WATERFRONT PHILIPPINES, INC., WELLEX INDUSTRIES, INC., AND THE WELLEX GROUP, INC., PETITIONERS, V. JUDGE GENIE G. GAPAS-AGBADA, IN HER CAPACITY AS ACTING PRESIDING JUDGE OF THE …

Waterfront Philippines versus Gapas-Agbada

The Case

This is a petition for certiorari under Rule 65 of the 1997 Revised Rules of Civil Procedure, brought by Waterfront Philippines, Incorporated, Wellex Industries, Incorporated, and the Wellex Group, Incorporated against Judge Genie G. Gapas-Agbada in her capacity as Acting Presiding Judge of Branch 100 of the Quezon City Regional Trial Court. The petitioners ask the Court to annul two orders of that court which declared them to have waived their right to present further evidence in a collection suit filed against them by the Social Security System. The case matters because it is the Court's clearest recent statement that the right to present evidence, though it may be waived, is not lightly deemed waived, and that rules of procedure must yield to the higher demand of substantial justice and due process.

Procedural History

The Social Security System sued the petitioners before Branch 100 of the Quezon City Regional Trial Court for a sum of money with damages, with a prayer for a writ of preliminary attachment. The trial court granted the writ. The petitioners moved to set the writ aside, and the trial court denied them. The petitioners then brought the matter to the Court of Appeals by petition for certiorari, and the appellate court nullified the trial court's orders of June 18, 2004, January 10, 2005, July 18, 2005, and September 12, 2005. The Social Security System appealed to the Supreme Court, which denied the appeal, and an entry of judgment followed in January 2007. The case then returned to the trial court, where pre-trial was held and the Social Security System presented its evidence. After a long series of postponements, the trial court issued an order on August 2, 2013 declaring the petitioners to have waived their right to present further evidence, and it denied their motion for reconsideration on September 30, 2013. The petitioners came to the Supreme Court by the present petition for certiorari.

Facts

In October 1999, the Social Security System entered into a contract of loan with real estate mortgage and assignment of shares, with an option to convert to shares of stock, in the amount of 375,000,000 pesos, with the petitioners. The loan was meant to finance the completion, renovation, and upgrading of the hotel facilities of Waterfront Philippines. When the loan was not paid, the Social Security System sued in 2004 and obtained a writ of preliminary attachment. That writ was later annulled by the Court of Appeals, in a ruling affirmed by the Supreme Court, and the case was remanded for trial.

After pre-trial in 2008, the Social Security System presented three witnesses and made its formal offer of evidence. The petitioners then sought several extensions of time to submit the judicial affidavits of their witnesses. The trial court granted them, resetting the hearings more than once. The petitioners presented one witness, Elvira Ting, whose testimony was terminated in August 2012, while the judicial affidavit of another witness, Lauraine San Roque, was declared inadmissible. The judicial affidavit of the petitioners' second witness was never filed.

When the hearing of August 2, 2013 arrived, the counsel of the Social Security System appeared, but the petitioners' counsel did not, and the required judicial affidavit was still missing. The Social Security System moved that the petitioners be deemed to have waived their right to present additional evidence, and the trial court granted the motion in its order of that same day. The petitioners' motion for reconsideration was denied on September 30, 2013, and so they came to the Supreme Court.

Issues

• Whether or not the trial court committed grave abuse of discretion amounting to lack or excess of jurisdiction in declaring the petitioners to have waived their right to present further evidence.
• Whether or not the petitioners were denied due process when they were not allowed to present evidence in support of their cause.

Applicable Provisions

Rule 65 of the 1997 Revised Rules of Civil Procedure, on the petition for certiorari, is the vehicle of the action, and the Court quotes its own governing principle from Go versus Tan:

The fundamental purpose of procedural rules is to afford each litigant every opportunity to present evidence on his behalf in order that substantial justice is achieved. Court litigations are primarily for the search of truth, and a liberal interpretation of the rules by which both parties are given the fullest opportunity to adduce proofs is the best way to ferret out such truth. The dispensation of justice and vindication of legitimate grievances should not be barred by technicalities.

This passage supplies the standard by which the Court measures the trial court's order: procedure exists to serve the search for truth, not to foreclose it.

Ruling

On the first issue, the Court ruled in favor of the petitioners. It held that the trial court committed grave abuse of discretion in declaring them to have waived their right to present evidence. The Court found that the series of postponements sought by the petitioners were anchored on meritorious grounds and were not vexatious or oppressive. The last postponement rested on the unavailability of the petitioners' last witness, who was still in the United States for medical treatment and had not been given ample notice. The Court also observed that the delay could not be attributed solely to the petitioners, since hearings had been cancelled because of the promotion of the presiding judges, and other external factors such as court inventory and the mandatory encoding period had intervened. The Court stressed that the amount involved was extremely high, and that to hastily declare a waiver would unjustly deprive the petitioners of the chance to ventilate their claim.

On the second issue, the Court held that due process was not accorded to the petitioners, since they were unjustly deprived of their right to present evidence. It recalled its ruling in De Guzman versus Elbinias, that although a speedy determination of an action implies a speedy trial, speed is not the chief objective of a trial, and that careful and deliberate consideration for the administration of justice is more important than a race to end the trial. It also cited PLDT versus Genovea, where the Court reopened a case so that a party could introduce evidence. The Court concluded that while the right to present evidence may be waived expressly or impliedly, the petitioners had not waived it here.

Doctrine

The right to present evidence may be waived expressly or impliedly, but waiver is not presumed from every delay. Where the postponements are grounded on meritorious reasons and do not evince an intent to delay the proceedings or a lack of interest to prosecute, the trial court should grant a reasonable continuance rather than declare the right waived. Rules of procedure are mere tools designed to facilitate the attainment of justice, and their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be eschewed. A party-litigant must be given the fullest opportunity to establish the merits of his complaint or defense rather than lose life, liberty, honor, or property to technicalities. This doctrine ties directly to the Go versus Tan principle quoted above, and to the constitutional guarantee of procedural due process.

Disposition

The petition was granted. The orders of August 2, 2013 and September 30, 2013 of Branch 100 of the Quezon City Regional Trial Court were reversed and set aside, and the case was remanded to the trial court for further proceedings.

Remember This

The single line worth memorizing is that the right to present evidence may be waived expressly or impliedly, but it is not waived where the postponements rest on meritorious grounds and show no intent to delay. Examiners like to use this case in civil procedure and remedial law questions on motions for postponement, the declaration of waiver of the right to present evidence, and the liberal construction of the Rules in favor of substantial justice and due process.