VIRGILIO B. AGUILAR, PETITIONER, VS. COURT OF APPEALS AND SENEN B. AGUILAR, RESPONDENTS.

This is a petition for review on certiorari seeking to reverse
and set aside the Decision of the Court of Appeals in CA-GR CV No. 03933
declaring null and void the orders of 23 and 26 April 1979, the judgment by
default of 26 July 1979, and the order of 22 October 1979 of the then Court of
First Instance of Rizal, Pasay City, Branch 30, and directing the trial court
to set the case for pre-trial conference.

Petitioner Virgilio and respondent Senen are brothers; Virgilio is the youngest of seven (7) children of the late
Maximiano Aguilar, while Senen is the
fifth. On 28 October 1969, the two
brothers purchased a house and lot in Parañaque where their father could spend
and enjoy his remaining years in a peaceful neighborhood. Initially, the brothers agreed that Virgilio’s share in the co-ownership was two-thirds while that of Senen was one-third. By virtue of a
written memorandum dated 23 February 1970, Virgilio and Senen agreed that henceforth their interests in the
house and lot should be equal, with Senen assuming the remaining mortgage obligation of the original
owners with the Social Security
System (SSS) in exchange for his
possession and enjoyment of the house together with their father.

Since Virgilio was
then disqualified from obtaining a loan
from SSS, the brothers agreed that the deed of sale would be executed and
the title registered in the meantime in the name of Senen. It was further agreed that Senen would take care of their
father and his needs since Virgilio and
his family were staying in Cebu.

After Maximiano Aguilar died in 1974, petitioner demanded from
private respondent that the latter vacate the house and that the property be
sold and proceeds thereof divided among them.

Because of the refusal of respondent to give in to petitioner’s demands, the latter filed on 12 January 1979 an
action to compel the sale of the house
and lot so that the they could divide the proceeds between them.

In his complaint, petitioner prayed that the proceeds of the sale
be divided on the basis of two-thirds (2/3) in his favor and one-third (1/3) to
respondent. Petitioner also prayed for
monthly rentals for the use of the house by respondent after their father died.

In his answer with counterclaim, respondent alleged that he had
no objection to the sale as long as the
best selling price could be obtained; that if the sale would be effected, the proceeds thereof should
be divided equally; and, that being a co-owner,
he was entitled to the use and enjoyment of the property.

Upon issues being joined, the case was set for pre­-trial on 26
April 1979 with the lawyers of both parties notified of the pre-trial and
served with the pre-trial order, with private respondent executing a special
power of attorney to his lawyer to appear at the pre-trial and enter into any
amicable settlement in his behalf.^[1]

On
20 April 1979, Atty. Manuel S. Tonogbanua,
counsel for respondent, filed a
motion to cancel pre-trial on the ground that he would be accompanying his wife
to Dumaguete City where she would be a principal sponsor in a wedding.

On 23 April 1979, finding the reasons of counsel to be without
merit, the trial court denied the motion and directed that the pre-trial should
continue as scheduled.

When the case was called for pre-trial as scheduled on 26 April
1979, plaintiff and his counsel appeared. Defendant did not appear;
neither his counsel in whose favor he executed
a special power of attorney to
represent him at the pre-trial. Consequently, the trial court, on motion of plaintiff, declared
defendant as in default and ordered reception of plaintiff’s evidence ex
parte.

On 7 May 1979, defendant through counsel filed an omnibus motion
to reconsider the order of default and to defer reception of evidence. The trial court denied the motion and
plaintiff presented his evidence.

On 26 July 1979,
rendering judgment by default against defendant, the trial court found
him and plaintiff to be co-owners of the house and lot in equal shares on the
basis of their written agreement. However, it ruled that plaintiff has been deprived of his participation
in the property by defendant’s continued enjoyment of the house and lot, free
of rent, despite demands for rentals and continued maneuvers of defendant to delay partition. The trial court also upheld the right of
plaintiff as
co-owner to demand partition. Since plaintiff could not agree to the amount offered by defendant for
the former’s share, the trial court held that the property should be sold to a
third person and the proceeds divided equally between the parties.

The trial court likewise ordered defendant to vacate the property
and pay plaintiff P1,200.00 as rentals^[2] from
January 1975 up to the date of decision plus interest from the time the action
was filed.

On 17 September 1979, defendant filed an omnibus motion for new
trial but on 22 October 1979 the trial court denied the motion.

Defendant sought relief from the Court of Appeals praying that
the following orders and decision of the trial court be set aside: (a) the order of 23 April 1970 denying
defendant’s motion for postponement of the pre-trial set on 26 April 1979; (b)
the order of 26 April 1979 declaring him in default and authorizing plaintiff
to present his evidence ex-parte; (c) the default judgment of 26 July 1979;
and, (d) the order dated 22 October 1979 denying
his omnibus motion for new trial.

On 16 October 1986, the
Court of Appeals set aside the order of the trial court of 26 April 1979 as
well as the assailed judgment rendered by default. The appellate court found
the explanation of counsel for defendant in his motion to cancel pre-trial as satisfactory
and devoid of a manifest intention to
delay the disposition of the case. It
also ruled that the trial court should have granted the motion for postponement filed by counsel for defendant who
should not have been declared as
in default for the absence of his counsel.

Petitioner now comes to
us alleging that the Court of Appeals erred (1) in not holding that the motion
of defendant through counsel to cancel the pre-trial was dilatory in character
and (2) in remanding the case to the trial court for pre-trial and trial.

The issues to be resolved
are: whether the trial court correctly
declared respondent as in default for his failure to appear at the
pre-trial and in allowing petitioner to present his evidence ex-parte, and whether the trial court correctly rendered
the default judgment against respondent.

We find merit in the
petition.

As regards the first
issue, the law is clear that the appearance of parties at the pre-trial is
mandatory.^[3] A party who fails to appear at a pre-trial
conference may be non-suited or considered as in default.^[4] In the case at bar, where private respondent
and counsel failed to appear at the scheduled pre-trial, the trial court has
authority to declare respondent in default.^[5]

Although respondent’s
counsel filed a motion to postpone pre-trial hearing, the grant or denial
thereof is within the sound
discretion of the trial court, which should take into account two factors in
the grant or denial of motions for postponement, namely: (a) the reason for the postponement and (b)
the merits of the case of movant.^[6]

In the instant case, the
trial court found the reason stated in the motion of counsel for respondent to
cancel the pre-trial to be without merit. Counsel’s explanation that he had to go to Iloilo by boat as early as 25
March 1979 to fetch his wife and accompany her to a wedding in Dumaguete City
on 27 April 1979 where she was one of the principal sponsors, cannot be
accepted. We find it insufficient to
justify postponement of the pre-trial, and the Court of Appeals did not act wisely
in overruling the denial. We sustain
the trial court and rule that it did not abuse its discretion in denying the
postponement for lack of merit. Certainly, to warrant a postponement of a mandatory process as pre-trial
would require much more than mere attendance in a social function. It is time indeed we emphasize that there
should be much more than mere perfunctory treatment of the pre-trial
procedure. Its observance must be taken
seriously if it is to attain its
objective, i.e., the speedy and
inexpensive disposition of cases.

Moreover, the trial court
denied the motion for postponement three (3) days before the scheduled
pre-trial. If, indeed, counsel for
respondent could not attend the pre?trial on the scheduled date,
respondent at least should have personally appeared in order not to be declared
as in default. But, since nobody
appeared for him, the order of the trial court declaring him as in default and
directing the presentation of petitioner’s evidence ex parte was proper.^[7]

With regard to the merits of the judgment of the trial court by
default, which respondent appellate court did not touch upon in resolving the
appeal, the Court holds that on the basis of the pleadings of the parties and
the evidence presented ex parte, petitioner and respondents are
co-owners of subject house and lot in equal shares; either one of them may
demand the sale of the house and lot at any time and the other cannot object to
such demand; thereafter the proceeds of the sale shall be divided equally
according to their respective interests.

Private respondent and his family refuse to pay monthly rentals
to petitioner from the time their father died in 1975 and to vacate the house so that it can be sold to third
persons. Petitioner alleges that respondent’s
continued stay in the property hinders its disposal to the prejudice of
petitioner. On the part of petitioner,
he claims that he should be paid two-thirds (2/3) of a monthly rental of
P2,400.00 or the sum of P1,600.00.

In resolving the dispute, the trial court ordered respondent to
vacate the property so that it could be sold to third persons and the proceeds
divided between them equally, and for respondent to pay petitioner one-half
(1/2) of P2,400.00 or the sum of P1,200.00 as monthly rental, conformably with
their stipulated sharing reflected in their written agreement.

We uphold the
trial court in ruling in favor of petitioner, except as to the effectivity of
the payment of monthly rentals by respondent as co-owner which we here declare
to commence only after the trial court ordered respondent to vacate in
accordance with its order of 26 July 1979.

Article 494 of the Civil Code provides that no co-owner shall be
obliged to remain in the co-ownership, and that each co-owner may demand at any
time partition of the thing owned in common insofar as his share is
concerned. Corollary to this rule, Art.
498 of the Code states that whenever the thing is essentially indivisible and
the co-owners cannot agree that it be allotted to one of them who shall indemnify the others, it shall be
sold and its proceeds accordingly distributed. This is resorted to (1) when the right to partition the property is
invoked by any of the co-owners but because of the nature of the property it
cannot be subdivided or its subdivision would prejudice the interests of the
co-owners, and (b) the co-owners are not in agreement as to who among them
shall be allotted or assigned the
entire property upon proper reimbursement of the co-owners. In one case,^[8] this Court upheld the order of the trial
court directing the holding of a public sale of the properties owned in common
pursuant to Art. 498 of the Civil Code.

However, being a co-owner respondent has the right to use the
house and lot without paying any compensation to petitioner, as he may use the
property owned in common so long as it is in accordance with the purpose for
which it is intended and in a manner not injurious to the interest of the other
co-owners.^[9]
Each co-owner of property held pro indiviso exercises his rights over the whole property and may use and enjoy the
same with no other limitation than that he shall not injure the interests of
his co-owners, the reason being that until a division is made, the respective share of each cannot be determined and every co-owner exercises,
together with his co-participants joint ownership over the pro indiviso property, in addition
to his use and enjoyment of the same.^[10]

Since petitioner has decided to enforce his right in court to end
the co-ownership of the house and lot and respondent has not refuted the
allegation that he has been preventing the sale of the property by his
continued occupancy of the premises, justice and equity demand that respondent
and his family vacate the property so that the sale can be effected immediately. In fairness to petitioner, respondent should
pay a rental of P1,200.00 per month, with legal interest from the time the
trial court ordered him to vacate, for the use and enjoyment of the other half
of the property appertaining to petitioner.

When petitioner filed an action to compel the sale of the
property and the trial court granted the petition and ordered the ejectment of
respondent, the co-ownership was deemed terminated and the right to enjoy the
possession jointly also ceased. Thereafter, the continued stay of respondent and his family in the house
prejudiced the interest of petitioner as the property should have been sold and
the proceeds divided equally between them. To this extent and from then on, respondent should be held liable for
monthly rentals until he and his family vacate.

WHEREFORE, the petition is GRANTED. The assailed Decision
of the Court of Appeals dated 16 October 1986 is REVERSED and SET ASIDE. The decision of the
trial court in Civil Case No. 6912-P dated 26 July 1979 is REINSTATED, with the modification that respondent Senen B. Aguilar is ordered to vacate the premises in
question within ninety (90) days from receipt of this decision, and to pay
petitioner Virgilio B. Aguilar a montly rental of P1,200.00 with interest at the
legal rate from the time he received the decision of the trial court directing
him to vacate until he effectively leaves the premises.

The trial court is further directed to take immediate steps to
implement this decision conformably with Art. 498 of the Civil Code and the
Rules of Court. This decision is final
and executory.

SO ORDERED.

Cruz, (Chairman), Davide, Jr., and
Quiason, JJ., concur.

^[1]
Page 97, Rollo.

^[2]
Presumably per month although the decision does not so specify.

^[3]
Jungco v. Court of Appeals, G.R. 78051, 8 November 1989, 179 SCRA 213.

^[4]
Sec. 2, Rule 20, Rules of Court; Insular
Veneer v. Plan, G.R. L-40155, 10 September
1976 73 SCRA 1.

^[5]
Pacweld Steel Corp. v. Asia Steel Corp. No. L-26325, 15 November 1982,
118 SCRA 229.

^[6]
Guzman v. Elbinias; G.R. No. 57395,
17 April 1989 172 SCRA 240.

^[7]
Ravelo v. Court of Appeals, No. L-40111, 27
October 1983, 125 SCRA 366.

^[8]
Reyes v. Concepcion, G.R. No. 56550, 1 October 1990, 190 SCRA 171.

^[9]
Article 486, Civil Code.

^[10]
Pardell v. Bartolome 23 Phil
450 (1912).