G.R. No. L-21705. April 27, 1967
NATIONAL WATERWORKS AND SEWERAGE AUTHORITY, PETITIONER, VS. HON. ALFREDO CATOLICO, PRESIDING JUDGE, CFI-MISAMIS OCCIDENTAL, BRANCH I, PROVINCE OF MISAMIS OCCIDENTAL; SEBASTIAN L…
CONCEPCION, C.J.:
These are interrelated
cases. G. R. No. L-21705 is a petition
for certiorari, with preliminary
injunction, to set aside an order of the Court of First Instance of Misamis Occidental, directing the execution of its decision
in Civil Case No. 2281 thereof, entitled “The Province of Misamis Occidental vs. National Waterworks and Sewerage
Authority” – hereinafter referred to as NAWASA – during the pendency of the appeal taken by the latter from said
decision, whereas G. R. No. L-24327 is the aforementioned appeal.
Said case No. 2281 was instituted by the Province of Misamis Occidental – hereinafter referred to as the
Province – on July 13, 1960, to recover from the NAWASA the possession, administration,
operation and control of the Misamis Waterworks System
and the Orquieta Waterworks System – hereafter
referred to collectively as the Systems – which had been taken over by the
NAWASA since 1956, acting in pursuance of Republic Act No. 1383. In due course, said court – presided over by
Hon. Alfredo Catolico, Judge, one of the respondents
in L-21705 – rendered judgment, on April 30, 1963, declaring that the Province
is the absolute owner of said Systems and ordering the NAWASA to return the
same to the Province, to refund thereto the sum of P13,855.44 which the
Province had delivered to the NAWASA when it took over the Systems, to render –
within thirty (30) days from notice of said decision – an accounting of the
income realized by the Systems since April 1956, or, in defect of such
accounting, to pay to the Province the sum of P7,823.76 monthly, the average
monthly income of the two (2) Systems, from April, 1956, to the date of the
return thereof to the Province, as well as to pay thereto P50,000, as
temperate, punitive and exemplary damages, and P5,000 by way of attorney’s
fees, in addition to the costs.
On May 3, 1963,
copy of the decision was sent by registered mail to counsel for the NAWASA, in Manila. On May 8, the Province filed a motion, which
was set for hearing on May 25, for the execution of said decision. Copy of this motion was received, on May 13,
by NAWASA’s counsel, who, on May 14, prepared an
opposition thereto upon the ground that he had not, as yet, received copy of
the decision. Invoking the same ground,
the NAWASA requested by telegram,
on May 24, the postponement of said hearing.
On May 25, Judge Catolico denied said request,
overruled NAWASA’s objection to the motion for
execution and granted the same. Two (2)
days later, the clerk of court issued the corresponding writ of execution,
which was complied with on May 28, 1963, insofar only as the possession,
administration, operation and control of the Systems, which were turned over
to the Province, not as to the money judgment in its favor, which remained
unsatisfied for lack of funds therefor in the NAWASA offices in Misamis
Occidental.
Soon thereafter, the NAWASA filed an urgent motion, dated May 31, 1963, for “permission to
post supersedeas bond to stay execution pending
appeal”. It, likewise, filed a
supplement to said motion, dated June 30, 1963, stating that the order of
execution was not supported by good grounds and that the damages that might
arise from the delay in the execution of the decision “can be fully
compensated”. By an order dated July 2, 1963, the lower court, then
presided over by Hon. Arturo B. Santos – Judge Catolico
being then on leave – denied said urgent motion, after receiving NAWASA’s evidence in support thereof. Accordingly, on July 5, 1963, the clerk of court issued another writ of
execution addressed to the City Sheriff of Manila.
Subsequently, or on August
16, 1963, the NAWASA filed the petition for certiorari in G. R. No. L-21705, predicated upon the theory that
the lower court had abused its discretion in ordering the execution of its
decision pending appeal therefrom and in denying the
urgent motion to stay the execution upon the filing of a supersedeas
bond. In support of this contention, the
NAWASA insists that the order of
execution was prematurely issued on May 27, 1963, because the NAWASA had not as
yet received copy of the aforementioned decision, because there was allegedly
no valid and sufficient reasons to order said execution, and because the NAWASA
claims to be entitled to stay the execution upon the posting of a supersedeas bond.
We find no merit in this
pretense. To begin with, there is no
legal provision barring execution of a decision, which is not yet final, before notice thereof has been served
upon the judgment debtor. Secondly,
copy of the decision of the lower court had, on May 3, 1963, been sent, by registered mail, in Ozamis City, addressed to NAWASA’s
counsel in Manila. In
the ordinary course of events, he should have received said copy long before May 25,
1963, when the
motion for execution was heard. Indeed,
this motion was filed on May 8, and copy thereof was receive by said counsel,
in Manila, five (5) days later, or on May 13, 1963. In fact, NAWASA’s
representative in Misamis Occidental had, prior to May 25,
1963, advised the
NAWASA, by telegram, of the aforementioned decision. Moreover, said representative was present, in
the courtroom, when the motion for execution was heard on May 25,
1963. Then too, NAWASA’s
written opposition to the motion for execution was prepared on May 14, 1963. In
other words, the NAWASA had had an opportunity to object to said motion and
did, in fact, object thereto.
Thirdly, this Court has repeatedly held, in several decisions the
first of which was rendered as early as August 30, 1959,[1]
that Republic Act No. 1383 – upon the authority of which the NAWASA had acted
in taking over the Systems in question – is unconstitutional – insofar as it makes the NAWASA the owner of
all local waterworks systems in the
Philippines – upon the ground that it constitutes a taking of private property without just
compensation and without due process of law.
Fourthly, although the execution of a decision pending appeal may be suspended upon
the filing of a supersedeas bond, the judgment debtor
is not entitled to suspension as a matter of right. The court is merely empowered to order it in the exercise of its sound judgment or discretion.[2] Considering
that the unconstitutionality of
the aforementioned feature of Republic Act No. 1383 is now settled, and that
the appeal from the decision of the lower court – insofar as the ownership, possession, administration and
control of the Systems in question – can not possibly prosper and can merely
have, therefore, a dilatory effect, the lower
court was obviously justified in refusing to suspend the execution of its decision, despite NAWASA’s offer of a supersedeas
bond.
As regards the
appeal taken by the NAWASA, it is even more patent, in view of the
aforementioned decisions of this Court that, as regards the title, possession,
administration and control of the Systems, and the obligation to refund the
funds seized from the treasury of said Systems when the NAWASA took over the
same, and to account for the earnings thereof, said appeal has no leg to stand
on.
The lower court was not justified, however, in awarding P50,000 as exemplary and temperate damages,
and P5,000, as attorney’s fees, for the NAWASA took over the Systems in compliance
with said Republic Act No. 1383, which it was entitled to assume to be
constitutional. In other words, it had
acted in good faith.
WHEREFORE, the writ prayed for in G. R. No. L-21705 is
denied, and the complaint therein dismissed, with costs against the NAWASA,
and, with the elimination of said award for exemplary and temperate damages and
attorney’s fees, the decision appealed from in G. R. No. L-24327, is hereby
affirmed, in all other respects, without special pronouncement as to costs in this instance.
IT IS SO ORDERED.
Reyes, J.B.L., Dizon, Regala, Makalintal, Bengzon, J.P., Zaldivar, Sanchez,
and Ruiz Castro, JJ., concur.
[1]
Baguio vs. NAWASA, 57 Off. Gaz. 1584; Cebu vs. NAWASA L-12892, April
20, 1960; Naguilian vs. NAWASA, L-18540, November
29, 1963; Mun. of La Carlota vs. NAWASA, L-20232, September
30, 1964; Mun. of Compostela
vs. NAWASA, L-21763, December
17, 1966.
[2]
Rule 39, Sections 2 and 3, Rules of Court, effective January 1, 1964; De Leon vs.
Soriano, L-7848, September 17, 1954; Rodriguez vs.
Court of Appeals, L-12534, May 20, 1959; Federation of United Namarco Distributors vs. National Marketing
Corporation, L-17819 and National Marketing Corporation vs. Tan,
L-17768, March 31, 1962; Astraquillo vs. Javier, et al., L-20034, January 30, 1965; Ledesma
vs. Teodoro, 52 Off. Gaz.
784; Alliance Insurance & Surety Co.
vs. Tan, 52 Off. Gaz. 7634; Buenaventura
vs. Peña, 44 Off. Gaz.
4923; Valdez vs. Querubin, 37 Phil. 774.