THIRD DIVISION
[G.R. No. 249225. September 29, 2021.]
GILBERT M. ANGELES AND BENEDICTO F. ANGELES, petitioners, vs.MANABAT DELGADO AMPER & CO. (FORMERLY C.L. MANABAT & CO., REPRESENTED BY ITS PARTNER, FREDIERIC B. LANDICHO, respondent.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Third Division, issued a Resolution datedSeptember 29, 2021, which reads as follows: ATICcS
"G.R. No. 249225(Gilbert M. Angeles and Benedicto F. Angeles, Petitioners, v. Manabat Delgado Amper & Co. (formerly C.L. Manabat & Co., represented by its partner, Fredieric B. Landicho, Respondent.) — This Petition 1 under Rule 45 seeks to reverse and set aside the Decision 2 dated 03 July 2019 and Resolution 3 dated 04 September 2019 of the Court of Appeals (CA) in two (2) consolidated cases, CA-G.R. CV No. 111193 and CA-G.R. SP No. 154429. The CA dismissed the consolidated cases and affirmed the Decision 4 dated 18 May 2018 of Branch 138, Regional Trial Court (RTC), Makati City.
Antecedents
Manabat Delgado Amper & Co. (MDAC), formerly known as C.L. Manabat & Co. (respondent), is a partnership engaged in the practice of accountancy. 5 Petitioner Gilbert Angeles (Gilbert), a Certified Public Accountant, was its former employee, while Benedicto Angeles (Benedicto) is Gilbert's father (collectively, petitioners). 6
On 02 September 2005, Gilbert signed a training contract with respondent entitled, "Acceptance and Commitment Document with Guarantee" (Training Contract), where he agreed to be deployed for secondment to Deloitte & Touche in San Francisco, California for nineteen (19) months, which included relevant training in Bangkok, Thailand. 7 Under paragraph 7 of the Training Contract, Gilbert undertook to return to the Philippines and render service to Respondent for three (3) years and two and a half (2.5) months at the end of his training and secondment. Otherwise, he shall reimburse respondent all expenses it may have incurred for his training and secondment including interest and charges, as may be determined by management, as well as damages equivalent to 25% of his total gross compensation under the Training Contract. 8 Moreover, Benedicto also bound himself to be solidarily liable with Gilbert for any and all compensation, damages or penalties that will arise because of the breach of the undertaking or non-performance of Gilbert's commitments pursuant to the Training Contract. 9
Respondent claimed that when Gilbert returned to the Philippines after the end of his training and secondment, he served for only one (1) year and one (1) month, and that despite demand 10 Gilbert refused to pay the amounts stated under paragraph 7 of the Training Contract. Thus, respondent filed a complaint against petitioners for sum of money and damages. Respondent prayed for reimbursement for the expenses it incurred for Gilbert's training, including interest and damages equivalent to 25% of his total gross compensation during his secondment abroad or in the total amount of at least PhP959,400.22, as well as PhP300,000.00 as attorney's fees plus PhP3,000.00 appearance fee per court hearing. 11
For his part, Gilbert alleged, among others, that MDAC is a juridical personality separate and distinct from C.L. Manabat and Co., which appeared as the contracting party in the Training Contract. Thus, MDAC has no personality to sue under the Training Contract. He also claimed that he had no option to refuse the Training Contract and was made to believe that the Training Contract would not be enforced. 12
Petitioners filed a motion to hear its affirmative defense pertaining to MDAC's lack of personality to sue. After hearing thereon, the RTC, in an Order dated 24 March 2015, found no merit to petitioners' defense. 13 It ruled that absent an agreement for dissolution, the mere withdrawal of a partner and change of name of the partnership do not affect its legal personality. Then, petitioners filed a Petition for Certiorari with Prayer for Issuance of a Writ of Preliminary Injunction and Temporary Restraining Order dated 14 September 2015 (petition for certiorari) before the CA contending that the RTC gravely abused its discretion in issuing said orders. 14 The CA's Fourteenth Division, in a Decision dated 31 May 2017, affirmed the Order dated 24 March 2015 of the RTC in CA-G.R. SP No. 142154. 15
When respondent finished presenting its evidence, the RTC issued an Order dated 19 September 2017, which, among others, set the reception of petitioners' evidence on 10 October 2017 with stern warning that the court will act accordingly if petitioners' counsel fails to present witnesses. 16
Despite said order, petitioners' counsel, Atty. Domingo A. Lagundi (Atty. Lagundi) of the Law Office of Jandoc Salanga Lagundi and Associates, still filed a Motion for Postponement of Hearing on 06 October 2017 (Motion for Postponement) praying for resetting, since it would allegedly be impossible for him to appear on 10 October 2017 as he was scheduled to go to his hometown in the Province of Cagayan Valley to commemorate his father's death anniversary. On 10 October 2017, only respondent's counsel appeared while petitioners' did not. 17 RTC denied the Motion for Postponement and considered petitioners to have waived their right to present evidence in an Order dated 10 October 2017. 18 This 10 October 2017 Order became the subject of a Petition for Certiorari, docketed as CA-G.R. SP No. 154429. 19
Upon respondent's motion, the case was deemed submitted for decision. 20
Ruling of the RTC
In a Decision 21 dated 18 May 2018, the RTC ordered petitioners to pay respondent: PhP129,187.72 as actual damages with interest of 1% per month from the filing of the complaint on 10 November 2010, until 30 June 2013, and 6% per annum from 01 July 2013 until full payment; the amount of PhP830,212.50 as liquidated damages; and PhP200,000.00 as attorney's fees and costs of suit. 22
RTC ruled that by preponderance of evidence, petitioners should be liable for the money claims and damages sought by MDAC and "[t]here is no doubt that [Gilbert] breached the provision under paragraph 7 of the [T]raining [C]ontract [. . .] when he resigned from [. . .] MDAC without completing the required three (3) years and two-and-a-half (2.5) months following his successful completion of the training [and] secondment abroad." 23 The RTC said that respondent was able to prove the actual expenses of PhP129,187.72 relating to the training and secondment of Gilbert and the liquidated damages of PhP830,212.50 it suffered by reason of the breach. 24 It also deemed the amount of PhP200,000.00 just and reasonable as attorney's fees considering that respondent was compelled to litigate to protect its interest from the act or omission of Petitioners. 25
The RTC also found that the commitment and terms as provided in the Training Contract are not contrary to public welfare and not greater than is necessary to afford protection to respondent when it freely gave the opportunity to Gilbert to undergo training in Bangkok and secondment in Deloitte & Touche in San Francisco, California. It emphasized the freedom of the parties to contract provided it is not contrary to law, morals, good custom, public order, and public policy. Further, it noted that the obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith. 26
Aggrieved, petitioners appealed this judgement to CA, docketed as CA-G.R. CV No. 11193. 27 CA-G.R. SP No. 154429 was consolidated with CA-G.R. CV No. 11193.
Ruling of the CA
In its Decision 28 dated 03 July 2019, the CA dismissed petitioners' petition and appeal, and affirmed RTC's actions.
For CA-G.R. SP No. 154429, CA found that petitioners were given several opportunities to be heard and RTC did not gravely abuse its discretion in ruling that petitioners already waived their right to present evidence. 29
For CA-G.R. CV No. 111193, the CA dismissed the appeal and agreed with the RTC's ruling that MDAC is a real party in interest, which was already affirmed by the CA's Fourteenth Division in its Decision dated 31 May 2017, and respondent had proven by preponderance of evidence that petitioners were liable for the breach of the Training Contract. 30 The CA also said that even if it were to admit Gilbert's judicial affidavit, petitioners still did not have sufficient evidence to prove and support their allegations. 31
Petitioners moved for reconsideration 32 but the same was denied by the CA in a Resolution 33 dated 04 September 2019.
Issues
The issues before Court are: [i] whether respondent MDAC, formerly known as C.L. Manabat & Co., is a real party-in-interest; [ii] whether petitioners were denied due process of law; and [iii] whether damages were properly awarded to MDAC. 34
Ruling of the Court
The petition has no merit. We find no basis to reverse the CA's Decision dated 03 July 2019 and Resolution dated 04 September 2019 that dismissed the consolidated cases and affirmed the RTC's Decision 35 dated 18 May 2018.
At the outset, We emphasize that CA adopted the factual findings of RTC. It is established that "[f]actual findings of the lower court, more so when supported by the evidence [. . .] command not only respect but even finality and are binding on the Court." 36 Moreover, as a rule, factual findings of the trial court, especially when affirmed by the appellate court, are accorded the highest degree of respect and considered conclusive between the parties. 37 Thus, We rely on RTC and CA's common and undisputed findings of fact in reaching Our conclusion.
First, the issue on whether MDAC is the real party-in-interest has already been resolved with finality, which precludes petitioners from raising this matter again before the Court.
One of the aspects of res judicata is conclusiveness of judgment. 38 Conclusiveness of judgment finds application when a fact or question has been squarely put in issue, judicially passed upon, and adjudged in a former suit by a court of competent jurisdiction. The fact or question settled by final judgment or order binds the parties to that action (and persons in privity with them or their successors-in-interest), and continues to bind them while the judgment or order remains standing and unreversed by proper authority on a timely motion or petition; the conclusively settled fact or question furthermore cannot again be litigated in any future or other action between the same parties or their privies and successors-in-interest, in the same or in any other court of concurrent jurisdiction, either for the same or for a different cause of action. 39
Conclusiveness of judgment applies here. As noted by CA, RTC had thoroughly considered, exhaustively threshed out, and correctly resolved this issue in its Order dated 24 March 2015 finding MDAC as the real party-in-interest. 40 Petitioners filed a Motion for Reconsideration dated 11 April 2015 but was denied by RTC. 41 Then, petitioners filed a petition for certiorari before CA contending that the RTC gravely abused its discretion in issuing said orders. 42 Significantly, the CA's Fourteenth Division affirmed the RTC orders declaring MDAC a real party-in-interest when it dismissed the petition for certiorari in its Decision dated 31 May 2017 in CA-G.R. SP No. 142154. Records do not show that petitioners pursued further remedies to avail relief from the Decision dated 31 May 2017. 43
Thus, petitioners are barred from raising this issue again before this Court and they are bound by the RTC's and CA's rulings that MDAC is a real party-in-interest. Res judicata rests on the principle that parties should not be permitted to litigate the same issue more than once. When a right or fact has been judicially tried and determined by a court of competent jurisdiction, or an opportunity for such trial has been given, the judgment of the court, so long as it remains unreversed, should be conclusive upon the parties and those in privity with them in law. 44
Second, the CA correctly ruled that petitioners were given several opportunities to be heard and the RTC did not gravely abuse its discretion in ruling that petitioners already waived their right to present evidence. 45 In Bautista, 46 We said that "[d]ue process is satisfied as long as the party is accorded an opportunity to be heard. If it is not availed of, it is deemed waived or forfeited without violating the constitutional guarantee." 47
As found by the CA, the RTC issued an Order dated 19 September 2017 setting the case for reception of petitioners' evidence on 10 October 2017 with "[s]tern warning that in the event the [petitioners'] counsel failed to present his intended witness on the next scheduled hearing, the court will act accordingly. This is without prejudice to any appropriate motion to be filed by the [petitioners'] counsel." Notably, the date of resetting was based on the express agreement of both parties' counsel. 48
Despite said order, petitioners' counsel, Atty. Lagundi still filed a Motion for Postponement of Hearing, and failed to attend the scheduled hearing on 10 October 2017. However, Atty. Lagundi's reason for not attending the hearing, i.e., to go to the province to commemorate his father's death anniversary, is hardly the meritorious reason that would warrant the allowance of the resetting of the hearing. To be sure, Atty. Lagundi willingly acceded to the setting of the case on 10 October 2017 and he did not even bother to present evidence that he actually went to their province on 10 October 2017. 49
Moreover, records show that petitioners' counsel is the Law Office of Jandoc Salanga Lagundi and Associates. Thus, if Atty. Lagundi was indeed not available, he could have sent another lawyer from his office to appear. Atty. Lagundi had no basis to expect that RTC will grant the postponement especially given the stern warning provided in the Order dated 19 September 2017.
The CA also aptly pointed out that respondent filed the complaint on 09 November 2010 and since then, numerous motions to defer, motions to postpone and motions for reconsideration were filed by petitioners, aside from the several requests petitioners' counsel made for the resetting of the case and his sudden non-appearances before RTC finally rendered the assailed Decision 50 dated 18 May 2018. 51
Thus, given the foregoing, petitioners were not deprived of due process. They were given several opportunities to participate in the proceedings but persistently failed to do so.
Finally, We affirm with modification the RTC's and CA's rulings that petitioners are solidarily liable to pay respondent actual damages with interest, liquidated damages, attorney's fees, and costs of suit for breach of the Training Contract. 52 Jurisprudence has established that as a rule, factual findings of the trial court, especially when affirmed by the appellate court, are accorded the highest degree of respect and considered conclusive between the parties. 53
As correctly found by the RTC and CA, the Training Contract between respondent and petitioners is valid and binding between them and there is no showing that it is contrary to law, morals, good customs, public order, or public policy. 54
Respondent has shown it incurred actual expenses of PhP129,187.72 relating to the training and secondment of Gilbert to which petitioners obliged themselves to reimburse respondent with interest and charges in case of breach. In addition, petitioners bound themselves to pay damages equivalent to 25% of Gilbert's total gross compensation under the Training Contract in case he failed to comply with his obligation to return to the Philippines and render service to respondent for three (3) years and two and a half (2.5) months at the end of his training and secondment. The parties to a contract are allowed to stipulate on liquidated damages to be paid in case of breach. It is attached to an obligation in order to ensure performance and has a double function: (1) to provide for liquidated damages, and (2) to strengthen the coercive force of the obligation by the threat of greater responsibility in the event of breach. 55
Consequently, respondent was able to prove by preponderance of evidence that Gilbert breached the Training Contract for which petitioners should be solidarily liable. 56 Moreover, as noted by the CA, even if it were to admit Gilbert's judicial affidavit, petitioners still did not have sufficient evidence to prove and support their allegations. 57 Nevertheless, We find it proper to reduce the amount of attorney's fees awarded by the RTC from PhP200,000.00, which is almost equivalent to 20% of the award. Pursuant to Article 2208 of the New Civil Code, in all cases, attorney's fees must be reasonable and We find here given the circumstances that an award of attorney's fees that is almost equivalent to 20% of the award is excessive. 58 Hence, the attorney's fees is reduced to 10% of the principal amount due. 59
We note, however, that in imposing legal interest on the actual damages, the RTC stated the same shall be at the rate of "1.0% per month from the filing of the complaint on November 10, 2010 until June 30, 2013 and 6% per annum from July 1, 2013 until full payment." 60 To obviate any confusion, the Court clarifies and modifies the legal interest to be set at 12% per annum, instead of 1% per month, from the filing of the complaint on 10 November 2010 until 30 June 2013, and 6% per annum from 01 July 2013 until fully satisfied to conform with the ruling in Nacar v. Gallery Frames. 61
WHEREFORE, premises considered, the instant petition is DENIED. The Decision 62 dated 03 July 2019 and Resolution 63 dated 04 September 2019 of the Court of Appeals in CA-G.R. CV No. 111193 and CA-G.R. SP No. 154429 are AFFIRMED with MODIFICATION in that petitioners Gilbert M. Angeles and Benedicto F. Angeles are ORDERED to pay jointly and severally respondent Manabat Delgado Amper & Co., the amount of P129,187.72 as actual damages with interest of 12% per annum from the filing of the complaint on 10 November 2010 until 30 June 2013 and 6% per annum from 01 July 2013 until full payment; the amount of P830,212.50 as liquidated damages; attorney's fees of 10% of the principal amount; and the costs of suit. TIADCc
SO ORDERED." (Leonen, J., on official leave.)
By authority of the Court:
(SGD.) MISAEL DOMINGO C. BATTUNG IIIDivision Clerk of Court
Footnotes
1.Rollo, pp. 10-53.
2.Id. at 59-82. Penned by Associate Justice Stephen C. Cruz, with Associate Justices Marie Christine Azcarraga-Jacob and Tita Marilyn Payoyo-Villordon, concurring.
3.Id. at. 84-86. Penned by Associate Justice Stephen C. Cruz, with Associate Justices Marie Christine Azcarraga-Jacob and Tita Marilyn Payoyo-Villordon, concurring.
4.Id. at 144-156. Penned by Judge Josefino A. Subia.
5.Id. at 61.
6.Id.
7.Id. at 94-96.
8.Id. at 61-62.
9.Id.
10.Id. at 98.
11.Id. at 62.
12.Id. at 62-63.
13.Id. at 76-77.
14.Id. at 65-66.
15.Id. at. 67-68, 202.
16.Id. at 69.
17.Id.
18.Id.
19.Id. at 60.
20.Id. at 69.
21.Id. at 144-156.
22.Id. at 156.
23.Id. at 153.
24.Id. at 154.
25.Id. at 155.
26.Id.
27.Id. at 60.
28.Id. at 59-82.
29.Id. at 71-75.
30.Id. at 75-82.
31.Id. at 81.
32.Id. at 85.
33.Id. at 84-86.
34.Id. at 20.
35.Id. at 144-156.
36. See Saclolo v. Marquito, G.R. No. 229243, 26 June 2019.
37.Federal Builders, Inc. v. Foundation Specialists, Inc., 742 Phil. 433 (2014).
38.Degayo v. Magbanua-Dinglasan, G.R. No. 173148, 06 April 2015.
39.Degayo v. Magbanua-Dinglasan, G.R. No. 173148, 06 April 2015; Hacienda Bigaa, Inc. v. Chavez, 632 Phil. 574 (2010).
40.Id. at 76-77.
41.Id. at 65.
42.Id. at 65-66.
43.Id. at 67-68.
44.Supra, note 39.
45.Rollo, pp. 72-75.
46. 474 Phil. 397 (2004).
47.Id.
48.Rollo, p. 72.
49.Id. at 74.
50.Id. at 144-156.
51.Id. at 64-70.
52.Id. at 82, 86, 156.
53.Supra, note 37.
54.Rollo, pp. 61-63, 78-81, 155.
55. See Atlantic Erectors, Inc. v. Court of Appeals, 697 Phil. 342 (2012).
56.Rollo, pp. 77-82, 135-155.
57.Id. at 81.
58. See Philippine Commercial International Bank v. Intermediate Appellate Court, 273 Phil. 226 (1991); Pentacapital Investment Corp. v. Mahinay, 637 Phil. 283 (2010); Bio-Research, Inc. v. Univille Development Corporation, G.R. No. 199257 (Notice), 18 April 2018.
59. See Pentacapital Investment Corp. v. Mahinay, 637 Phil. 283 (2010).
60. Emphasis supplied.
61. 716 Phil. 267 (2013).
62.Rollo, pp. 59-82.
63.Id. at 84-86.