Gonzales vs. Pe

The payment of the full amount of appellate docket and other lawful fees within the 15-day reglementary period is mandatory and jurisdictional for the perfection of an appeal; without such payment, the appeal is not perfected, the appellate court does not acquire jurisdiction over the subject matter, and the decision sought to be appealed from becomes final and executory.

Respondent Quirico Pe was engaged in the business of construction materials and had been transacting with petitioners Spouses Nestor Victor Rodriguez and Ma. Lourdes Rodriguez, who were contractors awarded two DPWH projects in Aklan and Antique. Petitioner Augustus Gonzales was Nestor Rodriguez's business partner. The dispute arose from a series of cement supply transactions between respondent (as owner of Antique Commercial) and petitioner Nestor Rodriguez (as owner of Greenland Builders), involving a blank Land Bank check entrusted to respondent as collateral for a pre-payment application with the DPWH. The parties' conflicting claims over the amount owed for cement deliveries and the propriety of respondent's filling in of the blank check culminated in civil litigation before the RTC of Iloilo City, Branch 31.

Respondent Quirico Pe, engaged in the construction materials business, had been transacting with petitioners Spouses Nestor Victor Rodriguez and Ma. Lourdes Rodriguez. The DPWH awarded two contracts to Nestor Rodriguez for the construction of the Lanot-Banga Road (Kalibo Highway) in Aklan and the concreting of the Laua-an Pandan Road in Antique. In 1998, respondent agreed to supply Portland cement for these projects. Nestor Rodriguez availed of the DPWH's pre-payment program for the Kalibo project, under which the DPWH would give an advance payment upon presentment, among others, of an official receipt for the amount advanced. To facilitate this pre-payment application, Nestor Rodriguez delivered to respondent a Land Bank of the Philippines (LBP) Check No. 6563066, signed by co-petitioners Ma. Lourdes Rodriguez and Augustus Gonzales, but with the amount and date left blank. The blank check was intended to serve as collateral guaranteeing payment for 15,698 bags of cement valued at ₱1,507,008.00, covered by Official Receipt No. 1175 issued by respondent (as owner of Antique Commercial) in favor of Nestor Rodriguez (as owner of Greenland Builders).

A year later, respondent filled in the blank check with the amount of ₱2,062,000.00 and dated it June 30, 1999, corresponding to what he claimed was the outstanding balance for cement deliveries. The check was dishonored for being "drawn against insufficient funds (DAIF)." The parties disputed the total amount of cement delivered and the corresponding payment: petitioners claimed they had paid ₱2,306,500.00, exceeding the value of 23,360 bags (₱2,167,340.00) for the Kalibo project, while respondent asserted he had delivered 40,360 bags and received only ₱2,306,500.00, leaving an outstanding balance of ₱2,062,000.00.

On December 9, 1999, petitioners filed an Amended Complaint for Declaration of Payment, Cancellation of Documents and Damages against respondent before the RTC of Iloilo City, Branch 31, docketed as Civil Case No. 25945. Respondent filed an Answer with compulsory counterclaim seeking recovery of the ₱2,062,000.00 balance with 24% interest. The RTC, in its Decision dated June 28, 2002, applied Section 14 of the Negotiable Instruments Law and found that respondent's filling up of the check was not made strictly in accordance with the authority given and was not done within a reasonable time. The RTC declared petitioners' obligation fully paid, nullified the check, awarded damages to petitioners, and dismissed the counterclaim. Respondent received the decision on July 26, 2002, and filed a Notice of Appeal on July 30, 2002, but did not pay the appellate docket and other lawful fees. Petitioners moved to dismiss the appeal for non-perfection due to non-payment of docket fees, and the RTC, by its Order dated September 23, 2002, dismissed the appeal and directed the issuance of a writ of execution. Respondent elevated the matter to the CA via certiorari, which reversed the RTC and ordered the belated payment of docket fees and the giving of due course to the appeal.

• Non-Perfection of Appeal: Petitioners maintained that since respondent failed to pay the docket and other legal fees at the time he filed the Notice of Appeal, his appeal was deemed not perfected in contemplation of law, rendering the RTC Decision dated June 28, 2002 final and executory.
• Wrong Application of Yambao: Petitioners argued that the CA's reliance on Yambao vs. Court of Appeals was misplaced, as respondent never made any payment of docket fees, not even a partial or attempted payment, simultaneous with the filing of the Notice of Appeal, unlike in Yambao where the petitioners subsequently paid the deficiency before the CA ruled on their motion for reconsideration.

• Perfection by Mere Filing: Respondent maintained, citing Section 9, Rule 41 of the Rules of Court, that his appeal was perfected by the mere filing of the notice of appeal, and that with such perfection, the trial court was divested of jurisdiction and only the CA had jurisdiction to determine the propriety of the appeal.
• Excusable Negligence: Respondent claimed that his failure to pay the required docket and other legal fees was because the RTC Branch Clerk of Court did not make an assessment of the appeal fees to be paid when he filed the notice of appeal, and that this should be treated as mistake and excusable negligence.
• Wrong Remedy: Respondent argued that since the CA's assailed Decision partook of an interlocutory order enjoining the finality of the RTC Decision, petitioners should have availed of a petition for certiorari under Rule 65 rather than a petition for review on certiorari under Rule 45.

• Perfection of Appeal: Whether respondent's appeal was properly perfected despite his failure to pay the appellate docket and other lawful fees within the 15-day reglementary period.
• Excusable Negligence: Whether respondent's non-payment of docket fees, attributed to the RTC Branch Clerk of Court's failure to issue an assessment, constitutes excusable negligence.
• Jurisdiction of the RTC: Whether the RTC lost jurisdiction over the case upon its issuance of the Order dated August 5, 2002 giving due course to respondent's appeal.
• Propriety of Rule 45 Petition: Whether a petition for review on certiorari under Rule 45 is the proper remedy to challenge the CA Decision dated June 23, 2004.

• Perfection of Appeal: No. The appeal was not perfected because respondent failed to pay the full amount of the appellate docket and other lawful fees within the 15-day reglementary period, a requirement that is both mandatory and jurisdictional under Section 4, Rule 41 of the Rules of Court.
• Excusable Negligence: No. The negligence was that of respondent's counsel in ignoring the basic procedure of paying docket fees upon filing a notice of appeal, and such negligence is not excusable as ordinary diligence and prudence could have guarded against it.
• Jurisdiction of the RTC: No. The RTC did not lose jurisdiction because the appeal was never perfected; under Section 9, Rule 41, the court of origin loses jurisdiction only upon the perfection of the appeal filed in due time and the expiration of the time to appeal of the other parties.
• Propriety of Rule 45 Petition: Yes. A petition for review on certiorari under Rule 45 is the proper remedy for a party aggrieved by a decision of the CA, as Rule 45 provides that decisions, final orders, or resolutions of the CA in any case, regardless of the nature of the action or proceedings involved, may be appealed to the Supreme Court.

• Perfection of Appeal: Section 4, Rule 41 of the Rules of Court requires that within the period for taking an appeal, the appellant shall pay to the clerk of the court which rendered the judgment the full amount of the appellate court docket and other lawful fees. This requirement is not merely directory but mandatory and jurisdictional. The Court relied on Far Corporation vs. Magdaluyo and subsequent cases establishing that without payment of docket fees within the prescribed period, the appeal is not perfected, the appellate court does not acquire jurisdiction over the subject matter, and the decision sought to be appealed from becomes final and executory. The CA's reliance on Yambao vs. Court of Appeals was erroneous because, unlike in Yambao where the petitioners subsequently paid the deficiency before the CA ruled on their motion for reconsideration — indicative of good faith — respondent herein never made any payment, not even an attempt, simultaneous with or after filing the Notice of Appeal. Under Section 1(c), Rule 50, the CA may dismiss an appeal on the ground of non-payment of docket fees within the reglementary period.

• Excusable Negligence: Respondent's counsel filed a notice of appeal without paying the appellate docket fees, simply ignoring the basic procedural requirement. The claim that the Branch Clerk of Court did not issue an assessment was too superficial to warrant consideration. Negligence to be excusable must be one which ordinary diligence and prudence could not have guarded against. Counsel's failure to keep abreast of procedural laws binds the client. The Court cited National Power Corporation vs. Laohoo, where it ruled that counsel's failure to file an appeal in due time does not amount to excusable negligence, and that to grant a plea for relaxation of the rules on technicality would disturb the well-entrenched ruling on the mandatory and jurisdictional nature of the period for perfecting an appeal.

• Jurisdiction of the RTC: The CA erroneously assumed that the RTC lost jurisdiction upon issuing the Order dated August 5, 2002 giving due course to the appeal. Section 9, Rule 41 provides that the court of origin loses jurisdiction only upon the perfection of the appeal filed in due time and the expiration of the time to appeal of the other parties. Since respondent's appeal was not perfected due to non-payment of docket fees, the RTC retained jurisdiction. Section 13, Rule 41 expressly allows the trial court, prior to transmittal of records, to dismiss an appeal motu proprio or on motion for non-payment of docket fees within the reglementary period. The RTC therefore properly acted on petitioners' Motion for Reconsideration, to Dismiss Appeal, and for Issuance of Writ of Execution.

• Propriety of Rule 45 Petition: Rule 45 provides that decisions, final orders, or resolutions of the CA in any case, regardless of the nature of the action or proceedings involved, may be appealed to the Supreme Court by filing a petition for review on certiorari, which is a continuation of the appellate process over the original case. This remedy is distinct from a petition for certiorari under Rule 65. The Court cited Emcor Incorporated vs. Sienes in support. Respondent's argument that the CA Decision was interlocutory and thus required a Rule 65 petition was unfounded.

• Mandatory and Jurisdictional Nature of Docket Fee Payment — The payment of the full amount of the appellate docket and other lawful fees within the 15-day reglementary period is both mandatory and jurisdictional for the perfection of an appeal. Without such payment, the appeal is not perfected, the appellate court does not acquire jurisdiction over the subject matter, and the decision sought to be appealed from becomes final and executory. The Court applied this doctrine to hold that respondent's failure to pay docket fees rendered his appeal unperfected and the RTC decision final.

• Perfection of Appeal; Effect on Trial Court Jurisdiction — Under Section 9, Rule 41, the court of origin loses jurisdiction over the case only upon the perfection of the appeal filed in due time and the expiration of the time to appeal of the other parties. Prior to transmittal of records, the trial court may issue orders for the protection and preservation of the rights of the prevailing party, including the issuance of a writ of execution if the appeal was not perfected. The Court applied this to hold that the RTC retained jurisdiction to dismiss the appeal and order execution.

• Negligence of Counsel Binds the Client — Counsel's failure to comply with basic procedural requirements, such as paying docket fees upon filing a notice of appeal, is not excusable negligence. Ordinary diligence and prudence could have guarded against such an omission. The client is bound by counsel's procedural lapses. The Court rejected respondent's claim that the Clerk of Court's failure to issue an assessment excused the non-payment.

• Rule 45 as Proper Remedy for CA Decisions — A petition for review on certiorari under Rule 45 is the proper remedy for a party aggrieved by any decision, final order, or resolution of the Court of Appeals, regardless of the nature of the action or proceedings involved. It is a continuation of the appellate process and is distinct from a petition for certiorari under Rule 65.

• "The requirement of paying the full amount of the appellate docket fees within the prescribed period is not a mere technicality of law or procedure. The payment of docket fees within the prescribed period is mandatory for the perfection of an appeal. Without such payment, the appeal is not perfected." — This passage articulates the core ratio decidendi, establishing the mandatory and jurisdictional character of docket fee payment as a requisite for perfecting an appeal.

• "While every litigant must be given the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities, the failure to perfect an appeal within the reglementary period is not a mere technicality. It raises jurisdictional problem, as it deprives the appellate court of its jurisdiction over the appeal." — This passage reconciles the policy of liberal construction with the jurisdictional character of appeal perfection, and is frequently cited in subsequent jurisprudence on the finality of judgments.

• "Just as a losing party has the right to appeal within the prescribed period, the winning party has the correlative right to enjoy the finality of the decision on the case." — This passage defines the correlative right of the prevailing party to the finality of judgments, underscoring the dual nature of the right to appeal as bounded by procedural rules.

• Far Corporation vs. Magdaluyo, G.R. No. 148739, November 19, 2004, 443 SCRA 218 — Controlling precedent establishing that the payment of docket and other legal fees within the prescribed period is both mandatory and jurisdictional, and that without such payment the appeal is not perfected and the appellate court does not acquire jurisdiction.
• Yambao vs. Court of Appeals, G.R. No. 140894, November 27, 2000, 346 SCRA 141 — Distinguished. The CA relied on this case to justify belated payment, but the Supreme Court held it inapplicable because respondent herein never made any payment or attempt to pay, unlike in Yambao where subsequent payment of the deficiency indicated good faith.
• National Power Corporation vs. Laohoo, G.R. No. 151973, July 23, 2009, 593 SCRA 564 — Followed. Counsel's failure to file an appeal in due time does not amount to excusable negligence; relaxation of rules on technicality would disturb the well-entrenched policy on the mandatory and jurisdictional nature of the period for perfecting an appeal.
• Emcor Incorporated vs. Sienes, G.R. No. 152101, September 8, 2009, 598 SCRA 617 — Followed. A petition for review on certiorari under Rule 45 is the proper remedy to challenge a CA decision, regardless of the nature of the action or proceedings involved.
• Ruiz vs. Delos Santos, G.R. No. 166386, January 27, 2009, 577 SCRA 29 — Cited for the principle that excusable negligence must be one which ordinary diligence and prudence could not have guarded against.

• Section 4, Rule 41, Rules of Court — Requires the appellant to pay the full amount of appellate court docket and other lawful fees to the clerk of the court which rendered the judgment within the period for taking an appeal. Applied as the mandatory and jurisdictional basis for holding respondent's appeal unperfected.
• Section 9, Rule 41, Rules of Court — Provides that a party's appeal by notice of appeal is deemed perfected upon filing of the notice of appeal in due time, and that the court loses jurisdiction over the case only upon the perfection of appeals filed in due time and the expiration of the time to appeal of the other parties. Applied to show that the RTC retained jurisdiction because the appeal was not perfected.
• Section 13, Rule 41, Rules of Court — Authorizes the trial court, prior to transmittal of records to the appellate court, to dismiss an appeal motu proprio or on motion for non-payment of docket and other lawful fees within the reglementary period. Applied to validate the RTC's dismissal of respondent's appeal.
• Section 1(c), Rule 50, Rules of Court — Authorizes the CA to dismiss an appeal on the ground of non-payment of docket and other lawful fees within the reglementary period. Cited to reinforce the mandatory nature of docket fee payment.
• Section 14, Negotiable Instruments Law — Governs the filling up of blanks in negotiable instruments, requiring that completion be made strictly in accordance with the authority given and within a reasonable time. Applied by the RTC in its Decision dated June 28, 2002 to nullify the check filled up by respondent.
• Rule 45, Rules of Court — Provides that decisions, final orders, or resolutions of the CA in any case may be appealed to the Supreme Court by filing a petition for review on certiorari. Applied to uphold the propriety of petitioners' remedy.

Antonio T. Carpio, Presbitero J. Velasco, Jr., Arturo D. Brion, and Maria Lourdes P. A. Sereno concurred with the decision. No separate concurring opinions were written.