ALABANG MEDICAL CENTER, PETITIONER, V. GOMECO METAL CORPORATION, RESPONDENT.
ELBINIAS, J.:
The salient facts are those as found in the RTC’s Decision[7] dated June 13, 2008, as follows:
“xxx on March 18, 1997, defendant (petitioner here) confirmed the proposal of plaintiff (respondent here) to undertake the complete supply and installation of stainless steel food service equipment and consequently, plaintiff and defendant signed the GOMECO Quotation under GMC No. 26857 xxx. Thereafter, plaintiff (respondent) proceeded to perform its obligations under the said Quotation while defendant (petitioner) warranted and represented that it would pay upon progressive billing by the former. Further, defendant (petitioner) confirmed and assented to the agreements contained in the quotations by receiving the goods and paying the down payment. However, upon further completion of the project, defendant (petitioner) failed to pay the remaining balance in the amount of P154,000.00 as of February 15, 2001. A demand letter dated March 22, 2001 xxx was then sent to defendant (petitioner) together with the Statement of Account. xxx Defendant (petitioner) however failed to settle and continues to refuse to pay its outstanding unpaid balance amounting to P154,000.00 plus agreed fee of three percent (3%) interest a month to the plaintiff (respondent); hence, the instant complaint.”[8] (Emphasis Supplied)
As a result of petitioner Alabang Medical Center’s (“petitioner AMC” or “petitioner” for brevity) refusal to pay the remaining balance, respondent GOMECO Metal Corporation (“respondent GOMECO” or “respondent” for brevity) filed before the MeTC, a Complaint[9] for “Sum of Money”[10] against petitioner.
The rest of the facts are continued in the RTC’s Decision[11] dated June 13, 2008, to wit:
“Summons was issued and defendant (petitioner) failed to file the requisite Answer.
Upon motion of plaintiff (respondent), the Court in its Order [of] May 30, 2003 declared the defendant (petitioner) in default and the plaintiff (respondent) was allowed to present its evidence ex-parte. Defendant (petitioner) however moved for a reconsideration and to admit attached Answer which was granted.
In its Answer, defendant (petitioner) denied the material allegations of the complaint and alleged, among others, that while it entered into a contract with plaintiff (respondent), the GOMECO Quotation was not the contract agreed upon but was merely made the basis for the specification and price of the verbal agreement. xxx Based on their verbal agreement, plaintiff (respondent) proceeded with the works but discontinued and in the meantime was not completed when the latter (plaintiff) (respondent) requested [from] the defendant (petitioner) that it (respondent) be given time to complete its obligation. xxx [I]t (petitioner) requested the plaintiff (respondent) to finish the works as it might cause accident since the steel railings were not fully welded and might give in when used. Despite repeated and persistent demands, plaintiff (respondent) neglected, failed and refused to complete its (respondent’s) obligation xxx. Its (petitioner’s) refusal to pay the remaining balance was merely to enforce the verbal agreement that full payment shall be made after plaintiff’s (respondent’s) completion and turn over of the works to them. xxx The 3% interest/fee per month is unconscionable, exorbitant and excessively high.
On April 11, 2005, the parties jointly agreed to have the case litigated under the Revised Rule on Summary Procedure xxx.
Thereafter, the case was set for preliminary conference. Despite notice, the defendant (petitioner) however failed to appear on the scheduled preliminary conference and the court a quo, upon motion of plaintiff’s (respondent’s) counsel, then declared the instant case submitted for decision which pronouncement was formalized in its Order dated May 23, 2005.”[12] (Emphasis Supplied)
On August 25, 2005, the MeTC rendered a Decision[13] in favor of respondent GOMECO. The dispositive portion of the MeTC’s Decision read as follows:
“WHEREFORE, in view of the foregoing, judgment is rendered in favor of Gomeco Metal Corporation and ordering Alabang Medical Center to pay the following amount[s]:
- The principal amount of P154,000.00 with interest at the rate of 3% per month computed from the filing of the complaint on September 5, 2003 until the obligation is fully paid;
- 20% of the total amount due as reasonable attorney’s fees; and
- Costs of suit.
SO ORDERED.”[14] (Emphasis Supplied)
Upon petitioner AMC’s appeal[15], the RTC rendered the assailed Decision[16] of June 13, 2008, which affirmed in toto the MeTC’s Decision[17].
After petitioner AMC’s Motion for Reconsideration[18] was denied by the RTC in its assailed Order[19] dated July 28, 2011, petitioner filed the Petition for Review[20] at bench praying as follows:
“WHEREFORE, it is respectfully prayed of this Honorable Court that the assailed Decision of the RTC dated June 13, 2008 and the Order dated July 28, 2011 affirming in toto the MeTC Decision dated August 25, 2005 in Civil Case No. 8419 be reversed and set aside and another one be issued dismissing the complaint.”[21]
Petitioner raised the following assignment of errors:
“(FIRST ASSIGNED ERROR)
THE RTC COMMITTED AN ERROR IN NOT FINDING THAT THE LATE APPEARANCE OF PETITIONER’S REPRESENTATIVE FOR A FEW MINUTES IS NOT A VALID JUSTIFICATION TO COMPLETELY DEPRIVE PETITIONER OF ITS DAY IN COURT[.]
(SECOND ASSIGNED ERROR)
THE RTC ERRED IN NOT HOLDING THAT THE FAILURE OF PETITIONER’S COUNSEL TO APPEAR IN THE PRELIMINARY CONFERENCE DUE TO HIS ILLNESS WAS EXCUSABLE AND JUSTIFIED[.]
(THIRD ASSIGNED ERROR)
THE RTC ERRED IN AFFIRMING THE DECISION OF THE MeTC DESPITE THE FACT THAT THE BALANCE OF THE CONTRACT PRICE IS NOT YET DUE FOR FAILURE OF GOMECO TO COMPLY WITH WHAT IS INCUMBENT UPON IT.
(FOURTH ASSIGNED ERROR)
THE RTC COMMITTED AN ERROR IN AFFIRMING THE DECISION OF THE MeTC DESPITE THE FACT THAT THE AWARD OF 3% INTEREST PER MONTH OR 36% PER ANNUM IS EXHORBITANT AND EXCESSIVE[.]
(FIFTH ASSIGNED ERROR)
THE RTC COMMITTED AN ERROR IN AFFIRMING THE MeTC AWARD OF 20% ATTORNEY’S FEES TO GOMECO[.]”[22]
Contrary to petitioner AMC’s arguments in its first and second assigned errors, the MeTC was justified in submitting the case for decision upon petitioner’s failure to attend the Preliminary Conference.
Petitioner raised the following arguments:
“Petitioner candidly admit that its counsel, Atty. Michael J.B. Salva failed to appear in the preliminary conference set on May 23, 2005 because of his illness.
It is also admitted that petitioner’s authorized representative, Ms. Melinda Constantino who was clothed with a board resolution to represent the corporation and who was in possession of the medical certificate of Atty. Salva did not make it on time. She arrived a few minutes late because of the far distance of Valenzuela City from her residence in Pila, Laguna and the unexpected heavy traffic she unluckily encountered on her way to the court on May 23, 2005.
However, such belated appearance is not enough to totally deprive petitioner of its day in court. Given the valid and meritorious defense of the petitioner, the MeTC and the RTC should have been liberal, so as not to sacrifice justice in the altar of technicality.”[23] (Emphasis Supplied)
Defeating petitioner AMC’s arguments however, is that the Rules on Summary Procedure warranted[24] the MeTC to render judgment on the Complaint[25] of respondent GOMECO, as the plaintiff below, when petitioner AMC, as the defendant below, and its counsel, Atty. Michael Salva (“Atty. Salva” for brevity), failed to appear on the scheduled Preliminary Conference despite notice.[26] This, considering that Ms. Melinda P. Constantino (“Ms. Constantino” for brevity), as petitioner AMC’s representative[27], arrived after the case had already been called[28]. In fact, Atty. Salva’s Medical Certificate[29], which was brought by Ms. Constantino for the purpose of requesting for a re-setting of the Preliminary Conference, was received by the MeTC’s Clerk of Court at already 9:15 A.M.[30] or forty-five (45) minutes after the scheduled Preliminary Conference at 8:30 A.M.[31]. Section 7, in relation to Section 6, of the Rules on Summary Procedure provides:
“SEC 7. Preliminary Conference; appearance of parties.
xxx
If a sole defendant shall fail to appear, the plaintiff shall be entitled to judgment in accordance with Section 6 hereof. xxx
SEC. 6. Effect of failure to answer. – Should the defendant fail to answer the complaint within the period above, the court, motu proprio, or on motion of the plaintiff, shall render judgment as may be warranted by the facts alleged in the complaint and limited to what is prayed for therein: Provided, however, That the court may in its discretion reduce the amount of damages and attorney’s fees claimed for being excessive or otherwise unconscionable. This is without prejudice to the applicability of Section 4, Rule 18 of the Rules of Court, if there are two or more defendants.” (Emphasis Supplied)
The duty of the MTC to render judgment pursuant to Section 6 of the Rules on Summary Procedure is mandatory, as was declared by the Supreme Court in Dr. Jose S. Luna vs. Judge Eduardo H. Mirafuente, A. M. No. MTJ-05-1610 September 26, 2005, to wit:
“Sectio[n] xxx 6 of the 1991 Revised Rule on Summary Procedure provide[s]:
xxx
Sec. 6. Effect of failure to answer. – Should the defendant fail to answer the complaint within the period above provided, the court, motu proprio, or on motion of the plaintiff, shall render judgment as may be warranted by the facts alleged in the complaint and limited to what is prayed for therein: Provided, however, That the court may in its discretion reduce the amount of damages and attorney’s fees claimed for being excessive or otherwise unconscionable. This is without prejudice to the applicability of Section 4, Rule 18 of the Rules of Court, if there are two or more defendants. xxx
The word ‘shall’ in the above-quoted sections of the 1991 Revised Rule on Summary Procedure underscores their mandatory character. Giving the provisions a directory application would subvert the nature of the Rule and defeat its objective of expediting the adjudication of the suits covered thereby. xxx” (Emphasis Supplied)
Besides, petitioner AMC could not properly claim that it had been totally deprived of its day in court. This is because petitioner’s Answer[32] to respondent GOMECO’s Complaint[33], although belatedly filed, had been allowed to be admitted by the MeTC.[34]
However, as properly raised by petitioner AMC in its third, fourth, and fifth assigned errors, petitioner AMC could not be made liable to respondent GOMECO based on respondent’s Complaint[35] and on the documents respondent submitted to the MeTC.
In affirming the MeTC’s Decision which found petitioner AMC liable to respondent GOMECO, the RTC ruled as follows:
“xxx It must be borne in mind that when the court a quo ordered the case submitted for decision due to the failure of the defendant to appear at the preliminary conference, it rightfully invoked a power vested upon it by Section 7 of the 1991 Revised Rule on Summary Procedure and the related provisions of Section 6 xxx.
xxx
In rendering its decision, the court a quo therefore has to rely simply on the facts as alleged by the plaintiff in the complaint and supporting evidence. To our judicious assessment, the questioned decision is complete as to its presentation and contents bearing upon the facts alleged in the complaint and the law and evidence supporting the same.
xxx the plaintiff-appellee has sufficiently established the material allegations in the complaint and adduced preponderant evidence, proving its claim against the defendant-appellant for the remaining unpaid balance of the contract in the amount of P154,000.00. Said contract where the plaintiff undertook to supply and install one (1) unit of stair railing at the main stair and one (1) unit of stair railing at pedia ward of Alabang Medical Center for a contract price of P253,053.00 xxx was validly entered by the plaintiff and defendant.
The instant complaint on appeal is anchored on the proposition that the defendant has an outstanding obligation to the plaintiff which remains unpaid. Unless that obligation is fully paid, the same cannot be said to have been extinguished.”[36] (Emphasis Supplied)
Contrary to the findings of the RTC however, is that respondent GOMECO’s Complaint[37] for “Sum of Money” lacked a cause of action against petitioner AMC, given that respondent GOMECO’s allegations[38] in its Complaint[39] were not supported by the evidence submitted by respondent. Respondent GOMECO’s allegations in its Complaint[40] below involved the supply and installation of Stainless Steel Food Service Equipments, which services were alleged by respondent to have not been paid for in full by petitioner AMC. The pertinent portion of respondent GOMECO’s Complaint[41] stated the following:
“3.2 Sometime in March 18, 1997 and thereafter, herein defendant ALABANG MEDICAL CENTER, confirmed the proposal of GOMECO METAL CORPORATION to undertake the complete supply and installation of Stainless Steel Food Service Equipments;
3.3 Thereafter, plaintiff GOMECO METAL CORPORATION and defendant ALABANG MEDICAL CENTER entered into a GOMECO QUOTATION duly signed in compliance with the above-mentioned undertaking. Inclusive in the quotation is the agreement for three (3%) percent a month or an annual fee of thirty-six (36%) percent annual fee for all accounts past due;
Attached hereto as Annex ‘A’ is a copy of GOMECO QUOTATION under GMC No. 26857.
3.4 Upon execution and delivery of the QUOTATION, GOMECO METAL CORPORATION proceeded to perform its obligations under the GOMECO QUOTATION while defendant warranted and represented that it would pay upon progressive billing by the plaintiff;
3.5 In fact, defendant ALABANG MEDICAL CENTER confirmed and assented to the agreements contained in the quotations by receiving the goods and paying the down payments;
3.6 However, upon further completion of the project, defendant ALABANG MEDICAL CENTER failed to make good their remaining balance in fraud of the plaintiff GOMECO METAL CORPORATION in the amount of Php 154,000.00 as of February 15, 2001 and which was the subject matter of [the] demand letter sent by plaintiff GOMECO METAL CORPORATION on 22 March 2001; xxx”[42] (Emphasis and underscoring supplied)
However, the evidence presented by respondent GOMECO to prove petitioner AMC’s supposed breach of obligation, which was the “GOMECO QUOTATION”[43] under “GMC 26857” dated March 18, 1997, did not refer to the “complete supply and installation of Stainless Steel Food Service Equipments”[44], but to a different obligation, which involved “Stair Railings”[45].
That a Complaint, such as respondent GOMECO’s Complaint[46] for “Sum of Money” here, lacks a cause of action against the defendant, such as petitioner AMC, if the evidence presented does not support the allegations in the Complaint, is in accordance with the following pronouncement of the Supreme Court in Dolores Adora Macaslang vs. Renato and Melba Zamora, G.R. No. 156375, May 30, 2011:
“xxx lack of cause action refers to a situation where the evidence does not prove the cause of action alleged in the pleading.” (Emphasis Supplied)
After careful consideration of all the facts, arguments, and issues appearing on the records, as well as of the pertinent laws and jurisprudence, and, in accordance with what is best determined to be just under the circumstances, the following disposition is therefore made on this matter.
GIVEN ALL THESE, the Petition is GRANTED. The Regional Trial Court’s assailed Decision[47] is SET ASIDE and REVERSED. The Complaint against petitioner Alabang Medical Center is DISMISSED.
SO ORDERED.
Dicdican (Chairman) and Dimagiba,[*] JJ., concur.
[*] Acting Junior Member vice J. Paredes per Office Order No. 34-14-RSF dated January 30, 2014.
[1] Rollo, pp. 9-30
[2] Rollo, pp. 34-38, Penned by Presiding Judge Trinidad L. Dabbay
[3] Rollo, pp. 69-72, Penned by Presiding Judge Cecilyn E. Burgos-Villavert
[4] Rollo, p. 69
[5] Rollo, pp. 39-40, Penned by Acting Presiding Judge Jose C. Fortuno
[6] Rollo, p. 39
[7] Rollo, pp. 34-38, Penned by Presiding Judge Trinidad L. Dabbay
[8] Rollo, p. 35
[9] Rollo, pp. 46-52
[10] Rollo, p. 69
[11] Rollo, pp. 34-38, Penned by Presiding Judge Trinidad L. Dabbay
[12] Rollo, pp. 35-36
[13] Rollo, pp. 69-72, Penned by Presiding Judge Cecilyn E. Burgos-Villavert
[14] Rollo, p. 71
[15] Rollo, p. 34
[16] Rollo, pp. 34-38, Penned by Presiding Judge Trinidad L. Dabbay
[17] Rollo, pp. 69-72, Penned by Presiding Judge Cecilyn E. Burgos-Villavert
[18] Rollo, p. 39
[19] Rollo, pp. 39-40, Penned by Acting Presiding Judge Jose C. Fortuno
[20] Rollo, pp. 9-30
[21] Rollo, p. 29
[22] Rollo, pp. 17-18
[23] Rollo, p. 19
[24] Dr. Jose S. Luna vs. Judge Eduardo H. Mirafuente, A. M. No. MTJ-05-1610 September 26, 2005
[25] Rollo, pp. 46-52
[26] Rollo, pp. 19-20, 36, 64-66, 71
[27] Rollo, p. 58
[28] Rollo, p. 60
[29] Rollo, p. 57
[30] Rollo, p. 57
[31] The Rollo, p. 59
[32] Rollo, pp. 53-56
[33] Rollo, pp. 46-52
[34] Rollo, p. 35
[35] Rollo, pp. 46-52
[36] Rollo, pp. 36-37
[37] Rollo, pp. 46-52
[38] Rollo, pp. 46-47
[39] Rollo, pp. 46-52
[40] Rollo, pp. 46-52
[41] Rollo, pp. 46-52
[42] Rollo, pp. 46-47
[43] Rollo, pp. 43-44
[44] Rollo, p. 46
[45] Rollo, p. 43
[46] Rollo, pp. 46-52
[47] Rollo, pp. 34-38, Penned by Presiding Judge Trinidad L. Dabbay