FIRST DIVISION
[G.R. No. 196032. March 20, 2019.]
GARMILL COMPANY, INC. AND FLORENDA GARAY, petitioners, vs.PIONEER HI-BRED PHILIPPINES, INC., respondent.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, First Division, issued a Resolution datedMarch 20, 2019which reads as follows:
"G.R. No. 196032 (Garmill Company, Inc. and Florenda Garay v. Pioneer Hi-bred Philippines, Inc.). — This is a petition for review on certiorari1 seeking to reverse the Decision 2 dated June 21, 2010 and Resolution 3 dated February 15, 2011 of the Court of Appeals (CA) in CA-G.R. SP No. 104783. The CA ruled that Branch 57, Regional Trial Court (RTC) of Makati City did not act with grave abuse of discretion amounting to lack or in excess of jurisdiction when it denied the petition for relief from judgment filed by petitioners Garmill Company, Inc. (Garmill) and Florenda Garay (Garay) (collectively, petitioners).
On December 5, 2000, Pioneer Hi-bred Philippines, Inc. (respondent) filed a complaint 4 for a sum of money with application for preliminary attachment against petitioners for the collection of the latter's outstanding obligation for agricultural products delivered to them on various dates.
On February 20, 2002, petitioners filed a motion to dismiss with corollary prayer to discharge attachment, 5 arguing that: (1) the claim has already been paid; and (2) the complaint is a mere scrap of paper for having been verified by one Mr. Ferdinand Nacito (Nacito), without the proper authorization.
After their motion to dismiss was denied, petitioners filed their answer with counterclaim, 6 alleging, among others, that they have paid their obligation to respondent.
Trial ensued. After the termination of the testimony of petitioners' last witness, their counsel, Atty. Constantine Tecson III (Atty. Tecson) asked for a period of 20 days from June 1, 2006, within which to submit the formal offer of exhibits. 7 Thereafter, Atty. Tecson sought three more extensions, for a total of 25 days from June 21, 2006 or until July 16, 2006, within which to submit the formal offer. 8 The RTC granted all three motions. 9 aDSIHc
During the hearing held on August 17, 2006 hearing, however, Atty. Tecson again moved for a resetting because he had not formally offered evidence for petitioners. 10 On the subsequent hearing held on October 10, 2006, Atty. Tecson was again given a fresh period of five days to file their formal offer of evidence. 11 Still and despite already having been given several extensions, Atty. Tecson requested for another seven days to file their formal offer, 12 which the RTC granted, thus allowing petitioners until October 22, 2006 to comply. 13
On March 9, 2007, and still without petitioners having filed their formal offer of evidence, the RTC upon respondent's motion, issued an Order declaring petitioners to have waived their right to file their formal offer of evidence. 14 The parties were thereafter given 30 days to file their respective memoranda. 15 Respondent filed its memorandum; petitioners however again failed to do so. 16
In a Decision 17 dated November 9, 2007, the RTC rendered judgment in favor of respondent, to wit:
WHEREFORE, premises duly considered, judgment is hereby rendered in favor of the [respondent] and against the [petitioners], ordering the latter jointly and severally to pay [respondent] the following:
1. The sum of P7,219,662.21 as of March 31, 2003 plus interest of 18% per annum until fully paid;
2. The sum of P200,000.00 as and for attorney's fees; and
3. Costs of suit.
SO ORDERED. 18
No appeal to the Decision dated November 9, 2007 was filed. 19
On February 8, 2008, petitioners, through their new counsel Atty. Fulgent Thomas Garay (Atty. Garay), filed a petition for relief from judgment with prayer for new trial before the RTC. 20 Petitioners averred that: (1) Atty. Tecson, their former counsel, received the November 9, 2007 Decision on December 11, 2007; (2) he had been grossly negligent and reckless in defending them as he was not able to submit a formal offer of exhibits and memorandum, which, petitioners claim, deprived them of their right to present their case; and (3) fraud was committed by respondent's counsel when he decided to forego with the presentation of the rebuttal evidence, notwithstanding its previous setting. 21 ETHIDa
In an Order 22 dated March 10, 2008, the RTC denied the petition for relief from judgment. Noting that petitioners were granted a total of six extensions of time to file their formal offer of exhibits, the RTC held that petitioners cannot now claim that they were deprived of their day in court. It also held that the negligence of petitioners' counsel binds them, and such negligence was not proven to be excusable.
Petitioners moved for a reconsideration of the March 10, 2008 Order, however, their motion was denied by the RTC in an Order dated on May 20, 2008. 23
Petitioners thus elevated the March 10, 2008 and May 20, 2008 Orders to the CA through a special civil action for certiorari under Rule 65 of the Rules of Court. 24 They ascribed grave abuse of discretion on the part of the RTC for: (1) denying the petition for relief from judgment and the motion for reconsideration despite the gross miscarriage of justice; (2) failing to appoint a counsel de officio, for petitioners; (3) ignoring evidence showing that respondent was guilty of fraud against petitioners; and (4) allowing the case to proceed despite the lack of authority on the part of respondent's representative to sue. 25
On June 21, 2010, the CA rendered a Decision denying the petition. It found that the RTC did not commit grave abuse of discretion in issuing the assailed orders. 26 According to the CA, petitioners were not completely deprived of their day in court because they were able to file an answer with counterclaim and several motions for extension to file formal offer. There was likewise no duty on the part of the RTC to appoint a counsel de officio since petitioners were represented by counsel during the proceedings. Also, the CA held that the kind of fraud asserted by petitioners was not extrinsic in nature. 27
Lastly, the CA found that, contrary to petitioners' argument, Nacito's authority to represent respondent includes cases filed after October 2, 2000 since the board resolution designating him as respondent's representative remains valid unless revoked, and petitioners have not shown that there was a subsequent board resolution revoking his authority. 28
Petitioners moved for a reconsideration of the CA Decision, but the same was denied by the CA in a Resolution 29 dated February 15, 2011. Hence, this petition for relief from judgment.
Section 1, Rule 38 of the Rules of Court reads:
Sec. 1. Petition for Relief from Judgment, Order, or Other Proceedings. — When a judgment or final order is entered, or any other proceeding is thereafter taken against a party in any court through fraud, accident, mistake, or excusable negligence, he may file a petition in such court and in the same case praying that the judgment, order or proceeding be set aside. cSEDTC
A petition for relief from judgment is an equitable remedy granted only under exceptional circumstances when there is no other available or adequate remedy. 30 For the court to set aside final and executory judgments, the presence of fraud, accident, mistake or excusable negligence must be established. 31
Here, petitioners rely on fraud allegedly committed by respondent's employees 32 and the excusable negligence of petitioners' own counsel 33 to support their plea for the reversal of the ruling of the trial court.
We deny the petition.
First, fraud as a ground for a petition for relief from judgment pertains to extrinsic or collateral fraud. 34
Extrinsic fraud refers to a fraudulent act of the prevailing party in litigation committed outside of the trial of the case, where the defeated party is prevented from fully exhibiting his side by deception practiced on him by his opponent, such as by keeping him away from court, by giving him a false promise of a compromise, or where an attorney fraudulently or without authority connives at his defeat. 35
In this case, petitioners accuse respondent, through its employees, of employing fraud through the purported scheme of augmenting their sales by delivering seeds directly to the farmers-end users with Garmill's name reflected as purchaser of the goods. 36 This allegation, however, is part of the defense of petitioners and could have been litigated and determined at trial. It does not pertain to acts which are intended to prevent petitioners' participation in the proceedings. This is not extrinsic fraud which could warrant a petition for relief from judgment.
Second, petitioners, citing Apex Mining, Inc. v. Court of Appeals, 37 insist that they are not bound by the gross negligence of their former counsel. Indeed, we have carved out exceptions to the rule that the negligence of counsel binds client, such as when the reckless or gross negligence of counsel deprives the client of due process of law, 38 or where the application of the rule will result in outright deprivation of the client's liberty or property, or where the interests of justice so require. 39 Petitioners claim that Atty. Tecson's negligence resulted to a deprivation of their right to due process. SDAaTC
We disagree.
The records show that, petitioners were accorded due process. The essence of due process is the opportunity to be heard. 40 As pointed out by the CA, petitioners, through their former counsel, were not only able to file their answer with counterclaim, they were also able to present evidence on their behalf, mark documentary exhibits and present three witnesses before the trial court. 41
In fact, even though pieces of petitioners' documentary evidence were never formally offered, the RTC, in its Decision dated November 9, 2007, 42 still evaluated them. That the RTC found their evidence not worthy of credence does not operate to deprive petitioners of due process. The RTC explained:
Defendants based their figures on delivery receipts. However, since these delivery receipts were not formally offered as evidence, they cannot be given probative value pursuant to Section 34, Rule 132 of the Rules of Court. Nonetheless, these delivery receipts bear no relation to the transaction which the subject sales invoices described. For one, defendants attached in their Answer a delivery receipt dated 28 February 1997 when the earliest transaction for which plaintiff is claiming payment is for one covered by the Sales Invoice dated June 13, 1997. Thus, the delivery receipts only misled the Court as these cover transactions for which plaintiff is not claiming payment.
Verily, the sales invoices sufficiently proved defendants' obligation to plaintiff. Sales Invoices are the primary documents upon which plaintiff bases its transaction records. In addition, as testified to by plaintiff's representative, delivery receipts are not competent evidence to prove deliveries since not every transaction is covered by one. Thus, the Sales Invoices are the proper proofs of the subject transactions and deliveries by plaintiff to defendant Garmill. Again, based on the Sales Invoices, the total number of bags delivered to defendant Garmill was 9,434 amounting to Php12,687,950.00. 43
We note also that the RTC granted respondent's motion to declare petitioners to have waived their right to formally offer their evidence only after obtaining six consecutive extensions of time to file the same. 44 Where a party was continually afforded several opportunities to participate in the proceedings, yet he failed to do so, he cannot be allowed later on to claim that he was deprived of his day in court. 45
Lastly, as we ruled in Gregorio v. Crisologo Vda. de Culig, 46 in order to invoke the exception to the rule that negligence of counsel binds client, petitioners should not be negligent themselves. They must discharge the "duty to be vigilant in respect of his interests by keeping himself up-to-date on the status of the case. Failing in this duty, the client should suffer whatever adverse judgment is rendered against them." 47 acEHCD
As correctly pointed out by the CA, petitioners are not entirely faultless. 48 Petitioners claim that they constantly communicated with their former counsel and it was through their former counsel's misrepresentations that the RTC's judgment was entered into without their knowledge. No evidence, however, was presented to prove these allegations.
As this Court held in Guevarra v. Bautista: 49
x x x [R]elief cannot be granted on the flimsy excuse that the failure to appeal was due to the neglect of the petitioners' counsel[,] [o]therwise, all that a defeated party has to do to salvage his case would be to claim neglect or mistake on the part of his counsel as a ground for reversing the adverse judgment, and there would then be no end to litigation, as every shortcoming of counsel could be the subject of challenge by his client. 50
WHEREFORE, the petition is DENIED. The Decision dated June 21, 2010 of the Court of Appeals in CA-G.R. SP No. 104783 is hereby AFFIRMED.
SO ORDERED." Bersamin, C.J., on official business; Del Castillo, J., designated as Acting Chairperson of the First Division per Special Order No. 2645 dated March 15, 2019. SDHTEC
Very truly yours,
(SGD.) LIBRADA C. BUENADivision Clerk of Court
Footnotes
1.Rollo, pp. 19-56.
2.Id. at 59-70; penned by Associate Justice Michael P. Elbinias, concurred in by Associate Justices Remedios A. Salazar-Fernando and Celia C. Librea-Leagogo.
3.Id. at 71-72.
4.Id. at 488-496.
5.Id. at 501-505.
6.Id. at 107-112.
7.Id. at 200.
8.Id. at 200-201, 203-204, 206-207.
9.Id. at 202, 205, 208.
10.Id. at 209.
11.Id. at 210.
12.Id. at 211-212.
13.Id. at 213.
14.Id. at 220.
15.Id. at 221.
16.Id. at 62.
17.Id. at 222-226.
18.Id. at 226.
19.Id. at 62.
20.Id. at 228-232.
21.Id.
22.Rollo, pp. 73-74.
23.Id. at 75.
24.Id. at 264-299.
25.Id. at 283-284.
26.Supra note 2.
27.Id.
28. Rollo, pp. 68-69.
29. Supra note 3.
30. Madarang v. Morales, G.R. No. 199283, June 9, 2014, 725 SCRA 480; Insular Life Savings and Trust Company v. Runes, Jr., G.R. No. 152530, August 12, 2004, 436 SCRA 317.
31. City of Dagupan v. Maramba, G.R. No. 174411, July 2, 2014, 728 SCRA 520, 540.
32. Rollo, pp. 45-50.
33. Id. at 39-45.
34. City of Dagupan v. Maramba, supra note 31 at 541.
35. Lasala v. National Food Authority, G.R. No. 171582, August 19, 2015, 767 SCRA 430, 447.
36. Rollo, pp. 45-50.
37. G.R. No. 133750, November 29, 1999, 319 SCRA 456.
38. Cagayan Economic Zone Authority v. Meridien Vista Gaming Corporation, G.R. No. 194962, January 27, 2016, 782 SCRA 345; Toyota Alabang, Inc. v. Games, G.R. No. 206612, August 17, 2015, 767 SCRA 72, 105; Building Care Corporation/Leopord Security & Investigation Agency v. Macaraeg, G.R. No. 198357, December 10, 2012, 687 SCRA 643; Gacutana-Fraile v. Domingo, G.R. No. 138518, December 15, 2000, 348 SCRA 414, 422.
39. Bernardo v. Court of Appeals, G.R. No. 106153, July 14, 1997, 275 SCRA 413.
40. Demaala v. Sandiganbayan, G.R. No. 173523, February 19, 2014, 717 SCRA 1; Vivo v. Philippine Amusement and Gaming Corporation (PAGCOR), G.R. No. 187854, November 12, 2013, 709 SCRA 276.
41. Rollo, p. 65.
42. Id. at 222-226.
43. Id. at 225.
44. Id. at 202, 205, 208, 209, 210, 213.
45. Demaala v. Sandiganbayan, supra note 40.
46. G.R. No. 180559, January 20, 2016, 781 SCRA 377, 390.
47. Id.
48. Rollo, p. 65.
49. Guevarra v. Bautista, G.R. No. 148435, November 28, 2008, 572 SCRA 375 citing Insular Life Savings and Trust Company v. Runes, Jr., supra note 30 at 326.
50. Id. at 382.