G.R. No. L-19884. May 08, 1969
ZAMBALES ACADEMY, INC., PLAINTIFF-APPELLANT, VS. CIRIACO VILLANUEVA, DEFENDANT-APPELLEE.
TEEHANKEE, J.:
Appeal on questions of law from a judgment of the Court of First
Instance of Zambales dismissing plaintiff’s complaint
in Civil Case No. 2386 for the annulment of the judgment by default for damages
secured by defendant on his counterclaim against plaintiff in a previous case,
Civil Case No. 1760 thereof, involving the same parties in the same
roles. Defendant likewise appealed from
the Court’s dismissal of his counterclaim for damages, but his appeal was
subsequently dismissed for failure to file his brief.
In case No. 1760 filed under date of August 12, 1955, plaintiff sued defendant for
actual and compensatory damages, moral and exemplary damages for having
allegedly fraudulently abused the trust reposed in him as director and board
trustee of plaintiff. Defendant in due
course filed his answer with a three-cause of action counterclaim for moral and
exemplary damages. Plaintiff’s motion
of February 16, 1956, to dismiss the counterclaim having been denied by the
lower Court on August 31, 1956, and it having continued to ignore and failed to
file its Answer to the counterclaim, the lower court upon defendant’s motion
finally declared plaintiff in default as to the counterclaim in its Order of
March 20, 1957. Evidence having been
adduced, the lower Court rendered its decision dated June 24, 1958 in the case, the dispositive portion of which reads:
“IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court hereby renders
judgment in favor of the defendant and against the plaintiff:
1.
Dismissing the plaintiff’s
complaint;
2.
Ordering the plaintiff to pay to
the defendant the sum of P2,500.00 as moral damages
and P1,000.00 as attorney’s fees on the first cause of action of the latter’s
counterclaim; the amount of P5,000.00 as moral damages and P1,000.00 as attorney’s
fees on the second cause of action; and the sum of P5,000.00 as moral damages
and P1,000.00 as exemplary damages on the third cause of action.”[1]
Plaintiff appealed this judgment in said
Case No. 1760 where it was docketed as Case CA-G.R. No. 25007-R. Before the perfection of the appeal,
however, and upon defendant’s motion, the lower Court ordered on August 15, 1958, the execution of its
decision as to defendant’s counterclaim.
Plaintiff thereafter instituted with the Court of Appeals an original
action for certiorari and prohibition for the setting aside and annulment of
said Order of execution.[2]
The Court of Appeals in due course rendered on June 8, 1959, its decision dismissing the petition on the
ground that plaintiff, having been declared in default, had lost its right to
appeal and the judgment on the counterclaim had become final and executory.
Plaintiff then sought a review by this Court of the Court of Appeals’
decision, which was docketed as Case G. R. No. L-16371 of this Court, entitled Zambales Colleges, Inc. vs. Hon. Court of Appeals, et
al. After due hearing, this Court,
through Mr. Justice J. B. L. Reyes, rendered on March 28, 1961 its decision, the pertinent portions
whereof follow:
“Petitioner urges in this instance that respondent trial court
committed a grave abuse of discretion and/or acted in excess of its
jurisdiction in sustaining the counterclaim notwithstanding an utter lack of
evidence in support of its allegations; that its order declaring the petitioner
(plaintiff therein) in default and judgment by default on the counterclaim are
null and void; and, finally, that said court erred in ruling that a party in default
has no right to appeal.
“There is clearly no merit in the first contention. While an error of judgment might have been
committed by the trial judge in his evaluation of the evidence in the damage
suit (but this is just an assumption), we, nonetheless, do not find such
exercise of discretion to be whimsical, arbitrary or capricious amounting to a
virtual refusal to perform his bounden duty as a magistrate of justice. As to the first and second cause of action,
the court, we note, took into consideration the criminal charges filed against
the defendant, the findings of the criminal courts dismissing the same for want
of substance, and testimonial evidence tending to show the lack of merit of the
criminal imputations instituted by the plaintiff (herein petitioner), like, for
instance, the absence of deceit on the part of accused Villanueva and damage on
the part of complainant college. Coming
specifically to the third cause of action, the trial court found, among other
things, that the warrant for Villanueva’s arrest was unduly hand-carried to
Manila without the necessary indorsement of the
justice of the peace court; that his arrest was so timed that defendant could
not possibly procure immediately a bond for his provisional release, and that
the warrant was served on him at his office at the Department of Education to
unnecessarily embarrass, humiliate, and ridicule him before his visitors and
co-employees. To accept petitioner’s
plea for a review of these findings and conclusions of the court would, in
effect, amount to allowing the substitution of petitions for certiorari in lieu
of appeals, which we are not in a position to do (see Chua Ke
vs. Abeto, 63 Phil. 539, and cases cited therein).
“Invoking the case of Navarro and Binoya vs. Bello, et
al., G. R. No. L-11647, January 31, 1958, 54 Off. Gaz. 6588, petitioner
next argues that the declaration of default is null and void, because the
issues raised in the counterclaim, particularly those contained in the second
and third causes of action, are so inextricably linked with those raised by the
complaint, that an answer would merely require a repleading
of the complaint.”
x x x x x
“Even the petitioner, however, does not pretend that
defendant’s initial cause of action in his counterclaim (malicious filing of
criminal charges) is related to the allegations stated in the complaint. This is but to be expected, considering that
the complaint never made the slightest reference to the matters averred in said
portion of the counterclaim x x x . That being the case, the plaintiff was still
obligated under the Rules of Court to controvert or otherwise meet the new
issues by filing the corresponding answer (see Sec. 7, Rule 10, Rules of
Court). The same thing may be said of
the third cause of action of the counterclaim, which only raised the propriety
of the manner how the warrant for Villanueva’s arrest was procured by the
plaintiff and served upon said defendant.
No further discourse is needed to show the already apparent disparity
between the issues posed by the first and third causes of action of the
counterclaim, on one hand, and the complaint, on the other.
“Petitioner is, however, correct as to the second cause of
action. The counterclaim itself recited
that this particular cause of action is merely based on facts alleged in the
complaint, and it thus had the effect only of restating the issues already
raised by the plaintiff Obviously, as far as this cause of action is concerned,
there was no occasion to rule the plaintiff in default. Hence, the award of damages on the
counterclaim’s second cause of action has not become final, since the case was
appealed on the merits. But this fact
did not excuse the petitioner from meeting the different issues of the first
and third causes of action, and as to them, it was properly declared in
default.
x x x x x x
“WHEREFORE, the judgment of the Court of Appeals appealed from is
modified in the sense that the order of execution, dated 15 August 1959, issued
by the trial court is its Civil Case No. 1760, shall be confined only to those
portions of its judgment relating to the first and third causes of action of
defendant Villanueva’s counterclaim, to the exclusion of the P6,000.00 – awarded on the second cause of action. The writ of preliminary injunction issued by
this Court on 8 March 1960
to stay execution of judgment in said civil case is hereby lifted, and the
trial court ordered to proceed in accordance with this opinion. No special pronouncement as to costs.”
Plaintiff filed in due course a Motion
for Reconsideration of the decision, which was denied by this Court on June 15, 1961.
In no time, plaintiff filed anew on July 18, 1961 the present
complaint docketed as Civil Case No. 2386 for the annulment of judgment against
it in defendant’s favor in the first case, Civil Case No. 1760, as affirmed by
this Court with modification in Case G.R. No. L-
16371 quoted above.[3]
Reiterating its previous contentions that the decision awarding damages on
defendant’s counterclaims in the first case was null and void and was not
supported by any evidence, and alleging that it was declared in default as to
defendant’s counterclaims “through the deception and betrayal of its
attorney in Civil Case No. 1760 and through no fault of (its) offices,”[4]
plaintiff prayed for the issuance of a writ of injunction against the Court’s
execution order of its decision in the case in favor of defendant’s
counterclaims and to declare said decision null and void. Defendant filed his Answer with counterclaim
for damages, averring that the nullity of the decision had already been passed
upon by the Supreme Court and the Court of Appeals, that the complaint stated
no cause of action as plaintiff had already lost its remedy under Rule 38 of
the Rules of Court, and that if plaintiff had been deceived by its lawyer, it
was a matter between them that was immaterial in the action. In its Reply, plaintiff acknowledged that its allegations in its complaint as to its lawyer’s deception was
“intended to legally justify our present action in view of our lost remedy
of appeal in Civil Case No. 1760 due to plaintiff’s default.”[5]
Thereafter, the parties filed several pleadings wherein both acknowledged that
the questions involved in their respective affirmative defenses involved
questions of law that did not require the introduction of evidence and asked
the Court to render judgment. The lower
Court did so, in its decision of February 14, 1962, holding that plaintiff’s
complaint for nullification of the decision against it on defendant’s
counterclaims therein for alleged lack of supporting evidence was already
passed upon and barred by this Court’s decision in G. R. L-16371, and that the
alleged deception and betrayal of plaintiff’s counsel would not render null
and void the judgment “especially when as in the instant case no
allegation has been made in the complaint that the opposite party and the Court
had colluded with the plaintiff’s counsel to deprive plaintiff of said
right”[6]
to present evidence and to appeal. The
lower Court also held the defendant’s counterclaim for damages to be untenable
in the absence of a positive allegation of plaintiff’s malice in filing the
case, and that damages had already been awarded defendant in the first
case. The lower Court therefore
dismissed both plaintiff’s complaint and defendant’s counterclaim for lack of a
sufficient cause of action and for being barred by prior judgment.
The Record on Appeal does not disclose it, but the records of
this Court in G.R. No. L-20410 entitled “Zambales
Academy, Inc. vs. Hon. Lucas Lacson, etc. et al”
filed on October 23, 1962 show that the plaintiff had in the second case, Civil
Case 2386, filed therein a bond for P9,500.00 in favor of defendant, whereby
the lower Court issued its Order of September 5, 1961, suspending execution of
the judgment in favor of defendant’s counterclaims in the first case, until
after the termination of the second case; that after the lower Court rendered
its decision of February 14, 1962, dismissing the second case, it issued its
Order of September 28, 1962 directing the execution of the said judgment in the
first case in favor of defendant; and plaintiff then filed this, its second
Petition with this Court, to prohibit and restrain, the carrying out of said
Order of execution, during the pendency of its
appeals from the judgments in the two cases, Nos. 1760 and 2386, in the
appellate courts. This second petition
was summarily dismissed for lack of merit by this Court in its Resolution of October 26, 1962.
Not content as yet, plaintiff filed thereafter on November 23, 1962 an Urgent Petition
for Issuance of a Writ of Preliminary Injunction in this case, reiterating the
same prayer to prohibit and restrain the carrying out of the said Order of
Execution. After having required and
received the Comment of defendant, wherein it was pointed out “the issues
raised in this case are the same issues raised in that case of ‘Zambales Colleges vs. Hon. Court of Appeals et al’ before
this Court in Case G. R. No. 16371, hence that decision becomes the law of the
case,” this Court on January 10, 1963 denied plaintiff’s prayer for the
issuance of preliminary injunction.
We come now to the plaintiff’s present appeal from the lower
Court’s judgment of dismissal of its complaint seeking to annul the judgment in
the first case, Case No. 1760. We find
no merit whatever in the appeal.
The principal issue raised by plaintiff-appellant in the lower
Court and here on appeal is that the judgment by default in the first case awarding
damages and attorney’s fees to defendant on his counterclaims, by virtue of the
lower Court’s findings that plaintiff had maliciously prosecuted defendant on
criminal charges was null and void for not being supported by any evidence
whatsoever. Plaintiff is tenacious in
its insistence that “the trial Court had no power and authority
to render the particular judgment in question, that is, in the award of moral
damages to defendant, there being absolutely no evidence supporting the
Court’s finding of malice in the institution of criminal cases”[7]
by plaintiff against defendant. These
are the very same issues and contentions of plaintiff that had already been
resolved and ruled out by this Court in its final decision of March 28, 1961, in case G. R. L-16371
as correctly held by the lower Court.
This Court then decided in rejecting plaintiff’s contentions that
assuming that an error of judgment might have been committed by the trial judge
in his evaluation of the evidence in the damage suit, “we, nonetheless do
not find such exercise of discretion to be whimsical, arbitrary or capricious
amounting to a virtual refusal to perform his bounden duty as a magistrate of
justice” such as to be reversible on certiorari.
As will be noted from our decision reproduced on page 2 hereof,
this Court, in upholding the trial Court’s award of damages, noted that the
trial Court took into consideration the criminal charges filed by plaintiff
against defendant, the findings of the criminal courts dismissing the same for
want of substance, the testimonial evidence tending to show the lack of merit
of the criminal imputations instituted by plaintiff and the ill-timing of the
service of the arrest warrant on defendant at his office at the Department of
Education to cause him unnecessary embarrassment, humiliation and
ridicule. This Court then rejected
plaintiff’s plea for a review of these findings and conclusions of the trial
court, because it “would, in effect, amount to allowing the substitution
of petitions for certiorari in lieu of appeals, which we are not in a position
to do.” While plaintiff correctly perceived this Court’s ruling then that
such review of evidence, findings and conclusions of the trial court are
“matters outside the scope of the remedy of certiorari,”[8]
it erroneously contends now that it may attack anew “the validity of the
judgment on the counterclaim not on the ground of lack of or excess of
jurisdiction or abuse of discretion, but on the ground of want of
power and authority of the trial court in awarding damages, to
defendant over which matter the Supreme Court declined to rule and to
decide.”[9]
This posture of plaintiff now is the contrary of its position then that
“the trial Court committed not a mere error of judgment but a capricious
and whimsical exercise of judgment amounting to lack of jurisdiction.”[10]
Plaintiff’s present position is but a futile exercise in
semantics: Since the lower court’s jurisdiction
to award damages to defendant was already sustained by this Court then, it can
no longer question anew in this case the lower Court’s “power and authority”
to do so. This Court did not then
decline to rule over the lower Court’s jurisdiction or “power and
authority” to award damages to defendant.
What it held then, as it holds now, was that the findings and
conclusions thereon of the trial Court on the basis of the evidence could only
be reviewed in a proper appeal, but that, “not having moved for the
reconsideration or for the lifting of the order of default, petitioner
itself has foreclosed its right to appeal from the portions of the judgment
which considered it in default.”[11]
While plaintiff, as it so vehemently continues to insist for the
most part of its brief, may have overcome the trial court’s findings of
malicious prosecution, had it not been declared in default and had it not
foreclosed itself its right to appeal, suffice it to say, as this Court pointed
out then, that plaintiff “was not denied or deprived of that right, but
lost it due to its own fault and negligence, for which it is exclusively to
blame.”[12]
Plaintiff should finally realize that public policy and sound practice enshrine
the fundamental principle of res judicata that parties ought not to be permitted to
litigate the same issue more than once, as the very object for which courts
were constituted was to put an end to controversies. Thus, the provisions of Rule 39, section 49
(b) that the effect of a judgment or final order rendered by a court or judge
of the Philippines, having jurisdiction to pronounce the judgment or order, is
“with respect to the matter directly adjudged or as to any other matter
that could have been raised in relation thereto, conclusive between the parties
and their successors in interest by title subsequent to the commencement of the
action or special proceeding, litigating for the same thing and under the same
title and in the same capacity.” For, as was long enunciated by this
Court, “it is a general rule common to all civilized systems of jurisprudence
that ‘the solemn and deliberate sentence of the law, pronounced by its
appointed organs, upon a disputed fact or state of facts, should be regarded as
a final and conclusive determination of the question litigated, and should
forever set the controversy at rest.’ Indeed it has been well said that this
maxim is more than a mere rule of law; more even than an important principle of
public policy; and that it is not too much to say that it is a fundamental
concept in the organization of every jural
society.”[13]
Here, plaintiff has in effect actually litigated or sought to
litigate the very same issue of the validity or nullity of the award for
damages against it and in favor of defendant’s counterclaim not only once but
thrice: in case G. R. L-16371 decided by
this Court on March 28, 1961, in. Case G. R. L-20410 summarily dismissed for
lack of merit by this Court on October
26, 1962 and for the third time in the present case. The remedy sought by him was consistently to
set aside the award of damages and enjoin its execution. That it has presented the present action in
the guise of an action for annulment of the said judgment does not prevent the
bar of the former adjudication of the first case against it. The corrolary
principle of res judicata
that “courts of the present day are not concerned so much with the form of
actions as with their substance” and that “despite a difference in
the form of the action, nevertheless the doctrine of res
judicata would be applied where it appeared
that the parties in the two suits were in truth ‘litigating for the same
thing,'” has just as long been enunciated by this Court.[14]
The trial Court, therefore, correctly ruled that it could not entertain
the instant action, for it would “amount to a reconsideration of a final
judgment” insofar as the judgment on the first and third causes of action
of defendant’s counterclaim in Civil Case No. 1760. as
upheld by this Court in G. R. No. L-16371 was concerned, and that it could not
likewise reconsider, by way of the annulment of judgment sought by plaintiff,
the judgment on the second cause of action of defendant’s counterclaim, as to
which this Court set aside the order of default, in view of the pendency of the appeal on the merits thereof in the Court
of Appeals.[15]
As to the lower Court’s ruling that its allegation of deception and betrayal by
its counsel, being an intrinsic fraud, was not a cause for annulment of the
judgment, plaintiff assigns no error and acknowledges that it made the
allegation “not with the intention of advancing it as a further ground of
the nullity of judgment, but to lay bare plaintiff’s lost remedy in Civil Case
No. 1760 because of its default.”[16]
If plaintiff’s allegation be true, then its recourse is the proper
administrative and legal action against its said counsel.
WHEREFORE, the judgment appealed from is hereby affirmed,
with costs in both instances against plaintiff-appellant.
Reyes, J.B.L., (Acting C.J.), Dizon, Makalintal, Zaldivar, Sanchez,
Fernando, and Barredo,
JJ., concur.
Concepcion, C.J., and Ruiz Castro,
JJ., on official leave.
Capistrano, J., did not take
part.
[1] Rec. on App. pp. 43-44.
[2] Zambales Colleges, Inc. vs. Hon. Lucas Lacson, Judge, Court of First Instance of Zambales, the Provincial Sheriff of Zambales
and Ciriaco Villanueva, CA-G. R.
No. 24617-R.
[3]
An Amended Complaint, with a mere amendment in form, in the prayer was filed on
August 7, 1961, Rec. on App.
p. 47.
[4] Paragraph 10, Complaint, Rec. on App. p. 10 and 55.
[5]
Rec. on App., p. 68.
[6]
Rec. on App., p. 84.
[7]
Appellant’s brief, p. 4; emphasis reproduced.
[8] Appellant’s
Brief, p. 7.
[9] Id.
p. 8, emphasis reproduced.
[10]
Plaintiff’s Petition for reconsideration in G. R. L-16371, p. 1.
[11]
Decision, Appellant’s Brief, p. 42, emphasis supplied. This doctrine has now been changed by Rule 41,
section 2 of the new Rules of Court.
[12] Idem,
Appellant’s Brief, pp. 42-44.
[13] Peñalosa vs.
Tuason, 22 Phil. 303, 310, (1912).
[14] Tanguinlay vs.
Quiros, 10 Phil. 360, 365 (1912), cited in Pua vs. Lapitan 107 Phil.
95 (1960).
[15] Supra,
page 4.
[16]
Appellant’s Brief, p. 28.