Case # 5

BDO Strategic Holdings v Asia Amalgamated Holdings, Inc. G.R. No.

217360

Facts:

 BDO Strategic Holdings and BDO Unibank, Inc are the petitioners while Asia
Amalgamated Holdings, Inc whose majority of shares are owned by Mr. Jimmy Gow is
the respondent.
 On November 6, 2007, Respondent filed for a complaint for declaration of nullity of
contract and damages against petitioners.
 On June 1, 2010, Mr. Gow was presented as the first witness which was cross-
examined on January 24, 2012 , April 17, 2012, September 12, 2012, and November
19, 2012.
 On December 10, 2012, cross-examination was suspended due to request for
issuance of subpoena duces tecum by petitioners which was granted by RTC.
 Respondent manifested to file an opposition and motion to quash the subpoena.
 On February 1, 2013, BDO Strategic Holdings, Inc. opposed the respondent’s motion
to quash and filed its written interrogatories addressed to respondent.
 On may 24, 2013, the quashal of the subpoena duces tecum and ad testificandum,
and the disallowance of the written interrogatories.
 Feeling Aggrieved, petitioner filed a petition for certiorari with an application for the
issuance of TRO and a writ for preliminary injunction before the CA.
 CA reversed the quashal of the subpoena duces and ad testificandum but upheld the
disallowance of the written interrogatories.
 Dissatisfied with the decision, petitioner filed for Motion for Partial Reconsideration
of the appealed in so far as it denied the request for written interrogatories but the
CA likewise denied the said motion.

Issue:

Whether the CA committed a reversible error in affirming the disallowance of the

written interrogatories addressed to respondent

Ruling:

The Petition is bereft of merit.

It is true that depositions are legal instrument consistent with the principle of promoting
the just, speedy and inexpensive disposition of every action or proceeding. They are
designed to facilitate the early disposition of cases and expediate the wheel of justice.
Hence, the use of discovery is highly encouraged.
However, while the petitioners are correct in contending that the modes of discovery are
important and encouraged, this is not absolute. It is important to be reminded that the
right to take deposition, whether in a form of oral or written interrogatories, has
limitations. The Rules of Court expressly provides for limitations to depositions when the
examination is being conducted in bad faith or in such a manner as to annoy, embarrass,
or oppress the person subject to the inquiry. Depositions are also limited when the
inquiry touches upon the irrelevant or enchroaches upon the recognized domains of
privilege.

Under statutes and proceedural rules, the court enjoys considerable leeway in matters
pertaining to discovery. To be specific, Section 16 of Rule 23 of the Rules of Court clearly
states that, upon notice and for good cause, the court may order for a deposition not to
be taken. Clearly, the court shall exercise its judicial discretion to determine the matter
of good cause. Good cause means a substantial reason --- one that affords a legal excuse.
In other words, it is for the court to determine whether there is a substantial reason to
disallow a deposition, as in this case. Thus, the grounds for disallowing a written
interrogatory are not restricted to those expressly mentioned under the Rules of Court
and existing jurisprudence.

It must also be emphasized that the court’s exercise of such discretion will not be set
aside in the absence of abuse, or unless the court’s disposition of matters of discovery
was improvident and affected the substantial rights of the parties.

Petitioners failed to establish that the disallowance by the lower court was made
arbitrarily, capriciously or oppressively to warrant a reversal.

On the contrary, respondent showed good cause for the disallowance. As ruled by the CA,
the use of written interrogatories will only cause further delay in the proceedings. It is
worthy to note that petitioner’s written interrogatories have a total of 561 questions,
which composed the 16 sets of interrogatories from A to Q.

It is fundamental and settled dictum that conclusions and findings of facts by the trail
court are entitled to great weight and should not be disturbed on appeal unless strong
and cogent reasons dictate otherwise. The trial court is in a better position to examine the
real evidence, as well as to observe the demeanor of the witness while testifying in the
case.

In this case, the mere allegations of petitioners that the subjects of teh written
interrogatories are relevant to the case and not made in bad faith, or in a manner
intended to annoy, embarrass or oppress, are not made in bad faith, or in a manner
intended to annoy, embarrass or oppress, are not sufficient bases to revisit the factual
evidence involved. It is also important to remember that inquiry in written interrogatories
should not only be relevant to the case, but also made in good faith and within the
bounds of the law. Thus, this Court finds no reason to reverse the finding of the CA.
Case # 20

City of Dagupan v. Ester F. Maramba G.R. No. 174411

Facts:

 Respondent was granted by DENR a miscellaneous lease contract for a 284 square-
meter property in Poblacion, Dagupan City, for a period of 25 years.
 In 1974, she constructed a commercial fish center on the property.
 On December 30, 2003, petitioner caused the demolition of the commercial fish
center without notice to respondent, allegedly treat to take over property.
 Through her Atty. Johnny Ferrer, the respondent filed a complaint for injunction and
damages with prayer for a writ of preliminary injunction and/or temporary
restraining order.
 The complaint alleged that the demolition and destruction is unlawful and the
demolition valued at Five Million (P10,000,000) pesos. The word, “ten” was
handwritten on top of the word, “five.”
 Respondent also prayed in the complaint that petitioner pay Ten Thousand (P
10,000.00) pesos for actual and present value of the commercial fish center.
 She also prayed for P5 Million as moral damages and P500, 000 as attorney’s fees.
 On July 30, 2004, the RTC by Judge Crispin Laron ruled in favor of respondent and
awarded P10 Million as actual damages.
 On August 26, 2004, petitioner city filed a motion for reconsideration. Respondent
filed for opposition prayed that the opposition be stricken off the records.
 On October 21, 2004, the trial court denied petitioner city’s motion for lack of notice
of time and place of hearing. In separate order, the trial court also granted
respondent’s motion for execution and ordered that “a writ of execution be issued in
the above-entitled case upon submission of the certificate of finality.”
 Petitioner filed a petition for relief with prayer for preliminary injunction dated
October 29, 2004, together with an affidavit of merit, alleging that the decision, were
it not for the City Legal Officer’s mistake, negligence and gross incompetence, would
not have been obtained by the plaintiff, or should have been reconsidered or
otherwise overturned, the damage award in the total amount of P11M being not only
unconscionable and unreasonable, but completely baseless.
 On November 18, 2004, the trial court denied petitioner city’s petition for relief and
ordered that the writ of execution dated October 26, 2004 be implemented.
 On August 25, 2005, the trial court, through acting Judge Silverio Castillo granted the
petition for relief and consequently modified its July 30, 2004 decision and reduce the
award of actual damages from P 10 million to P 75,000.
 Aggrieved by this order, respondent filed a petition for certiorari before the CA and
was granted. It held that petitioner’s motion for reconsideration lacked a notice of
hearing and was a mere scrap of paper.
 Consequently, the July 30, 2004 decision penned by Judge Laron became final and
executory.
 The CA also denied reconsideration, prompting petitioner city to elevate the case
before this court.
Issue:

 Whether the lack of notice of hearing in a motion for reconsideration is excusable

negligence that allows the filing of a petition for relief of judgement;
 Whether the 60-day period to file a petition for relief from judgment, when reckoned
from receipt of the denial of the motion for reconsideration, is considered filed on
time;

Ruling:

 Mistake bordering on extrinsic fraud

Rule 38 of the Rules of Court allows for the remedy called a petition for relief from
judgement. This is an equitable remedy “allowed in exceptional cases when there is no
other available or adequate remedy” that will allow for substantive justice.

Section 1 of Rule 38 provides for the grounds that warrant the filing of a petition
under Rule 38:
Section 1. Petition for relief from judgment, order, or other proceedings. -When
a judgement 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 judgement, order or
proceeding be set aside.

The presence of “fraud, accident, mistake, or excusable negligence” must be

assessed from the circumstances of the case.

Excusable negligence as a ground for a petition for relief requires that the
negligence be so gross “that ordinary diligence and prudence could not have guarded
against it.” This excusable negligence must also be imputable to the party- litigant and not
to his or her counsel whose negligence binds his or her client. The binding effect of
counsel’s negligence ensures against the resulting uncertainty and tentativeness of
proceedings if clients were allowed to merely disown their counsels’ conduct.

Nevertheless, this court has relaxed this rule in several occasions such as: where
reckless or gross negligence of counsel deprives the client of due process of law, when
application of the rule will result in outright deprivation of the client’s liberty or property;
or where the interests of justice so require.” Certainly, excusable negligence must be
proven.

Fraud as a ground for a petition for relief from judgement pertains to extrinsic or
collateral fraud. The court explained this type of fraud as follows:
Where fraud is the ground, the fraud must be extrinsic and collateral. The extrinsic
or collateral fraud that invalidates a final judgement must be such that it prevented the
unsuccessful party from fully and fairly presenting his case or defense and the losing
party from having an adversarial trial of the issue. There is extrinsic fraud when a party is
prevented from fully presenting his case to the court as when the lawyer connives to
defeat or corruptly sells out his client’s interest. Extrinsic fraud can be committed bu a
counsel against his client when the latter is prevented from presenting his case to the
court.

On the other hand, mistake as used in Rule 38 means mistake of fact and not
mistake of law. A wrong choice in legal strategy or mode of procedure will not be
considered a mistake for purposes of granting a petition for relief from judgement.

Mistake as a ground also “does not apply and was never intended to apply to a
judicial error which the court might have committed in the trial such error may be
corrected by means of an appeal.”

Mistake can be of such nature as to cause substantial injustice to one of the

parties. It may be so palpable that it borders on extrinsic fraud.

Petitioner recounted the “mistakes, negligence, incompetence and suspicious

acts/omissions” of city legal officer Atty. Roy S. Laforteza in the affidavit of merit signed by
then Mayor, Benjamin S. Lim:
He filed a motion for reconsideration without the requisite notice of hearing - his
most grievous and fatal error. This resulted in the finality of the Decision, and the
issuance of the Order of Execution.

Atty. Laforteza’s “mistake” was fatal considering that the trial court awarded a
total amount of P11 million in favor of respondent based merely on her testimony that
“the actual cost of the building through continuous improvement is 5 million more or
less”; that her husband spent $ 1,760 for round trip business travel to Phil to attend the
case; and that “for his accommodation and car rental, her husband spent more or less, P
10,000.00 including round trip ticket.

Nowhere in the trial court’s July 30, 2004 decision penned by Judge Laron did it
state or refer to any document presented by respondent to substantiate her claim costs.

On the other hand, the August 25, 2005 trial court decision penned by Judge
Castillo discussed that “respondent was only able to prove the amount of P75,000 as the
appraised value of the improvements made on the leased premises.” Based on the
decision, respondent did not able to show proof of P5 Million amount of improvements
made on establishment, did not show the receipt of her traveling expense and the car
rental she made during her stay in the country.

Second, the body of trial court’s July 30, 2004 decision was inconsistent with the
dispositive portion that awarded P500,000 as moral damages and P500,000 as attorney’s
fees.
The gross disparity between the award of actual damages and the amount actually
proved during the trial, the magnitude of the award, the nature of the “mistake” made,
and that such negligence did not personally affect the legal officer of the city all
contributed to a conclusion that he mistake or negligence committed by counsel bordered
on extrinsic fraud.
 There were discrepancy and lack of proof even on the amount of moral damages
and attorney’s fees awarded.

Petitioner followed the procedure under Section 4, Rule 38 which provides that
“if the petition is sufficient in form and substance to justify relief, the court in which it is
filed , shall issue an order requiring the adverse parties to answer the same within fifteen
days from the receipt thereof.”

The requirement under Section 4 of Rule 38 was complied with when respondent
filed an answer with motion to dismiss, and the court considered this pleading in its
resolution of petitioner’s petition for relief from judgement.

Periods for filing a petition for relief under Rule 38

The time for filing a petition for relief is found under Section 3, Rule 38 of the
Rules of Court which reads: Sec. 3 Time for filing petition; contents and verification. - A
petition provided for in either of the preceding sections of this Rule must be verified, filed
within sixty days after the petitioner learns of the judgment, final order, or other
proceeding to be set aside, and not more than six months after such judgment or final
order was entered, or such proceeding was taken; and must be accompanied with
affidavits showing the fraud, accident, mistake or excusable negligence relied upon, and
the facts constituting the petitioner’s good and substantial cause of action or defense, as
the case may be.

The double period required under this provision is jurisdictional and should be
strictly complied with. Otherwise, a petition for relief from judgment filed beyond the
reglementary period will be dismissed outright.

The 60-day period to file a petition for relief from judgment is reckoned from
actual receipt of the denial of the motion for reconsideration when one is filed.

Petitioner received a copy of the July 30, 2004 decision on August 11, 2004. It filed
a motion for reconsideration on August 11, 2004. It filed a motion for reconsideration on
August 26, 2004. It filed a motion for reconsideration on August 26, 2004. On October 25,
2004, it received a copy of the October 21, 2004 trail court order denying its motion for
reconsideration. Four days later or on October 29, 2004, it filed its petition for relief from
judgement. Thus, the petition for relief from judgement was considered field on time.
RP v. Heirs of Enrique Oribello, et.al. G.R. No.199501

Facts:

 A parcel of land situated in Nagbaculao, Kalaklan, Olongapo City was once classified
as forest land by the Bureau of Forest Development.
 The said property was originally occupied by certain Valentin Fernandez in 1968 by
virtue of Residential Permit issued by the same government office.
 Upon Valentin’s death, his son, Odillon Fernandez continued to occupy the said
property together with Sps. Apog.
 In 1969, Odillon sold the property to Mrs. Florentina Balcita who, later on, sold the
same property to Oribello.
 Oribello filed a Miscellaneous Sales Application with DENR but was denied since the
land remained forest land.
 On February 20, 1987, the subject property was declared open to disposition under
the PLA. Thus, Oribello filed another Miscellaneous Sales Application on April 6, 1987.
 On 1990, the Director of Land order the issuance od a patent in favor of Oribello.
 On even date, Miscellaneous Sales Patent and OCT were issued to Oribello.
 Matilde Apog and Aliseo San Juan claiming to be actual occupant, protested the
issuance of MSP and OCT in favor of Oribello.
 They sought the annulment of the sales patent, arguing that Oribello and Land
Inspector Dominador Laxa committed fraud and misrepresentation in the approval of
the Miscellaneous Sales Application of Oribello.
 After investigation, the Regional Executive Director of the DENR found substantial
evidence that fraud and misrepresentation were committed in the issuance of the
sales patent in favor of Oribello, warranting a reversion suit.
 On March 20,1992, the Office of the Solicitor General, representing petitioner,
instituted a complaint for reversion and cancellation of title before the RTC of
Olongapo City docketed as Civil Case No. 225-0-92. The case was thereafter
consolidated with Civil Case No. 23-0-91, a complaint for recovery of possession filed
by Oribello against Apog and San Juan.

Issue:

 Petitioner anchors the present petition on the ground that the consolidated cases,
without any order of severance, cannot be subject of multiple appeals.

Ruling:

 Section 1, Rule 31 of the Rules of Court provides:

Section 1. Consolidation - When actions involving a common question of law or
fact are pending before the court, it may order a joint hearing or trial of any or all the
matters in issue in the actions; it may order all the actions consolidated, and it may make
such orders concerning proceedings therein as may tend to avoid unnecessary costs or
delay.
 Consolidation is a procedural device to aid the court in deciding how cases in its
docket are to be tried so that the business of the court may be dispatched expeditiously
and with economy while providing justice to the parties. To promote this end, the rule
allows the consolidation and a single trial of several cases in the court’s docket, or the
consolidation of the issues within those cases. The Court explained, thus:
In the context of legal procedure, the term “consolidation” is used in three
different senses:
(1) Where all except one of several actions are stayed until one is tried, in which
case the judgement in the one trial is conclusive as to the others. This is not actually
consolidation but is referred to as such. (quasi-consolidation)
(2) Where several actions are combined into one, lose their separate identity, and
become a single action in which a single judgment is rendered. This is illustrated by a
situation where several actions are pending between the same parties stating claims
which might have been set out originally in one complaint. (actual consolidation)
(3) Where several actions are ordered to be tried together but each retains its
separate character and requires the entry of a separate judgment. This type of
consolidation does not merge the suits into a single action, or cause the parties to one
action to be parties to the other. (consolidation for trial)

In the present case, the complaint for reversion filed by petitioner (Civil Case No. 225-0-
92) was consolidated with the complaint for recovery of possession filed by Oribello (Civil
Case No. 223-0-91). While these two cases involve common questions of law and fact,
each action retains its separate and distinct character. The reversion suit settles whether
the subject land will be reverted to the State, while the recovery of possession case
determines which private party has the better right of possession over the subject
property. These cases, involving different issues and seeking different remedies, require
the rendition and entry of separate judgments. The consolidation is merely for joint trial
of the cases. Notably, the complaint for recovery of possession proceeded independently
of the reversion case, and was disposed of accordingly by the trial court.

Since each action does not lose its distinct character, severance of one action from the
other is not necessary to appeal a judgment already rendered in one action. There is no
rule or law prohibiting the appeal of a judgment or part of a judgement in one case which
is consolidated with the other cases. Further, severance is within the sound discretion of
the court for convenience or avoid prejudice. It is not mandatory under the Rules of Court
that the court sever one case from the other cases before a party can appeal an adverse
ruling on such case.