SPOUSES MARCIANO CHUA AND CHUA CHO, PETITIONERS, VS. COURT OF APPEALS AND SPOUSES MARIANO C. MORENO AND SHEILA MORENO, RESPONDENT.

Chua versus Court of Appeals

The Case

This is a petition for review on certiorari brought by the spouses Marciano Chua and Chua Cho against the Court of Appeals and the spouses Mariano Moreno and Sheila Moreno. The petitioners were the defendants in an ejectment suit over four lots in Batangas City and were ordered ejected. The case matters because it settles, in one clean ruling, the nature of the supersedeas bond in ejectment cases: how much it should be, who computes it, where it is filed, and when it must be filed. Those four questions are the heart of every unlawful detainer appeal.

Procedural History

The Municipal Trial Court of Batangas City rendered judgment for the plaintiffs, ordering the ejectment of the petitioners and the payment of monthly rentals and attorney's fees. The petitioners filed a notice of appeal. The plaintiffs then moved for immediate execution on the ground that no supersedeas bond had been filed and no monthly deposits had been made. The Regional Trial Court denied the motion for execution, directed the petitioners to file a supersedeas bond and to make deposits, and later granted an extension of five days. The plaintiffs went to the Court of Appeals on certiorari. The Court of Appeals granted the petition, set aside the orders of the Regional Trial Court, and ordered the issuance of a writ of execution as to possession. It denied reconsideration. Hence this petition for review before the Supreme Court.

Facts

On March 5, 1993, the Municipal Trial Court of Batangas City rendered judgment against the petitioners, ordering their ejectment from four lots and directing them to pay monthly rentals of 50,000 pesos starting April 7, 1992 until they vacate, plus 20,000 pesos in attorney's fees. The petitioners' counsel received a copy of the decision on March 10, 1993, and filed a notice of appeal the very next day. On March 16, 1993, the Municipal Trial Court transmitted the records to the Regional Trial Court.

On March 29, 1993, the plaintiffs moved for immediate execution, pointing out that no supersedeas bond had been filed and no monthly deposits had been made. The petitioners opposed the motion, but their ground was that they were co-owners of the lots and that execution would render their appeal moot. They later said they were willing to file a bond but had been busy with their businesses.

On June 10, 1993, the Regional Trial Court denied the motion for execution, reasoning that the early transmission of the records had prevented the petitioners from filing the bond on time. It then directed them to file a supersedeas bond of 550,000 pesos, to deposit 150,000 pesos as accrued rentals, and to deposit 50,000 pesos monthly thereafter. On June 17, 1993, it granted a further extension of five days. The petitioners filed a cash bond, later substituted with a surety bond. The Court of Appeals set aside the orders of June 10 and June 17, holding that the filing period could not be extended.

Issues

• Whether or not the Regional Trial Court had the authority, after the period to appeal had expired, to set the amount of and accept a supersedeas bond to stay execution of the ejectment judgment pending appeal.
• Whether or not the supersedeas bond must be filed within the period for perfecting the appeal.
• Whether or not the petitioners may excuse their delay by claiming they did not know the amount of the bond or where to file it.
• Whether or not the pendency of a partition suit and the petitioners' claim of co-ownership constitute a supervening event that justifies staying immediate execution.
• Whether or not the execution of the judgment would deprive the petitioners of property without due process of law.

Applicable Provisions

Section 8 of Rule 70 of the Rules of Court provides:

SEC. 8. Immediate execution of judgment. How to stay same. If judgment is rendered against the defendant, execution shall issue immediately, unless an appeal has been perfected and the defendant to stay execution files a sufficient bond, approved by the municipal or city court and executed to the plaintiff to enter the action in the Court of First Instance and to pay the rents, damages, and costs accruing down to the time of the judgment appealed from, and unless, during the pendency of the appeal, he deposits with the appellate court the amount of rent due from time to time under the contract, if any, as found by the judgment of the municipal or city court to exist. In the absence of a contract, he shall deposit with the court the reasonable value of the use and occupation of the premises for the preceding month or period at the rate determined by the judgment, on or before the tenth day of each succeeding month or period. The supersedeas bond shall be transmitted by the municipal or city court, with the other papers, to the clerk of the Court of First Instance to which the action is appealed.

This is the provision that fixes the three requisites for staying execution and governs the amount, the place, and the time of filing of the bond.

Section 7 of Rule 70 of the Rules of Court provides:

SEC. 7. Judgment conclusive only on possession; not conclusive in actions involving title or ownership. The judgment rendered in an action for forcible entry or detainer shall be effective with respect to the possession only and in no wise bind the title or affect the ownership of the land or building. Such judgment shall not bar an action between the same parties respecting title to the land or building, nor shall it be held conclusive of the facts therein found in a case between the same parties upon a different cause of action not involving possession.

This provision explains why the pending partition suit does not block execution, because the ejectment judgment touches possession only and not ownership.

Ruling

On the first issue, the Court held that the petition has no merit. A judgment for the plaintiff in an ejectment suit is immediately executory. To stay it, three requisites must concur: the defendant perfects the appeal, files a supersedeas bond, and makes the periodic deposits. Failure to comply with any of them is a ground for outright execution, and the court's duty in this respect is ministerial and imperative. Necessarily, the bond must be filed within the period for perfecting the appeal. Here, the bond was filed out of time, and a writ of execution should have issued as a matter of right.

On the second issue, the Court held that the petitioners did not need the court to fix the amount. They could have computed it themselves, because the supersedeas bond is equivalent to the unpaid rentals, damages, and costs that accrued before the decision was rendered, as determined in the judgment. The bond does not answer for amounts accruing during the appeal, which are covered by the periodic deposits. The amount was evident from the face of the decision.

On the third issue, the Court held that the claim of confusion over where to file was an afterthought. The bond should be filed before the Municipal Trial Court or, where the records have been forwarded, before the Regional Trial Court, but in either case during the period of appeal. The petitioners' real reason for not filing was their belief that they need not do so.

On the fourth issue, the Court held that there was no supervening event. The Laurel versus Abalos exception did not apply, because no other court had voided the plaintiffs' title. The titles stood in the names of the private respondents, and no action questioned them. The pendency of the partition suit did not preclude execution, since an ejectment suit is conclusive only on material possession and not on ownership.

On the fifth issue, the Court held that any perceived injury to the petitioners' business could have been avoided by the simple expedient of filing a supersedeas bond. They had the opportunity and did not use it. They cannot now complain of deprivation of property without due process.

Doctrine

A judgment in favor of the plaintiff in an ejectment suit is immediately executory. To stay execution pending appeal, the defendant must perfect the appeal, file a supersedeas bond, and make periodic deposits of the rentals or the reasonable value of use and occupation. These requisites are mandatory, and the court's duty to order execution upon noncompliance is ministerial and imperative.

The supersedeas bond must be filed within the period for perfecting the appeal. Its amount is equivalent to the unpaid rentals, damages, and costs accruing before the judgment, as determined in the decision itself, and the defendant may compute it without awaiting an order from the court. It is filed with the Municipal Trial Court, or with the Regional Trial Court if the records have been forwarded. The bond does not cover amounts accruing during the appeal, which are the subject of the periodic deposits.

An ejectment judgment binds only on possession and does not affect ownership, so a pending partition suit is not a supervening event that stays execution.

Disposition

The petition was denied, and the decision and resolution of the Court of Appeals were affirmed, with costs against the petitioners.

Remember This

Memorize this line: the supersedeas bond is computed from the judgment itself and must be filed within the period to appeal, or execution issues as a matter of right. Examiners use this case to test the mandatory requisites for staying execution in ejectment and the rule that an ejectment judgment binds only on possession, not ownership.