondent judge in a
collection suit instituted by private respondent Northern Motors,
Inc. against petitioner; and, (b) the judgment of default in the
same case.
On March 31, 1982, private respondent Northern Motors, Inc.
filed with the then Court of First Instance of Rizal (Pasig) a case
for sum of money with damages; docketed as Civil Case No. 4520.
On April 22, 1982, petitioner Alex Lina was served with summons
together with a copy of the complaint.
On May 8, 1982, when no answer or motion to dismiss was filed
by petitioner, private respondent Northern Motors, Inc. filed a
motion to declare him in default. The motion was set for hearing
on May 21, 1982.
On May 19, 1982, petitioner filed his opposition to the aforesaid
motion inviting attention to the fact that he had filed a motion
for extension of time to file responsive pleading within the
reglementary period. On May 26, 1982, respondent judge issued
an order declaring defendant (herein petitioner) in default and
allowing plaintiff (herein private respondent) to adduce its
evidence ex parte.
On May 27, 1982, defendant (petitioner) filed his answer to the
complaint.
On July 28, 1982, respondent court rendered its decision in favor
of plaintiff (herein private respondent).
On August 11, 1982, petitioner filed a motion to set aside
decision dated July 28, 1982.
On August 25, 1982, respondent judge issued an order denying
petitioner's motion to set aside decision.
On October 6, 1982, petitioner filed with the then Court of
Appeals a petition for certiorari/prohibition, which was denied in
its decision dated November 29, 1982 on the ground that
... when the private respondent filed on May
8, 1982, its motion to declare defendant in
default because the last day for him to file an
answer under the summons was May 7, 1982,
the petitioner has not filed an answer. So,

CIVIL PROCEDURE
there was actually a valid ground for the
motion, and the respondent court could have
validly declared the defendant in default,
especially because, at that time it was still
unaware of the fact that on May 5, 1982, the
herein petitioner had sent to it, by registered
mail, a motion for extension of twenty days
from May 7, 1982, within which to file an
answer, and which motion was received by
the respondent court only on May 19, 1982.
But, then the respondent court did not
immediately act on the motion to declare
defendant in default, so that by May 19,
1982, the herein petitioner was still able to
file an opposition to the motion asking him to
be declared in default. The principal ground
of the opposition of the petitioner was the
fact that he had sent, by registered mail, a
motion for extension of time to file
responsive pleading, and he even attached to
his opposition a copy of the motion for
extension.
On May 26, 1982, the respondent court
resolved the motion to declare defendant in
default by granting the motion. Now since on
May 26, 1982, the motion for extension of
time to file responsive pleading was already
before the court, as it received the same on
May 19, 1982, and aside from this, a copy
thereof was attached to the petitioner's
opposition to the private respondent's
motion to declare defendant in default, it is
conclusively assumed that the respondent
court, in resolving the motion to declare
defendant in default, had taken into
consideration the motion for extension,
especially because the ground of petitioner's
opposition to the motion to declare
defendant in default is the fact that he had
asked for extension of time to file responsive
pleading. Now, then, when the respondent
court declared the defendant in default, it is a
clear and inevitable implication, without the
need of an express statement to that effect,
although it would have been more desirable,
that the motion for extension of nine to file
responsive pleading was denied. In other
words, the Order of May 26, 1982 had the
necessary and logical implication that the
petitioner's opposition to the motion to
declare defendant in default, based upon the
ground that he had asked for extension of
time to file responsive pleading, was
disapproved or denied by the court.(pp. 2223, Rollo)
Coming to this Court on a petition for certiorari/prohibition,
petitioner raised the following issues, to wit:
1. Whether or not the order of default was
issued in grave abuse of discretion amounting
to lack of jurisdiction.

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Full Text: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

2. Whether or not certiorari is proper in a

case where judgment by default was
rendered without an order of default being
furnished petitioner and where meritorious
defenses exist, which are for the trial court to
evaluate and which evaluation was not done
in this case.
We are in agreement with respondent appellate court's
affirmance of the questioned order of the trial court. The
granting of additional time within which to file an answer to a
complaint is a matter largely addressed to the sound discretion of
the trial court. "While trial courts are persuaded, as a matter of
policy, to adopt a basically flexible attitude in favor of the
defendant in this area of our adjective law, the defense should
never be lulled into the belief that whenever trial courts refuse a
second request for extension to file an answer, the appellate
courts will grant relief (Naga Development Corporation vs. Court
of Appeals, 41 SCRA 105)."

remedy in the ordinary course of law, could

have been just as plain, adequate and speedy
as certiorari. Such a remedy could have been
granted by the respondent court. And if the
respondent court still denies the petition,
then petitioner can take an appeal on the
order denying the petition, and in the course
of such appeal petitioner can also assail the
judgment an the merits upon the ground that
it is supported by the evidence, or it is
contrary to law. (p. 25, Rollo)
ACCORDINGLY, the petition is DISMISSED. Without costs.
SO ORDERED.

In the case at bar, it was on May 5, 1982 or two (2) days before
the expiration of the fifteen-day reglementary period given to
defendant to file his responsive pleading when petitioner moved
for an extension of twenty (20) days from May 7 within which to
file his answer. Upon motion of private respondent and over the
objection of petitioner, respondent judge issued an order
declaring petitioner in default.
Under the Rules of Court, the remedies available to a defendant
in the Court of First Instance (now Regional Trial Court) are:
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 a
meritorious defense; (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)
Petitioner in this case did not avail himself of any of the above
remedies. Instead, he went to the appellate court on
certiorari/prohibition. On this point, respondent appellate court
aptly said:
... where the judgment rendered by the
respondent court is the one sought to be
annulled, a petition for relief, under Rule 38
of the Revised Rules of Court, which is a

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Full Text: Rule 9 Effect of Failure to Plead

G.R. No. L-40098 August 29, 1975
ANTONIO LIM TANHU, DY OCHAY, ALFONSO LEONARDO NG
SUA
and
CO
OYO, petitioners,
vs.
HON. JOSE R. RAMOLETE as Presiding Judge, Branch III, CFI,
Cebu and TAN PUT, respondents.
Zosa, Zosa, Castillo, Alcudia & Koh for petitioners.
Fidel Manalo and Florido & Associates for respondents.

BARREDO, J.:
Petition for (1) certiorari to annul and set aside certain actuations
of respondent Court of First Instance of Cebu Branch III in its Civil
Case No. 12328, an action for accounting of properties and
money totalling allegedly about P15 million pesos filed with a
common cause of action against six defendants, in which after
declaring four of the said defendants herein petitioners, in
default and while the trial as against the two defendants not
declared in default was in progress, said court granted plaintiff's
motion to dismiss the case in so far as the non-defaulted
defendants were concerned and thereafter proceeded to hear
ex-parte the rest of the plaintiffs evidence and subsequently
rendered judgment by default against the defaulted defendants,
with the particularities that notice of the motion to dismiss was
not duly served on any of the defendants, who had alleged a
compulsory counterclaim against plaintiff in their joint answer,
and the judgment so rendered granted reliefs not prayed for in
the complaint, and (2) prohibition to enjoin further proceedings
relative to the motion for immediate execution of the said
judgment.
Originally, this litigation was a complaint filed on February 9,
1971 by respondent Tan Put only against the spouses-petitioners
Antonio Lim Tanhu and Dy Ochay. Subsequently, in an amended
complaint dated September 26, 1972, their son Lim Teck Chuan
and the other spouses-petitioners Alfonso Leonardo Ng Sua and
Co Oyo and their son Eng Chong Leonardo were included as
defendants. In said amended complaint, respondent Tan alleged
that she "is the widow of Tee Hoon Lim Po Chuan, who was a
partner in the commercial partnership, Glory Commercial
Company ... with Antonio Lim Tanhu and Alfonso Ng Sua that
"defendant Antonio Lim Tanhu, Alfonso Leonardo Ng Sua, Lim
Teck Chuan, and Eng Chong Leonardo, through fraud and
machination, took actual and active management of the
partnership and although Tee Hoon Lim Po Chuan was the
manager of Glory Commercial Company, defendants managed to
use the funds of the partnership to purchase lands and building's
in the cities of Cebu, Lapulapu, Mandaue, and the municipalities
of Talisay and Minglanilla, some of which were hidden, but the
description of those already discovered were as follows: (list of
properties) ...;" and that:
13. (A)fter the death of Tee Hoon Lim Po
Chuan, the defendants, without liquidation
continued the business of Glory Commercial
Company by purportedly organizing a
corporation known as the Glory Commercial
Company, Incorporated, with paid up capital
in the sum of P125,000.00, which money and
other assets of the said Glory Commercial

CIVIL PROCEDURE
Company, Incorporated
assets of the defunct
Company partnership, of
has a share equivalent
thereof;

are actually the

Glory Commercial
which the plaintiff
3
to one third (/ )

14. (P)laintiff, on several occasions after the

death of her husband, has asked defendants
of the above-mentioned properties and for
the liquidation of the business of the defunct
partnership, including investments on real
estate in Hong Kong, but defendants kept on
promising to liquidate said properties and
just told plaintiff to
15. (S)ometime in the month of November,
1967, defendants, Antonio Lim Tanhu, by
means of fraud deceit and misrepresentations
did then and there, induce and convince the
plaintiff to execute a quitclaim of all her rights
and interests, in the assets of the partnership
of Glory Commercial Company, which is null
and void, executed through fraud and without
any legal effect. The original of said quitclaim
is in the possession of the adverse party
defendant Antonio Lim Tanhu.
16. (A)s a matter of fact, after the execution
of said quitclaim, defendant Antonio Lim
Tanhu offered to pay the plaintiff the amount
P65,000.00 within a period of one (1) month,
for which plaintiff was made to sign a receipt
for the amount of P65,000.00 although no
such amount was given and plaintiff was not
even given a copy of said document;
17. (T)hereafter, in the year 1968-69, the
defendants who had earlier promised to
liquidate the aforesaid properties and assets
in favor among others of plaintiff and until
the middle of the year 1970 when the
plaintiff formally demanded from the
defendants the accounting of real and
personal properties of the Glory Commercial
Company, defendants refused and stated that
they would not give the share of the plaintiff.
(Pp. 36-37, Record.)
She prayed as follows:
WHEREFORE, it is most respectfully prayed
that judgment be rendered:
a) Ordering the defendants to render an
accounting of the real and personal
properties of the Glory Commercial Company
including those registered in the names of the
defendants and other persons, which
properties are located in the Philippines and
in Hong Kong;
b) Ordering the defendants to deliver to the
3
plaintiff after accounting, one third (/ ) of
the total value of all the properties which is

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Full Text: Rule 9 Effect of Failure to Plead

approximately P5,000,000.00 representing
the just share of the plaintiff;
c) Ordering the defendants to pay the
attorney of the plaintiff the sum of Two
Hundred Fifty Thousand Pesos (P250,000.00)
by way of attorney's fees and damages in the
sum of One Million Pesos (P1,000,000.00).
This Honorable Court is prayed for other
remedies and reliefs consistent with law and
equity and order the defendants to pay the
costs. (Page 38, Record.)
The admission of said amended complaint was opposed by
defendants upon the ground that there were material
modifications of the causes of action previously alleged, but
respondent judge nevertheless allowed the amendment
reasoning that:
The present action is for accounting of real
and personal properties as well as for the
recovery of the same with damages.
An objective consideration of pars. 13 and 15
of the amended complaint pointed out by the
defendants to sustain their opposition will
show that the allegations of facts therein are
merely to amplify material averments
constituting the cause of action in the original
complaint. It likewise include necessary and
indispensable defendants without whom no
final determination can be had in the action
and in order that complete relief is to be
accorded as between those already parties.
Considering that the amendments sought to
be introduced do not change the main causes
of action in the original complaint and the
reliefs demanded and to allow amendments
is the rule, and to refuse them the exception
and in order that the real question between
the parties may be properly and justly
threshed out in a single proceeding to avoid
multiplicity of actions. (Page 40, Record.)
In a single answer with counterclaim, over the signature of their
common counsel, defendants denied specifically not only the
allegation that respondent Tan is the widow of Tee Hoon
because, according to them, his legitimate wife was Ang Siok Tin
still living and with whom he had four (4) legitimate children, a
twin born in 1942, and two others born in 1949 and 1965, all
presently residing in Hongkong, but also all the allegations of
fraud and conversion quoted above, the truth being, according to
them, that proper liquidation had been regularly made of the
business of the partnership and Tee Hoon used to receive his just
share until his death, as a result of which the partnership was
dissolved and what corresponded to him were all given to his
wife and children. To quote the pertinent portions of said
answer:
AND BY WAY OF SPECIAL AND AFFIRMATIVE
DEFENSES,

CIVIL PROCEDURE
defendants hereby incorporate all facts
averred and alleged in the answer, and
further most respectfully declare:
1. That in the event that plaintiff is filing the
present complaint as an heir of Tee Hoon Lim
Po Chuan, then, she has no legal capacity to
sue as such, considering that the legitimate
wife, namely: Ang Siok Tin, together with
their children are still alive. Under Sec. 1, (d),
Rule 16 of the Revised Rules of Court, lack of
legal capacity to sue is one of the grounds for
a motion to dismiss and so defendants prays
that a preliminary hearing be conducted as
provided for in Sec. 5, of the same rule;
2. That in the alternative case or event that
plaintiff is filing the present case under Art.
144 of the Civil Code, then, her claim or
demand has been paid, waived abandoned or
otherwise extinguished as evidenced by the
'quitclaim' Annex 'A' hereof, the ground cited
is another ground for a motion to dismiss
(Sec. 1, (h), Rule 16) and hence defendants
pray that a preliminary hearing be made in
connection therewith pursuant to Section 5
of the aforementioned rule;
3. That Tee Hoon Lim Po Chuan was legally
married to Ang Siok Tin and were blessed
with the following children, to wit: Ching
Siong Lim and Ching Hing Lim (twins) born on
February 16, 1942; Lim Shing Ping born on
March 3, 1949 and Lim Eng Lu born on June
25, 1965 and presently residing in Hongkong;
4. That even before the death of Tee Hoon
Lim Po Chuan, the plaintiff was no longer his
common law wife and even though she was
not entitled to anything left by Tee Hoon Lim
Po Chuan, yet, out of the kindness and
generosity on the part of the defendants,
particularly Antonio Lain Tanhu, who, was
inspiring to be monk and in fact he is now a
monk, plaintiff was given a substantial
amount evidenced by the 'quitclaim' (Annex
'A');
5. That the defendants have acquired
properties out of their own personal fund and
certainly not from the funds belonging to the
partnership, just as Tee Hoon Lim Po Chuan
had acquired properties out of his personal
fund and which are now in the possession of
the widow and neither the defendants nor
the partnership have anything to do about
said properties;
6. That it would have been impossible to buy
properties from funds belonging to the
partnership without the other partners
knowing about it considering that the amount
taken allegedly is quite big and with such big
amount withdrawn the partnership would
have been insolvent;
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Full Text: Rule 9 Effect of Failure to Plead

7. That plaintiff and Tee Hoon Lim Po Chuan
were not blessed with children who would
have been lawfully entitled to succeed to the
properties left by the latter together with the
widow and legitimate children;
8. That despite the fact that plaintiff knew
that she was no longer entitled to anything of
the shares of the late Tee Hoon Lim Po
Chuan, yet, this suit was filed against the
defendant who have to interpose the
following

CIVIL PROCEDURE
not appear, for which reason, upon motion of plaintiff dated
February 16, 1973, in an order of March 12, 1973, they were all
"declared in DEFAULT as of February 3, 1973 when they failed to
appear at the pre-trial." They sought to hive this order lifted thru
a motion for reconsideration, but the effort failed when the court
denied it. Thereafter, the trial started, but at the stage thereof
where the first witness of the plaintiff by the name of Antonio
Nuez who testified that he is her adopted son, was up for recross-examination, said plaintiff unexpectedly filed on October
19, 1974 the following simple and unreasoned
MOTION TO DROP DEFENDANTS LIM TECK
CHUAN AND ENG CHONG LEONARDO

COUNTERCLAIM
A. That the defendants hereby reproduced,
by way of reference, all the allegations and
foregoing averments as part of this
counterclaim; .
B. That plaintiff knew and was aware she was
merely the common-law wife of Tee Hoon
Lim Po Chuan and that the lawful and legal is
still living, together with the legitimate
children, and yet she deliberately suppressed
this fact, thus showing her bad faith and is
therefore liable for exemplary damages in an
amount which the Honorable Court may
determine in the exercise of its sound judicial
discretion. In the event that plaintiff is
married to Tee Hoon Lim Po Chuan, then, her
marriage is bigamous and should suffer the
consequences thereof;
C. That plaintiff was aware and had
knowledge about the 'quitclaim', even though
she was not entitled to it, and yet she falsely
claimed that defendants refused even to see
her and for filing this unfounded, baseless,
futile and puerile complaint, defendants
suffered mental anguish and torture
conservatively estimated to be not less than
P3,000.00;
D. That in order to defend their rights in
court, defendants were constrained to
engage the services of the undersigned
counsel, obligating themselves to pay
P500,000.00 as attorney's fees;
E. That by way of litigation expenses during
the time that this case will be before this
Honorable Court and until the same will be
finally
terminated
and
adjudicated,
defendants will have to spend at least
P5,000.00. (Pp. 44-47. Record.)
After unsuccessfully trying to show that this counterclaim is
merely permissive and should be dismissed for non-payment of
the corresponding filing fee, and after being overruled by the
court, in due time, plaintiff answered the same, denying its
material allegations.
On February 3, 1973, however, the date set for the pre-trial, both
of the two defendants-spouses the Lim Tanhus and Ng Suas, did

COMES now plaintiff, through her

undersigned counsel, unto the Honorable
Court most respectfully moves to drop from
the complaint the defendants Lim Teck Chuan
and Eng Chong Leonardo and to consider the
case dismissed insofar as said defendants Lim
Teck Chuan and Eng Chong Leonardo are
concerned.
WHEREFORE, it is most respectfully prayed of
the Honorable Court to drop from the
complaint the defendants Lim Teck Chuan
and Eng Chong Leonardo and to dismiss the
case against them without pronouncement as
to costs. (Page 50, Record.)
which she set for hearing on December 21,
1974. According to petitioners, none of the
defendants declared in default were notified
of said motion, in violation of Section 9 of
Rule 13, since they had asked for the lifting of
the order of default, albeit unsuccessfully,
and as regards the defendants not declared in
default, the setting of the hearing of said
motion on October 21, 1974 infringed the
three-day requirement of Section 4 of Rule
15, inasmuch as Atty. Adelino Sitoy of Lim
Teck Chuan was served with a copy of the
motion personally only on October 19, 1974,
while Atty. Benjamin Alcudia of Eng Chong
Leonardo was served by registered mail sent
only on the same date.
Evidently without even verifying the notices
of service, just as simply as plaintiff had
couched her motion, and also without any
legal grounds stated, respondent court
granted the prayer of the above motion thus:
ORDER
Acting on the motion of the plaintiff praying
for the dismissal of the complaint as against
defendants Lim Teck Chuan and Eng Chong
Leonardo.
The same is hereby GRANTED. The complaint
as against defendant Lim Teck Chuan and Eng
Chong Leonardo is hereby ordered
DISMISSED without pronouncement as to
costs.
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Full Text: Rule 9 Effect of Failure to Plead

Simultaneously, the following order was also issued:
Considering that defendants Antonio Lim
Tanhu and his spouse Dy Ochay as well as
defendants Alfonso Ng Sua and his spouse Co
Oyo have been declared in default for failure
to appear during the pre-trial and as to the
other defendants the complaint had already
been ordered dismissed as against them.
Let the hearing of the plaintiff's evidence exparte be set on November 20, 1974, at 8:30
A.M. before the Branch Clerk of Court who is
deputized for the purpose, to swear in
witnesses and to submit her report within ten
(10) days thereafter. Notify the plaintiff.
SO ORDERED.
Cebu City, Philippines, October 21, 1974.
(Page 52, Record.)
But, in connection with this last order, the scheduled ex-parte
reception of evidence did not take place on November 20, 1974,
for on October 28, 1974, upon verbal motion of plaintiff, the
court issued the following self-explanatory order: .
Acting favorably on the motion of the plaintiff
dated October 18, 1974, the Court deputized
the Branch Clerk of Court to receive the
evidence of the plaintiff ex-parte to be made
on November 20, 1974. However, on October
28, 1974, the plaintiff, together with her
witnesses, appeared in court and asked, thru
counsel, that she be allowed to present her
evidence.
Considering the time and expenses incurred
by the plaintiff in bringing her witnesses to
the court, the Branch Clerk of Court is hereby
authorized to receive immediately the
evidence of the plaintiff ex-parte.
SO ORDERED.
Cebu City, Philippines, October 28, 1974.
(Page 53. Record.)
Upon learning of these orders on October 23, 1973, the
defendant Lim Teck Cheng, thru counsel, Atty. Sitoy, filed a
motion for reconsideration thereof, and on November 1, 1974,
defendant Eng Chong Leonardo, thru counsel Atty. Alcudia, filed
also his own motion for reconsideration and clarification of the
same orders. These motions were denied in an order dated
December 6, 1974 but received by the movants only on
December 23, 1974. Meanwhile, respondent court rendered the
impugned decision on December 20, 1974. It does not appear
when the parties were served copies of this decision.
Subsequently, on January 6, 1975, all the defendants, thru
counsel, filed a motion to quash the order of October 28, 1974.
Without waiting however for the resolution thereof, on January
13, 1974, Lim Teck Chuan and Eng Chong Leonardo went to the
Court of Appeals with a petition for certiorari seeking the
annulment of the above-mentioned orders of October 21, 1974

CIVIL PROCEDURE
and October 28, 1974 and decision of December 20, 1974. By
resolution of January 24, 1975, the Court of Appeals dismissed
said petition, holding that its filing was premature, considering
that the motion to quash the order of October 28, 1974 was still
unresolved by the trial court. This holding was reiterated in the
subsequent resolution of February 5, 1975 denying the motion
for reconsideration of the previous dismissal.
On the other hand, on January 20, 1975, the other defendants,
petitioners herein, filed their notice of appeal, appeal bond and
motion for extension to file their record on appeal, which was
granted, the extension to expire after fifteen (15) days from
January 26 and 27, 1975, for defendants Lim Tanhu and Ng Suas,
respectively. But on February 7, 1975, before the perfection of
their appeal, petitioners filed the present petition with this Court.
And with the evident intent to make their procedural position
clear, counsel for defendants, Atty. Manuel Zosa, filed with
respondent court a manifestation dated February 14, 1975
stating that "when the non-defaulted defendants Eng Chong
Leonardo and Lim Teck Chuan filed their petition in the Court of
Appeals, they in effect abandoned their motion to quash the
order of October 28, 1974," and that similarly "when Antonio Lim
Tanhu, Dy Ochay, Alfonso Leonardo Ng Sua and Co Oyo, filed
their petition for certiorari and prohibition ... in the Supreme
Court, they likewise abandoned their motion to quash." This
manifestation was acted upon by respondent court together with
plaintiffs motion for execution pending appeal in its order of the
same date February 14, 1975 this wise:
ORDER
When these incidents, the motion to quash
the order of October 28, 1974 and the motion
for execution pending appeal were called for
hearing today, counsel for the defendantsmovants submitted their manifestation
inviting the attention of this Court that by
their filing for certiorari and prohibition with
preliminary injunction in the Court of Appeals
which was dismissed and later the defaulted
defendants filed with the Supreme Court
certiorari with prohibition they in effect
abandoned their motion to quash.
IN VIEW HEREOF, the motion to quash is
ordered ABANDONED. The resolution of the
motion for execution pending appeal shall be
resolved after the petition for certiorari and
prohibition shall have been resolved by the
Supreme Court.
SO ORDERED.
Cebu City, Philippines, February 14, 1975.
(Page 216, Record.)
Upon these premises, it is the position of petitioners that
respondent court acted illegally, in violation of the rules or with
grave abuse of discretion in acting on respondent's motion to
dismiss of October 18, 1974 without previously ascertaining
whether or not due notice thereof had been served on the
adverse parties, as, in fact, no such notice was timely served on
the non-defaulted defendants Lim Teck Chuan and Eng Chong
Leonardo and no notice at all was ever sent to the other
defendants, herein petitioners, and more so, in actually ordering
the dismissal of the case by its order of October 21, 1974 and at
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Full Text: Rule 9 Effect of Failure to Plead

the same time setting the case for further hearing as against the
defaulted defendants, herein petitioners, actually hearing the
same ex-parte and thereafter rendering the decision of
December 20, 1974 granting respondent Tan even reliefs not
prayed for in the complaint. According to the petitioners, to
begin with, there was compulsory counterclaim in the common
answer of the defendants the nature of which is such that it
cannot be decided in an independent action and as to which the
attention of respondent court was duly called in the motions for
reconsideration. Besides, and more importantly, under Section 4
of Rule 18, respondent court had no authority to divide the case
before it by dismissing the same as against the non-defaulted
defendants and thereafter proceeding to hear it ex-parte and
subsequently rendering judgment against the defaulted
defendants, considering that in their view, under the said
provision of the rules, when a common cause of action is alleged
against several defendants, the default of any of them is a mere
formality by which those defaulted are not allowed to take part
in the proceedings, but otherwise, all the defendants, defaulted
and not defaulted, are supposed to have but a common fate, win
or lose. In other words, petitioners posit that in such a situation,
there can only be one common judgment for or against all the
defendant, the non-defaulted and the defaulted. Thus,
petitioners contend that the order of dismissal of October 21,
1974 should be considered also as the final judgment insofar as
they are concerned, or, in the alternative, it should be set aside
together with all the proceedings and decision held and rendered
subsequent thereto, and that the trial be resumed as of said
date, with the defendants Lim Teck Chuan and Eng Chong
Leonardo being allowed to defend the case for all the
defendants.
On the other hand, private respondent maintains the contrary
view that inasmuch as petitioners had been properly declared in
default, they have no personality nor interest to question the
dismissal of the case as against their non-defaulted codefendants and should suffer the consequences of their own
default. Respondent further contends, and this is the only
position discussed in the memorandum submitted by her
counsel, that since petitioners have already made or at least
started to make their appeal, as they are in fact entitled to
appeal, this special civil action has no reason for being.
Additionally, she invokes the point of prematurity upheld by the
Court of Appeals in regard to the above-mentioned petition
therein of the non-defaulted defendants Lim Teck Chuan and Eng
Chong Leonardo. Finally, she argues that in any event, the errors
attributed to respondent court are errors of judgment and may
be reviewed only in an appeal.
After careful scrutiny of all the above-related proceedings, in the
court below and mature deliberation, the Court has arrived at the
conclusion that petitioners should be granted relief, if only to
stress emphatically once more that the rules of procedure may
not be misused and abused as instruments for the denial of
substantial justice. A review of the record of this case
immediately discloses that here is another demonstrative
instance of how some members of the bar, availing of their
proficiency in invoking the letter of the rules without regard to
their real spirit and intent, succeed in inducing courts to act
contrary to the dictates of justice and equity, and, in some
instances, to wittingly or unwittingly abet unfair advantage by
ironically camouflaging their actuations as earnest efforts to
satisfy the public clamor for speedy disposition of litigations,
forgetting all the while that the plain injunction of Section 2 of
Rule 1 is that the "rules shall be liberally construed in order to
promote their object and to assist the parties in obtaining not
only 'speedy' but more imperatively, "just ... and inexpensive

CIVIL PROCEDURE
determination of every action and proceeding." We cannot
simply pass over the impression that the procedural maneuvers
and tactics revealed in the records of the case at bar were
deliberately planned with the calculated end in view of depriving
petitioners and their co-defendants below of every opportunity
to properly defend themselves against a claim of more than
substantial character, considering the millions of pesos worth of
properties involved as found by respondent judge himself in the
impugned decision, a claim that appears, in the light of the
allegations of the answer and the documents already brought to
the attention of the court at the pre-trial, to be rather dubious.
What is most regrettable is that apparently, all of these alarming
circumstances have escaped respondent judge who did not seem
to have hesitated in acting favorably on the motions of the
plaintiff conducive to the deplorable objective just mentioned,
and which motions, at the very least, appeared to be 'of highly
controversial' merit, considering that their obvious tendency and
immediate result would be to convert the proceedings into a
one-sided affair, a situation that should be readily condemnable
and intolerable to any court of justice.
Indeed, a seeming disposition on the part of respondent court to
lean more on the contentions of private respondent may be
discerned from the manner it resolved the attempts of
defendants Dy Ochay and Antonio Lim Tanhu to have the earlier
order of default against them lifted. Notwithstanding that Dy
Ochay's motion of October 8, 1971, co-signed by her with their
counsel, Atty. Jovencio Enjambre (Annex 2 of respondent answer
herein) was over the jurat of the notary public before whom she
took her oath, in the order of November 2, 1971, (Annex 3 id.) it
was held that "the oath appearing at the bottom of the motion is
not the one contemplated by the abovequoted pertinent
provision (See. 3, Rule 18) of the rules. It is not even a
verification. (See. 6, Rule 7.) What the rule requires as
interpreted by the Supreme Court is that the motion must have
to be accompanied by an affidavit of merits that the defendant
has a meritorious defense, thereby ignoring the very simple legal
point that the ruling of the Supreme Court in Ong Peng vs.
Custodio, 1 SCRA 781, relied upon by His Honor, under which a
separate affidavit of merit is required refers obviously to
instances where the motion is not over oath of the party
concerned, considering that what the cited provision literally
requires is no more than a "motion under oath." Stated
otherwise, when a motion to lift an order of default contains the
reasons for the failure to answer as well as the facts constituting
the prospective defense of the defendant and it is sworn to by
said defendant, neither a formal verification nor a separate
affidavit of merit is necessary.
What is worse, the same order further held that the motion to lift
the order of default "is an admission that there was a valid
service of summons" and that said motion could not amount to a
challenge against the jurisdiction of the court over the person of
the defendant. Such a rationalization is patently specious and
reveals an evident failure to grasp the import of the legal
concepts involved. A motion to lift an order of default on the
ground that service of summons has not been made in
accordance with the rules is in order and is in essence verily an
attack against the jurisdiction of the court over the person of the
defendant, no less than if it were worded in a manner specifically
embodying such a direct challenge.
And then, in the order of February 14, 1972 (Annex 6, id.) lifting
at last the order of default as against defendant Lim Tanhu, His
Honor posited that said defendant "has a defense (quitclaim)
which renders the claim of the plaintiff contentious." We have
read defendants' motion for reconsideration of November 25,
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Full Text: Rule 9 Effect of Failure to Plead

1971 (Annex 5, id.), but We cannot find in it any reference to a
"quitclaim". Rather, the allegation of a quitclaim is in the
amended complaint (Pars. 15-16, Annex B of the petition herein)
in which plaintiff maintains that her signature thereto was
secured through fraud and deceit. In truth, the motion for
reconsideration just mentioned, Annex 5, merely reiterated the
allegation in Dy Ochay's earlier motion of October 8, 1971, Annex
2, to set aside the order of default, that plaintiff Tan could be but
the common law wife only of Tee Hoon, since his legitimate wife
was still alive, which allegation, His Honor held in the order of
November 2, 1971, Annex 3, to be "not good and meritorious
defense". To top it all, whereas, as already stated, the order of
February 19, 1972, Annex 6, lifted the default against Lim Tanhu
because of the additional consideration that "he has a defense
(quitclaim) which renders the claim of the plaintiff contentious,"
the default of Dy Ochay was maintained notwithstanding that
exactly the same "contentions" defense as that of her husband
was invoked by her.
Such tenuous, if not altogether erroneous reasonings and
manifest inconsistency in the legal postures in the orders in
question can hardly convince Us that the matters here in issue
were accorded due and proper consideration by respondent
court. In fact, under the circumstances herein obtaining, it seems
appropriate to stress that, having in view the rather substantial
value of the subject matter involved together with the obviously
contentious character of plaintiff's claim, which is discernible
even on the face of the complaint itself, utmost care should have
been taken to avoid the slightest suspicion of improper
motivations on the part of anyone concerned. Upon the
considerations hereunder to follow, the Court expresses its grave
concern that much has to be done to dispel the impression that
herein petitioners and their co-defendants are being railroaded
out of their rights and properties without due process of law, on
the strength of procedural technicalities adroitly planned by
counsel and seemingly unnoticed and undetected by respondent
court, whose orders, gauged by their tenor and the citations of
supposedly pertinent provisions and jurisprudence made therein,
cannot be said to have proceeded from utter lack of juridical
knowledgeability and competence.
1
The first thing that has struck the Court upon reviewing the
record is the seeming alacrity with which the motion to dismiss
the case against non-defaulted defendants Lim Teck Chuan and
Eng Chong Leonardo was disposed of, which definitely ought not
to have been the case. The trial was proceeding with the
testimony of the first witness of plaintiff and he was still under
re-cross-examination. Undoubtedly, the motion to dismiss at that
stage and in the light of the declaration of default against the rest
of the defendants was a well calculated surprise move, obviously
designed to secure utmost advantage of the situation, regardless
of its apparent unfairness. To say that it must have been entirely
unexpected by all the defendants, defaulted and non-defaulted ,
is merely to rightly assume that the parties in a judicial
proceeding can never be the victims of any procedural waylaying
as long as lawyers and judges are imbued with the requisite
sense of equity and justice.
But the situation here was aggravated by the indisputable fact
that the adverse parties who were entitled to be notified of such
unanticipated dismissal motion did not get due notice thereof.
Certainly, the non-defaulted defendants had the right to the
three-day prior notice required by Section 4 of Rule 15. How
could they have had such indispensable notice when the motion
was set for hearing on Monday, October 21, 1974, whereas the

CIVIL PROCEDURE
counsel for Lim Teck Chuan, Atty. Sitoy was personally served
with the notice only on Saturday, October 19, 1974 and the
counsel for Eng Chong Leonardo, Atty. Alcudia, was notified by
registered mail which was posted only that same Saturday,
October 19, 1974? According to Chief Justice Moran, "three days
at least must intervene between the date of service of notice and
the date set for the hearing, otherwise the court may not validly
act on the motion." (Comments on the Rules of Court by Moran,
Vol. 1, 1970 ed. p. 474.) Such is the correct construction of
Section 4 of Rule 15. And in the instant case, there can be no
question that the notices to the non-defaulted defendants were
short of the requirement of said provision.
We can understand the over-anxiety of counsel for plaintiff, but
what is incomprehensible is the seeming inattention of
respondent judge to the explicit mandate of the pertinent rule,
not to speak of the imperatives of fairness, considering he should
have realized the far-reaching implications, specially from the
point of view he subsequently adopted, albeit erroneously, of his
favorably acting on it. Actually, he was aware of said
consequences, for simultaneously with his order of dismissal, he
immediately set the case for the ex-parte hearing of the evidence
against the defaulted defendants, which, incidentally, from the
tenor of his order which We have quoted above, appears to have
been done by him motu propio As a matter of fact, plaintiff's
motion also quoted above did not pray for it.
Withal, respondent court's twin actions of October 21, 1974
further ignores or is inconsistent with a number of known
juridical principles concerning defaults, which We will here take
occasion to reiterate and further elucidate on, if only to avoid a
repetition of the unfortunate errors committed in this case.
Perhaps some of these principles have not been amply projected
and elaborated before, and such paucity of elucidation could be
the reason why respondent judge must have acted as he did. Still,
the Court cannot but express its vehement condemnation of any
judicial actuation that unduly deprives any party of the right to
be heard without clear and specific warrant under the terms of
existing rules or binding jurisprudence. Extreme care must be the
instant reaction of every judge when confronted with a situation
involving risks that the proceedings may not be fair and square to
all the parties concerned. Indeed, a keen sense of fairness, equity
and justice that constantly looks for consistency between the
letter of the adjective rules and these basic principles must be
possessed by every judge, If substance is to prevail, as it must,
over form in our courts. Literal observance of the rules, when it is
conducive to unfair and undue advantage on the part of any
litigant before it, is unworthy of any court of justice and equity.
Withal, only those rules and procedure informed, with and
founded on public policy deserve obedience in accord with their
unequivocal language or words..
Before proceeding to the discussion of the default aspects of this
case, however, it should not be amiss to advert first to the patent
incorrectness, apparent on the face of the record, of the
aforementioned order of dismissal of October 21, 1974 of the
case below as regards non-defaulted defendants Lim and
Leonardo. While it is true that said defendants are not petitioners
herein, the Court deems it necessary for a full view of the
outrageous procedural strategy conceived by respondent's
counsel and sanctioned by respondent court to also make
reference to the very evident fact that in ordering said dismissal
respondent court disregarded completely the existence of
defendant's counterclaim which it had itself earlier held if
indirectly, to be compulsory in nature when it refused to dismiss
the same on the ground alleged by respondent Tan that he
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docketing fees for the filing thereof had not been paid by
defendants.
Indeed, that said counterclaim is compulsory needs no extended
elaboration. As may be noted in the allegations hereof
aforequoted, it arose out of or is necessarily connected with the
occurrence that is the subject matter of the plaintiff's claim,
(Section 4, Rule 9) namely, plaintiff's allegedly being the widow of
the deceased Tee Hoon entitled, as such, to demand accounting
of and to receive the share of her alleged late husband as partner
of defendants Antonio Lim Tanhu and Alfonso Leonardo Ng Sua
in Glory Commercial Company, the truth of which allegations all
the defendants have denied. Defendants maintain in their
counterclaim that plaintiff knew of the falsity of said allegations
even before she filed her complaint, for she had in fact admitted
her common-law relationship with said deceased in a document
she had jointly executed with him by way of agreement to
terminate their illegitimate relationship, for which she received
P40,000 from the deceased, and with respect to her pretended
share in the capital and profits in the partnership, it is also
defendants' posture that she had already quitclaimed, with the
assistance of able counsel, whatever rights if any she had thereto
in November, 1967, for the sum of P25,000 duly receipted by her,
which quitclaim was, however, executed, according to
respondent herself in her amended complaint, through fraud.
And having filed her complaint knowing, according to
defendants, as she ought to have known, that the material
allegations thereof are false and baseless, she has caused them
to suffer damages. Undoubtedly, with such allegations,
defendants' counterclaim is compulsory, not only because the
same evidence to sustain it will also refute the cause or causes of
action alleged in plaintiff's complaint, (Moran, supra p. 352) but
also because from its very nature, it is obvious that the same
cannot "remain pending for independent adjudication by the
court." (Section 2, Rule 17.)
The provision of the rules just cited specifically enjoins that "(i)f a
counterclaim has been pleaded by a defendant prior to the
service upon him of the plaintiff's motion to dismiss, the action
shall not be dismissed against the defendant's objection unless
the counterclaim can remain pending for independent
adjudication by the court." Defendants Lim and Leonardo had no
opportunity to object to the motion to dismiss before the order
granting the same was issued, for the simple reason that they
were not opportunity notified of the motion therefor, but the
record shows clearly that at least defendant Lim immediately
brought the matter of their compulsory counterclaim to the
attention of the trial court in his motion for reconsideration of
October 23, 1974, even as the counsel for the other defendant,
Leonardo, predicated his motion on other grounds. In its order of
December 6, 1974, however, respondent court not only upheld
the plaintiffs supposed absolute right to choose her adversaries
but also held that the counterclaim is not compulsory, thereby
virtually making unexplained and inexplicable 180-degree
turnabout in that respect.
There is another equally fundamental consideration why the
motion to dismiss should not have been granted. As the plaintiff's
complaint has been framed, all the six defendants are charged
with having actually taken part in a conspiracy to misappropriate,
conceal and convert to their own benefit the profits, properties
and all other assets of the partnership Glory Commercial
Company, to the extent that they have allegedly organized a
corporation, Glory Commercial Company, Inc. with what they had
illegally gotten from the partnership. Upon such allegations, no
judgment finding the existence of the alleged conspiracy or
holding the capital of the corporation to be the money of the

CIVIL PROCEDURE
partnership is legally possible without the presence of all the
defendants. The non-defaulted defendants are alleged to be
stockholders of the corporation and any decision depriving the
same of all its assets cannot but prejudice the interests of said
defendants. Accordingly, upon these premises, and even
prescinding from the other reasons to be discussed anon it is
clear that all the six defendants below, defaulted and nondefaulted, are indispensable parties. Respondents could do no
less than grant that they are so on page 23 of their answer. Such
being the case, the questioned order of dismissal is exactly the
opposite of what ought to have been done. Whenever it appears
to the court in the course of a proceeding that an indispensable
party has not been joined, it is the duty of the court to stop the
trial and to order the inclusion of such party. (The Revised Rules
of Court, Annotated & Commented by Senator Vicente J.
Francisco, Vol. 1, p. 271, 1973 ed. See also Cortez vs. Avila, 101
Phil. 705.) Such an order is unavoidable, for the "general rule
with reference to the making of parties in a civil action requires
the joinder of all necessary parties wherever possible, and the
joinder of all indispensable parties under any and all conditions,
the presence of those latter being a sine qua non of the exercise
of judicial power." (Borlasa vs. Polistico, 47 Phil. 345, at p. 347.) It
is precisely " when an indispensable party is not before the court
(that) the action should be dismissed." (People v. Rodriguez, 106
Phil. 325, at p. 327.) The absence of an indispensable party
renders all subsequent actuations of the court null and void, for
want of authority to act, not only as to the absent parties but
even as to those present. In short, what respondent court did
here was exactly the reverse of what the law ordains it
eliminated those who by law should precisely be joined.
As may he noted from the order of respondent court quoted
earlier, which resolved the motions for reconsideration of the
dismissal order filed by the non-defaulted defendants, His Honor
rationalized his position thus:
It is the rule that it is the absolute prerogative
of the plaintiff to choose, the theory upon
which he predicates his right of action, or the
parties he desires to sue, without dictation or
imposition by the court or the adverse party.
If he makes a mistake in the choice of his
right of action, or in that of the parties
against whom he seeks to enforce it, that is
his own concern as he alone suffers
therefrom. The plaintiff cannot be compelled
to choose his defendants, He may not, at his
own expense, be forced to implead anyone
who, under the adverse party's theory, is to
answer for defendant's liability. Neither may
the Court compel him to furnish the means
by which defendant may avoid or mitigate
their liability. (Vao vs. Alo, 95 Phil. 495-496.)
This being the rule this court cannot compel
the plaintiff to continue prosecuting her
cause of action against the defendantsmovants if in the course of the trial she
believes she can enforce it against the
remaining defendants subject only to the
limitation provided in Section 2, Rule 17 of
the Rules of Court. ... (Pages 6263, Record.)
Noticeably, His Honor has employed the same equivocal
terminology as in plaintiff's motion of October 18, 1974 by
referring to the action he had taken as being "dismissal of the
complaint against them or their being dropped therefrom",
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without perceiving that the reason for the evidently intentional
ambiguity is transparent. The apparent idea is to rely on the
theory that under Section 11 of Rule 3, parties may be dropped
by the court upon motion of any party at any stage of the action,
hence "it is the absolute right prerogative of the plaintiff to
choosethe parties he desires to sue, without dictation or
imposition by the court or the adverse party." In other words, the
ambivalent pose is suggested that plaintiff's motion of October
18, 1974 was not predicated on Section 2 of Rule 17 but more on
Section 11 of Rule 3. But the truth is that nothing can be more
incorrect. To start with, the latter rule does not comprehend
whimsical and irrational dropping or adding of parties in a
complaint. What it really contemplates is erroneous or mistaken
non-joinder and misjoinder of parties. No one is free to join
anybody in a complaint in court only to drop him
unceremoniously later at the pleasure of the plaintiff. The rule
presupposes that the original inclusion had been made in the
honest conviction that it was proper and the subsequent
dropping is requested because it has turned out that such
inclusion was a mistake. And this is the reason why the rule
ordains that the dropping be "on such terms as are just" just
to all the other parties. In the case at bar, there is nothing in the
record to legally justify the dropping of the non-defaulted
defendants, Lim and Leonardo. The motion of October 18, 1974
cites none. From all appearances, plaintiff just decided to ask for
it, without any relevant explanation at all. Usually, the court in
granting such a motion inquires for the reasons and in the
appropriate instances directs the granting of some form of
compensation for the trouble undergone by the defendant in
answering the complaint, preparing for or proceeding partially to
trial, hiring counsel and making corresponding expenses in the
premises. Nothing of these, appears in the order in question.
Most importantly, His Honor ought to have considered that the
outright dropping of the non-defaulted defendants Lim and
Leonardo, over their objection at that, would certainly be unjust
not only to the petitioners, their own parents, who would in
consequence be entirely defenseless, but also to Lim and
Leonardo themselves who would naturally correspondingly suffer
from the eventual judgment against their parents. Respondent
court paid no heed at all to the mandate that such dropping must
be on such terms as are just" meaning to all concerned with its
legal and factual effects.
Thus, it is quite plain that respondent court erred in issuing its
order of dismissal of October 21, 1974 as well as its order of
December 6, 1974 denying reconsideration of such dismissal. As
We make this ruling, We are not oblivious of the circumstance
that defendants Lim and Leonardo are not parties herein. But
such consideration is inconsequential. The fate of the case of
petitioners is inseparably tied up with said order of dismissal, if
only because the order of ex-parte hearing of October 21, 1974
which directly affects and prejudices said petitioners is
predicated thereon. Necessarily, therefore, We have to pass on
the legality of said order, if We are to decide the case of herein
petitioners properly and fairly.
The attitude of the non-defaulted defendants of no longer
pursuing further their questioning of the dismissal is from
another point of view understandable. On the one hand, why
should they insist on being defendants when plaintiff herself has
already release from her claims? On the other hand, as far as
their respective parents-co-defendants are concerned, they must
have realized that they (their parents) could even be benefited by
such dismissal because they could question whether or not
plaintiff can still prosecute her case against them after she had
secured the order of dismissal in question. And it is in connection

CIVIL PROCEDURE
with this last point that the true and correct concept of default
becomes relevant.
At this juncture, it may also be stated that the decision of the
Court of Appeals of January 24, 1975 in G. R. No. SP-03066
dismissing the petition for certiorari of non-defaulted defendants
Lim and Leonardo impugning the order of dismissal of October
21, 1974, has no bearing at all in this case, not only because that
dismissal was premised by the appellate court on its holding that
the said petition was premature inasmuch as the trial court had
not yet resolved the motion of the defendants of October 28,
1974 praying that said disputed order be quashed, but principally
because herein petitioners were not parties in that proceeding
and cannot, therefore, be bound by its result. In particular, We
deem it warranted to draw the attention of private respondent's
counsel to his allegations in paragraphs XI to XIV of his answer,
which relate to said decision of the Court of Appeals and which
have the clear tendency to make it appear to the Court that the
appeals court had upheld the legality and validity of the
actuations of the trial court being questioned, when as a matter
of indisputable fact, the dismissal of the petition was based solely
and exclusively on its being premature without in any manner
delving into its merits. The Court must and does admonish
counsel that such manner of pleading, being deceptive and
lacking in candor, has no place in any court, much less in the
Supreme Court, and if We are adopting a passive attitude in the
premises, it is due only to the fact that this is counsel's first
offense. But similar conduct on his part in the future will
definitely be dealt with more severely. Parties and counsel would
be well advised to avoid such attempts to befuddle the issues as
invariably then will be exposed for what they are, certainly
unethical and degrading to the dignity of the law profession.
Moreover, almost always they only betray the inherent weakness
of the cause of the party resorting to them.
2
Coming now to the matter itself of default, it is quite apparent
that the impugned orders must have proceeded from inadequate
apprehension of the fundamental precepts governing such
procedure under the Rules of Court. It is time indeed that the
concept of this procedural device were fully understood by the
bench and bar, instead of being merely taken for granted as
being that of a simple expedient of not allowing the offending
party to take part in the proceedings, so that after his adversary
shall have presented his evidence, judgment may be rendered in
favor of such opponent, with hardly any chance of said judgment
being reversed or modified.
The Rules of Court contain a separate rule on the subject of
default, Rule 18. But said rule is concerned solely with default
resulting from failure of the defendant or defendants to answer
within the reglementary period. Referring to the simplest form of
default, that is, where there is only one defendant in the action
and he fails to answer on time, Section 1 of the rule provides that
upon "proof of such failure, (the court shall) declare the
defendant in default. Thereupon the court shall proceed to
receive the plaintiff's evidence and render judgment granting him
such relief as the complaint and the facts proven may warrant."
This last clause is clarified by Section 5 which says that "a
judgment entered against a party in default shall not exceed the
amount or be different in kind from that prayed for."
Unequivocal, in the literal sense, as these provisions are, they do
not readily convey the full import of what they contemplate. To
begin with, contrary to the immediate notion that can be drawn
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from their language, these provisions are not to be understood as
meaning that default or the failure of the defendant to answer
should be "interpreted as an admission by the said defendant
that the plaintiff's cause of action find support in the law or that
plaintiff is entitled to the relief prayed for." (Moran, supra, p. 535
citing Macondary & Co. v. Eustaquio, 64 Phil. 466, citing with
approval Chaffin v. McFadden, 41 Ark. 42; Johnson v. Pierce, 12
Ark. 599; Mayden v. Johnson, 59 Ga. 105; People v. Rust, 292
111. 328; Ken v. Leopold 21 111. A. 163; Chicago, etc. Electric R.
Co. v. Krempel 116 111. A. 253.)
Being declared in default does not constitute a waiver of rights
except that of being heard and of presenting evidence in the trial
court. According to Section 2, "except as provided in Section 9 of
Rule 13, a party declared in default shall not be entitled to notice
of subsequent proceedings, nor to take part in the trial." That
provision referred to reads: "No service of papers other than
substantially amended pleadings and final orders or judgments
shall be necessary on a party in default unless he files a motion to
set aside the order of default, in which event he shall be entitled
to notice of all further proceedings regardless of whether the
order of default is set aside or not." And pursuant to Section 2 of
Rule 41, "a party who has been declared in default may likewise
appeal from the judgment rendered against him as contrary to
the evidence or to the law, even if no petition for relief to set
aside the order of default has been presented by him in
accordance with Rule 38.".
In other words, a defaulted defendant is not actually thrown out
of court. While in a sense it may be said that by defaulting he
leaves himself at the mercy of the court, the rules see to it that
any judgment against him must be in accordance with law. The
evidence to support the plaintiff's cause is, of course, presented
in his absence, but the court is not supposed to admit that which
is basically incompetent. Although the defendant would not be in
a position to object, elementary justice requires that, only legal
evidence should be considered against him. If the evidence
presented should not be sufficient to justify a judgment for the
plaintiff, the complaint must be dismissed. And if an unfavorable
judgment should be justifiable, it cannot exceed in amount or be
different in kind from what is prayed for in the complaint.
Incidentally, these considerations argue against the present
widespread practice of trial judges, as was done by His Honor in
this case, of delegating to their clerks of court the reception of
the plaintiff's evidence when the defendant is in default. Such a
Practice is wrong in principle and orientation. It has no basis in
any rule. When a defendant allows himself to be declared in
default, he relies on the faith that the court would take care that
his rights are not unduly prejudiced. He has a right to presume
that the law and the rules will still be observed. The proceedings
are held in his forced absence, and it is but fair that the plaintiff
should not be allowed to take advantage of the situation to win
by foul or illegal means or with inherently incompetent evidence.
Thus, in such instances, there is need for more attention from the
court, which only the judge himself can provide. The clerk of
court would not be in a position much less have the authority to
act in the premises in the manner demanded by the rules of fair
play and as contemplated in the law, considering his comparably
limited area of discretion and his presumably inferior preparation
for the functions of a judge. Besides, the default of the defendant
is no excuse for the court to renounce the opportunity to closely
observe the demeanor and conduct of the witnesses of the
plaintiff, the better to appreciate their truthfulness and
credibility. We therefore declare as a matter of judicial policy
that there being no imperative reason for judges to do otherwise,
the practice should be discontinued.

CIVIL PROCEDURE
Another matter of practice worthy of mention at this point is that
it is preferable to leave enough opportunity open for possible
lifting of the order of default before proceeding with the
reception of the plaintiff's evidence and the rendition of the
decision. "A judgment by default may amount to a positive and
considerable injustice to the defendant; and the possibility of
such serious consequences necessitates a careful and liberal
examination of the grounds upon which the defendant may seek
to set it aside." (Moran, supra p. 534, citing Coombs vs. Santos,
24 Phil. 446; 449-450.) The expression, therefore, in Section 1 of
Rule 18 aforequoted which says that "thereupon the court shall
proceed to receive the plaintiff's evidence etc." is not to be taken
literally. The gain in time and dispatch should the court
immediately try the case on the very day of or shortly after the
declaration of default is far outweighed by the inconvenience
and complications involved in having to undo everything already
done in the event the defendant should justify his omission to
answer on time.
The foregoing observations, as may be noted, refer to instances
where the only defendant or all the defendants, there being
several, are declared in default. There are additional rules
embodying more considerations of justice and equity in cases
where there are several defendants against whom a common
cause of action is averred and not all of them answer
opportunely or are in default, particularly in reference to the
power of the court to render judgment in such situations. Thus,
in addition to the limitation of Section 5 that the judgment by
default should not be more in amount nor different in kind from
the reliefs specifically sought by plaintiff in his complaint, Section
4 restricts the authority of the court in rendering judgment in the
situations just mentioned as follows:
Sec. 4. Judgment when some defendants
answer, and other make difficult. When a
complaint states a common cause of action
against several defendant some of whom
answer, and the others fail to do so, the court
shall try the case against all upon the answer
thus filed and render judgment upon the
evidence presented. The same proceeding
applies when a common cause of action is
pleaded in a counterclaim, cross-claim and
third-party claim.
Very aptly does Chief Justice Moran elucidate on this provision
and the controlling jurisprudence explanatory thereof this wise:
Where a complaint states a common cause of
action against several defendants and some
appear to defend the case on the merits
while others make default, the defense
interposed by those who appear to litigate
the case inures to the benefit of those who
fail to appear, and if the court finds that a
good defense has been made, all of the
defendants must be absolved. In other words,
the answer filed by one or some of the
defendants inures to the benefit of all the
others, even those who have not seasonably
filed their answer. (Bueno v. Ortiz, L-22978,
June 27, 1968, 23 SCRA 1151.) The proper
mode of proceeding where a complaint states
a common cause of action against several
defendants, and one of them makes default,
is simply to enter a formal default order
against him, and proceed with the cause
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upon the answers of the others. The
defaulting defendant merely loses his
standing in court, he not being entitled to the
service of notice in the cause, nor to appear
in the suit in any way. He cannot adduce
evidence; nor can he be heard at the final
hearing, (Lim Toco v. Go Fay, 80 Phil. 166.)
although he may appeal the judgment
rendered against him on the merits. (Rule 41,
sec. 2.) If the case is finally decided in the
plaintiff's favor, a final decree is then entered
against all the defendants; but if the suit
should be decided against the plaintiff, the
action will be dismissed as to all the
defendants alike. (Velez v. Ramas, 40 Phil.
787-792; Frow v. de la Vega, 15 Wal. 552,21
L. Ed. 60.) In other words the judgment will
affect the defaulting defendants either
favorably or adversely. (Castro v. Pea, 80
Phil. 488.)
Defaulting defendant may ask execution if
judgment is in his favor. (Castro v.
Pea, supra.) (Moran, Rules of Court, Vol. 1,
pp. 538-539.)
In Castro vs. Pea, 80 Phil. 488, one of the
numerous cases cited by Moran, this Court
elaborated on the construction of the same
rule when it sanctioned the execution, upon
motion and for the benefit of the defendant
in default, of a judgment which was adverse
to the plaintiff. The Court held:
As above stated, Emilia Matanguihan, by her
counsel, also was a movant in the petition for
execution Annex 1. Did she have a right to be
such, having been declared in default?
In Frow vs. De la Vega,supra, cited as
authority in Velez vs. Ramas, supra, the
Supreme Court of the United States adopted
as ground for its own decision the following
ruling of the New York Court of Errors
in Clason vs. Morris, 10 Jons., 524:
It would be unreasonable to hold that
because one defendant had made default,
the plaintiff should have a decree even
against him, where the court is satisfied from
the proofs offered by the other, that in fact
the plaintiff is not entitled to a decree. (21
Law, ed., 61.)
The reason is simple: justice has to be
consistent. The complaint stating a common
cause of action against several defendants,
the complainant's rights or lack of them
in the controversy have to be the same, and
not different, as against all the defendant's
although one or some make default and the
other or others appear, join issue, and enter
into trial. For instance, in the case of Clason
vs. Morris above cited, the New York Court of
Errors in effect held that in such a case if the
plaintiff is not entitled to a decree, he will not
be entitled to it, not only as against the

CIVIL PROCEDURE
defendant appearing and resisting his action
but also as against the one who made
default. In the case at bar, the cause of action
in the plaintiff's complaint was common
against the Mayor of Manila, Emilia
Matanguihan, and the other defendants in
Civil Case No. 1318 of the lower court. The
Court of First Instance in its judgment found
and held upon the evidence adduced by the
plaintiff and the defendant mayor that as
between said plaintiff and defendant
Matanguihan the latter was the one legally
entitled to occupy the stalls; and it decreed,
among other things, that said plaintiff
immediately vacate them. Paraphrasing the
New York Court of Errors, it would be
unreasonable to hold now that because
Matanguihan had made default, the said
plaintiff should be declared, as against her,
legally entitled to the occupancy of the stalls,
or to remain therein, although the Court of
First Instance was so firmly satisfied, from the
proofs offered by the other defendant, that
the same plaintiff was not entitled to such
occupancy that it peremptorily ordered her
to vacate the stalls. If in the cases of Clason
vs. Morris, supra, Frow vs. De la Vega, supra,
and Velez vs. Ramas, supra the decrees
entered inured to the benefit of the
defaulting defendants, there is no reason why
that entered in said case No. 1318 should not
be held also to have inured to the benefit of
the defaulting defendant Matanguihan and
the doctrine in said three cases plainly implies
that there is nothing in the law governing
default which would prohibit the court from
rendering judgment favorable to the
defaulting defendant in such cases. If it
inured to her benefit, it stands to reason that
she had a right to claim that benefit, for it
would not be a benefit if the supposed
beneficiary were barred from claiming it; and
if the benefit necessitated the execution of
the decree, she must be possessed of the
right to ask for the execution thereof as she
did when she, by counsel, participated in the
petition for execution Annex 1.
Section 7 of Rule 35 would seem to afford a
solid support to the above considerations. It
provides that when a complaint states a
common cause of action against several
defendants, some of whom answer, and the
others make default, 'the court shall try the
case against all upon the answer thus filed
and render judgment upon the evidence
presented by the parties in court'. It is
obvious that under this provision the case is
tried jointly not only against the defendants
answering but also against those defaulting,
and the trial is held upon the answer filed by
the former; and the judgment, if adverse, will
prejudice the defaulting defendants no less
than those who answer. In other words, the
defaulting defendants are held bound by the
answer filed by their co-defendants and by
the judgment which the court may render
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against all of them. By the same token, and
by all rules of equity and fair play, if the
judgment should happen to be favorable,
totally or partially, to the answering
defendants, it must correspondingly benefit
the defaulting ones, for it would not be just
to let the judgment produce effects as to the
defaulting defendants only when adverse to
them and not when favorable.
In Bueno vs. Ortiz, 23 SCRA 1151, the Court applied the provision
under discussion in the following words:
In answer to the charge that respondent
Judge had committed a grave abuse of
discretion in rendering a default judgment
against the PC, respondents allege that, not
having filed its answer within the
reglementary period, the PC was in default,
so that it was proper for Patanao to forthwith
present his evidence and for respondent
Judge to render said judgment. It should be
noted, however, that in entering the area in
question and seeking to prevent Patanao
from continuing his logging operations
therein, the PC was merely executing an
order of the Director of Forestry and acting as
his agent. Patanao's cause of action against
the other respondents in Case No. 190,
namely, the Director of Forestry, the District
Forester of Agusan, the Forest Officer of
Bayugan, Agusan, and the Secretary of
Agriculture and Natural Resources. Pursuant
to Rule 18, Section 4, of the Rules of Court,
'when a complaint states a common cause of
action against several defendants some of
whom answer and the others fail to do so,
the court shall try the case against all upon
the answer thus filed (by some) and render
judgment upon the evidence presented.' In
other words, the answer filed by one or some
of the defendants inures to the benefit of all
the others, even those who have not
seasonably filed their answer.
Indeed, since the petition in Case No. 190
sets forth a common cause of action against
all of the respondents therein, a decision in
favor of one of them would necessarily favor
the others. In fact, the main issue, in said
case, is whether Patanao has a timber license
to undertake logging operations in the
disputed area. It is not possible to decide
such issue in the negative, insofar as the
Director of Forestry, and to settle it
otherwise, as regards the PC, which is merely
acting as agent of the Director of Forestry,
and is, therefore, his alter ego, with respect
to the disputed forest area.
Stated differently, in all instances where a common cause of
action is alleged against several defendants, some of whom
answer and the others do not, the latter or those in default
acquire a vested right not only to own the defense interposed in
the answer of their co- defendant or co-defendants not in default
but also to expect a result of the litigation totally common with
them in kind and in amount whether favorable or unfavorable.

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The substantive unity of the plaintiff's cause against all the
defendants is carried through to its adjective phase as ineluctably
demanded by the homogeneity and indivisibility of justice itself.
Indeed, since the singleness of the cause of action also inevitably
implies that all the defendants are indispensable parties, the
court's power to act is integral and cannot be split such that it
cannot relieve any of them and at the same time render
judgment against the rest. Considering the tenor of the section in
question, it is to be assumed that when any defendant allows
himself to be declared in default knowing that his defendant has
already answered, he does so trusting in the assurance implicit in
the rule that his default is in essence a mere formality that
deprives him of no more than the right to take part in the trial
and that the court would deem anything done by or for the
answering defendant as done by or for him. The presumption is
that otherwise he would not -have seen to that he would not be
in default. Of course, he has to suffer the consequences of
whatever the answering defendant may do or fail to do,
regardless of possible adverse consequences, but if the complaint
has to be dismissed in so far as the answering defendant is
concerned it becomes his inalienable right that the same be
dismissed also as to him. It does not matter that the dismissal is
upon the evidence presented by the plaintiff or upon the latter's
mere desistance, for in both contingencies, the lack of sufficient
legal basis must be the cause. The integrity of the common cause
of action against all the defendants and the indispensability of all
of them in the proceedings do not permit any possibility of
waiver of the plaintiff's right only as to one or some of them,
without including all of them, and so, as a rule, withdrawal must
be deemed to be a confession of weakness as to all. This is not
only elementary justice; it also precludes the concomitant hazard
that plaintiff might resort to the kind of procedural strategem
practiced by private respondent herein that resulted in totally
depriving petitioners of every opportunity to defend themselves
against her claims which, after all, as will be seen later in this
opinion, the record does not show to be invulnerable, both in
their factual and legal aspects, taking into consideration the
tenor of the pleadings and the probative value of the competent
evidence which were before the trial court when it rendered its
assailed decision where all the defendants are indispensable
parties, for which reason the absence of any of them in the case
would result in the court losing its competency to act validly, any
compromise that the plaintiff might wish to make with any of
them must, as a matter of correct procedure, have to await until
after the rendition of the judgment, at which stage the plaintiff
may then treat the matter of its execution and the satisfaction of
his claim as variably as he might please. Accordingly, in the case
now before Us together with the dismissal of the complaint
against the non-defaulted defendants, the court should have
ordered also the dismissal thereof as to petitioners.
Indeed, there is more reason to apply here the principle of unity
and indivisibility of the action just discussed because all the
defendants here have already joined genuine issues with
plaintiff. Their default was only at the pre-trial. And as to such
absence of petitioners at the pre-trial, the same could be
attributed to the fact that they might not have considered it
necessary anymore to be present, since their respective children
Lim and Leonardo, with whom they have common defenses,
could take care of their defenses as well. Anything that might
have had to be done by them at such pre-trial could have been
done for them by their children, at least initially, specially
because in the light of the pleadings before the court, the
prospects of a compromise must have appeared to be rather
remote. Such attitude of petitioners is neither uncommon nor
totally unjustified. Under the circumstances, to declare them
immediately and irrevocably in default was not an absolute
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necessity. Practical considerations and reasons of equity should
have moved respondent court to be more understanding in
dealing with the situation. After all, declaring them in default as
respondent court did not impair their right to a common fate
with their children.
3
Another issue to be resolved in this case is the question of
whether or not herein petitioners were entitled to notice of
plaintiff's motion to drop their co-defendants Lim and Leonardo,
considering that petitioners had been previously declared in
default. In this connection, the decisive consideration is that
according to the applicable rule, Section 9, Rule 13, already
quoted above, (1) even after a defendant has been declared in
default, provided he "files a motion to set aside the order of
default, he shall be entitled to notice of all further proceedings
regardless of whether the order of default is set aside or not" and
(2) a party in default who has not filed such a motion to set aside
must still be served with all "substantially amended or
supplemented pleadings." In the instant case, it cannot be denied
that petitioners had all filed their motion for reconsideration of
the order declaring them in default. Respondents' own answer to
the petition therein makes reference to the order of April 3,
1973, Annex 8 of said answer, which denied said motion for
reconsideration. On page 3 of petitioners' memorandum herein
this motion is referred to as "a motion to set aside the order of
default." But as We have not been favored by the parties with a
copy of the said motion, We do not even know the excuse given
for petitioners' failure to appear at the pre-trial, and We cannot,
therefore, determine whether or not the motion complied with
the requirements of Section 3 of Rule 18 which We have held to
be controlling in cases of default for failure to answer on time.
(The Philippine-British Co. Inc. etc. et al. vs. The Hon. Walfrido de
los Angeles etc. et al., 63 SCRA 50.)
We do not, however, have here, as earlier noted, a case of
default for failure to answer but one for failure to appear at the
pre-trial. We reiterate, in the situation now before Us, issues
have already been joined. In fact, evidence had been partially
offered already at the pre-trial and more of it at the actual trial
which had already begun with the first witness of the plaintiff
undergoing re-cross-examination. With these facts in mind and
considering that issues had already been joined even as regards
the defaulted defendants, it would be requiring the obvious to
pretend that there was still need for an oath or a verification as
to the merits of the defense of the defaulted defendants in their
motion to reconsider their default. Inasmuch as none of the
parties had asked for a summary judgment there can be no
question that the issues joined were genuine, and consequently,
the reason for requiring such oath or verification no longer holds.
Besides, it may also be reiterated that being the parents of the
non-defaulted defendants, petitioners must have assumed that
their presence was superfluous, particularly because the cause of
action against them as well as their own defenses are common.
Under these circumstances, the form of the motion by which the
default was sought to be lifted is secondary and the
requirements of Section 3 of Rule 18 need not be strictly
complied with, unlike in cases of default for failure to answer. We
can thus hold as We do hold for the purposes of the revival of
their right to notice under Section 9 of Rule 13, that petitioner's
motion for reconsideration was in substance legally adequate
regardless of whether or not it was under oath.
In any event, the dropping of the defendants Lim and Leonardo
from plaintiff's amended complaint was virtually a second
amendment of plaintiffs complaint. And there can be no doubt

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that such amendment was substantial, for with the elimination
thereby of two defendants allegedly solidarily liable with their codefendants, herein petitioners, it had the effect of increasing
proportionally what each of the remaining defendants, the said
petitioners, would have to answer for jointly and severally.
Accordingly, notice to petitioners of the plaintiff's motion of
October 18, 1974 was legally indispensable under the rule abovequoted. Consequently, respondent court had no authority to act
on the motion, to dismiss, pursuant to Section 6 of Rule 15, for
according to Senator Francisco, "(t) he Rules of Court clearly
provide that no motion shall be acted upon by the Court without
the proof of service of notice thereof, together with a copy of the
motion and other papers accompanying it, to all parties
concerned at least three days before the hearing thereof, stating
the time and place for the hearing of the motion. (Rule 26,
section 4, 5 and 6, Rules of Court (now Sec. 15, new Rules). When
the motion does not comply with this requirement, it is not a
motion. It presents no question which the court could decide.
And the Court acquires no jurisdiction to consider it. (Roman
Catholic Bishop of Lipa vs. Municipality of Unisan 44 Phil., 866;
Manakil vs. Revilla, 42 Phil., 81.) (Laserna vs. Javier, et al., CA-G.R.
No. 7885, April 22, 1955; 21 L.J. 36, citing Roman Catholic Bishop
of Lipa vs. Municipality of Unisan 44 Phil., 866; Manakil vs.
Revilla, 42 Phil., 81.) (Francisco. The Revised Rules of Court in the
Philippines, pp. 861-862.) Thus, We see again, from a different
angle, why respondent court's order of dismissal of October 21,
1974 is fatally ineffective.
4
The foregoing considerations notwithstanding, it is respondents'
position that certiorari is not the proper remedy of petitioners. It
is contended that inasmuch as said petitioners have in fact made
their appeal already by filing the required notice of appeal and
appeal bond and a motion for extension to file their record on
appeal, which motion was granted by respondent court, their
only recourse is to prosecute that appeal. Additionally, it is also
maintained that since petitioners have expressly withdrawn their
motion to quash of January 4, 1975 impugning the order of
October 28, 1974, they have lost their right to assail by certiorari
the actuations of respondent court now being questioned,
respondent court not having been given the opportunity to
correct any possible error it might have committed.
We do not agree. As already shown in the foregoing discussion,
the proceedings in the court below have gone so far out of hand
that prompt action is needed to restore order in the entangled
situation created by the series of plainly illegal orders it had
issued. The essential purpose of certiorari is to keep the
proceedings in lower judicial courts and tribunals within legal
bounds, so that due process and the rule of law may prevail at all
times and arbitrariness, whimsicality and unfairness which justice
abhors may immediately be stamped out before graver injury,
juridical and otherwise, ensues. While generally these objectives
may well be attained in an ordinary appeal, it is undoubtedly the
better rule to allow the special remedy of certiorari at the option
of the party adversely affected, when the irregularity committed
by the trial court is so grave and so far reaching in its
consequences that the long and cumbersome procedure of
appeal will only further aggravate the situation of the aggrieved
party because other untoward actuations are likely to materialize
as natural consequences of those already perpetrated. If the law
were otherwise, certiorari would have no reason at all for being.
No elaborate discussion is needed to show the urgent need for
corrective measures in the case at bar. Verily, this is one case
that calls for the exercise of the Supreme Court's inherent power
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of supervision over all kinds of judicial actions of lower courts.
Private respondent's procedural technique designed to disable
petitioners to defend themselves against her claim which
appears on the face of the record itself to be at least highly
controversial seems to have so fascinated respondent court that
none would be surprised should her pending motion for
immediate execution of the impugned judgment receive similar
ready sanction as her previous motions which turned the
proceedings into a one-sided affair. The stakes here are high. Not
only is the subject matter considerably substantial; there is the
more important aspect that not only the spirit and intent of the
rules but even the basic rudiments of fair play have been
disregarded. For the Court to leave unrestrained the obvious
tendency of the proceedings below would be nothing short of
wittingly condoning inequity and injustice resulting from
erroneous construction and unwarranted application of
procedural rules.
5
The sum and total of all the foregoing disquisitions is that the
decision here in question is legally anomalous. It is predicated on
two fatal malactuations of respondent court namely (1) the
dismissal of the complaint against the non-defaulted defendants
Lim and Leonardo and (2) the ex-parte reception of the evidence
of the plaintiff by the clerk of court, the subsequent using of the
same as basis for its judgment and the rendition of such
judgment.
For at least three reasons which We have already fully discussed
above, the order of dismissal of October 21, 1974 is unworthy of
Our sanction: (1) there was no timely notice of the motion
therefor to the non-defaulted defendants, aside from there being
no notice at all to herein petitioners; (2) the common answer of
the defendants, including the non-defaulted, contained a
compulsory counterclaim incapable of being determined in an
independent action; and (3) the immediate effect of such
dismissal was the removal of the two non-defaulted defendants
as parties, and inasmuch as they are both indispensable parties in
the case, the court consequently lost the" sine qua non of the
exercise of judicial power", per Borlasa vs. Polistico, supra. This is
not to mention anymore the irregular delegation to the clerk of
court of the function of receiving plaintiff's evidence. And as
regards the ex-parte reception of plaintiff's evidence and
subsequent rendition of the judgment by default based thereon,
We have seen that it was violative of the right of the petitioners,
under the applicable rules and principles on default, to a
common and single fate with their non-defaulted co-defendants.
And We are not yet referring, as We shall do this anon to the
numerous reversible errors in the decision itself.
It is to be noted, however, that the above-indicated two
fundamental flaws in respondent court's actuations do not call
for a common corrective remedy. We cannot simply rule that all
the impugned proceedings are null and void and should be set
aside, without being faced with the insurmountable obstacle that
by so doing We would be reviewing the case as against the two
non-defaulted defendants who are not before Us not being
parties hereto. Upon the other hand, for Us to hold that the
order of dismissal should be allowed to stand, as contended by
respondents themselves who insist that the same is already final,
not only because the period for its finality has long passed but
also because allegedly, albeit not very accurately, said 'nondefaulted defendants unsuccessfully tried to have it set aside by
the Court of Appeals whose decision on their petition is also
already final, We would have to disregard whatever evidence had
been presented by the plaintiff against them and, of course, the

CIVIL PROCEDURE
findings of respondent court based thereon which, as the
assailed decision shows, are adverse to them. In other words,
whichever of the two apparent remedies the Court chooses, it
would necessarily entail some kind of possible juridical
imperfection. Speaking of their respective practical or pragmatic
effects, to annul the dismissal would inevitably prejudice the
rights of the non-defaulted defendants whom We have not heard
and who even respondents would not wish to have anything
anymore to do with the case. On the other hand, to include
petitioners in the dismissal would naturally set at naught every
effort private respondent has made to establish or prove her case
thru means sanctioned by respondent court. In short, We are
confronted with a legal para-dilemma. But one thing is certain
this difficult situations has been brought about by none other
than private respondent who has quite cynically resorted to
procedural maneuvers without realizing that the technicalities of
the adjective law, even when apparently accurate from the literal
point of view, cannot prevail over the imperatives of the
substantive law and of equity that always underlie them and
which have to be inevitably considered in the construction of the
pertinent procedural rules.
All things considered, after careful and mature deliberation, the
Court has arrived at the conclusion that as between the two
possible alternatives just stated, it would only be fair, equitable
and proper to uphold the position of petitioners. In other words,
We rule that the order of dismissal of October 21, 1974 is in law a
dismissal of the whole case of the plaintiff, including as to
petitioners herein. Consequently, all proceedings held by
respondent court subsequent thereto including and principally its
decision of December 20, 1974 are illegal and should be set
aside.
This conclusion is fully justified by the following considerations of
equity:
1. It is very clear to Us that the procedural maneuver resorted to
by private respondent in securing the decision in her favor was
ill-conceived. It was characterized by that which every principle
of law and equity disdains taking unfair advantage of the rules
of procedure in order to unduly deprive the other party of full
opportunity to defend his cause. The idea of "dropping" the nondefaulted defendants with the end in view of completely
incapacitating their co-defendants from making any defense,
without considering that all of them are indispensable parties to
a common cause of action to which they have countered with a
common defense readily connotes an intent to secure a onesided decision, even improperly. And when, in this connection,
the obvious weakness of plaintiff's evidence is taken into
account, one easily understands why such tactics had to be
availed of. We cannot directly or indirectly give Our assent to the
commission of unfairness and inequity in the application of the
rules of procedure, particularly when the propriety of reliance
thereon is not beyond controversy.
2. The theories of remedial law pursued by private respondents,
although approved by His Honor, run counter to such basic
principles in the rules on default and such elementary rules on
dismissal of actions and notice of motions that no trial court
should be unaware of or should be mistaken in applying. We are
at a loss as to why His Honor failed to see through counsel's
inequitous strategy, when the provisions (1) on the three-day
rule on notice of motions, Section 4 of Rule 15, (2) against
dismissal of actions on motion of plaintiff when there is a
compulsory counterclaim, Section 2, Rule 17, (3) against
permitting the absence of indispensable parties, Section 7, Rule
3, (4) on service of papers upon defendants in default when there
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are substantial amendments to pleadings, Section 9, Rule 13, and
(5) on the unity and integrity of the fate of defendants in default
with those not in default where the cause of action against them
and their own defenses are common, Section 4, Rule 18, are so
plain and the jurisprudence declaratory of their intent and proper
construction are so readily comprehensible that any error as to
their application would be unusual in any competent trial court.
3. After all, all the malactuations of respondent court are
traceable to the initiative of private respondent and/or her
counsel. She cannot, therefore, complain that she is being made
to unjustifiably suffer the consequences of what We have found
to be erroneous orders of respondent court. It is only fair that
she should not be allowed to benefit from her own frustrated
objective of securing a one-sided decision.
4. More importantly, We do not hesitate to hold that on the basis
of its own recitals, the decision in question cannot stand close
scrutiny. What is more, the very considerations contained therein
reveal convincingly the inherent weakness of the cause of the
plaintiff. To be sure, We have been giving serious thought to the
idea of merely returning this case for a resumption of trial by
setting aside the order of dismissal of October 21, 1974, with all
its attendant difficulties on account of its adverse effects on
parties who have not been heard, but upon closer study of the
pleadings and the decision and other circumstances extant in the
record before Us, We are now persuaded that such a course of
action would only lead to more legal complications incident to
attempts on the part of the parties concerned to desperately
squeeze themselves out of a bad situation. Anyway, We feel
confident that by and large, there is enough basis here and now
for Us to rule out the claim of the plaintiff.
Even a mere superficial reading of the decision would
immediately reveal that it is littered on its face with deficiencies
and imperfections which would have had no reason for being
were there less haste and more circumspection in rendering the
same. Recklessness in jumping to unwarranted conclusions, both
factual and legal, is at once evident in its findings relative
precisely to the main bases themselves of the reliefs granted. It is
apparent therein that no effort has been made to avoid glaring
inconsistencies. Where references are made to codal provisions
and jurisprudence, inaccuracy and inapplicability are at once
manifest. It hardly commends itself as a deliberate and
consciencious adjudication of a litigation which, considering the
substantial value of the subject matter it involves and the
unprecedented procedure that was followed by respondent's
counsel, calls for greater attention and skill than the general run
of cases would.
Inter alia, the following features of the decision make it highly
improbable that if We took another course of action, private
respondent would still be able to make out any case against
petitioners, not to speak of their co-defendants who have already
been exonerated by respondent herself thru her motion to
dismiss:
1. According to His Honor's own statement of plaintiff's case,
"she is the widow of the late Tee Hoon Po Chuan (Po Chuan, for
short) who was then one of the partners in the commercial
partnership, Glory Commercial Co. with defendants Antonio Lim
Tanhu (Lim Tanhu, for short) and Alfonso Leonardo Ng Sua (Ng
Sua, for short) as co-partners; that after the death of her
husband on March 11, 1966 she is entitled to share not only in
the capital and profits of the partnership but also in the other

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assets, both real and personal, acquired by the partnership with
funds of the latter during its lifetime."
Relatedly, in the latter part of the decision, the findings are to the
following effect: .
That the herein plaintiff Tan Put and her late
husband Po Chuan married at the Philippine
Independent Church of Cebu City on
December, 20, 1949; that Po Chuan died on
March 11, 1966; that the plaintiff and the late
Po Chuan were childless but the former has a
foster son Antonio Nuez whom she has
reared since his birth with whom she lives up
to the present; that prior to the marriage of
the plaintiff to Po Chuan the latter was
already managing the partnership Glory
Commercial Co. then engaged in a little
business in hardware at Manalili St., Cebu
City; that prior to and just after the marriage
of the plaintiff to Po Chuan she was engaged
in the drugstore business; that not long after
her marriage, upon the suggestion of Po
Chuan the plaintiff sold her drugstore for
P125,000.00 which amount she gave to her
husband in the presence of defendant Lim
Tanhu and was invested in the partnership
Glory Commercial Co. sometime in 1950; that
after the investment of the above-stated
amount in the partnership its business
flourished and it embarked in the import
business and also engaged in the wholesale
and retail trade of cement and GI sheets and
under huge profits;
xxx xxx xxx
That the late Po Chuan was the one who
actively managed the business of the
partnership Glory Commercial Co. he was the
one who made the final decisions and
approved the appointments of new personnel
who were taken in by the partnership; that
the late Po Chuan and defendants Lim Tanhu
and Ng Sua are brothers, the latter two (2)
being the elder brothers of the former; that
defendants Lim Tanhu and Ng Sua are both
naturalized Filipino citizens whereas the late
Po Chuan until the time of his death was a
Chinese citizen; that the three (3) brothers
were partners in the Glory Commercial Co.
but Po Chuan was practically the owner of
the partnership having the controlling
interest; that defendants Lim Tanhu and Ng
Sua were partners in name but they were
mere employees of Po Chuan .... (Pp. 89-91,
Record.)
How did His Honor arrive at these conclusions? To start with, it is
not clear in the decision whether or not in making its findings of
fact the court took into account the allegations in the pleadings
of the parties and whatever might have transpired at the pretrial. All that We can gather in this respect is that references are
made therein to pre-trial exhibits and to Annex A of the answer
of the defendants to plaintiff's amended complaint. Indeed, it
was incumbent upon the court to consider not only the evidence
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formally offered at the trial but also the admissions, expressed or
implied, in the pleadings, as well as whatever might have been
placed before it or brought to its attention during the pre-trial. In
this connection, it is to be regretted that none of the parties has
thought it proper to give Us an idea of what took place at the
pre-trial of the present case and what are contained in the pretrial order, if any was issued pursuant to Section 4 of Rule 20.
The fundamental purpose of pre-trial, aside from affording the
parties every opportunity to compromise or settle their
differences, is for the court to be apprised of the unsettled issues
between the parties and of their respective evidence relative
thereto, to the end that it may take corresponding measures that
would abbreviate the trial as much as possible and the judge may
be able to ascertain the facts with the least observance of
technical rules. In other words whatever is said or done by the
parties or their counsel at the pre- trial serves to put the judge on
notice of their respective basic positions, in order that in
appropriate cases he may, if necessary in the interest of justice
and a more accurate determination of the facts, make inquiries
about or require clarifications of matters taken up at the pretrial, before finally resolving any issue of fact or of law. In brief,
the pre-trial constitutes part and parcel of the proceedings, and
hence, matters dealt with therein may not be disregarded in the
process of decision making. Otherwise, the real essence of
compulsory pre-trial would be insignificant and worthless.
Now, applying these postulates to the findings of respondent
court just quoted, it will be observed that the court's conclusion
about the supposed marriage of plaintiff to the deceased Tee
Hoon Lim Po Chuan is contrary to the weight of the evidence
brought before it during the trial and the pre-trial.
Under Article 55 of the Civil Code, the declaration of the
contracting parties that they take each other as husband and
wife "shall be set forth in an instrument" signed by the parties as
well as by their witnesses and the person solemnizing the
marriage. Accordingly, the primary evidence of a marriage must
be an authentic copy of the marriage contract. While a marriage
may also be proved by other competent evidence, the absence of
the contract must first be satisfactorily explained. Surely, the
certification of the person who allegedly solemnized a marriage is
not admissible evidence of such marriage unless proof of loss of
the contract or of any other satisfactory reason for its nonproduction is first presented to the court. In the case at bar, the
purported certification issued by a Mons. Jose M. Recoleto,
Bishop, Philippine Independent Church, Cebu City, is not,
therefore, competent evidence, there being absolutely no
showing as to unavailability of the marriage contract and, indeed,
as to the authenticity of the signature of said certifier, the jurat
allegedly signed by a second assistant provincial fiscal not being
authorized by law, since it is not part of the functions of his
office. Besides, inasmuch as the bishop did not testify, the same
is hearsay.
As regards the testimony of plaintiff herself on the same point
and that of her witness Antonio Nuez, there can be no question
that they are both self-serving and of very little evidentiary value,
it having been disclosed at the trial that plaintiff has already
assigned all her rights in this case to said Nuez, thereby making
him the real party in interest here and, therefore, naturally as
biased as herself. Besides, in the portion of the testimony of
Nuez copied in Annex C of petitioner's memorandum, it appears
admitted that he was born only on March 25, 1942, which means
that he was less than eight years old at the supposed time of the
alleged marriage. If for this reason alone, it is extremely doubtful

CIVIL PROCEDURE
if he could have been sufficiently aware of such event as to be
competent to testify about it.
Incidentally, another Annex C of the same memorandum
purports to be the certificate of birth of one Antonio T. Uy
supposed to have been born on March 23, 1937 at Centro
Misamis, Misamis Occidental, the son of one Uy Bien, father, and
Tan Put, mother. Significantly, respondents have not made any
adverse comment on this document. It is more likely, therefore,
that the witness is really the son of plaintiff by her husband Uy
Kim Beng. But she testified she was childless. So which is which?
In any event, if on the strength of this document, Nuez is
actually the legitimate son of Tan Put and not her adopted son,
he would have been but 13 years old in 1949, the year of her
alleged marriage to Po Chuan, and even then, considering such
age, his testimony in regard thereto would still be suspect.
Now, as against such flimsy evidence of plaintiff, the court had
before it, two documents of great weight belying the pretended
marriage. We refer to (1) Exhibit LL, the income tax return of the
deceased Tee Hoon Lim Po Chuan indicating that the name of his
wife was Ang Sick Tin and (2) the quitclaim, Annex A of the
answer, wherein plaintiff Tan Put stated that she had been living
with the deceased without benefit of marriage and that she was
his "common-law wife". Surely, these two documents are far
more reliable than all the evidence of the plaintiff put together.
Of course, Exhibit LL is what might be termed as pre-trial
evidence. But it is evidence offered to the judge himself, not to
the clerk of court, and should have at least moved him to ask
plaintiff to explain if not rebut it before jumping to the
conclusion regarding her alleged marriage to the deceased, Po
Chuan. And in regard to the quitclaim containing the admission
of a common-law relationship only, it is to be observed that His
Honor found that "defendants Lim Tanhu and Ng Sua had the
plaintiff execute a quitclaim on November 29, 1967 (Annex "A",
Answer) where they gave plaintiff the amount of P25,000 as her
share in the capital and profits of the business of Glory
Commercial Co. which was engaged in the hardware business",
without making mention of any evidence of fraud and
misrepresentation in its execution, thereby indicating either that
no evidence to prove that allegation of the plaintiff had been
presented by her or that whatever evidence was actually offered
did not produce persuasion upon the court. Stated differently,
since the existence of the quitclaim has been duly established
without any circumstance to detract from its legal import, the
court should have held that plaintiff was bound by her admission
therein that she was the common-law wife only of Po Chuan and
what is more, that she had already renounced for valuable
consideration whatever claim she might have relative to the
partnership Glory Commercial Co.
And when it is borne in mind that in addition to all these
considerations, there are mentioned and discussed in the
memorandum of petitioners (1) the certification of the Local Civil
Registrar of Cebu City and (2) a similar certification of the
Apostolic Prefect of the Philippine Independent Church, Parish of
Sto. Nio, Cebu City, that their respective official records
corresponding to December 1949 to December 1950 do not show
any marriage between Tee Hoon Lim Po Chuan and Tan Put,
neither of which certifications have been impugned by
respondent until now, it stands to reason that plaintiff's claim of
marriage is really unfounded. Withal, there is still another
document, also mentioned and discussed in the same
memorandum and unimpugned by respondents, a written
agreement executed in Chinese, but purportedly translated into
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Full Text: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

English by the Chinese Consul of Cebu, between Tan Put and Tee
Hoon Lim Po Chuan to the following effect:

question, it is clear that not an iota of reliable proof exists of such

alleged misdeeds.

CONSULATE OF THE REPUBLIC OF CHINA

Cebu City, Philippines

Of course, the existence of the partnership has not been denied,

it is actually admitted impliedly in defendants' affirmative
defense that Po Chuan's share had already been duly settled with
and paid to both the plaintiff and his legitimate family. But the
evidence as to the actual participation of the defendants Lim
Tanhu and Ng Sua in the operation of the business that could
have enabled them to make the extractions of funds alleged by
plaintiff is at best confusing and at certain points manifestly
inconsistent.

TRANSLATION
This is to certify that 1, Miss Tan Ki Eng Alias
Tan Put, have lived with Mr. Lim Po Chuan
alias TeeHoon since 1949 but it recently
occurs that we are incompatible with each
other and are not in the position to keep
living together permanently. With the mutual
concurrence, we decided to terminate the
existing relationship of common law-marriage
and promised not to interfere each other's
affairs from now on. The Forty Thousand
Pesos (P40,000.00) has been given to me by
Mr. Lim Po Chuan for my subsistence.
Witnesses:
Mr. Lim Beng Guan Mr. Huang Sing Se
Signed on the 10 day of the 7th month of the
54th year of the Republic of China
(corresponding to the year 1965).
(SGD) TAN KI ENG
Verified from the records. JORGE TABAR (Pp.
283-284, Record.)
Indeed, not only does this document prove that plaintiff's
relation to the deceased was that of a common-law wife but that
they had settled their property interests with the payment to her
of P40,000.
In the light of all these circumstances, We find no alternative but
to hold that plaintiff Tan Put's allegation that she is the widow of
Tee Hoon Lim Po Chuan has not been satisfactorily established
and that, on the contrary, the evidence on record convincingly
shows that her relation with said deceased was that of a
common-law wife and furthermore, that all her claims against
the company and its surviving partners as well as those against
the estate of the deceased have already been settled and paid.
We take judicial notice of the fact that the respective counsel
who assisted the parties in the quitclaim, Attys. H. Hermosisima
and Natalio Castillo, are members in good standing of the
Philippine Bar, with the particularity that the latter has been a
member of the Cabinet and of the House of Representatives of
the Philippines, hence, absent any credible proof that they had
allowed themselves to be parties to a fraudulent document His
Honor did right in recognizing its existence, albeit erring in not
giving due legal significance to its contents.
2. If, as We have seen, plaintiff's evidence of her alleged status as
legitimate wife of Po Chuan is not only unconvincing but has
been actually overcome by the more competent and weighty
evidence in favor of the defendants, her attempt to substantiate
her main cause of action that defendants Lim Tanhu and Ng Sua
have defrauded the partnership Glory Commercial Co. and
converted its properties to themselves is even more dismal. From
the very evidence summarized by His Honor in the decision in

In her amended complaint, plaintiff repeatedly alleged that as

3
widow of Po Chuan she is entitled to / share of the assets and
properties of the partnership. In fact, her prayer in said complaint
3
is, among others, for the delivery to her of such / share. His
Honor's statement of the case as well as his findings and
judgment are all to that same effect. But what did she actually try
to prove at the ex- parte hearing?
According to the decision, plaintiff had shown that she had
money of her own when she "married" Po Chuan and "that prior
to and just after the marriage of the plaintiff to Po Chuan, she
was engaged in the drugstore business; that not long after her
marriage, upon the suggestion of Po Chuan, the plaintiff sold her
drugstore for P125,000 which amount she gave to her husband in
the presence of Tanhu and was invested in the partnership Glory
Commercial Co. sometime in 1950; that after the investment of
the above-stated amount in the partnership, its business
flourished and it embarked in the import business and also
engaged in the wholesale and retail trade of cement and GI
sheets and under (sic) huge profits." (pp. 25-26, Annex L,
petition.)
To begin with, this theory of her having contributed of P125,000
to the capital of the partnership by reason of which the business
flourished and amassed all the millions referred to in the decision
has not been alleged in the complaint, and inasmuch as what was
being rendered was a judgment by default, such theory should
not have been allowed to be the subject of any evidence. But
inasmuch as it was the clerk of court who received the evidence,
it is understandable that he failed to observe the rule. Then, on
the other hand, if it was her capital that made the partnership
3
flourish, why would she claim to be entitled to only to / of its
assets and profits? Under her theory found proven by
respondent court, she was actually the owner of everything,
particularly because His Honor also found "that defendants Lim
Tanhu and Ng Sua were partners in the name but they were
employees of Po Chuan that defendants Lim Tanhu and Ng Sua
had no means of livelihood at the time of their employment with
the Glory Commercial Co. under the management of the late Po
Chuan except their salaries therefrom; ..." (p. 27, id.) Why then
3
does she claim only / share? Is this an indication of her
generosity towards defendants or of a concocted cause of action
existing only in her confused imagination engendered by the
death of her common-law husband with whom she had settled
her common-law claim for recompense of her services as
common law wife for less than what she must have known would
go to his legitimate wife and children?
Actually, as may be noted from the decision itself, the trial court
was confused as to the participation of defendants Lim Tanhu
and Ng Sua in Glory Commercial Co. At one point, they were
deemed partners, at another point mere employees and then
elsewhere as partners-employees, a newly found concept, to be
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Full Text: Rule 9 Effect of Failure to Plead

sure, in the law on partnership. And the confusion is worse
comfounded in the judgment which allows these "partners in
name" and "partners-employees" or employees who had no
means of livelihood and who must not have contributed any
capital in the business, "as Po Chuan was practically the owner of
3
the partnership having the controlling interest", / each of the
huge assets and profits of the partnership. Incidentally, it may be
observed at this juncture that the decision has made Po Chuan
play the inconsistent role of being "practically the owner" but at
the same time getting his capital from the P125,000 given to him
by plaintiff and from which capital the business allegedly
"flourished."
Anent the allegation of plaintiff that the properties shown by her
exhibits to be in the names of defendants Lim Tanhu and Ng Sua
were bought by them with partnership funds, His Honor
confirmed the same by finding and holding that "it is likewise
clear that real properties together with the improvements in the
names of defendants Lim Tanhu and Ng Sua were acquired with
partnership funds as these defendants were only partnersemployees of deceased Po Chuan in the Glory Commercial Co.
until the time of his death on March 11, 1966." (p. 30, id.) It Is
Our considered view, however, that this conclusion of His Honor
is based on nothing but pure unwarranted conjecture. Nowhere
is it shown in the decision how said defendants could have
extracted money from the partnership in the fraudulent and
illegal manner pretended by plaintiff. Neither in the testimony of
Nuez nor in that of plaintiff, as these are summarized in the
decision, can there be found any single act of extraction of
partnership funds committed by any of said defendants. That the
partnership might have grown into a multi-million enterprise and
that the properties described in the exhibits enumerated in the
decision are not in the names of Po Chuan, who was Chinese, but
of the defendants who are Filipinos, do not necessarily prove that
Po Chuan had not gotten his share of the profits of the business
or that the properties in the names of the defendants were
bought with money of the partnership. In this connection, it is
decisively important to consider that on the basis of the
concordant and mutually cumulative testimonies of plaintiff and
Nuez, respondent court found very explicitly that, and We
reiterate:
xxx xxx xxx
That the late Po Chuan was the one who
actively managed the business of the
partnership Glory Commercial Co. he was the
one who made the final decisions and
approved the appointments of new Personnel
who were taken in by the partnership; that
the late Po Chuan and defendants Lim Tanhu
and Ng Sua are brothers, the latter to (2)
being the elder brothers of the former; that
defendants Lim Tanhu and Ng Sua are both
naturalized Filipino citizens whereas the late
Po Chuan until the time of his death was a
Chinese citizen; that the three (3) brothers
were partners in the Glory Commercial Co.
but Po Chuan was practically the owner of
the partnership having the controlling
interest; that defendants Lim Tanhu and Ng
Sua were partners in name but they were
mere employees of Po Chuan; .... (Pp. 90-91,
Record.)
If Po Chuan was in control of the affairs and the running of the
partnership, how could the defendants have defrauded him of

CIVIL PROCEDURE
such huge amounts as plaintiff had made his Honor believe?
Upon the other hand, since Po Chuan was in control of the affairs
of the partnership, the more logical inference is that if
defendants had obtained any portion of the funds of the
partnership for themselves, it must have been with the
knowledge and consent of Po Chuan, for which reason no
accounting could be demanded from them therefor, considering
that Article 1807 of the Civil Code refers only to what is taken by
a partner without the consent of the other partner or partners.
Incidentally again, this theory about Po Chuan having been
actively managing the partnership up to his death is a substantial
deviation from the allegation in the amended complaint to the
effect that "defendants Antonio Lim Tanhu, Alfonso Leonardo Ng
Sua, Lim Teck Chuan and Eng Chong Leonardo, through fraud and
machination, took actual and active management of the
partnership and although Tee Hoon Lim Po Chuan was the
manager of Glory Commercial Co., defendants managed to use
the funds of the partnership to purchase lands and buildings etc.
(Par. 4, p. 2 of amended complaint, Annex B of petition) and
should not have been permitted to be proven by the hearing
officer, who naturally did not know any better.
Moreover, it is very significant that according to the very tax
declarations and land titles listed in the decision, most if not all of
the properties supposed to have been acquired by the
defendants Lim Tanhu and Ng Sua with funds of the partnership
appear to have been transferred to their names only in 1969 or
later, that is, long after the partnership had been automatically
dissolved as a result of the death of Po Chuan. Accordingly,
defendants have no obligation to account to anyone for such
acquisitions in the absence of clear proof that they had violated
the trust of Po Chuan during the existence of the partnership.
(See Hanlon vs. Hansserman and. Beam, 40 Phil. 796.)
There are other particulars which should have caused His Honor
to readily disbelieve plaintiffs' pretensions. Nuez testified that
"for about 18 years he was in charge of the GI sheets and
sometimes attended to the imported items of the business of
Glory Commercial Co." Counting 18 years back from 1965 or 1966
would take Us to 1947 or 1948. Since according to Exhibit LL, the
baptismal certificate produced by the same witness as his birth
certificate, shows he was born in March, 1942, how could he
have started managing Glory Commercial Co. in 1949 when he
must have been barely six or seven years old? It should not have
escaped His Honor's attention that the photographs showing the
premises of Philippine Metal Industries after its organization "a
year or two after the establishment of Cebu Can Factory in 1957
or 1958" must have been taken after 1959. How could Nuez
have been only 13 years old then as claimed by him to have been
his age in those photographs when according to his "birth
certificate", he was born in 1942? His Honor should not have
overlooked that according to the same witness, defendant Ng
Sua was living in Bantayan until he was directed to return to Cebu
after the fishing business thereat floundered, whereas all that
the witness knew about defendant Lim Teck Chuan's arrival from
Hongkong and the expenditure of partnership money for him
were only told to him allegedly by Po Chuan, which testimonies
are veritably exculpatory as to Ng Sua and hearsay as to Lim Teck
Chuan. Neither should His Honor have failed to note that
according to plaintiff herself, "Lim Tanhu was employed by her
husband although he did not go there always being a mere
employee of Glory Commercial Co." (p. 22, Annex the decision.)
The decision is rather emphatic in that Lim Tanhu and Ng Sua had
no known income except their salaries. Actually, it is not stated,
however, from what evidence such conclusion was derived in so
far as Ng Sua is concerned. On the other hand, with respect to
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Full Text: Rule 9 Effect of Failure to Plead

Lim Tanhu, the decision itself states that according to Exhibit NNPre trial, in the supposed income tax return of Lim Tanhu for
1964, he had an income of P4,800 as salary from Philippine Metal
Industries alone and had a total assess sable net income of
P23,920.77 that year for which he paid a tax of P4,656.00. (p. 14.
Annex L, id.) And per Exhibit GG-Pretrial in the year, he had a net
income of P32,000 for which be paid a tax of P3,512.40. (id.) As
early as 1962, "his fishing business in Madridejos Cebu was
making money, and he reported "a net gain from operation (in)
the amount of P865.64" (id., per Exhibit VV-Pre-trial.) From what
then did his Honor gather the conclusion that all the properties
registered in his name have come from funds malversed from the
partnership?
It is rather unusual that His Honor delved into financial
statements and books of Glory Commercial Co. without the aid of
any accountant or without the same being explained by any
witness who had prepared them or who has knowledge of the
entries therein. This must be the reason why there are apparent
inconsistencies and inaccuracies in the conclusions His Honor
made out of them. In Exhibit SS-Pre-trial, the reported total
assets of the company amounted to P2,328,460.27 as of
December, 1965, and yet, Exhibit TT-Pre-trial, according to His
Honor, showed that the total value of goods available as of the
same date was P11,166,327.62. On the other hand, per Exhibit
XX-Pre-trial, the supposed balance sheet of the company for
1966, "the value of inventoried merchandise, both local and
imported", as found by His Honor, was P584,034.38. Again, as of
December 31, 1966, the value of the company's goods available
for sale was P5,524,050.87, per Exhibit YY and YY-Pre-trial. Then,
per Exhibit II-3-Pre-trial, the supposed Book of Account, whatever
that is, of the company showed its "cash analysis" was
P12,223,182.55. We do not hesitate to make the observation that
His Honor, unless he is a certified public accountant, was hardly
qualified to read such exhibits and draw any definite conclusions
therefrom, without risk of erring and committing an injustice. In
any event, there is no comprehensible explanation in the
decision of the conclusion of His Honor that there were
P12,223,182.55 cash money defendants have to account for,
particularly when it can be very clearly seen in Exhibits 11-4, 114- A, 11-5 and 11-6-Pre-trial, Glory Commercial Co. had accounts
payable as of December 31, 1965 in the amount of
P4,801,321.17. (p. 15, id.) Under the circumstances, We are not
prepared to permit anyone to predicate any claim or right from
respondent court's unaided exercise of accounting knowledge.

CIVIL PROCEDURE
what might result after such liquidation to belong to the
deceased partner, and before this is finished, it is impossible to
determine, what rights or interests, if any, the deceased had
(Bearneza vs. Dequilla 43 Phil. 237). In other words, no specific
amounts or properties may be adjudicated to the heir or legal
representative of the deceased partner without the liquidation
being first terminated.
Indeed, only time and the fear that this decision would be much
more extended than it is already prevent us from further pointing
out the inexplicable deficiencies and imperfections of the
decision in question. After all, what have been discussed should
be more than sufficient to support Our conclusion that not only
must said decision be set aside but also that the action of the
plaintiff must be totally dismissed, and, were it not seemingly
futile and productive of other legal complications, that plaintiff is
liable on defendants' counterclaims. Resolution of the other
issues raised by the parties albeit important and perhaps pivotal
has likewise become superfluous.
IN VIEW OF ALL THE FOREGOING, the petition is granted. All
proceedings held in respondent court in its Civil Case No. 12328
subsequent to the order of dismissal of October 21, 1974 are
hereby annulled and set aside, particularly the exparte proceedings against petitioners and the decision on
December 20, 1974. Respondent court is hereby ordered to enter
an order extending the effects of its order of dismissal of the
action dated October 21, 1974 to herein petitioners Antonio Lim
Tanhu, Dy Ochay, Alfonso Leonardo Ng Sua and Co Oyo. And
respondent court is hereby permanently enjoined from taking
any further action in said civil case gave and except as herein
indicated. Costs against private respondent.
Makalintal, C.J., Fernando, Aquino and Concepcion Jr., JJ., concur.

Additionally, We note that the decision has not made any finding
regarding the allegation in the amended complaint that a
corporation denominated Glory Commercial Co., Inc. was
organized after the death of Po Chuan with capital from the
funds of the partnership. We note also that there is absolutely no
finding made as to how the defendants Dy Ochay and Co Oyo
could in any way be accountable to plaintiff, just because they
happen to be the wives of Lim Tanhu and Ng Sua, respectively.
We further note that while His Honor has ordered defendants to
deliver or pay jointly and severally to the plaintiff P4,074,394.18
3
or / of the P12,223,182.55, the supposed cash belonging to the
partnership as of December 31, 1965, in the same breath, they
3
have also been sentenced to partition and give / share of the
properties enumerated in the dispositive portion of the decision,
which seemingly are the very properties allegedly purchased
from the funds of the partnership which would naturally include
the P12,223,182.55 defendants have to account for. Besides,
assuming there has not yet been any liquidation of the
partnership, contrary to the allegation of the defendants, then
Glory Commercial Co. would have the status of a partnership in
liquidation and the only right plaintiff could have would be to

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Full Text: Rule 9 Effect of Failure to Plead

G.R. No. L-39047 April 30, 1985
ALBERTO PASCUA, CRISPINA PASCUA, SOTERA PASCUA, and
EDUARDO
MOLINA, petitioners,
vs.
HON. ALFREDO C. FLORENDO, CFI of Cagayan, CLEMENTE
CASTRO, and JULIANA O. CASTRO,respondents.
Hermenigildo G. Rapanan for petitioner.

GUTTIEREZ, JR., J.:

This is a petition for review on certiorari, seeking to annul the
decision of the Court of First Instance of Cagayan which
dismissed the petitioners' action for reconveyance with damages
on the ground that the period within which to file the same had
already prescribed.
Petitioners, as plaintiffs, filed a complaint for reconveyance with
damages against the private respondents, spouses Clemente and
Juliana Castro. The latter, as defendants, in lieu of filing an
answer, filed a motion to dismiss the complaint on the grounds
that the complaint states no cause of action and that the same is
already barred by the statute of limitations.
The trial court denied the respondents' motion after finding that
the grounds relied upon by them did not appear on the face of
the complaint. The court subsequently declared the respondents
in default for their having failed to file an answer within the
reglementary period. Thus, the petitioners proceeded to present
their evidence ex-parte
After receiving the petitioners' evidence, the trial court made the
following findings:
From the evidence adduced during the
presentation of evidence by plaintiffs, it was
shown that Alberto Pascua is one of the
plaintiffs in this case; that he knows his coplaintiffs Crispina, Sotera, surnamed Pascua,
and Eduardo Molina, the first two being his
sisters while the last is his nephew being the
son of his sister Alejandra; that his father is
Jordan Pascua while his mother is Magdalena
Dumadag; that both his parents are already
dead (Exhibits A, B, and C); that Alejandra
Pascua is also dead; that during the lifetime
of Jordan and Magdalena Dumadag, they
begot five children, namely Alberto,
Alejandra, Crispina, Martin and Sotera; that
Jordan Pascua and Magdalena Dumadag
acquired a parcel of land located at
Dacalafugo,
Camalaniugan,
Cagayan,
consisting of 1.02.20 hectares and described
in paragraph 3 of the complaint; that lately
they came to know that their brother Martin
Pascua sold the property to Clemente Castro,
a resident of Camalaniugan, Cagayan; that
when they went to complain to the Agrarian
office in Tuguegarao Clemente Castro showed
them the deed of sale which they xerox
copied (Exhibit D); that the signature Alberto
Pascua appearing in Exhibit D is not his

CIVIL PROCEDURE
signature; that the genuine signature of
Alberto Pascua appears in Exhibit E; that he
and this co-plaintiffs did not give consent to
the sale of the land subject matter of this
case; that the signature Sotera Pascua,
appearing in Exhibit D is not also the
signature of Sotera Pascua; that he and his
co-plaintiffs did not appear before the Notary
Public; that the land subject matter of this
case was never given to Martin Pascua by
their deceased father; that Martin Pascua is
already dead; that the land is now titled in
the name of the defendant Juliana O. Castro
(Exhibits F and F-1) while the deed of sale was
executed in favor of Clemente Castro (Exhibit
D); that the land is declared for taxation
purposes under Tax Declaration No. 157
(Exhibit G) in the name of Juliana Castro; that
plaintiffs and the defendants have been
neighbors since before the war and
defendants know that the land sold to them
and subject matter of this suit was inherited
by the plaintiffs from their deceased father;
that they (plaintiffs) have been deprived of
the fruits of the land for more than 20 years;
that the land yields from thirty to forty sacks
of palay valued at P 30.00 each; and that
plaintiffs agreed to pay their counsel the
amount of P 1,200.00 out of which they have
already paid P 200.00.
From Exhibit D of the plaintiffs, it appears
that the deed of sale was executed in favor
the defendant Clemente Castro married to
Juliana Orteza by Martin Pascua on May 8,
1951. Alberto Pascua and Sotera Pascua
testified that lately they came to know that
this land was conveyed by Martin Pascua to
the defendants and that said defendants
have been in possession of the land in
question for more than 20 years. They
testified further, however, that they have
been deprived of the fruits of the land for
more than twenty years. If such is the case, it
is clear that the defendants have entered and
occupied the property for more than twenty
years and it is inconceivable that the plaintiffs
did not come to know that the defendants
bought the property from their brother
Martin Pascua when they admitted that they
have suffered damages by virtue of the
dispossession for more than twenty years.
The conclusion is obvious that the plaintiffs
had knowledge of the transaction made by
their brother about twenty years ago.
From the evidence of the plaintiffs, the Court
finds that there was really fraud committed
by Martin Pascua in selling the entire
property which said Martin Pascua and
plaintiffs inherited from their parents thus
excluding the shares of the plaintiffs.
Certainly, Martin Pascua could only sell onefifth of the property and that the four-fifths
were fraudulently conveyed by him. It is clear
that there was fraud on the part of Martin
Pascua in selling the shares of his brother and
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Full Text: Rule 9 Effect of Failure to Plead

sisters. The action for relief on the ground of
fraud, however, may be brought only within
four years from the discovery of the fraud.
(Article 1391, New Civil Code; Section 43 (c)
Act 190).
xxx xxx xxx
In view of the fact that the deed of sale was
executed on May 8, 1951, or over twenty
years before the filing of the complaint on
May 31, 1973, it is hard to believe that
plaintiffs did not come to know of this deed
of sale executed by their brother. The Court,
therefore, comes to the inevitable conclusion
that this action, having been filed 22 years
after the execution of the deed of sale, has
long prescribed.
Not satisfied with the trial court's decision, petitioners elevated
the case to this Court through this petition. The petitioners ask us
to examine the following alleged errors of the respondent court:
1. THE TRIAL COURT ERRED IN DISMISSING
THE CASE ON GROUND OF PRESCRIPTION
ALTHOUGH IT HAS PREVIOUSLY DENIED A
MOTION TO DISMISS BASED ON THE SAME
GROUND.
2. THE TRIAL COURT ERRED IN NOT
GRANTING RELIEF TO PLAINTIFFS ALTHOUGH
THE DEFENDANTS WERE DECLARED IN
DEFAULT.
The petitioners contend that the trial court acted with grave
abuse of discretion when, after hearing their evidence presented
ex-parte, the respondents having been declared in default, it
dismissed the case on the ground that the action had already
prescribed. When the same ground was earlier raised, the court
denied the motion to dismiss filed by the respondents. The
petitioners argue that because of its denying the motion to
dismiss, the trial court is estopped from dismissing the case on
the same ground. Petitioners further contend that the court's
conclusion that they had knowledge of the sale executed by their
deceased brother, Martin Pascua about twenty years ago is
based merely on surmises and conjectures because, in reality, it
was only in 1973 when they came to learn of the deed of sale
executed by their deceased brother in 1951. In 1973, the deed
was shown to them by respondent Clemente Castro at the
Agrarian office. Therefore, the period of prescription should be
counted from the knowledge of the petitioners of the deed of
sale and not from the date it was executed.
Petitioners' contention are without merit.
The trial court denied the motion to dismiss because the grounds
relied upon by the respondents for their motiondid not appear on
the face of the complaint. There was no finding that the
allegation of prescription had no merit. It cannot be said,
therefore, that the trial court was already estopped from passing
upon the issue of prescription. The issue was not adjudicated on
its merits and the doctrine of res judicata had not set in yet.
We likewise find the petitioners' contention, that they came to
know of the deed of sale by Martin Pascua in favor of the

CIVIL PROCEDURE
respondents only in 1973, highly improbable. As the trial court
correctly observed, it is inconceivable that the petitioners did not
come to know about the purchase by the respondents of
property from Martin Pascua. They admitted that they have been
neighbors of the respondents since before the war or period of
about 30 years and that the latter had deprived them of the fruits
of the land in question for more than 20 years. Alberto Pascua,
one of the petitioners testified that his parents from whom they
inherited the property died more than 25 years ago yet the
children never exerted any effort to have the property
partitioned. This fact indicates that petitioners had knowledge of
the sale, which explains why they had no interest at all in any
project of partition. More important is the fact that after the
respondents purchased the land they worked to secure an
Original Certificate of Title on the basis of a free patent
application. This was way back in 1958, 15 years before the
petitioners decided to file the action below. Clearly, the
petitioners' action is now barred by the statute of limitations.
In the case of Iglesia ni Cristo v. Hon. Judge, Court of First
instance of Nueva Ecija, Br. I (123 SCRA 523), quoting the case
of Labora v. Dayang-hirang (37 SCRA 346), we ruled:
The rule in this jurisdiction, regarding public
patents and the character of the certificate of
title that may be issued by virtue thereof, is
that where land is granted by the
government to a private individual, the
corresponding patent therefore, is recorded,
and the certificate of title is issued to the
grantee; thereafter, the land is automatically
brought within the operation of the Land
Registration Act, the title issued to the
grantee becoming entitled to all the
safeguards provided in Section 38 of said Act.
In other words, upon the expiration of one
year from its issuance, the certificate of title
becomes irrevocable and indefeasible like a
certificate issued in a registration proceeding.
It is quite obvious, therefore, that the respondents' title has
already become indefeasible and irrevocable, the one-year
period provided by law having expired in 1959.
Moreover, even if we add the lower court's finding that there
was fraud on the part of Martin Pascua when he effected the sale
of the disputed lot in favor of the respondents, the petitioners
are still barred from recovering the lot because their action
should have been filed within four (4) years from their discovery
of the fraud, which in turn, is deemed at the latest to have taken
place in 1958, when the respondents were issued an original
certificate of title. This was our ruling in the case of Balbin v.
Medalla (108 SCRA 666) where we stated:
An action for reconveyance of real property
resulting from fraud may be barred by the
statute of limitations, which requires that the
action shall be filed within four (4) years from
the discovery of the fraud. Such discovery is
deemed to have taken place when the
petitioners herein were issued original
certificates of title through either homestead
or free patent grants, for the registration of
said patents constitutes constructive notice
to the whole world. (Gerona v. de Guzman,
11 SCRA 153, and cited cases thereof ).
meikimouse

Full Text: Rule 9 Effect of Failure to Plead

CIVIL PROCEDURE

In the case at bar, the latest patent was

issued on October 14, 1959. There is,
therefore, merit in petitioners' contention
that if any action for reconveyance should be
commenced, the same should be filed on or
before October 14, 1963. But private
respondents' complaint for reconveyance and
annulment of titles with damages was filed
only on August 30, 1973 or more than 14
years had already elapsed from the date of
the issuance of the respective titles of the
defendants. Consequently, the action for
reconveyance of land titled in the names of
defendants (petitioners herein) had already
prescribed.

answer within the reglementary period.

Referring to the simplest form of default, that
is, where there is only one defendant in the
action and he fails to answer on time, Section
I of the rule provides that upon 'proof of such
failure, (the court shall) declare the
defendant in default. Thereupon the court
shall proceed to receive the plaintiff's
evidence and render judgment granting him
such relief as the complaint and the facts
proven may warrant.' This last clause is
clarified by Section 5 which says that 'a
judgment entered against a party in default
shall not exceed the amount or be different in
kind from that prayed for'.

The petitioners raise as a second issue that the respondent court

had no alternative but to grant the relief prayed for in their
complaint as this was evident in the tenor of the summons issued
by said court which in part stated:

Unequivocal, in the literal sense, as these

provisions are, they do not readily convey the
full import of what they contemplate. To
begin with, contrary to the immediate notion
that can be drawn from their language, these
provisions are not to be understood as
meaning that default or the failure of the
defendant to answer should be 'interpreted
as an admission by the said defendant that
the plaintiff's cause of action find support in
the law or that plaintiff is entitled to the relief
prayed for.' (Moran,supra, p. 535 citing
Macondray & Co. v. Eustaquio, 64 Phil. 466,
citing with approval Chaffin v. McFadden, 41
Ark 42; Johnson v. Pierce, 12 Ark. 599;
Mayden v. Johnson, 59 Ga. 105; People v.
Rust, 292 Ill. 328; Ken v. Leopold, 21 Ill. A.
163; Chicago, etc. Electric R. Co. v. Krempel,
116 Ill. A. 253.)

... if you fail to appear within the time

aforesaid, the plaintiff will take judgment
against you by default and demand from this
Court the relief applied for in said complaint.
...
Petitioners also anchor their contention on Rule 18, Section 1 of
the Rules of Court which provides:
Judgment by default.If the defendant fails
to answer within the time specified in these
rules, the court shall, upon motion of the
plaintiff and proof of such failure, declare the
defendant in default. Thereupon the court
shall proceed to receive the plaintiff's
evidence and render judgment granting him
such relief as the complaint and the facts
proven may warrant. This provision applies
where no answer is made to a counter-claim,
cross-claim or third-party complaint within
the period provided in this Rule.
Nowhere in the aforequoted provision nor in the summons
issued by the respondent court is it stated that the petitioners
are automatically entitled to the relief prayed for, once the
respondents are declared in default.
Favorable relief can be granted only after the court has
ascertained that the evidence offered and the facts proven by
the presenting party, petitioners in this case, warrant the grant of
the same. Otherwise, it would be meaningless to require
presentation of evidence if everytime the other party is declared
in default, a decision would automatically be rendered in favor of
the non-defaulting party and exactly according to the tenor of his
prayer. This is not contemplated by the Rules nor is it sanctioned
by the due process clause.

xxx xxx xxx

In other words, a defaulted defendant is not
actually thrown out of court. While in a sense
it may be said that by defaulting he leaves
himself at the mercy of the court, the rules
see to it that any judgment against him must
be in accordance with law. The evidence to
support the plaintiff's cause is, of course,
presented in his absence, but the court is not
supposed to admit that which is basically
incompetent. Although the defendant would
not be in a position to object, elementary
justice requires that only legal evidence
should be considered against him. If the
evidence presented should not be sufficient
to justify a judgment for the plaintiff, the
complaint must be dismissed. And if an
unfavorable judgment should be justifiable, it
cannot exceed in amount or be different in
kind from what is prayed for in the complaint.

In the case of Lim Tanhu v. Ramolete (66 SCRA 452-453), we had

occasion to elaborate on this point. We ruled:

In the instant case, from the evidence presented ex-parte by the

petitioners and from their very own allegations, the only
judgment that is warranted is the dismissal of the complaint. It is
barred by the statute of limitations.

The Rules of Court contain a separate rule on

the subject of default, Rule 18. But said rule is
concerned solely with default resulting from
failure of the defendant or defendants to

WHEREFORE, the petition is hereby DISMISSED for lack of merit.

No costs. SO ORDERED.

meikimouse

Full Text: Rule 9 Effect of Failure to Plead

G.R. No. L-40895 November 6, 1975
MILAGROS
DE
LA
CRUZ, petitioner,
vs.
HON. JUDGE BIENVENIDO EJERCITO, Court of First Instance of
Pampanga and Angeles City, Branch IV; TEODORO DAVID, City
Fiscal of Angeles City, and PEOPLE OF THE PHILIPPINES, thru the
Office of the SOLICITOR GENERAL, respondents. .
C. S. Gaddi & Maximo Q. Canlas for petitioner. .
Office of the Solicitor General Estelito P. Mendoza, Assistant
Solicitor General Eulogio Raquel-Santos and Solicitor Tomas M.
Dilig for respondent People of the Philippines.
City Fiscal Eller Dula Torres for respondent City Fiscal of Angeles
City.

AQUINO, J.:
On May 20, 1974 Milagros de la Cruz was charged with bigamy in
the Court of First Instance of Pampanga, Angeles City Branch IV
for having married Sergeant Dominick L. Gaccino on September
15, 1973 while her prior marriage to Teodoro G. David was
undissolved. The information was filed at the instance of her first
husband (Criminal Case No. 3128).
On August 1, 1974 Milagros de la Cruz filed in the same court at
its San Fernando Branch III a complaint for the annulment of her
marriage to Sergeant Gaccino on the ground of duress (Civil Case
No. 4188).
Defendant Gaccino did not answer the complaint. Judge Mariano
Castaeda, Jr. ordered the Provincial Fiscal to investigate
whether there was a collusion between the parties. A special
counsel of the Fiscal's office reported that there was no collusion.
.

CIVIL PROCEDURE
charge. He argues that the decision in the annulment case should
be set up as a defense by Milagros de la Cruz during the trial and
that it would not justify the outright dismissal of the criminal
case.
On the other hand, the Solicitor General manifested that the
stand of Milagros de la Cruz should be sustained because one
element of bigamy is that the alleged second marriage, having all
the requisites, would be valid were it not for the subsistence of
the first marriage (People vs. Mora Dumpo, 62 Phil. 246, 248;
Merced vs. Hon. Diez, 109 Phil. 155; Zapanta vs. Montesa, 114
Phil. 1227).
We hold that the finding in the annulment case that the second
marriage contracted by Milagros de la Cruz with Sergeant
Gaccino was a nullity is determinative of her innocence and
precludes the rendition of a verdict that she committed bigamy.
To try the criminal case in the face of such a finding would be
unwarranted.
As noted by Groizard, it is essential "que el segundo matrimonio
'ha de constituir un acto solemne en que concurran los requisitos
exigidos para la existencia del sacramento o del contrato' " (2
Cuello Calon, Derecho Penal, 12th ed., p. 675, note 2). As pointed
out in the Merced case, supra, it is necessary in a prosecution for
bigamy that the second marriage be declared valid if its validity
was questioned in a civil action.
And even supposing arguendo that the decree annulling the
second marriage was questionable or erroneous because it was
issued in a judgment by default, still that would not prevent the
decree from having legal effect. "An erroneous judgment is not a
void judgment" (Chereau vs. Fuentebella, 43 Phil. 216).
WHEREFORE, the lower court's order of May 27, 1975, denying
the motion to dismiss of Milagros de la Cruz, is set aside. The writ
of prohibition is granted. No Costs.
SO ORDERED.

On December 16, 1974 Judge Castaeda rendered a decision

annulling the marriage of Milagros de la Cruz to Gaccino. No
appeal was taken from that decision. It became final. In view of
the annulment of her second marriage, Milagros de la Cruz filed
on January 27, 1975 a motion to dismiss the bigamy charge. The
private prosecutor and the prosecuting fiscal opposed the
motion.
Judge Bienvenido Ejercito denied it in his order of May 27, 1975
on the ground that the decision in the annulment case is not
controlling in the criminal case because the parties and the issues
in the two cases are not the same.
That refusal of Judge Ejercito to dismiss the bigamy case, not
withstanding the judicial pronouncement that her second
marriage was a nullity, prompted Milagros de la Cruz to file the
instant special civil action of certiorari and prohibition.
The issue is whether the bigamy case became moot or untenable
after the second marriage, on which the prosecution for bigamy
is based, was annulled.
The City Fiscal of Angeles City contends that the lower court
acted correctly in denying the motion to dismiss the bigamy

meikimouse