Spouses Gile v. Philippine Savings Bank

THIRD DIVISION

[G.R. No. 236736. July 10, 2019.]

SPOUSES TERESITA D. GILE AND ROSALINO D. GILE, petitioners, vs.PHILIPPINE SAVINGS BANK, respondent.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, Third Division, issued a Resolution datedJuly 10, 2019, which reads as follows:

"G.R. No. 236736 (Spouses Teresita D. Gile and Rosalino D. Gile vs. Philippine Savings Bank). — This is a petition for review on certiorari1 under Rule 45 seeking to reverse and set aside the September 6, 2017 Decision 2 and January 12, 2018 Resolution 3 of the Court of Appeals (CA) in CA-G.R. SP No. 140961.

The Antecedents

On July 30, 2007, petitioners, Spouses Teresita and Rosalino Gile (Spouses Gile), obtained a car loan from respondent Philippine Savings Bank (PS Bank) in the total amount of P877,800.00 to be paid in five (5) years as evidenced by a promissory note secured by a chattel mortgage covering a 2007 Mitsubishi Adventure GX DSL M/T owned by Spouses Gile. Unfortunately, Spouses Gile defaulted in the payment of the loan. 4

On July 1, 2011, a complaint for a sum of money with prayer for the issuance of preliminary attachment was filed by PS Bank against Spouses Gile for their failure to pay the loan balance despite demand to settle the same. The case was raffled to the Metropolitan Trial Court (MeTC) of Makati City, Branch 65 and was docketed as Civil Case No. 102352. 5

During the proceedings, the case was set for presentation of evidence for PS Bank on July 5, 2013 and for Spouses Gile on August 2, 2013. 6 On July 5, 2013, upon motion of Spouses Gile's counsel, the case was ordered dismissed by the MeTC for failure of PS Bank's counsel and the witness to appear during the scheduled trial. 7 The motion for reconsideration 8 subsequently filed was denied in an Order dated August 22, 2013. 9

PS Bank filed an appeal 10 before the Regional Trial Court (RTC). On August 11, 2014, the appeal was given due course by the RTC of Makati City, Branch 66, ruling that every party litigant should be given the amplest opportunity for the just determination of his case free from the severities of technicalities. It ordered the case to be remanded to the MeTC, Branch 65 for proper disposition. 11

However, on January 26, 2015, upon a motion for reconsideration filed by Spouses Gile, the RTC reconsidered its earlier ruling and directed for the reinstatement of the July 5, 2013 Order of the MeTC which dismissed the complaint. 12

PS Bank moved for reconsideration but was denied in an Order dated May 27, 2015. 13 Unperturbed, PS Bank filed a petition for review before the CA. 14

On September 6, 2017, the CA granted the petition and decreed, thus:

WHEREFORE, the instant petition is hereby GRANTED. The impugned Orders of the Regional Trial Court of Makati City, Branch 66 dated January 26, 2015, and May 27, 2015 are SET ASIDE and VACATED.

This case is hereby REMANDED to Metropolitan Trial Court of Makati City, Branch 65 for prompt and proper disposition on the merits.

SO ORDERED.15 (Emphasis in the original)

Petitioners sought reconsideration 16 of the September 6, 2017 Decision but was denied in a Resolution dated January 12, 2018. 17

Hence, the instant recourse.

Issue

Stripped to the core, for the Court's resolution is the issue: Whether the CA erred in remanding, for further proceedings, the complaint previously dismissed by the lower court on the ground of non-prosequitur.

The Court's Ruling

The petition is bereft of merit.

The MeTC dismissed the case for PS Bank's failure to appear on the date of the presentation of its evidence pursuant to Section 3, Rule 17 of the Rules of Court. This is inferred from the Order of dismissal dated July 5, 2013 which states:

On motion of [Spouses Gile's] counsel, considering the failure of [PS Bank's] counsel and witness to appear for the presentation of [PS Bank's] evidence despite notice, the case is ordered dismissed. 18

Section 3, Rule 17 of the Rules of Court provides:

Section 3. Dismissal due to fault of plaintiff. — If, for no justifiable cause, the plaintiff fails to appear on the date of the presentation of his evidence in chief on the complaint, or to prosecute his action for an unreasonable length of time, or to comply with these Rules or any order of the court, the complaint may be dismissed upon motion of the defendant or upon the court's own motion, without prejudice to the right of the defendant to prosecute his counterclaim in the same or in a separate action. This dismissal shall have the effect of an adjudication upon the merits, unless otherwise declared by the court.

Initially, the RTC overturned the order of dismissal, recognizing that the failure of PS Bank's counsel to appear in the scheduled hearing for presentation of evidence was due to inadvertence. Thus, in the higher interest of justice and fair play, and to give the party the amplest opportunity for the just determination of the n case, the RTC ordered for the remand of the case to the MeTC for proper disposition. 19 However, the RTC reconsidered its earlier ruling and affirmed the MeTC's dismissal of the case, ratiocinating that PS Bank took the rules very lightly when it filed the complaint without a certification on forum shopping, postponed the pre-trial once, submitted the judicial affidavit of its sole witness two (2) months late from its due date, and postponed the trial twice on the ground of unavailability of witness. 20

In granting the appeal and reversing the RTC, the CA ratiocinated that the alleged procedural lapses of PS Bank were adequately explained. As regards the failure to attach the verification and certification, the CA accepted the explanation that it was due to inadvertence of counsel's legal assistant which was immediately rectified by attaching the necessary verification and certification in the subsequently filed Comment. Also, the CA ruled that PS Bank's failure to attend the re-scheduled date for presentation of its evidence is not a deliberate disregard of the rules and there was no intent to delay the proceedings. It found that PS Bank only missed one (1) trial date set by the MeTC as initially observed by the RTC. The CA opined that the said procedural lapses by PS Bank cannot be categorized as too blatant that will qualify to be irresponsible and contumacious, warranting a dismissal of its case. 21

Ruling of the Court

We affirm the ruling of the CA.

It is recognized that it is within the trial court's discretion to dismiss motu proprio the complaint on the ground of plaintiff's failure to prosecute. 22 However, "the power of the trial court to dismiss an action for non-prosequitur is not without its limits." 23 In the case of Republic of the Phils. v. Heirs of Enrique Oribello, Jr, et al., 24 the Court instructed:

Unless a party's conduct is so indifferent, irresponsible, contumacious or slothful as to provide substantial grounds for dismissal, i.e., equivalent to default or non-appearance in the case, the courts should consider lesser sanctions which would still amount to achieving the desired end. In the absence of a pattern or scheme to delay the disposition of the case or of a wanton failure to observe the mandatory requirement of the rules on the part of the plaintiff, as in the case at bar, courts should decide to dispense with rather than wield their authority to dismiss. 25

Also, in the case of Soliman v. Fernandez, 26 it was pronounced that:

If a pattern or scheme to delay the disposition of the case or a wanton failure to observe the mandatory requirement of the rules on the part of the plaintiff is not present, as in this case, courts should not wield their authority to dismiss. Indeed, while the dismissal rests on the prerogative of the trial court, it must soundly be exercised and not be abused, as there must be sufficient reason to justify its extinctive effect on the plaintiff's cause of action. Deferment of proceedings may be tolerated so that the court, aimed at a just and inexpensive determination of the action, may adjudge cases only after a full and free presentation of all the evidence by both parties. 27

Based on the foregoing, the CA correctly ruled that the court a quo erred in dismissing the case. It rightly observed that PS Bank's complaint was dismissed by the MeTC because it missed one (1) trial date. PS Bank explained that the absence of its counsel and witness on the scheduled trial date was because the witness was misinformed that the trial was set in the afternoon. Nevertheless, its counsel arrived in court at 9:45 a.m. of the scheduled trial date but was informed that the case has already been dismissed earlier that day.

PS Bank's absence during the July 5, 2013 hearing, however, should not have been categorized as "too blatant that will qualify to be irresponsible and contumacious" warranting a dismissal of the case. There was no showing that the party's conduct "is so indifferent, irresponsible, contumacious or slothful" 28 to justify the abbreviation of the proceedings.

Besides, petitioners did not deny that they still owe PS Bank a portion of the loan, albeit, the challenge that what was demanded by PS Bank is more that their actual indebtedness. The CA duly found that the holding of a full blown trial where the parties can present their respective evidence to support their claims will be more appropriate, reasonable, and just.

Indeed, cases should be resolved based on their merits and not on mere technicalities. 29 This Court's ruling in Bank of the Philippine Islands v. Spouses Genuino30 is on point:

[T]he ends of justice and fairness would best be served if the parties are given the full opportunity to litigate their claims and the real issues involved in the case are threshed out in a full-blown trial. Besides, petitioners would not be prejudiced should the case proceed as they are not stripped of any affirmative defenses nor deprived of due process of law.

This is not to say that adherence to the Rules could be dispensed with. However, exigencies and situations might occasionally demand flexibility in their application. Indeed, on several occasions, the Court relaxed the rigid application of the rules of procedure to afford the parties opportunity to fully ventilate the merits of their cases. This is in line with the time-honored principle that cases should be decided only after giving all parties the chance to argue their causes and defenses. Technicality and procedural imperfection should thus not serve as basis of decisions. 31

Accordingly, there is no reason to disturb the ruling of the CA.

WHEREFORE, the petition is DENIED. The September 6, 2017 Decision and January 12, 2018 Resolution of the Court of Appeals in CA-G.R. SP No. 140961 are hereby AFFIRMED.

SO ORDERED."

Very truly yours,

(SGD.) WILFREDO V. LAPITANDivision Clerk of Court

 

Footnotes

1.Rollo, pp. 10-31.

2. Penned by Associate Justice Priscilla J. Baltazar-Padilla and concurred in by Associate Justices Eduardo B. Peralta, Jr. and Jhosep Y. Lopez; id. at 33-42.

3.Id. at 61-62.

4.Id. at 64-65.

5.Id. at 64-69.

6.Id. at 87; 88.

7.Id. at 89.

8.Id. at 90-93.

9.Id. at 97.

10.Id. at 98-99.

11.Id. at 105-107.

12. Order dated January 26, 2015; id. at 108-109.

13.Id. at 110.

14.Id. at 111-121.

15.Id. at 41-42.

16.Id. at 43-59.

17.Id. at 61-62.

18.Id. at 89.

19.Id. at 105-107.

20. Order dated January 26, 2015; id. at 108-109.

21.Id. at 33-42.

22.Rep. of the Phils. v. Heirs of Enrique Oribello, Jr., et al., 705 Phil. 614, 626 (2013).

23.Soliman v. Fernandez, 735 Phil. 45, 51 (2014), citing Belonio v. Rodriguez, 504 Phil. 126, 149 (2005).

24.Supra note 21.

25.Id. at 626.

26.Supra note 22.

27.Id. at 51-52.

28.Rollo, p. 38.

29.Bank of the Philippine Islands v. Sps. Genuino, 764 Phil. 642, 646 (2015).

30. Supra.

31. Id. at 650.

n Note from the Publisher: Written as "the its" in the original document.