G.R. No. L-21450. April 15, 1968
SERAFIN TIJAM, ET AL., PLAINTIFFS-APPELLEES, VS. MAGDALENO SIBONGHANOY ALIAS GAVINO SIBONGHANOY, ET AL., DEFENDANTS, MANILA SURETY AND FIDELITY CO., INC. (CEBU BRANCH) BONDING C…
DIZON, J.:
On July 19,
1948 – barely one month after the effectivity
of Republic Act No. 296 known as the Judiciary Act of 1948 the spouses Serafin Tijam and Felicitas Tagalog commenced Civil
Case No. R-660 in the Court of First Instance of Cebu
against the spouses Magdaleno Sibonghanoy
and Lucia Baguio to recover from them the sum of P1,908.00, with legal interest thereon from the date of
the filing of the complaint until the whole obligation is paid, plus costs. As prayed for in the complaint, a writ of
attachment was issued by the court against defendants’ properties, but the same
was soon dissolved upon the filing of a counter-bond by defendants and the
Manila Surety and Fidelity Co., Inc. hereinafter referred to as the Surety, on
the 31st of the same month.
After being duly served
with summons the defendants filed their answer in which, after making some
admissions and denials of the material averments of the complaint, they
interposed a counterclaim. This
counterclaim was answered by the plaintiffs.
After trial upon the issues thus joined, the Court rendered judgment in favor of the plaintiffs and,
after the same had become final and executory,
upon motion of the latter, the Court issued a writ of execution against the defendants. The writ having been
returned unsatisfied, the plaintiffs moved for the issuance of a writ of execution against the Surety’s bond (Rec. on Appeal pp.
46-49), against which the Surety filed a written opposition (Id. pp. 49) upon
two grounds, namely, (1) Failure to prosecute and (2) Absence of a demand upon the Surety for the payment of the amount due under the judgment. Upon these grounds the Surety prayed the
Court not only to deny the motion for execution against its counter-bond but
also the following affirmative relief: “to
relieve the herein bonding company of its liability, if any, under
the bond in question” (Id. p. 54) The Court denied this motion on the
ground solely that no previous demand had been made on the Surety for the satisfaction
of the judgment. Thereafter the
necessary demand was made, and upon failure of the Surety to satisfy the judgment,
the plaintiffs filed a second motion for execution against the
counter-bond. On the date set for the
hearing thereon, the Court, upon motion of the Surety’s counsel, granted the
latter a period of five days
within which to answer the motion. Upon
its failure to file such answer, the Court granted the motion for execution and
the corresponding writ was issued.
Subsequently, the Surety
moved to quash the writ on the ground that the same was issued without the
required summary hearing provided for in Section 17 of Rule 59 of the Rules of
Court. As the Court denied the motion,
the Surety appealed to the Court of Appeals from such order of denial and from
the one denying its motion for reconsideration (Id. pp. 97). Its record on appeal was
then printed as required by the Rules, and in due time it filed its brief raising therein no other
question but the ones covered by the following assignment of errors:
“I. That
the Honorable Court a quo erred in issuing its order dated November 2, 1957, by holding the incident as
submitted for resolution, without a summary hearing and compliance with the
other mandatory requirements provided for in Section 17, Rule 59 of the Rules
of Court.
“II. That the Honorable Court a quo erred in
ordering the issuance of execution against the herein bonding
company-appellant.
“III. That the Honorable Court a quo erred in denying
the motion to quash the writ of execution filed by the herein bonding
company-appellant as well as its subsequent motion for reconsideration, and/or in not quashing or setting aside the writ of
execution.”
Not one of the assignment of errors – it is obvious -raises the question of lack of jurisdiction, neither
directly nor indirectly.
Although the appellees failed to file their brief, the Court of Appeals,
on December 11, 1962, decided the case affirming the orders appealed from.
On January
8, 1963 – five days after the Surety received notice of the decision, it
filed a motion asking for extension of time within which to file a motion for
reconsideration. The Court of Appeals
granted the motion in its resolution of January 10 of the same year. Two days later the Surety filed a pleading
entitled MOTION TO DISMISS, alleging substantially that appellees‘
action was filed in the Court of First Instance of Cebu
on July 19, 1948 for the recovery of the sum of P1,908.00 only; that a month
before that date Republic Act No. 296, otherwise known as the Judiciary Act of
1948, had already become effective, Section 88 of which placed within the
original exclusive jurisdiction of inferior courts all civil actions where the
value of the subject matter or the amount of the demand does not exceed
P2,000.00, exclusive of interest and costs; that the Court of First Instance
therefore had no jurisdiction to try and decide the case. Upon these premises the Surety’s motion
prayed the Court of Appeals to set aside its decision and to dismiss the
case. By resolution of January
16, 1963 the Court
of Appeals required the appellees to answer the motion to dismiss, but they
failed to do so. Whereupon, on May 20 of
the same year, the Court
resolved to set aside its decision and to certify the case to Us. The pertinent
portions of its resolution read as follows:
“It would indeed appear from the record that the action at
bar, which is a suit for collection of money in the sum of exactly P1,908.00
exclusive of interest, was originally instituted in the Court of First
Instance of Cebu on July 19, 1948. But about a month prior to the filing of the
complaint, more specifically on June
17, 1948, the Judiciary Act of 1948 took effect, depriving the
Court of First Instance of original jurisdiction over cases in which the
demand, exclusive of interest, is not more than P2,000.00. (Secs.
44[c] and 86[b] R.A. No. 296.)
“We believe, therefore, that the point raised in appellant’s
motion is an important one which
merits serious consideration. As stated,
the complaint was filed on July 19,
1948. This case therefore
has been pending now for almost 15 years, and throughout the entire proceeding
appellant never raised the question of jurisdiction until after receipt of this
Court’s adverse decision.
“There are three cases decided by the Honorable Supreme Court
which may be worthy of consideration in connection with this case, namely:
Tyson Tan, et al. vs. Filipinas Compañia de Seguros, et al., G.R. No. L-10096, March 23, 1956; Pindangan Agricultural Co., Inc. vs. Jose P. Dans, etc., et al., G. R. No. L-14591,
September 26,
1962; and Alfredo Montelibano
et al. vs. Bacolod-Murcia Milling Co., Inc., G. R.
No. L-15092, September 29, 1962, wherein the Honorable Supreme Court
frowned upon the ‘undesirable practice’ of appellants submitting their case for
decision and then accepting the judgment, if favorable, but attacking it for
lack of jurisdiction when adverse.
“Considering, however, that the Supreme Court has the
‘exclusive’ appellate jurisdiction over ‘all cases in which the jurisdiction
of any inferior court is in issue’ (Sec. 1, Par. 3[3], Judiciary Act of 1948,
as amended), we have no choice but to certify, as we hereby do certify, this
case to the Supreme Court.
“ACCORDINGLY, pursuant to Section 31 of the Judiciary Act of
1948 as amended, let the record of this case be forwarded to the Supreme
Court.”
It is an undisputed fact
that the action commenced by appellees in the Court
of First Instance of Cebu against the Sibunghanoy spouses was for the recovery of the sum of P1,908.00 only
– an amount within the original exclusive jurisdiction of inferior courts in
accordance with the provisions of the Judiciary Act of 1948 which had taken
effect about a month prior to the date when the action was commenced. True also is the rule that jurisdiction over
the subject matter is conferred upon the courts exclusively by law, and as the
lack of it affects the very authority of the court to take cognizance of the case,
the objection may be raised at any stage of the proceedings. However, considering the facts and
circumstances of the present case – which shall forthwith be set forth – We
are of the opinion that the Surety is now barred by laches
from invoking this plea at this late hour for the purpose of annuling
everything done heretofore in
the case with its active participation.
As already stated, the
action was commenced in the Court of First Instance of Cebu
on July 19, 1948,
that is, almost fifteen years before the Surety filed its
motion to dismiss on January 12, 1963 raising the question of lack of jurisdiction
for the first time.
It must be remembered that although the action, originally, was
exclusively against the Sibunghanoy spouses, the
Surety became a quasi-party therein since July 31, 1948 when it filed a
counter-bond for the dissolution of the writ of attachment issued by the court
of origin (Record on Appeal, pp. 15-19).
Since then, it acquired certain rights and assumed specific obligations
in connection with the pending case, in accordance with Sections 12 and 17,
Rule 57, Rules of Court (Bautista vs. Joaquin 46 Phil. 885; Kimpang
& Co. vs. Javier 65 Phil. 170).
Upon the filing of the first motion for execution against the
counter-bond the Surety not only filed a written opposition thereto praying for
its denial but also asked for an additional affirmative relief –
that it be relieved of its liability under the counter-bond upon the grounds
relied upon in support of its opposition – lack of jurisdiction of the court a
quo not being one of them.
Then, at the hearing on the second motion for execution against
the counter-bond, the Surety appeared, through counsel, to ask for time within
which to file an answer or opposition thereto.
This motion was granted, but instead of such answer or opposition, the
Surety filed the motion to dismiss mentioned heretofore.
A party may be estopped or barred from
raising a question in different ways and for different reasons. Thus we speak of estoppel
in pais, of estoppel by
deed or by record, and of estoppel by laches.
Laches, in a general sense, is failure
or neglect, for an unreasonable and unexplained length of time, to do that
which, by exercising due diligence, could or should have been done earlier; it
is negligence or omission to assert a right within a reasonable time, warranting a presumption
that the party entitled to assert it either has abandoned it or declined
to assert it.
The doctrine of laches or of
“stale demands” is based upon grounds of public policy which
requires, for the peace of society, the
discouragement of stale claims and, unlike the statute of limitations, is not a mere question of time but is principally a question of the inequity or unfairness of
permitting a right or claim to be enforced or asserted.
It has been held that a party can not invoke the jurisdiction of
a court to secure affirmative relief against his opponent and, after obtaining
or failing to obtain such relief, repudiate or question that same jurisdiction
(Dean vs. Dean, 136 Or. 694, 86 A.L.R.
79). In the case just cited, by way of
explaining the rule, it was further said that the question whether the court
had jurisdiction either of the subject matter of the action or of the parties
was not important in such cases because the party is barred from such conduct not
because the judgment or order of the court is valid and conclusive as an adjudication, but for, the reason that such a practice can not be
tolerated – obviously for
reasons of public policy.
Furthermore, it has also been held that after voluntarily submitting
a cause and encountering an adverse decision on the merits, it is too late for the looser to
question the jurisdiction or power of the court (Pease vs. Rathbun-Jones
etc. 243 U.S. 273, 61 L.Ed. 715, 37 S.Ct. 283;
St. Louis etc. vs. McBride, 141 U.S. 127, 35 L. Ed. 659). And in
Littleton vs. Burgess, 16 Wyo. 58, the Court said that it is not right
for a party who has affirmed and invoked the jurisdiction of a court in a particular matter to secure an
affirmative relief, to afterwards deny that same jurisdiction to escape a
penalty.
Upon this same principle is what We said in the three cases
mentioned in the resolution of the Court of Appeals of May 20, 1963 (supra) –
to the effect that we frown
upon the “undesirable practice” of a party submitting his case for
decision and then accepting the judgment, only if favorable, and attacking it
for lack of jurisdiction, when adverse -as well as in Pindañgan
etc. vs. Dans et al., G. R. L-14591, September 26,
1962; Montelibano et al., vs. Bacolod-Murcia
Milling Co., Inc., G.R. L-15092; Young
Men Labor Union etc. vs. the Court of Industrial Relations et al., G.R.
L-20307, Feb. 26, 1965, and Mejia vs. Lucas 100 Phil. p. 277.
The facts of this case show that from the time the Surety became
a quasi-party on July 31, 1948, it could have raised the question of the lack of jurisdiction of the Court of First
Instance of Cebu to take cognizance of the present
action by reason of the sum of money involved which, according to the law then
in force, was within the original exclusive jurisdiction of inferior
courts. It failed to do so. Instead, at several stages of the proceedings
in the court a quo as well as in the Court
of Appeals, it invoked the jurisdiction of said courts to obtain
affirmative relief and submitted its case for a final adjudication on the
merits. It was only after an adverse
decision was rendered by the Court of Appeals that it finally woke up to raise
the question of jurisdiction. Were We to
sanction such conduct on its part, We would
in effect be declaring as useless all the proceedings had in
the present case since it was commenced on July 19, 1948 and compel the
judgment creditors to go up their Calvary once more. The inequity and unfairness of this is not
only patent but revolting.
Coming now to the merits
of the appeal: after going over the entire record, We have become persuaded
that We can do nothing better than to quote in toto,
with approval, the decision rendered by the Court of Appeals on December 11,
1962 as
follows:
“In Civil Case No. R-660 of the Court
of First Instance of Cebu, which was a suit for
collection of a sum of money, a writ of attachment was issued against defendants’
properties. The attachment, however, was
subsequently discharged under Section 12 of Rule 59 upon the filing by
defendants of a bond subscribed by Manila Surety & Fidelity Co., Inc.
“After trial, judgment
was rendered in favor of plaintiffs.
“The writ of execution against defendants having been returned
totally unsatisfied, plaintiffs moved, under Section 17 of Rule 59, for
issuance of writ of execution against Manila Surety & Fidelity Co., Inc. to
enforce the obligation of the bond. But
the motion was, upon the surety’s opposition, denied on the ground that there
was ‘no showing that a demand had been made by the plaintiffs to the bonding company for payment of the amount
due under the judgment’ (Record on Appeal, p. 60).
“Hence, plaintiffs made the necessary demand upon the surety
for satisfaction of the judgment, and upon the latter’s failure to pay the
amount due, plaintiffs again filed a motion dated October 31, 1957, for issuance of writ of execution
against the surety, with notice of hearing on November 2, 1957.
On October 31, 1957,
the surety received copy of said motion and notice of hearing.
“It appears that when the motion was called on November 2, 1957, the surety’s
counsel asked that he be given time within which to answer the motion, and so
an order was issued in open court, as follows:
‘As prayed for, Atty. Jose P. Soberano,
Jr., counsel for the Manila Surety & Fidelity Co., Inc., Cebu Branch, is given
until Wednesday, November
6, 1957, to file his answer to the motion for the issuance of a writ of execution dated October
30, 1957 of the plaintiffs, after which this incident shall be deemed
submitted for resolution.
‘SO ORDERED.
‘Given in open court, this 2nd day of November,
1957, at Cebu City, Philippines.
‘(Sgd.) JOSE M. MENDOZA
Judge’ (Record on
Appeal, pp.
64-65,
underscoring
ours).
“Since the surety’s counsel failed to file any answer or
objection within the period given him, the court, on December 7, 1957, issued an order granting
plaintiffs’ motion for execution against the surety; and on December 12, 1957, the corresponding writ of execution
was issued.
“On December 24,
1957, the surety filed a motion to quash the writ of execution on the ground that the same was ‘issued
without the requirements of Section 17, Rule 59 of the Rules of Court having
been complied with,’ more specifically, that the same was issued without the required ‘summary
hearing’. This notion was denied by
order of February 10, 1958.
“On February 25, 1958,
the surety filed a motion for reconsideration of the above-stated order of
denial; which motion was likewise
denied by order of March 26, 1958.
“From the above-stated orders of February 10, 1958 and March 26, 1958—denying the surety’s motion to quash the
writ of execution and motion for reconsideration, respectively—the surety has
interposed the appeal on hand.
“The surety insists that the lower court should have granted
its motion to quash the writ of execution because the same was issued without
the summary hearing required by Section 17 of Rule 59, which reads:
‘SEC. 17.
When execution returned unsatisfied, recovery had upon bond. ? If the execution be returned
unsatisfied in whole or in part, the surety or sureties on any bond given
pursuant to the provisions of this role to secure the payment of the judgment
shall become finally charged on such bond, and bound to pay to the plaintiff
upon demand the amount due under the judgment, which amount may be recovered
from such surety or sureties after notice and summary hearing in the same
action.’ (Underscoring ours)
“Summary hearing is ‘not intended to be carried on in the
formal manner in which ordinary actions
are prosecuted’ (83 C.J.S. 792).
It is, rather, a procedure by which a question is resolved with
dispatch, with the least possible delay, and in preference to ordinary legal
and regular judicial proceedings’ (Ibid, p. 790). What is essential is that ‘the defendant is
notified or summoned to appear and is given an opportunity to hear what is
urged upon him, and to interpose a defense, after which follows an adjudication
of the rights of the parties’ (Ibid., pp. 793-794); and as to the extent and latitude
of the hearing, the same will naturally lie upon the discretion of the court,
depending upon the attending circumstances and the nature of the incident up
for consideration.
“In the case at bar, the surety had been notified of the
plaintiffs’ motion for execution and of the date when the same would be
submitted for consideration. In fact,
the surety’s counsel was present in court when the motion was called, and it
was upon his request that the court a quo gave him a
period of four days within which to file
an answer. Yet he allowed that period to
lapse without filing an answer or objection.
The surety cannot now, therefore, complain that it was deprived of its
day in court.
“It is argued that the surety’s counsel did not file an answer
to the motion ‘for the simple reason that all its defenses can be set up during
the hearing of the motion even if the same are not reduced to writing’
(Appellant’s brief, p. 4). There is obviously
no merit in this pretense because, as stated above, the record will show that
when the motion was called, what the surety’s counsel did was to ask that he
be allowed and given time to file an answer.
Moreover, it was stated in the order given in open court upon request of
the surety’s counsel that after the four-day period within which to file an
answer, ‘the incident shall be deemed submitted for resolution’; and counsel
apparently agreed, as the order was issued upon his instance and he interposed
no objection thereto.
“It is also urged that
although according to Section 17 of Rule 59, supra, there
is no need for a separate action, there must, however, be a separate judgment
against the surety in order to hold it liable on the bond (Appellant’s Brief,
p. 15). Not so, in our opinion, A bond
filed for discharge of attachment is, per Section 12 of Rule 59, “to
secure the payment to the plaintiff of any judgment he may recover in the
action,’ and stands ‘in place of the
property so released‘. Hence,
after the judgment for the plaintiff has become executory
and the execution is ‘returned unsatisfied’ (Sec. 17, Rule 59), as in this case,
the liability of the bond automatically attaches and, in failure of the surety
to satisfy the judgment against the defendant despite demand therefor, writ of execution may issue against the surety to
enforce the obligation of the bond.”
UPON ALL THE FOREGOING, the orders appealed from are hereby affirmed, with costs against the
appellant Manila Surety and Fidelity Company, Inc.
Reyes, J.B.L., (Acting C.J.), Makalintal,
Bengzon, J.P., Zaldivar,
Sanchez, Ruiz Castro, Angeles, and
Fernando, JJ., concur.