Lapanday Foods Corp. v. The Heirs of Rodriguez, Sr.

SECOND DIVISION

[G.R. No. 229139. November 10, 2021.]

LAPANDAY FOODS CORPORATION, petitioner, vs.THE HEIRS OF PEDRO RODRIGUEZ, SR., NAMELY: MARIA LUCIA E. RODRIGUEZ, ET AL., respondents.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, Second Division, issued a Resolution dated10 November 2021which reads as follows: CAIHTE

"G.R. No. 229139 (Lapanday Foods Corporation v. The Heirs of Pedro Rodriguez, Sr., namely: Maria Lucia E. Rodriguez, et al.). — This resolves the petition for review on certiorari filed by Lapanday Foods Corporation praying that the assailed Order 1 dated November 28, 2016 of the Regional Trial Court (RTC), Branch 14 of Davao City, in Civil Case No. 33, 034-09 be annulled and set aside.

As a brief background, the petitioner Lapanday Food Corporation (petitioner) filed a complaint for reformation of contract before the RTC against the respondents Heirs of Pedro Rodriguez, Sr., namely: Maria Lucia E. Rodriguez, Nemesio E. Rodriguez, Petronilo Alberto E. Rodriguez, Pedro E. Rodriguez, Jr., and Maria Pilar Rosario E. Rodriguez (respondents). Through an Order 2 dated September 23, 2016, the RTC dismissed the complaint due to the absence of petitioner and its counsel and the petitioner's failure to complete the presentation of its evidence.

The RTC Ruling

On October 18, 2016, the petitioner, through its new counsel, filed its Entry of Appearance with Motion for Reconsideration. 3 The RTC, through the assailed Order dated November 28, 2016, denied the petitioner's motion for reconsideration, viz.:

WHEREFORE, for failure of the plaintiff to comply with the requirement of the payment of the docket fee before the lapse of the prescriptive period, the Motion for Reconsideration is hereby DENIED.

SO ORDERED. 4

The RTC explained that the petitioner did not pay the prescribed docket fees when it filed an amended complaint on February 4, 2011, asking in alternative for the payment of actual damages not less than P870,679.37, legal interest, exemplary damages of not less than P200,000.00, and attorney's fees of at least P200,000.00, plus P3,000.00 per appearance of its counsel. 5

According to the RTC, the petitioner's cause of action is based on the parties' Banana Production and Purchase Agreement (BPPA) dated October 3, 2005. Article 1144 of the Civil Code of the Philippines provides that an action upon a written contract must be brought within 10 years from the time the right of action accrues. As such, any action brought against the said contract should have been filed and accompanied by payment of the proper docket fee within the time allowed by the rules. The petitioner knew of the defect in the contract right after its execution because it was the petitioner who prepared the contract; and the petitioner had already collected irrigation charges from the respondents before the year 2007. 6

Undeterred, the petitioner assails, on pure question of law, the Order dated November 28, 2016 of the RTC through the present petition for review on certiorari.

The petitioner submits that the RTC should not have dismissed its complaint based on its failure to pay additional docket fees because non-payment of docket fees on the amended complaint will not result in the loss of the court's jurisdiction. 7

In their Comment, 8 the respondents contend that the petitioner expounded on the non-payment of docket fees when in fact, the RTC Order dated September 23, 2016 expressly provides that the complaint was dismissed due to the petitioner's failure to complete the presentation of evidence. For more than seven years, the petitioner was able to present only one witness. The respondents allege that it was the protracted delays due to the fault of the petitioners that caused the dismissal of the complaint. 9

In its Reply, 10 the petitioner points out that it already questioned the Order 11 dated September 23, 2016 of the RTC through its motion for reconsideration, which the RTC resolved in its Order 12 dated November 28, 2016. The petitioner posits that the Order dated November 28, 2016 of the RTC had, in effect, superseded the earlier Order dated September 23, 2016.

Issue

Whether RTC erred in denying the petitioner's motion for reconsideration on the ground of the petitioner's failure to pay the docket fee based on its amended complaint before the lapse of the applicable prescriptive period.

The Court's Ruling

The petition is unmeritorious.

In Sun Insurance Office Ltd. v. Judge Asuncion (Sun Insurance), 13 the Court laid down the following rule concerning the payment of docket fees:

1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a trial court with jurisdiction over the subject matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period. 14 (Emphasis ours)

The same principle was applied in Proton Pilipinas Corp. v. Banque Nationale De Paris, 15 where the Court ordered the reassessment and payment of docket fees, provided that the applicable prescriptive or reglementary period has not yet expired.

In this case, as the RTC aptly ruled, the petitioner may no longer be allowed to pay the docket fees for its amended complaint since the petitioner's cause of action had already prescribed. The Court categorically declared in Sun Insurance that it may allow the payment of docket fees but only if this would be made within the applicable prescriptive period. Again, the BPPA, which was the subject of the complaint for reformation of contract, was executed in 2005. The petitioner, as the one who prepared the contract, knew of the supposed errors therein from the time of the BPPA's execution. Thus, the RTC was correct in holding that the 10-year period for the petitioner to bring an action based on their written contract had already prescribed.

On this score, Article 1144 of the Civil Code of the Philippines provides:

Article 1144. The following actions must be brought within ten years from the time the right of action accrues:

(1) Upon a written contract;

(2) Upon an obligation created by law;

(3) Upon a judgment.

Furthermore, the petitioner is misguided on its submission that the Order dated November 28, 2016 of the RTC superseded its Order dated September 23, 2016. The Order dated September 23, 2016, which dismissed the petitioner's complaint due to failure to complete the presentation of evidence, was not superseded in any manner; it has neither been reversed nor set aside. In fact, it does not run contrary to the Order dated November 28, 2016. The later Order simply ruled that an additional ground, which is the failure to pay the docket fee, warranted the dismissal of the complaint. Ultimately, both Orders yielded the same result, which is the dismissal of the petitioner's complaint.

WHEREFORE, the petition is DENIED. The Order dated November 28, 2016 of the Regional Trial Court, Branch 14 of Davao City in Civil Case No. 33,034-09 is hereby AFFIRMED.

SO ORDERED."

By authority of the Court:

(SGD.) TERESITA AQUINO TUAZONDivision Clerk of Court

 

Footnotes

1.Rollo, pp. 37-38; issued by Presiding Judge Jill Rose S. Jaugan-Lo.

2.Id. at 31; issued by Acting Presiding Judge Loida S. Posadas-Kahulugan.

3.Id. at 26-28.

4.Id. at 38.

5.Id. at 37.

6.Id.

7.Id. at 18.

8.Id. at 58-59.

9.Id. at 59.

10.Id. at 68-69.

11.Id. at 31.

12.Id. at 37-38.

13. 252 Phil. 280 (1989).

14.Id. at 291.

15. 499 Phil. 247 (2005).