Mesina vs. Meer

A petition for relief from judgment under Rule 38 is not available against a judgment of the CA rendered in its appellate jurisdiction; the phrase "any court" in Section 1 refers only to municipal/metropolitan and regional trial courts. Relief will also not be granted where the loss of the remedy at law was due to the party's own negligence or mistaken mode of procedure.

The dispute between Humberto D. Meer and spouses Michaelangelo and Grace Mesina concerns registered land in Pandacan, Manila and competing Torrens titles over it. The procedural question turns on the scope of Rule 38 of the 1997 Revised Rules of Civil Procedure, which revised the old rule requiring a petition for relief from an inferior court's judgment to be filed with the Court of First Instance. The revision was part of the move toward uniform procedure in municipal and regional trial courts and the designation of municipal/metropolitan trial courts as courts of record under R.A. No. 7691.

Respondent Humberto D. Meer was the registered owner of a parcel of land at Lot 15, Block 5, Pandacan, Manila, covered by TCT No. 158886. Sometime in June 1993, he applied for a loan to construct a house on the property, but discovered that his certificate of title had been cancelled and that a new one, TCT No. 166074, had been issued in the name of spouses Sergio and Lerma Bunquin. The Bunquins had acquired the property by virtue of a deed of sale dated June 3, 1985 purportedly executed by Meer in their favor.

On January 12, 1994, Meer sought the cancellation of TCT No. 166074 with the MeTC of Manila, Branch 10, and on the same day a notice of lis pendens was annotated at the back of that title. While the case was pending, TCT No. 166074 was cancelled and replaced by TCT No. 216518 issued in the name of petitioners, spouses Michaelangelo and Grace Mesina. The property had been conveyed to the Mesinas on September 28, 1993, even prior to the annotation of the lis pendens; the Absolute Deed of Sale was notarized on the same day, including the payment of taxes appurtenant thereto. The transfer of title from Lerma Bunquin to petitioners was effected only on June 15, 1994 because of requirements imposed by the National Housing Authority. Because of these developments, Meer impleaded petitioners as additional party defendants.

During the hearings, the Bunquin spouses never appeared and were declared in default, while petitioners participated actively in defense of their position. In its Decision dated February 16, 1998, the MeTC ruled that the alleged sale between Meer and the Bunquins was fraudulent, but adjudged petitioners buyers in good faith and entitled to possession of the property. The MeTC noted that petitioners had relied on what appeared in Lerma Bunquin's title, made verification with the NHA, and sought legal advice before purchasing the property.

Meer filed a Motion for Reconsideration, which the MeTC denied, and he then appealed to the RTC. The RTC reversed the MeTC. It found that the Deed of Sale between Meer and the Bunquins was a forgery and that Meer's signature was forged, and that the deed in favor of petitioners was registered after the annotation of the lis pendens. The CA affirmed the RTC in a Resolution dated May 10, 2000.

On July 17, 2000, after the reglementary period for appeal had lapsed, petitioners filed a Petition for Relief from Judgment asking the CA to set aside its May 10, 2000 Resolution. They alleged extrinsic fraud consisting of collusion between Meer and the Bunquins during the MeTC trial, excusable negligence due to their counsel's delay in producing requested documents, and a good and substantial defense. The CA denied the petition and later denied reconsideration, prompting the present petition for review.

• Availability of Rule 38: Petitioners argued that the phrase "any court" in Rule 38 extends the remedy of petition for relief to judgments or orders of the CA.
• Extrinsic Fraud: Petitioners argued that extrinsic fraud was committed through collusion between respondent Meer and the Bunquins during the MeTC trial; had the Bunquins testified on the validity of the Deed of Sale and the authenticity of Meer's signature, the result would have been in petitioners' favor.
• Excusable Negligence: Petitioners maintained that their failure to file the requisite appeal on time was largely due to their counsel of record's delay in producing requested documents; they also blamed counsel and invoked honest mistake of law and lack of legal education.
• Good and Substantial Defense: Petitioners claimed they had a good and substantial defense, arguing in their petition that the notarized Deed of Sale was presumed genuine and regular, that Meer's mere denial did not overcome the presumption, and that no handwriting expert was secured to compare the signatures.
• Equity and Substantial Justice: Petitioners asked the SC not to strictly construe the Rules on equitable grounds because their "only earthly possession" was at stake.

• Availability of Rule 38 Relief: Whether a petition for relief from judgment under Rule 38 of the 1997 Revised Rules of Civil Procedure may be availed of against a judgment of the CA rendered in the exercise of its appellate jurisdiction.
• Equitable Exception and Negligence: Whether the SC should relax the Rules on equitable grounds because the property is petitioners' "only earthly possession," despite the loss of their appeal through counsel's delay and their claimed lack of legal education.
• Sufficiency of Grounds for Relief: Whether petitioners' allegations of extrinsic fraud, excusable negligence, and a good and substantial defense are sufficient to give due course to their petition for relief.

• Availability of Rule 38 Relief: No. Rule 38 requires the petition to be filed in the same court that rendered the judgment; "any court" refers only to municipal/metropolitan and regional trial courts, and neither the Rules nor the Revised Internal Rules of the CA allow relief in the CA.
• Equitable Exception and Negligence: No. Relief is equitable and exceptional, and it will not be granted where the loss of the remedy was due to the party's own negligence or mistaken procedure; counsel's mistake does not justify relief absent palpable gross negligence.
• Sufficiency of Grounds for Relief: No. The extrinsic fraud claim should have been raised in the MeTC, and the defenses were available from the beginning; petitioners cannot use relief to revive a lost appeal.

• Availability of Rule 38 Relief: Rule 38, Section 1 of the 1997 Revised Rules of Civil Procedure requires the petition to be filed "in such court and in the same case" praying that the judgment, order, or proceeding be set aside. The SC explained that the revised Rule 38 departed from the old rule, which required a petition for relief from a municipal trial court judgment to be filed with the Court of First Instance, because the revision was in line with Rule 5's uniform procedure for municipal and regional trial courts and the designation of municipal/metropolitan trial courts as courts of record under R.A. No. 7691. The phrase "any court" therefore refers only to municipal/metropolitan and regional trial courts. Procedure in the CA and the SC is governed by separate provisions, Rules 44 to 56, and may be supplemented by additional rules; neither the Rules of Court nor the Revised Internal Rules of the CA allows a petition for relief in the CA. The CA thus correctly denied the petition.

• Equitable Exception and Negligence: Relief from judgment is an equitable remedy and is allowed only under exceptional circumstances and only if fraud, accident, mistake, or excusable negligence is present. Where the defendant has another available or adequate remedy, such as a motion for new trial or appeal, he cannot avail himself of relief. The SC acknowledged that it has sometimes construed the Rules with liberality in the interest of substantial justice and in the exercise of equity jurisdiction, but the circumstances here did not justify an exception. Petitioners blamed their counsel and invoked honest mistake of law and lack of legal education, but the SC held that a mistake of counsel justifies a second opportunity only when it is so palpable as to amount to gross negligence. Petitioners had squandered the various opportunities available at the different stages of the case, and public interest demands an end to litigation; a belated effort to reopen a case that had attained finality would only delay the administration of justice.

• Sufficiency of Grounds for Relief: The SC held that petitioners' allegation of extrinsic fraud should have been brought at issue in the MeTC. If they truly believed that the default of the Bunquin spouses prejudiced their rights, they should have questioned it from the beginning; instead, they chose to participate in the proceedings and actively presented their defense, and their efforts were rewarded when the MeTC ruled in their favor. They never raised the issue when Meer appealed to the RTC, and they made no effort to bring it for consideration after the RTC reversed the MeTC and the CA sustained the reversal. The defenses they forwarded in support of the petition should likewise have been raised in the MeTC, as they had been available from the beginning. The SC would not allow petitioners, in the guise of equity, to benefit from their own negligence.

• Petition for Relief from Judgment — It is an equitable remedy allowed only under exceptional circumstances and only if fraud, accident, mistake, or excusable negligence is present. It must be filed in the same court that rendered the judgment, and it is not available against a CA appellate judgment; the phrase "any court" in Rule 38 refers only to municipal/metropolitan and regional trial courts. The SC applied this by holding that the CA correctly denied the petition for relief.
• Relief Not Available Where Other Adequate Remedy Exists — Where the defendant has another available or adequate remedy, such as a motion for new trial or appeal from the adverse decision, he cannot avail himself of a petition for relief. The SC applied this because petitioners lost their appeal through counsel's delay.
• Relief Not Granted for Party's Own Negligence or Mistaken Procedure — Relief will not be granted to a party who seeks to be relieved from the effects of a judgment when the loss of the remedy at law was due to his own negligence or a mistaken mode of procedure; otherwise, the petition for relief would revive a right of appeal already lost. The SC applied this to petitioners' failure to appeal on time.
• Mistake of Counsel — In exceptional cases, when the mistake of counsel is so palpable that it amounts to gross negligence, the SC may afford a party a second opportunity to vindicate his right. The SC found no such gross negligence because petitioners had squandered the various opportunities available at the different stages of the case.
• Extrinsic Fraud Must Be Raised at the Earliest Opportunity — A party cannot raise extrinsic fraud for the first time in a petition for relief after participating in the trial and failing to raise it on appeal. The SC applied this to petitioners' collusion claim, which they did not raise in the MeTC, the RTC, or the CA.
• Equity Jurisdiction — The SC may construe the Rules with liberality in the interest of substantial justice and in the exercise of equity jurisdiction, but it will not do so where the party seeks to benefit from his own negligence. The SC applied this by refusing to relax the Rules despite petitioners' claim that the property was their "only earthly possession."

• "Relief from judgment is an equitable remedy and is allowed only under exceptional circumstances and only if fraud, accident, mistake, or excusable negligence is present. Where the defendant has other available or adequate remedy such as a motion for new trial or appeal from the adverse decision, he cannot avail himself of this remedy." — This states the nature of relief from judgment and the condition that prevents its use when another remedy exists.
• "While Rule 38 uses the phrase "any court", it refers only to municipal/metropolitan and regional trial courts." — This is the SC's core interpretation of Rule 38's scope, rejecting its application to CA appellate judgments.
• "As it stands, neither the Rules of Court nor the Revised Internal Rules of the Court of Appeals allow the remedy of petition for relief in the Court of Appeals." — This confirms that the remedy is unavailable in the CA under the governing procedural rules.
• "Finally, it is a settled rule that relief will not be granted to a party who seeks to be relieved from the effects of the judgment when the loss of the remedy at law was due to his own negligence, or a mistaken mode of procedure; otherwise, the petition for relief will be tantamount to reviving the right of appeal which has already been lost either because of inexcusable negligence or due to mistaken mode of procedure by counsel." — This is the SC's basis for denying relief despite petitioners' equitable plea.

• Palmares vs. Jimenez, 90 Phil. 659 (1951) — Cited for the rule that relief from judgment is an equitable remedy available only in exceptional circumstances and not where the party has another adequate remedy such as appeal.
• Espinosa vs. Yatco, 7 SCRA 78 (1963) — Cited for the rule that relief will not be granted where the loss of the remedy was due to the party's own negligence or mistaken mode of procedure.

• Rule 38, Section 1, 1997 Revised Rules of Civil Procedure — Requires a petition for relief from judgment, final order, or other proceeding to be filed in the same court and in the same case when a judgment is entered against a party through fraud, accident, mistake, or excusable negligence; applied to hold that the remedy is not available in the CA.
• Rule 38, Section 2, 1997 Revised Rules of Civil Procedure — Requires the petition to be filed within 60 days after the petitioner learns of the judgment, final order, or proceeding and to be accompanied by affidavits showing the fraud, accident, mistake, or excusable negligence and the petitioner's good and substantial cause of action or defense; mentioned as part of the Rule 38 requirements.
• Rule 45, Rules of Court — Governs the petition for review on certiorari filed by petitioners to assail the CA resolutions.
• Rule 5, Section 1, Rules of Court — Prescribes uniform procedure in the municipal trial courts and the RTC except as stated; cited to explain the revision of Rule 38.
• R.A. No. 7691 (1994) — Designated municipal/metropolitan trial courts as courts of record; cited to support the reading that "any court" in Rule 38 refers to municipal/metropolitan and regional trial courts.
• Rules 44-56, Rules of Court — Govern procedure in the CA and the SC; cited to show that Rule 38 relief is not part of CA procedure.
• Revised Internal Rules of the Court of Appeals — Cited with the Rules of Court as not allowing the remedy of petition for relief in the CA.