HIPOLITA DULAY CATBAGAN, REPRESENTED BY JULIANA C. DULAY, PLAINTIFF-PETITIONER, VS. THE PHILIPPINE NATIONAL BANK, LOURDES MOYA, FE MOYA, AIDA MOYA, JOSE MOYA, ROMEO MOYA, NELLY …

Catbagan versus Philippine National Bank

The Case

This is a petition for review on certiorari brought by Hipolita Dulay Catbagan, acting through her attorney-in-fact Juliana Dulay, against the Philippine National Bank and the several members of the Moya family. The action below was one for redemption and damages concerning a fifteen-hectare parcel of land that the Moyas had earlier sold to Catbagan but which the bank had meanwhile foreclosed and bought at public auction. The case matters for two reasons: it illustrates the requisites of a valid redemption, and it shows how a case becomes moot and academic once the very relief prayed for has already been granted, and how a final judgment in a related action forecloses issues by res judicata.

Procedural History

Catbagan filed a complaint for redemption and damages in the Court of First Instance of Pangasinan, Branch Ten. The trial court dismissed the complaint on the ground that the power of attorney relied upon by Juliana Dulay was not sufficient in form and substance to vest in her the authority to sue in Catbagan's behalf. Catbagan moved for reconsideration, and the motion was denied. She then came to the Supreme Court by petition for review on certiorari. While the petition was pending, the bank moved to dismiss on the ground that redemption had already been effected by a Deed of Redemption, and the Moyas moved to cite the bank and the petitioner for contempt. The Court deferred the bank's motion until decision on the merits and denied the contempt motions. The Court also verified with the Court of Appeals the status of a related case for rescission, Civil Case Number SCC-One Hundred Eleven, and learned that the appeal therein had been dismissed for failure to pay the docketing fee, so that the judgment in that case had become final and executory.

Facts

On two occasions in November 1962, Hipolita Dulay Catbagan purchased a fifteen-hectare parcel of land from the Moya family. Unknown to the sale, or at least preceding it, the Moyas had already mortgaged that same land to the Philippine National Bank, and the mortgage was duly registered. The mortgage debt was never paid.

The bank foreclosed the mortgage and, on July 10, 1968, the property was sold at public auction, with the bank itself as the highest bidder. Juliana Dulay, acting as Catbagan's attorney-in-fact, attempted to redeem the foreclosed property, but the bank refused, because there was no written authority from the Moyas, who remained the registered owners despite the 1962 sale. Catbagan then sued for redemption and damages.

Meanwhile, the Moyas had themselves sued Catbagan for rescission and damages in Civil Case Number SCC-One Hundred Eleven. That court upheld the two deeds of sale, declared Catbagan entitled to possession, and expressly permitted her to redeem the land from the bank. The Moyas chose not to appeal. On June 3, 1969, the bank and Catbagan executed a Deed of Redemption, and the land was redeemed. When the Moyas later appealed that related case, their appeal was dismissed for failure to pay the docketing fee, and the judgment became final.

Issues

• Whether or not the petition has been rendered moot and academic by the redemption of the land in dispute.
• Whether or not the judgment in the related action for rescission, having become final and executory, settled the issues of ownership, the right of redemption, and damages between the parties.
• Whether or not the trial court erred in dismissing the complaint on the ground of insufficiency of the power of attorney.

Applicable Provisions

The decision does not quote a specific statutory provision; it rests on the procedural doctrine of mootness and on the finality of judgments. The governing principle is that a judgment that has become final and executory is immutable and binding on the parties. It bears on the case because the judgment in the related rescission case had become final, and the relief of redemption had already been granted, leaving nothing for the Court to adjudicate.

Ruling

On the first issue, the Court held that the case had become moot and academic. The land in dispute had already been redeemed by the petitioner, which was precisely the relief she sought. There was no longer any live controversy for the Court to resolve.

On the second issue, the Court held that the judgment in the related rescission case had become final and executory and had settled once and for all the issues of damages, the right of redemption, and ownership of the land. The petitioner's claim for reimbursement and damages had been finally disposed of because she failed to appeal from the decision in that related case, where her counterclaim for damages was dismissed. The Court stressed that the judgment had become final because the appeal was dismissed for failure to pay the docketing fee.

On the third issue, the Court did not need to reach the merits of the trial court's ruling on the power of attorney, because the case had already become moot and the related judgment had foreclosed the claims.

Doctrine

A case becomes moot and academic when the relief prayed for has already been granted, leaving no live controversy for the court to resolve. A judgment that has become final and executory is immutable and binding, and it settles the rights of the parties once and for all, including claims that were raised or could have been raised therein. A party who fails to appeal from a judgment that dismisses her counterclaim is bound by that dismissal. These rules tie directly to the redemption at issue: once redemption was effected and the related judgment became final, the Court had nothing left to adjudicate.

Disposition

The petition was dismissed, without costs, because the land had already been redeemed and the case had become moot and academic.

Remember This

The single line worth memorizing is that a case becomes moot and academic when the relief prayed for has already been granted, and a final judgment binds the parties once and for all. Examiners like to use this case to test mootness and the finality of judgments, and to ask whether a party who failed to appeal a dismissed counterclaim may still litigate the same claim in a later action.