THIRD DIVISION
[G.R. No. 237995. April 3, 2019.]
MARINA PORT SERVICES, INC., petitioner, vs.MANILA FLOATING SILO CORPORATION AND PHILIPPINE PORTS AUTHORITY, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Third Division, issued a Resolution dated April 3, 2019, which reads as follows:
"G.R. No. 237995 (MARINA PORT SERVICES, INC., petitioner, v. MANILA FLOATING SILO CORPORATION AND PHILIPPINE PORTS AUTHORITY, respondents). — Rules of procedure are designed to expedite the resolution of cases. They should not be invoked to delay court proceedings.
This resolves a Petition for Review on Certiorari 1 assailing the August 14, 2017 Decision 2 and February 15, 2018 Resolution 3 of the Court of Appeals in CA-G.R. SP No. 138579. The Court of Appeals upheld the March 17, 2014 4 and October 20, 2014 5 orders of the Regional Trial Court, which denied a Motion to Dismiss Counterclaims 6 based on a liberal interpretation of the Rules of Court.
Marina Port Services, Inc. (Marina Port Services), now known as Asian Terminals, Inc., is a corporation engaged in providing arrastre, stevedoring, and cargo handling services. Meanwhile, Manila Floating Silo Corporation (Manila Floating Silo) is a corporation engaged in setting up floating bulk terminal facilities at the South Harbor of the Port of Manila. 7
Marina Port Services, Manila Floating Silo, and the Philippine Ports Authority have been in litigation since August 5, 1993. The controversy arose when the Philippine Ports Authority entered into a contract with Marina Port Services for arrastre, stevedoring, and cargo handling services. Shortly after, it entered into another contract with Manila Floating Silo to set up a floating bulk terminal facility. 8
Believing that the latter contract would "interfere with and violate its exclusive contractual duties, responsibilities[,] and rights in its contract with the [Philippine Ports Authority]," 9 Marina Port Services filed an action for declaratory relief and final injunction with temporary restraining order against Manila Floating Silo and the Philippine Ports Authority. A series of actions for injunctions and temporary restraining orders arose between the parties. 10 CAIHTE
These actions eventually became the subject of the 1996 case, Philippine Ports Authority v. Court of Appeals. 11 There, this Court set aside a writ of preliminary injunction previously issued by the Court of Appeals and ordered the trial court to conduct trial on the merits immediately. 12
Thus, the trial court proceeded with the case. Pre-trial commenced on December 14, 2009 and was terminated on November 19, 2012. Records revealed that Manila Floating Silo failed to attend five (5) of the 12 dates set for pre-trial, including the November 19, 2012 proceeding. Subsequently, Manila Port Services moved that: (1) it be allowed to present evidence ex parte; and (2) the trial court declare Manila Floating Silo in default. The trial court granted its Motion. 13
On September 27, 2013, Marina Port Services moved 14 for the dismissal of Manila Floating Silo's counterclaims for its failure to appear at pre-trial. Marina Port Services submitted that while Rule 18, Sections 4 15 and 5 16 of the Rules of Court refer to dismissals of the plaintiff's action for nonappearance, they should also include dismissals of counterclaims brought by the defendant. 17
In its March 17, 2014 Order, 18 the trial court denied Manila Port Services' Motion to Dismiss Counterclaims, ruling that Rule 18, Sections 4 and 5 did not include dismissing counterclaims on account of a defendant's absence. 19
Marina Port Services filed a Motion for Reconsideration, 20 but it was denied by the trial court in its October 20, 2014 Order. 21 The trial court remarked on the "emerging trend" 22 of decisions by this Court to resolve cases by focusing on their substantial merits rather than unnecessarily focusing on the technicalities. 23
On January 5, 2015, Marina Port Services filed before the Court of Appeals a Petition for Certiorari, 24 arguing that the trial court acted with grave abuse of discretion when it relaxed the application of procedural rules in Manila Floating Silo's favor without any justifiable reason. 25
In its August 14, 2017 Decision, 26 the Court of Appeals dismissed the Petition for lack of merit.
The Court of Appeals found that the trial court committed no grave abuse of discretion, reiterating the principle that strict application of procedural rules should not be used to delay court proceedings. It found that since Manila Floating Silo was declared in default, it already suffered the consequence for its nonappearance at pre-trial. It also noted that since the case has been pending resolution since 1993, the case should be resolved with due and deliberate dispatch. 27
Marina Port Services filed a Motion for Reconsideration, 28 but it was denied in the Court of Appeals February 15, 2018 Resolution. 29
Hence, this Petition 30 was filed.
Petitioner insists that since a counterclaim is considered a defendant's action against the plaintiff, Rule 18, Sections 4 and 5 on dismissals of actions for nonappearances at pre-trial should also apply to counterclaims. It claims that the trial court and the Court of Appeals had no justifiable reason to relax the procedural rules in private respondent's favor. 31
Private respondent, on the other hand, maintains that the Court of Appeals did not err in sustaining the denial of the Motion to Dismiss Counterclaims since its nonappearance at pre-trial was not its fault and that procedural technicalities should not result in injustice. 32 It argues that dismissal of the counterclaims, not being provided for in law or the rules, was left to the sound discretion of the trial court. 33 It submits that even this Court in Philippine Ports Authority found that it had a valid claim against petitioner and, thus, the grant of the Motion to Dismiss Counterclaims might result in the deprivation of its property without due process. 34
For its part, public respondent claims that it will not be prejudiced whether private respondent's counterclaims are dismissed or not. As such, it defers the resolution of the Petition to this Court's sound judgment. 35
Before this Court is the sole issue of whether or not the Court of Appeals erred in relaxing the strict application of procedural rules so as to prevent further delay in the disposition of the case on the merits.
The failure of a defendant to appear is cause to declare him or her in default. The plaintiff would be allowed to present evidence ex parte. Rule 18, Section 5 of the Rules of Court provides: DETACa
SECTION 5. Effect of Failure to Appear. — The failure of the plaintiff to appear when so required pursuant to the next preceding section shall be cause for dismissal of the action. The dismissal shall be with prejudice, unless otherwise ordered by the court. A similar failure on the part of the defendant shall be cause to allow the plaintiff to present his evidence ex parte and the court to render judgment on the basis thereof.
Here, the trial court declared private respondent in default for its failure to appear at pre-trial. It will not be allowed to present evidence on its behalf. Thus, its counterclaims now stand on the strength of its allegations, not its evidence. If its counterclaims cannot stand without presentation of evidence, then the consequences of its nonappearance at pre-trial would effectively result in the dismissal of the counterclaims without having to go through a separate adjudication.
This Resolution, however, should not be construed to have resolved the merits of private respondent's counterclaims. Any resolution on the matter is best left to the discretion of the trial court currently hearing the case.
The case has long been pending resolution before the trial court, and this separate Petition only contributes to its continued delay. In Macasa v. Herrera: 36
Inconsiderate dismissals, even if without prejudice, do not constitute a panacea nor a solution to the congestion of court dockets; while they lend a deceptive aura of efficiency to records of individual judges, they merely postpone the ultimate reckoning between the parties. In the absence of clear lack of merit or intention to delay, justice is better served by a brief continuance, trial on the merits, and final disposition of the cases before the court. 37
Justice is better served by resolving a case with due and deliberate dispatch. This was the order of this Court in Philippine Ports Authority, which was decided 23 years ago:
WHEREFORE, the instant petition for review on certiorari is hereby GRANTED. The questioned Decision of the Court of Appeals and its Order issuing a writ of preliminary injunction are REVERSED and SET ASIDE. Trial on the merits of Civil Case Nos. 93-67096, 93-67441 and 93-67464 shall immediately take place, with the courts below disposing of said cases with deliberate dispatch. 38 (Emphasis supplied)
That this case is still in its pre-trial stage should be an indication to the trial court to prevent actions that may unnecessarily delay the disposition of this case on its merits. Therefore, its denial of petitioner's Motion to Dismiss Counterclaims was warranted. The Court of Appeals committed no error in affirming the trial court's judgment.
WHEREFORE, the Petition is DENIED. aDSIHc
SO ORDERED."
Very truly yours,
WILFREDO V. LAPITANDivision Clerk of CourtBy:(SGD.) MISAEL DOMINGO C. BATTUNG IIIDeputy Division Clerk of Court
Footnotes
1.Rollo, pp. 3-53.
2.Id. at 58-66. The Decision was penned by Associate Justice Zenaida T. Galapate-Laguilles, and concurred in by Associate Justice Magdangal M. De Leon and Franchito N. Diamante of the Fifth Division, Court of Appeals, Manila.
3.Id. at 68-72. The Resolution was penned by Associate Justice Zenaida T. Galapate-Laguilles, and concurred in by Associate Justice Magdangal M. De Leon and Franchito N. Diamante of the Former Fifth Division, Court of Appeals, Manila.
4.Id. at 688-692. The Order, in Civil Case No. 93-67096, was penned by Acting Presiding Judge Danilo V. Suarez of Branch 31, Regional Trial Court, Manila.
5.Id. at 751-753. The Order, in Civil Case No. 93-67096, was penned by Acting Presiding Judge Danilo V. Suarez of Branch 31, Regional Trial Court, Manila.
6.Id. at 622-647.
7.Id. at 58-59.
8.Id. at 59.
9.Id.
10.Id.
11. 323 Phil. 260 (1996) [Per J. Romero, Second Division].
12.Id. at 297.
13.Rollo, pp. 60-61.
14.Rollo, pp. 622-647.
15. RULES OF COURT, Rule 18, sec. 4 provides:
SECTION 4. Appearance of parties. — It shall be the duty of the parties and their counsel to appear at the pre-trial. The non-appearance of a party may be excused only if a valid cause is shown therefor or if a representative shall appear in his behalf fully authorized in writing to enter into an amicable settlement, to submit to alternative modes of dispute resolution, and to enter into stipulations or admissions of facts and of documents.
16. RULES OF COURT, Rule 18, sec. 5 provides:
SECTION 5. Effect of failure to appear. — The failure of the plaintiff to appear when so required pursuant to the next preceding section shall be cause for dismissal of the action. The dismissal shall be with prejudice, unless otherwise ordered by the court. A similar failure on the part of the defendant shall be cause to allow the plaintiff to present his evidence ex parte and the court to render judgment on the basis thereof.
17.Rollo, pp. 61-62.
18.Id. at 688-692.
19.Id. at 691.
20.Id. at 694-711.
21.Id. at 751-753.
22.Id. at 752.
23. Id.
24. Id. at 755-799.
25. Id. at 768-770.
26. Id. at 58-66.
27. Id. at 63-65.
28. Id. at 2299-2325.
29. Id. at 68-72.
30. Id. at 3-53. Comment (rollo, pp. 2339-2347) for private respondent Manila Floating Silo was filed on July 30, 2018 while Comment (rollo, pp. 2356-2361) for public respondent Philippine Ports Authority was filed on August 17, 2018. This Court did not order petitioner to reply to the comments. Nonetheless, petitioner submitted a Motion for Leave to File and Admit the Attached Consolidated Reply (rollo, pp. 2407-2430) on September 26, 2018, which was granted by this Court in a December 10, 2018 Resolution (rollo, pp. 2431-2432).
31. Id. at 24-46.
32. Id. at 2340-2341.
33. Id. at 2341-2342.
34. Id. at 2343.
35. Id. at 2356-2357.
36. 101 Phil. 44 (1957) (Per J. Reyes, J.B.L., En Banc].
37. Id. at 48.
38. 323 Phil. 260, 297 (1996) [Per J. Romero, Second Division].