REPUBLIC OF THE PHILIPPINES, PETITIONER, VS. THE HONORABLE COURT OF APPEALS AND FIDELA DEL CASTILLO, MARRIED TO EULALIO MISTICA, RESPONDENTS.

This petition seeks to set aside the Decision* dated
September 9, 1985, of the Court of Appeals in CA-G.R. No. 63242, and the
Resolution** dated October 2, 1986, denying petitioner’s motion
for reconsideration dated September 26, 1985, which affirmed the Order*** dated JuIy 19, 1977 of
the then Court of First Instance of Bulacan, Branch
VIII, declaring herein petitioner in default.

The antecedent facts
appearing on record are as follows:

Private respondent, on
January 18, 1977, filed an Amended Application for Registration of Title (for confirmation of Title) involving
three (3) parcels of land all situated in the Barrio of Perez, Municipality of Meycauayan, Bulacan, claiming
that she is in open, actual, continuous and adverse possession of said parcels
of land for more than thirty (30) years, together with her
predecessors-in-interest.

The then Court of First
Instance of Bulacan, issued an Order dated June 21,
1977 granting petitioner fifteen
(15) days from said date within
which to file a written opposition.  This
Order was received by the Office of the Solicitor General (OSG, for brevity) on
June 27, 1977.

In compliance with the
aforementioned Order, petitioner filed its written opposition on July
15, 1977 alleging among others, that:

“1.  Applicant and her predecessors-in-interest
have not acquired ownership in fee simple of subject property by the issuance
by the Spanish Government in their favor of either (a)
‘titulo real’ or royal grant, (b) ‘concession
especial’, or Special Grant, (c) ‘composicion con estado titulo’ or adjustment
title, (d) ‘titulo de compra’
or title by purchase, (e) ‘informacion posesoria’ or possessory
information under the Royal Decree of February 13, 1594, or by any other
recognized mode of acquisition of title over realty
under pertinent applicable laws.  But
even assuming arguendo that the applicant possesses
any of said Spanish Government grants over the parcels of land applied for,
still whatever legal and/or possessory rights she
may have acquired by reason thereof, have been lost, abandoned or forfeited for
failure to occupy and possess them for at least thirty (30) years immediately
preceding the filing of this suit.” (p. 19, Rollo, Copy of Opposition is attached as Annex F)

In an Order dated July 19,
1977, the Court of
First Instance of Bulacan declared the petitioner in
default in view of the failure of the Solicitor General, representing the
petitioner to comply with the Court’s Order dated June 21, 1977.

Subsequently, or on
August 3, 1977, the Solicitor General filed a Supplemental Opposition on the
ground that the parcels of land applied for registration in the instant
application were found to be within the unclassified region or denominated as forest land, consequently, no
valid jurisdiction can be acquired by the court a quo, the subject properties being beyond the commerce of man.

On August 12, 1977,
petitioner filed a Motion to Set Aside Order of Default arguing that:  (1) the Republic actually filed its written
opposition on July 15, 1977 by registered mail, followed by a Supplemental
Opposition also sent by registered mail on August 3, 1977; (2) considering that
the Order dated June 21, 1977 requiring the Republic to file the written opposition within fifteen (15) days was actually received by the OSG on June 27, 1977, said 15-day period therefore, expired on July 12, 1977, hence, the opposition filed on July 15, 1977 was only
three (3) days late; (3) the late filing of the written
opposition was occasioned by the fact that OSG was then waiting for a
communication from the Bureau of Lands
and Bureau of Forest Development regarding their stand on the instant
application, however, no communication was received from the Bureau of Lands
while the Bureau of Forest Development sent a report which was received by the OSG only on July 20, 1977; (4) nevertheless, to protect the interest of the government, an opposition was filed,
and later, the Supplemental Opposition; (5) the three (3) days delay in the
filing of the Opposition was due to accident and/or excusable negligence; (6) the
Republic has meritorious grounds in opposing the application; and (7) applicant
would not suffer any real injury should the lower Court grant the Motion to Set
Aside the Order of Default.

Notwithstanding the foregoing arguments, the lower court denied said Motion to Set Aside the Order of
Default in an Order dated August 23,
1977.  Petitioners, through a
motion, sought a reconsideration of said Order of denial but the same was
likewise denied in an Order
dated November 22, 1977.

On appeal, the
Court of Appeals rendered a decision dated September 9, 1985, affirming the Order of the then Court
of First Instance of BuIacan declaring the petitioner in default.  Petitioner moved for a reconsideration but respondent
Court issued a resolution denying the same.

Convinced that the
grounds upon which the instant petition rents deserve this Court’s solicitude,
petitioner came to Us by way of petition
for review on certiorari raising the issue:  whether or not the lower court erred
in denying the Motion to Set Aside the Order of Default, for which reason, a
judgment by default inevitably ensued.

After a mature reflection, We resolve to grant the
petition.

The appellate court in
its Decision held that:

“x x x
the period of 15-days started to run from the time of notice, which was June
21, 1977 because the Asst. Provincial Fiscal, Amando
C. Vicente, was present in court when the order was given.  Ordinarily, the standard rule is to reckon
the period from the time of receipt of court order by mail or actual receipt thereof in the
office of counsel.  But in this case the
government was put on notice personally of the 15-day period on June 21, 1977, because he
was present in court.  Hence, the
government’s opposition was 9 days late in July 19, 1977 when it was filed.  x x
x.” (p. 6, Decision, IAC.; p. 25, Rollo)

However, contrary to the
respondent court’s declaration, the presence of the Assistant Provincial Fiscal
does not alter the rule that the period is reckoned from the time of receipt of the court order by mail or actual receipt thereof by counsel of record, who in the case at
bar, is the Solicitor General.

Of significance is the Notice of Appearance filed by the Solicitor General with the trial
court where the limited power of the fiscal was clearly defined, such that “only notices of orders, resolutions, and decisions served on him (Solicitor
General) will bind the party represented” (p. 26, Rollo).  Inevitably,
the reglementary fifteen (15) day period to file an
opposition to the application for registration
should be reckoned from the time
the OSG was apprised of the said application and not from the time the assistant provincial fiscal was notified.

Notwithstanding the foregoing considerations, the petitioner’s Opposition
was still three (3) days late
but the same could not be allowed to totally affect its case.  Aside from the reasons mentioned by the
petitioner to justify its delay, which We find credible, time and again this
Court has enjoined the courts not to apply an iron-clad rule of technicality at
the expense of due process in default cases, especially when the cause of the
affected party is highly meritorious, as in this case where one of the grounds
cited by the government in opposing the application is:  “that the land applied for registration has
been found to be within the unclassified region of Meycauayan,
Bulacan, as per BF
Map LC No. 657 dated March 1, 1927 (copy of the verification report is attached
as Annex “A” to the Supplemental Opposition) and, therefore,
ownership of said land cannot be acquired by acquisitive prescription and the
trial court is bereft of jurisdiction to grant the instant application
(Republic v. Reyes, 71 SCRA 426; Republic v. Animas,
56 SCRA 499)” (p. 29, Rollo), and when no real injury would result to the
interest of the applicant by the grant of the petitioner’s Motion to Set Aside Order of Default simply because at the time
it was filed, no hearing had yet been held on the merits of the case.

Finally, well-settled is the principle that judgments
by default are not looked upon with favor to prevent a positive and considerable
injustice to the defendant.  In fact, courts should be liberal in setting aside orders of default unless it clearly
appears that the reopening of the case is intended for delay.  Thus, it
would not be amiss for the courts to give both parties every chance to fight
their case fairly and in the open without resort to
technicality.

WHEREFORE, in view of all the foregoing, the decision appealed from is hereby SET ASIDE and another one rendered ordering the trial
court to proceed with the trial on the merits and to allow petitioner to present its case.

SO ORDERED.

Melencio-Herrera, (Chairman),
Padilla, Sarmiento, and
Regalado, JJ., concur.

* Penned
by Justice Leonor Ines Luciano, concurred in by Justices Ramon G. Gaviola, Jr., Jose C. Campos, Jr., and Bienvenido
C. Ejercito, and the dissenting opinion of Associate
Justice Ma. Rosario Quetolio-Losa.

** Penned by Justice Leonor Ines Luciano
and concurred in by Justices Carolina
C. Grino-Aquino and Emeterio
C. Cui.

*** Penned
by Judge Eduardo P. Caguioa.