ROSENDA A. DE NUQUI, ET AL., PLAINTIFFS-APPELLEES, VS. ILDEFONSO D. YAP, DEFENDANT-APPELLANT.

Nuqui versus Yap

The Case

This is the case of Nuqui versus Yap. Rosenda Nuqui, Sotero Dionisio, Junior, and the spouses Antolin and Erlinda Diaz sued Ildefonso Yap in the Court of First Instance of Misamis Occidental for the rescission of a contract. The trial court ordered Yap to restore the buildings and grounds described in their mutual agreement, to pay three hundred pesos monthly from July 31, 1956 until he surrendered the properties, and to pay attorney's fees. The plaintiffs then asked that legal interest be added, and the trial court granted that request by order before Yap's appeal was perfected. The case matters because it fixes the rule on when a trial court may still amend its own judgment: the power survives until the judgment becomes final or an appeal is perfected, and a partial reconsideration does not require the total revocation of the original judgment.

Procedural History

The action for rescission was filed in the Court of First Instance of Misamis Occidental and tried jointly with another case involving the same contract, in which Yap was also a defendant. On March 31, 1960, the trial court rendered a joint decision. As to the rescission case, it ordered Yap to restore the buildings and grounds with all permanent improvements, to pay three hundred pesos monthly from July 31, 1956 until surrender of the properties, and to pay one thousand pesos as attorney's fees to the spouses Diaz.

On May 10, 1960, the plaintiffs moved for reconsideration, asking that legal interest be imposed on the sums Yap had to pay. On May 14, 1960, the trial court partially granted the motion and amended the dispositive portion of its decision in the rescission case so that Yap would pay interest at the legal rate on the monthly rental of three hundred pesos from July 31, 1956 until full surrender of the property, plus the attorney's fees.

On June 25, 1960, Yap perfected his appeal in both cases, with the record on appeal approved, and the motion for reconsideration and the May 14 order were included in that record. The Supreme Court decided that appeal on February 26, 1965. It modified the judgment by eliminating the award of attorney's fees to the spouses Diaz in the rescission case and the award of nominal and exemplary damages in the other case, and by making the award of attorney's fees payable to counsel for the account of the corporation; in all other respects it affirmed the judgment.

On July 25, 1965, the plaintiffs in the rescission case moved for satisfaction of all money judgments, alleging that of a total award of forty two thousand four hundred sixty pesos and seventy five centavos, Yap had paid only thirty two thousand four hundred pesos, leaving an unsatisfied balance of ten thousand sixty pesos and seventy five centavos. On September 3, 1965, the trial court granted the motion but directed Yap to deposit only one thousand nine hundred thirty five pesos as legal interest on the total amount of rentals, and denied attorney's fees in line with the Supreme Court decision. Both sides moved for reconsideration, and on October 1, 1965, the trial court denied both motions. The plaintiffs then filed a second motion for reconsideration, praying that Yap be ordered to pay eight thousand seven hundred forty eight pesos representing legal interest accrued since July 31, 1956 under the May 14, 1960 order. On October 21, 1965, the trial court granted the motion and ordered Yap to deposit eight thousand seven hundred forty pesos and thirty centavos as legal interest. Yap then brought this direct appeal, questioning the orders of September 3, October 1, and October 21, 1965, principally on the ground that the judgment in the rescission case, which had become final and executory, did not provide for legal interest.

Facts

The plaintiffs and Yap were bound by a mutual agreement over certain buildings and grounds. When Yap failed to comply, the plaintiffs sued for rescission in the Court of First Instance of Misamis Occidental, and the case was tried jointly with a related case involving the same contract.

On March 31, 1960, the trial court rendered judgment ordering Yap to restore the properties and to pay monthly rentals and attorney's fees. The plaintiffs then asked for legal interest. On May 14, 1960, still before any appeal was perfected, the trial court amended its judgment to impose interest at the legal rate from July 31, 1956 until full surrender of the property.

Yap appealed, and the Supreme Court in 1965 affirmed the judgment with modifications that removed the attorney's fees awarded to the spouses Diaz. When the plaintiffs later sought execution and satisfaction of the money judgment, the trial court, over Yap's opposition, enforced the interest imposed in the May 14, 1960 order. Yap insisted that the final judgment contained no such award of interest, and this appeal followed.

Issues

• Whether or not the trial court's order of May 14, 1960 validly amended and modified its judgment of March 31, 1960 by imposing legal interest, when the judgment had not yet become final and no appeal had yet been perfected.
• Whether or not a court that partially reconsiders its judgment must first totally revoke the original judgment and render a new one before the modification can take effect.
• Whether or not the trial court correctly ordered Yap to pay legal interest in the execution proceedings, despite the earlier final judgment.

Applicable Provisions

The decision does not quote any statutory provision. Its reasoning rests on the settled rule, applied in the cases it discusses, that a court retains control over its judgment until the judgment becomes final or an appeal is perfected, and may amend or modify it within that period. The Court cites the rule in Cordovero versus Villaruz that where a new trial is granted, the former decision must be revoked, and the rule in Robles versus Timario that a judgment which has already become final cannot be cured of an omission, such as the imposition of interest, in the order of execution. These doctrines, rather than any codal text, supply the governing standard in this case.

Ruling

On the first issue, the Court held that the appeal is without merit. The trial court's order of May 14, 1960 expressly amended and modified the judgment of March 31, 1960 by directing Yap to pay legal interest starting July 31, 1956. The Court stressed that the court's authority to modify its judgment was not challenged, and could not be challenged, because the modification was made before the appeal was perfected. The order was even included in the record on appeal, yet Yap failed to raise any question about it, although he should have done so; the plaintiffs, as the prevailing parties, could not be expected to raise it.

On the second issue, the Court rejected Yap's reliance on Cordovero versus Villaruz and Robles versus Timario. It declared that it knows of no rule requiring that when a court partially reconsiders its judgment, which is not yet final or the subject of a perfected appeal, the former judgment must first be totally revoked and a new judgment rendered. In Cordovero, a new trial had been granted, and the former decision had to be revoked; here, no new trial was granted, for none was sought. In Robles, the judgment that inadvertently omitted interest had already become final, and the omission was sought to be cured only in the order of execution; here, the judgment was modified prior to the perfection of the appeal, while the lower court still had control over it.

On the third issue, because the May 14, 1960 order validly stood as part of the judgment, the trial court correctly enforced the award of legal interest in the execution proceedings. The Court affirmed the orders appealed from.

Doctrine

A court retains control over its judgment until the judgment becomes final or an appeal is perfected, and within that period it may amend or modify the judgment, including by adding an award of legal interest that was omitted. A partial reconsideration does not require the total revocation of the original judgment and the rendition of a new one; the rule requiring revocation applies where a new trial is granted. Once a judgment has become final, however, an omission such as the imposition of interest can no longer be cured in the order of execution. A party who fails to raise an objection to a modification that was included in the record on appeal cannot raise it for the first time later.

Disposition

The Supreme Court affirmed the orders appealed from, with treble costs to be paid by Yap's counsel, so that Yap remained liable for the legal interest imposed by the trial court.

Remember This

The single line worth memorizing is that a court may amend its judgment at any time before it becomes final or before an appeal is perfected, and a partial reconsideration needs no total revocation of the original judgment. Examiners like to use this case on the finality of judgments and the court's control over its own decision, especially to contrast it with the rule that an omission in a final judgment cannot be cured at the execution stage.