Banez, Jr. vs. Concepcion

An order denying a motion to dismiss, being interlocutory, cannot be the basis of a petition for certiorari absent a showing that it was issued without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction and that there is no appeal or any plain, speedy, and adequate remedy; direct resort to the Supreme Court also violates the hierarchy of courts absent special and important reasons. Certiorari is likewise not a proper mode to resolve evidentiary matters, including prescription, where the complaint does not show on its face that the action has prescribed.

Petitioner Juan B. Banez, Jr. was counsel for Leodegario B. Ramos in Civil Case No. 3287-V-90 and later became a party-defendant in Civil Case No. 722-M-2002 because he had guaranteed Ramos's performance under a compromise agreement with the late Rodrigo Gomez. The Estate of Gomez, represented by its administratrix Tsui Yuk Ying, was the adverse party in the enforcement proceedings, while respondent Judge Crisanto C. Concepcion presided over the RTC, Branch 12, Malolos City. The dispute implicated the ten-year prescriptive period for enforcing judgments under the Civil Code and the procedural rules governing certiorari and the hierarchy of courts.

Leodegario B. Ramos discovered that a 1,233-square-meter parcel of land, a portion of a larger 3,054-square-meter tract in Meycauayan, Bulacan, which he had adjudicated solely to himself upon his mother's death on November 16, 1982, had earlier been transferred by his mother to Ricardo Asuncion, who in turn sold it to the late Rodrigo Gomez. On February 1, 1990, Ramos commenced Civil Case No. 3287-V-90 in the RTC of Valenzuela against Gomez, also known as Domingo Ng Lim, seeking rescission of their contract of sale and damages.

Before the Valenzuela RTC could decide the case on the merits, Ramos and Gomez entered into a compromise agreement on October 9, 1990, which the RTC approved through a decision rendered the same day. Petitioner Juan B. Banez, Jr., then counsel for Ramos, assisted Ramos in entering the compromise agreement "to finally terminate this case." The agreement required, among others, that Gomez cause the survey and segregation of the 1,233-square-meter portion; that Ramos execute a deed of absolute sale over that portion in favor of Gomez; that Ramos entrust to Gomez the owner's duplicate copy of TCT No. T-10179 P(M); and that Ramos return his loan obligation of P80,000.00 plus P20,000.00 for its use and P10,000.00 as attorney's fees, guaranteed by a post-dated check for P110,000.00 drawn and issued by petitioner, payable sixty days from October 9, 1990. The agreement provided that if the check was dishonored for any reason, the compromise agreement would be considered null and void and of no effect.

One stipulation required Ramos to execute a deed of absolute sale in favor of Gomez over the 1,233-square-meter parcel covered by TCT No. T-13005 P(M) in Ramos's name. Another required petitioner to issue post-dated checks totaling P110,000.00 to guarantee Ramos's payment of (a) P80,000.00 as loan obligation, (b) P20,000.00 for the use of the loan, and (c) P10,000.00 as attorney's fees. Only P80,000.00 was ultimately paid to Gomez because petitioner's check dated April 23, 1991 for the balance of P30,000.00 was dishonored for insufficiency of funds.

Gomez died on November 7, 1990, survived by his wife Tsui Yuk Ying and their minor children, collectively referred to as the Estate of Gomez. The Estate sued Ramos and petitioner for specific performance in the RTC of Caloocan City to recover the P30,000.00 balance in Civil Case No. C-15750. On February 28, 1994, Civil Case No. C-15750 was amicably settled through a compromise agreement under which petitioner directly bound himself to pay the Estate P10,000.00 on or before March 15, 1994, P10,000.00 on or before April 15, 1994, and P10,000.00 on or before May 15, 1994.

The Estate performed Gomez's obligations under the first paragraph of the October 9, 1990 compromise agreement by causing the survey of the larger tract to segregate the 1,233-square-meter area. Ramos, however, failed to cause the registration of the deed of absolute sale under the second paragraph despite the Estate having delivered the approved survey plan and shouldered the expenses, and he did not deliver the owner's duplicate copy of TCT No. T-10179 P(M) as stipulated. Instead, Ramos and petitioner caused the 1,233-square-meter portion to be registered in Ramos's name under TCT No. T-13005-P(M).

On July 6, 1995, the Estate brought a complaint for specific performance against Ramos and petitioner in the RTC of Valenzuela, docketed as Civil Case No. 4679-V-95, to recover the 1,233-square-meter lot. The Valenzuela RTC dismissed the complaint on April 1, 1996 upon motion of Ramos and petitioner on the grounds of improper venue, because the objective was to recover ownership and possession of realty situated in Meycauayan, Bulacan, and improper remedy, because the proper recourse was to enforce the compromise judgment through a motion for execution. The Estate appealed, but the Court of Appeals affirmed the dismissal on July 24, 2001 in CA-G.R. CV No. 54231.

On September 20, 2002, the Estate commenced Civil Case No. 722-M-2002, ostensibly to revive the compromise judgment rendered on October 9, 1990 in Civil Case No. 3287-V-90, praying that Ramos be ordered to execute the deed of absolute sale covering the 1,233-square-meter lot under the fourth stipulation of the compromise agreement. Petitioner was impleaded as a party-defendant because he had guaranteed Ramos's performance and had actively participated in the transaction. On January 8, 2003, petitioner moved to dismiss, alleging that the action was barred by res judicata and prescription, that he was not a real party-in-interest, and that the amount he had guaranteed with his personal check had already been paid by Ramos with his own money.

• Grave Abuse of Discretion and Prescription: Petitioner argued that the RTC acted with grave abuse of discretion amounting to lack or excess of jurisdiction when, after correctly dismissing Civil Case No. 722-M-2002 on the ground of prescription under Article 1143 of the Civil Code, it reconsidered and set aside that order, denied his motions for reconsideration, and required him to file an answer despite the principal defendant not having been validly served with summons. He maintained that Civil Case No. 722-M-2002 was an action to revive the judgment by compromise rendered on October 9, 1990, and that under Article 1144 of the Civil Code in relation to Section 6, Rule 39 of the Rules of Court, the action had to be filed within ten years from the finality of the judgment.
• Full Satisfaction and Waiver: Petitioner submitted that dismissal was also proper because the judgment had already been fully satisfied and because the claim to the 1,233-square-meter lot under the compromise agreement had been waived, abandoned, or otherwise extinguished due to the failure of the Estate's counsel to move for the issuance of a writ of execution.
• Improper Reliance on the Specific Performance Action: Petitioner maintained that the Estate could not rely on the pendency and effects of the appeal from the action for specific performance after its dismissal had been affirmed by the Court of Appeals on grounds of improper venue, lack of personality, and improper remedy.
• Lack of Real Party-in-Interest and Payment: Petitioner alleged that he was not a real party-in-interest and that the amount he had guaranteed with his personal check had already been paid by Ramos with his own money.

• Interruption of Prescription: The Estate of Gomez countered that the filing on July 6, 1995 of the action for specific performance in the RTC of Valenzuela stopped the running of the prescriptive period; that the period commenced to run again after the Court of Appeals dismissed that action on July 24, 2001; that the total elapsed period was only five years and 11 months; and that the action for revival of judgment filed on September 20, 2002 was within the ten-year period to enforce a final and executory judgment by action.

• Propriety of Certiorari Against Interlocutory Order: Whether the orders denying petitioner's motion to dismiss may be challenged by a petition for certiorari despite being interlocutory.
• Hierarchy of Courts: Whether the direct filing of the petition for certiorari in the Supreme Court, instead of the Court of Appeals, is proper.
• Evidentiary Matters and Prescription: Whether the defense of prescription and petitioner's other factual claims may be resolved in a motion to dismiss or in certiorari proceedings.
• Nature of Civil Case No. 722-M-2002: Whether Civil Case No. 722-M-2002 is an action to revive the compromise judgment and whether it is barred by prescription.

• Propriety of Certiorari Against Interlocutory Order: No. An order denying a motion to dismiss is merely interlocutory and cannot be the basis of a petition for certiorari; the exception for lack or excess of jurisdiction or grave abuse of discretion did not apply because petitioner failed to demonstrate it and had a plain remedy by answer, trial, and appeal.
• Hierarchy of Courts: No. The direct filing in the Supreme Court violated the hierarchy of courts under Section 4, Rule 65, and no special, important, or compelling reasons justified it.
• Evidentiary Matters and Prescription: No. The prescription defense and petitioner's factual claims could not be resolved in a motion to dismiss or certiorari because the complaint did not show on its face that the action had prescribed and the issues required a full trial.
• Nature of Civil Case No. 722-M-2002: It is an action to revive the compromise judgment. There is no substantial difference between an action expressly for revival of judgment and an action for recovery of property under a right adjudged under a final judgment; the petition was dismissed.

• Propriety of Certiorari Against Interlocutory Order: The orders assailed were orders denying petitioner's motion to dismiss. An order denying a motion to dismiss is interlocutory because it does not terminate the proceedings in which it is issued, and settled doctrine holds that such an order cannot be the basis of a petition for certiorari; allowing review would delay the administration of justice and burden the courts. The exception under Section 1, Rule 65 permits certiorari against an interlocutory order if it was issued without jurisdiction, in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal or any plain, speedy, and adequate remedy. The exception was inapplicable: petitioner did not demonstrate lack or excess of jurisdiction or grave abuse of discretion, and he had ordinary remedies, such as filing an answer, proceeding to pre-trial and trial, and eventually appealing the denial of the motion to dismiss if necessary.
• Hierarchy of Courts: Even assuming concurrence of jurisdiction among the Supreme Court, the Court of Appeals, and the RTC to issue certiorari, petitioner had no unrestrained freedom to choose the forum. Section 4, Rule 65 and the policy on hierarchy of courts required that petitions against the RTC be filed with the Court of Appeals, unless special, important, or compelling reasons clearly set out in the petition justified direct resort to the Supreme Court. Vergara, Sr. vs. Suelto and People vs. Cuaresma were cited to emphasize that the Supreme Court's original jurisdiction over extraordinary writs should be exercised only when absolutely necessary or when serious and important reasons exist, and that strict observance of the hierarchy is necessary to prevent inordinate demands on the Court's time and docket. Because no such reasons were shown, the direct filing warranted outright dismissal.
• Evidentiary Matters and Prescription: Even if direct filing were allowed, dismissal would still follow because the petition would require consideration and evaluation of evidentiary matters, and the Supreme Court is not a trier of facts. Although Civil Case No. 722-M-2002 was ostensibly for recovery of ownership and possession, it was really an action to revive the compromise judgment dated October 9, 1990, since the ultimate outcome would be to order execution of that judgment. Under Hizon vs. Escocio, there is no substantial difference between an action expressly called one for revival of judgment and an action for recovery of property under a right adjudged under and evidenced by a final judgment. The parties themselves treated the complaint as one for revival, and they should be fully heard on their claims like in any other independent action. Petitioner's defense of prescription presented an evidentiary concern. Article 1144 of the Civil Code requires an action to revive a judgment to be brought within ten years from accrual, but such a defense can be used in a motion to dismiss only when the complaint on its face shows that the action has already prescribed; otherwise, the issue requires a full-blown trial on the merits, as held in Pineda vs. Heirs of Eliseo Guevara. The complaint did not show on its face that the period to revive had lapsed. Moreover, the mere lapse of the period did not per se render the judgment stale, because events that effectively suspended the running of the period might have intervened. Lancita vs. Magbanua was cited for the rule that the time when execution is stayed by agreement, injunction, appeal, death of a party, or otherwise is generally not included in computing the time limited for suing out execution, and any interruption or delay occasioned by the debtor extends the time. Petitioner also raised factual issues in his motion to dismiss, such as full payment or discharge of Ramos's obligation and waiver or abandonment of rights under the compromise agreement. Proof of these matters could not be received in certiorari proceedings and should be established in the RTC.
• Nature of Civil Case No. 722-M-2002: Civil Case No. 722-M-2002 was characterized as an action to revive the judgment by compromise dated October 9, 1990. Because the ultimate relief sought was execution of that compromise judgment, the action was in substance one for revival, notwithstanding its ostensible label as an action for recovery of ownership and possession. The principle that there is no substantial difference between an action expressly for revival of judgment and an action for recovery of property under a right adjudged under and evidenced by a final judgment was relied upon. The parties themselves treated the complaint as one for revival, and they should be fully heard on their respective claims in the RTC. The petition was therefore dismissed.

• Interlocutory Orders and Certiorari — An order denying a motion to dismiss is interlocutory and, as a general rule, cannot be challenged by certiorari because it does not terminate the proceedings. The exception is when the order was issued without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal or any plain, speedy, and adequate remedy. The exception was not applied because petitioner failed to show grave abuse and had ordinary remedies.
• Hierarchy of Courts — The concurrence of jurisdiction among the Supreme Court, Court of Appeals, and RTC over petitions for certiorari does not give litigants absolute freedom to choose the forum. Petitions against the RTC should be filed with the Court of Appeals, and direct resort to the Supreme Court is allowed only for special, important, or compelling reasons clearly set out in the petition. The direct petition was dismissed for failure to justify the exception.
• Certiorari and Evidentiary Matters — Certiorari is not a proper remedy for resolving factual or evidentiary matters because the Supreme Court is not a trier of facts. Where the complaint does not show on its face that the action has prescribed, the defense of prescription involves evidentiary matters requiring a full trial and cannot be resolved in a motion to dismiss or in certiorari proceedings.
• Revival of Judgment and Action for Recovery of Property — There is no substantial difference between an action expressly called one for revival of judgment and an action for recovery of property under a right adjudged under and evidenced by a final judgment. Civil Case No. 722-M-2002 was treated as an action to revive the compromise judgment.
• Suspension of the Period for Enforcement of Judgment — In computing the time limited for suing out execution, the general rule is that the time when execution is stayed by agreement, injunction, appeal or writ of error operating as a supersedeas, death of a party, or otherwise should not be included; any interruption or delay occasioned by the debtor extends the time within which the writ may be issued without scire facias. Events suspending the prescriptive period might have intervened, so the mere lapse of ten years did not necessarily render the judgment stale.

• "It is settled, however, that an order denying a motion to dismiss, being merely interlocutory, cannot be the basis of a petition for certiorari." — The Court states the general rule that disallowed petitioner's certiorari challenge to the RTC orders denying his motion to dismiss.
• "The exception does not apply to this challenge. The petitioner has not demonstrated how the assailed orders could have been issued without jurisdiction, or with excess of jurisdiction, or in grave abuse of discretion amounting to lack or excess of jurisdiction." — The Court applies the exception to the general rule and finds petitioner failed to show grave abuse or jurisdictional error.
• "There being no special, important or compelling reason that justified the direct filing of the petition for certiorari in this Court in violation of the policy on hierarchy of courts, its outright dismissal is unavoidable." — The Court dismisses the petition for violating the hierarchy of courts.
• "An allegation of prescription, as the Court put it in Pineda v. Heirs of Eliseo Guevara, “can effectively be used in a motion to dismiss only when the complaint on its face shows that indeed the action has already prescribed, [o]therwise, the issue of prescription is one involving evidentiary matters requiring a full blown trial on the merits and cannot be determined in a mere motion to dismiss.”" — The Court explains why the prescription defense could not be resolved in the motion to dismiss and required trial.

• Atienza vs. Court of Appeals, G.R. No. 85455, June 2, 1994, 232 SCRA 737, 744 — Cited for the rule that an order denying a motion to dismiss is interlocutory and cannot be the basis of a petition for certiorari.
• Vergara, Sr. vs. Suelto, G.R. No. L-74766, December 21, 1987, 156 SCRA 753, 766 — Cited for the policy on hierarchy of courts and the rule that the Supreme Court's original jurisdiction over extraordinary writs should be exercised only when absolutely necessary or for serious and important reasons.
• People vs. Cuaresma, G.R. No. 67787, April 18, 1989, 172 SCRA 415, 423-425 — Cited for strict adherence to the hierarchy of courts and the requirement that special and important reasons be clearly and specifically set out for direct resort to the Supreme Court.
• Hizon vs. Escocio, 103 Phil. 1106 (1958) — Cited for the principle that there is no substantial difference between an action expressly for revival of judgment and an action for recovery of property under a right adjudged under and evidenced by a final judgment.
• Pineda vs. Heirs of Eliseo Guevara, G.R. No. 143188, February 14, 2007, 515 SCRA 627, 637 — Cited for the rule that prescription may be raised in a motion to dismiss only when the complaint on its face shows that the action has prescribed; otherwise, it is an evidentiary matter requiring trial.
• Lancita vs. Magbanua, G.R. No. L-15467, January 31, 1963, 7 SCRA 42, 46 — Cited for the rule that the time during which execution is stayed by agreement, injunction, appeal, death, or other cause is generally excluded in computing the period for suing out execution, and that interruption or delay by the debtor extends the time.

• Article 1144, Civil Code — Provides that actions upon a written contract, an obligation created by law, or a judgment must be brought within ten years from the time the right of action accrues. Petitioner invoked it to argue that the action to revive the October 9, 1990 compromise judgment had prescribed; the defense could not be resolved on a motion to dismiss because the complaint did not show on its face that prescription had set in.
• Article 1143 (3), Civil Code — Cited by the RTC in its February 18, 2003 order as providing the ten-year period within which a right of action based upon a judgment must be brought. The RTC initially relied on it to dismiss Civil Case No. 722-M-2002.
• Article 1155, Civil Code — Cited by the RTC in its March 24, 2003 order as the basis for holding that the filing of the specific performance action on July 6, 1995 interrupted the prescriptive period.
• Section 6, Rule 39, Rules of Court — Provides that a final and executory judgment may be executed by motion within five years from entry and, after the lapse of that time and before it is barred by the statute of limitations, may be enforced by action. Petitioner invoked it in relation to Article 1144 to argue that the revival action was time-barred.
• Section 1, Rule 65, Rules of Court — Provides that certiorari lies when a tribunal, board, or officer exercising judicial or quasi-judicial functions has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal or any plain, speedy, and adequate remedy. The Court quoted it and found the exception inapplicable.
• Section 4, Rule 65, Rules of Court — Governs where a petition for certiorari, prohibition, or mandamus must be filed and embodies the hierarchy of courts. The Court quoted it and held that petitioner's direct filing in the Supreme Court was improper absent special and compelling reasons.

Sereno, C.J., Leonardo-De Castro, Villarama, Jr., and Reyes, JJ., concur.