CARLOS M. SISON, PLAINTIFF AND APPELLEE VS. GONZALO D. DAVID, DEFENDANT AND APPELLANT.

Sison versus David

The Case

This is an action for damages brought by Carlos Moran Sison against Attorney Gonzalo D. David, arising from allegedly malicious and defamatory statements contained in a petition for bond that David filed in a cadastral proceeding. Sison claims that David, in effect, implied that he was incompetent and unfit to manage corporate affairs and was scheming to enrich himself at the expense of his wife. The case matters because it is the leading Philippine authority on the distinction between absolutely privileged and qualifiedly privileged communications in judicial proceedings, and on the rule that utterances made in the course of judicial proceedings are absolutely privileged, so that even express malice does not destroy the privilege.

Procedural History

Sison commenced the action in the Court of First Instance of Manila. On December 10, 1954, that court rendered judgment for Sison, awarding him 5,000 pesos as moral damages and 1,000 pesos as attorney's fees, plus costs. The court then, on its own motion, rendered an amended decision dated December 29, 1954, finding no merit in David's counterclaim and increasing the award to 15,000 pesos as moral damages and 3,000 pesos as attorney's fees, aside from costs. David appealed from the amended decision to the Court of Appeals. The Court of Appeals, considering that the sum awarded plus the amount claimed in the first three causes of action of David's counterclaim aggregated 173,000 pesos, forwarded the records to the Supreme Court pursuant to Section 17 of Republic Act Number 296. Although that Act was later amended by Republic Act Number 2613 to increase the exclusive appellate jurisdiction of the Court of Appeals in civil cases to those in which the value in controversy does not exceed 200,000 pesos, the Supreme Court retained appellate jurisdiction over the appeal because the pertinent facts were not disputed and the issues hinged on the conclusions deducible from those facts and the applicable law.

Facts

On December 20, 1938, Margarita David executed a will constituting several legacies and naming her grand nieces Narcisa de la Fuente de Teodoro and Priscilla de la Fuente de Sison as heirs of the residue of her estate, subject to the condition that if they should die leaving no descendants, the properties inherited would pass one-half to the heirs of the testatrix's father and the other half to the heirs of her mother. The defendant Gonzalo D. David is one of such heirs of the parents of Margarita David. On October 21, 1939, the two sisters were legally adopted by Margarita David as her children. On September 6, 1940, Margarita David donated to them practically the same properties bequeathed in her will. Upon her death in Manila on February 24, 1941, a special proceeding was instituted for the settlement of her estate, with Jose Teodoro, Sr. as executor and Gonzalo D. David as his counsel. The sisters later extra-judicially partitioned the properties between themselves. The plaintiff, Carlos Moran Sison, is the husband of Mrs. Sison.

On or about May 9, 1950, David caused to be annotated on the titles of several lands acquired by Mrs. Sison a notice of adverse claim for the fees of the executor and his own fees as counsel. It turned out that on or about February 28, 1949, the properties had been assigned by Mrs. Sison to Priscila Estate, Inc., a corporation organized by her and the plaintiff, in exchange for shares of stock. On September 8, 1951, the corporation filed an urgent petition to lift the adverse claim over one of the properties, and the motion was granted provided that the movant would file a bond should any objection be interposed later.

On September 26, 1951, David filed a petition for bond, praying that the sale be disapproved or that a bond of 12,000 pesos be furnished. In that petition, David alleged, among others, that the property to be sold was one of the few unencumbered properties inherited from Margarita David because practically all of the properties of the heiress were mortgaged and the corporation was operating on an overdraft; that the reason for the overdraft was that new buildings had been made as conjugal properties of Carlos Sison and Priscila de la Fuente, and the paraphernal properties inherited from Margarita David were being sold to pay the obligations of these conjugal properties; and that the sale would contravene the provisions of the will. On October 6, 1951, Sison commenced this action, alleging that these averments were made with malice and implied that he was incompetent and scheming to enrich himself. David answered that the allegations were proper and necessary to protect his interests and those of his client, and that the petition for bond was an absolutely privileged communication. David also set up a counterclaim with four causes of action based on allegedly impertinent, false and scandalous statements made by Sison through counsel in the special proceeding, and on a criminal complaint for libel that was dismissed.

Issues

• Whether or not the lower court validly amended its decision on its own motion after promulgation and before appeal.
• Whether or not the allegations in David's petition for bond are absolutely privileged as utterances made in the course of judicial proceedings.
• Whether or not the alleged malice of David defeats the privilege and entitles Sison to damages.

Applicable Provisions

Rule 124, section 5, of the Rules of Court provides:

Every court shall have power to amend and control its processes and orders so as to make them conformable to law and justice.

This provision authorized the lower court to amend its decision on its own motion before any appeal was taken.

Ruling

On the first issue, the Court held that there was no merit in the claim that the amended decision was a nullity. The amended decision was rendered nineteen days after the promulgation of the original decision, or within the reglementary period to appeal, and before any appeal had been taken, so that the lower court still had jurisdiction and control over the case. Moreover, the amendment was authorized by Rule 124, section 5, of the Rules of Court.

On the second and third issues, the Court held that utterances made in the course of judicial proceedings, including all kinds of pleadings, petitions and motions, belong to the class of communications that are absolutely privileged. The Court clarified that the pertinency or relevancy essential to the privilege enjoyed in judicial proceedings does not make it a qualified privilege within the legal connotation of the term. Otherwise, all privileged communications in judicial proceedings would be qualified, and none would be absolutely privileged, for the exemption never extends to matters patently unrelated to the subject of the inquiry. The Court distinguished the two classes: in cases of absolutely privileged communications, the occasion is an absolute bar to the action, and even the existence of express malice does not destroy the privilege; whereas in cases of conditionally or qualifiedly privileged communications, the law raises only a prima facie presumption in favor of the occasion, and the communication is actionable upon proof of actual malice. The Court explained that the class of absolutely privileged communications is narrow and practically limited to legislative and judicial proceedings and other acts of state, and that the privilege is not intended so much for the protection of those engaged in the public service as for the promotion of the public welfare, so that judges, jurors, lawyers and witnesses may speak their minds freely and exercise their functions without incurring the risk of prosecution or an action for damages.

Doctrine

Utterances made in the course of judicial proceedings, including all kinds of pleadings, petitions and motions, are absolutely privileged communications. In absolutely privileged communications, the occasion is an absolute bar to the action, and even the existence of express malice does not destroy the privilege. The pertinency or relevancy essential to the privilege in judicial proceedings does not make it a qualified privilege; the exemption never extends to matters patently unrelated to the subject of the inquiry. A qualifiedly privileged communication, by contrast, is actionable upon proof of actual malice. The rule rests on public policy, so that lawyers, judges, jurors and witnesses may speak their minds freely in the administration of justice.

Disposition

The Supreme Court ruled in favor of David, holding that the statements in his petition for bond were absolutely privileged and that the amended decision of the lower court was validly rendered.

Remember This

Memorize this line: utterances in the course of judicial proceedings, including all kinds of pleadings, petitions and motions, are absolutely privileged, and even express malice does not destroy the privilege. Examiners use this case to test the distinction between absolute and qualified privilege in defamation, and the power of a court to amend its own decision before appeal under Rule 124, section 5.