SALVACION FERIA VDA. DE POTENCIANO, PLAINTIFF AND APPELLEE, VS. WILLIAM GRUENBERG, ET AL., DEFENDANTS, WILLIAM GRUENBERG, DEFENDANT AND APPELLANT.

Potenciano versus Gruenberg

The Case

This is Potenciano versus Gruenberg, a case about the enforcement of a judgment long after it was rendered. Salvacion Feria Vda. de Potenciano, as beneficiary of a trust held by the Philippine National Bank, sued William Gruenberg to collect on a 1949 judgment for unpaid theatre rentals. Gruenberg resisted, claiming the old judgment was void for want of notice and that the action to enforce it had already prescribed. The case matters because it fixes two rules every reviewee must know: when a judgment becomes final and executory for purposes of counting the period to enforce it, and which prescriptive period governs — the old Code of Civil Procedure or the Civil Code.

Procedural History

The original judgment was rendered by the Court of First Instance of Manila in the earlier civil case, sentencing Gruenberg to pay the bank as trustee. The present action to enforce that judgment was filed in the same court on September 21, 1959. Gruenberg moved to dismiss; the motion was overruled on January 30, 1960, and he answered on February 11, 1960. After hearing, the trial court rendered judgment ordering enforcement of the old judgment, with legal interest from the filing of the complaint, plus costs. Gruenberg appealed to the Supreme Court, which affirmed the trial court. The Court later issued an amended decision on February 27, 1962, restating the same result but clarifying the reckoning of the prescriptive period.

Facts

In the earlier civil case, Gruenberg and a co-defendant were represented by Attorney Delfin Gonzales. Counsel filed a motion to withdraw on December 24, 1947, but the court denied it on July 27, 1948. Trial was terminated on November 11, 1948, and counsel asked for time to file a memorandum. On August 12, 1949, the trial court rendered its decision, ordering Gruenberg to pay 7,000 pesos in unpaid rentals for September and October 1947 of the Lotus Theatre, plus 500 pesos as liquidated damages.

A copy of that decision was served not on Attorney Gonzales but on Gruenberg, through his maid Agustina Belleza, on August 21, 1949. A writ of execution issued but was not satisfied. Nearly ten years later, on September 21, 1959, the present action to enforce the judgment was filed.

Gruenberg answered that the earlier proceedings were null and void for lack of valid notice of hearing, since he was never notified of the resolution on his counsel's motion to withdraw, and that the action had prescribed. The trial court found that counsel had been notified and had appeared at trial, and that Gruenberg himself received a copy of the decision. It ordered enforcement. Gruenberg appealed.

Issues

• Whether or not the judgment sought to be enforced is null and void for lack of valid notice of hearing to Gruenberg or his counsel.
• Whether or not the action to enforce the judgment has already prescribed.

Applicable Provisions

Section 43 of the Code of Civil Procedure provides:

Section 43. Other Civil Actions. How Limited. Civil Actions other than for the recovery of real property can only be brought within the following periods after the right of action accrues: 1. Within ten years: An action upon an agreement, contract, or promise in writing, or upon the judgment or decree of a court.

This is the provision the Court applies to measure the ten-year period for enforcing a judgment, because the right of action accrued before the Civil Code took effect.

Ruling

On the first issue, the Court held that the claim of nullity is without foundation in fact and in law. Attorney Gonzales remained Gruenberg's counsel because his motion to withdraw was denied, so notice of hearing must have been served on him, and he in fact appeared at trial until its conclusion, even asking for time to file a memorandum. The decision itself was served on Gruenberg in accordance with the rules.

On the second issue, the Court held that the action had not prescribed. The ten-year period is not counted from the date of the decision, nor from the date of service, but from the day the judgment became final and executory, because the action does not accrue until the judgment can be enforced. Since Gruenberg received a copy on August 21, 1949, the judgment became final and executory on September 21, 1949, the thirty-first day from August 22, 1949. Counting ten years from that date, the last day to sue fell on September 20, 1959, a Sunday, so the action filed the next day, September 21, 1959, was timely.

Doctrine

Two rules must be retained. First, a judgment becomes final and executory upon the expiration of the period to appeal, counted from service of a copy of the decision on the party or counsel; the date of the decision is not the reckoning point. Second, the action to enforce a judgment prescribes in ten years under Section 43 of the Code of Civil Procedure, counted from the time the judgment became final and executory, not from its rendition or service. When the last day falls on a Sunday, the action may be filed the next day.

Disposition

The Supreme Court affirmed the decision of the trial court, with costs, ordering enforcement of the 1949 judgment against Gruenberg.

Remember This

Memorize this line: the ten-year period to enforce a judgment runs from the date it became final and executory, not from the date of the decision or of service. Examiners use this case to test the reckoning of the prescriptive period for enforcing judgments and the rule on service of notice upon counsel of record.