Perez vs. Hermano

A Rule 65 petition filed within a fresh 60-day period counted from notice of denial of a timely motion for reconsideration is timely under A.M. No. 00-2-03-SC applied retroactively as curative procedural law, and causes of action against different defendants arising from the same series of transactions over the same subject matter with common questions of fact and law may be joined, severance thereof constituting grave abuse of discretion.

Petitioners Cristina Agraviador Aviso and spouses Victor and Milagros Perez were owners of five parcels of land contracted to be sold to Zescon Land, Inc. through its president Zenie Sales-Contreras, with respondent Antonio Hermano asserting rights as mortgagee over the same properties. At the time of filing, Section 4, Rule 65 of the 1997 Rules of Civil Procedure as amended by Circular No. 39-98 governed the sixty-day period for certiorari, later amended anew during pendency by A.M. No. 00-2-03-SC to count the period from notice of denial of reconsideration. Joinder of causes of action was governed by Sections 5 and 6, Rule 2, liberally construed to avoid multiplicity of suits without prejudice to litigants.

Sometime in November 1997, petitioners entered into a Contract to Sell with Zescon Land, Inc., through Zenie Sales-Contreras, for five parcels of land for Nineteen Million One Hundred Four Thousand Pesos (P19,104,000.00). Under the agreement a portion would be paid as down payment, another portion advanced in cash upon execution, and another portion used by buyer Zescon to pay loans earlier contracted by petitioners secured by mortgages.

Simultaneous with execution, according to petitioners, Sales-Contreras through tricky machination caused them to sign other documents over the same properties, including a Deed of Absolute Sale for a lower consideration, two mortgage deeds in favor of respondent Hermano whom they had never met with accompanying notes and acknowledgment receipts for Ten Million Pesos (P10,000,000.00) each. Petitioners alleged the mortgages were explained merely as facilitative of payment under the Contract to Sell, that they never intended to mortgage to Hermano nor received any proceeds, while acknowledging Hermano caused discharge of their first mortgage and release of titles, albeit to Hermano who threatened foreclosure.

Thereafter, on 27 April 1998, petitioners filed Civil Case No. Q-98-34211 for enforcement of the contract to sell, annulment or rescission of the two mortgages, and damages against all defendants before the Regional Trial Court of Quezon City, Branch 224. Hermano filed his Answer with Compulsory Counterclaim on 15 May 1998 denying the allegations. On 19 February 1999, Hermano separately filed Civil Case No. Q-99-36914 for judicial foreclosure of real estate mortgage against Aviso before Branch 216, then on 17 January 2000 filed before Branch 224 a Motion With Leave To Dismiss The Complaint Against Defendant Antonio Hermano, Or Ordered Severed For Separate Trial, invoking misjoinder of causes of action and parties under Rule 2, Section 6.

Over opposition, Branch 224 granted the motion by Order dated 28 February 2000, directing that Hermano be dropped and petitioners' claims against him be set up by answer in the foreclosure case. Petitioners received that Order on 21 March 2000 and moved for reconsideration on 23 March 2000, which was denied on 25 May 2000 and received on 18 June 2000. On 17 August 2000 petitioners filed a Rule 65 petition imputing grave abuse to the trial court, which the Court of Appeals dismissed on 19 October 2000 as filed beyond the reglementary period and, on 02 March 2001, denied reconsideration after computing 4 days elapsed before reconsideration plus the period to 17 August 2000 as 63 days total.

• Timeliness and Computation: Petitioner argued that following A.M. No. 00-2-03-SC amending Section 4, Rule 65, the petition was filed on the 60th day and thus within the reglementary period.
• Absence of Rule 16 Motion to Dismiss: Petitioner maintained that Hermano did not file a motion to dismiss under Rule 16 and his Motion with Leave to Dismiss or Sever was filed almost two years after his Answer.
• No Misjoinder of Causes of Action: Petitioner argued that there was no misjoinder of causes of action warranting dismissal or severance.
• No Misjoinder of Parties: Petitioner maintained that there was no misjoinder of parties justifying dropping Hermano as defendant.

• Untimeliness: Respondent countered that the petition was filed on the 61st day, beyond the reglementary period.
• Misjoinder and Severance: Respondent argued that under Rule 2, Section 6 of the 1997 Rules of Civil Procedure, the enforcement-of-contract claim against Zescon could not be joined with the annulment/rescission claim against Hermano as party defendant under a different transaction or cause of action, so the complaint against him could be severed and tried separately.

• Timeliness and Retroactivity: Whether the Rule 65 petition filed on 17 August 2000 was filed within the 60-day reglementary period under Section 4, Rule 65 in light of A.M. No. 00-2-03-SC.
• Joinder and Grave Abuse: Whether the trial court acted with grave abuse of discretion in dismissing/severing the complaint against Hermano in Civil Case No. Q-98-34211 for alleged misjoinder of causes of action and parties.

• Timeliness and Retroactivity: Yes. Timely, because a fresh 60-day period is counted from notice of denial of a timely motion for reconsideration under curative A.M. No. 00-2-03-SC applied retroactively to pending actions, with 17 August 2000 as exactly the 60th day from 18 June 2000.
• Joinder and Grave Abuse: Yes. Grave abuse was committed, as common questions of fact and law arising from the same series of transactions over the same properties permitted joinder, and misjoinder is not a ground for dismissal.

• Timeliness and Retroactivity: At filing the prevailing rule was Section 4, Rule 65 as amended by Circular No. 39-98, which interrupted the period by a motion for reconsideration and allowed filing within the remaining period of not less than five days. During pendency A.M. No. 00-2-03-SC effective 01 September 2000 provided that where reconsideration is timely filed the sixty-day period shall be counted from notice of denial, with no extension except for compelling reason not exceeding fifteen days. Described as curative because historically a fresh period from denial was allowed, the amendment remedies Circular No. 39-98 confusion and, as procedural and curative, applies retroactively to pending undetermined actions. Excluding the first day and including the last under Article 13 of the Civil Code, receipt of denial on 18 June 2000 to filing on 17 August 2000 was exactly 60 days, so dismissal for lateness was reversible error.
• Joinder and Grave Abuse: Joinder of causes of action unites two or more demands that could be separate suits; it is generally permissive, liberally construed to avoid multiplicity and promote efficient complete adjudication without prejudice, requiring some substantial unity and common question of law and fact subject to jurisdiction, venue, and joinder of parties. Section 5, Rule 2 permits joinder conditioned on compliance with joinder of parties, exclusion of special civil actions, proper venue/jurisdiction, and money-claim aggregation, while Section 6 provides misjoinder is not a ground for dismissal but may be severed on motion or motu proprio. Where different parties are joined, a common question of fact or law arising from the same transaction or series of transactions is required. The complaint adequately alleged Zescon, through Sales-Contreras, misled petitioners after the contract to sell into signing the Hermano mortgages over the same properties, raising common questions whether misleading occurred, which of the four contracts was valid in light of Article 2085 requiring the mortgagor to be absolute owner, and whether fraud rendered defendants liable for damages. Severance and dropping of Hermano in favor of asserting claims in the separate foreclosure case defeated liberal joinder and complete determination in one action.

• Fresh 60-day period for Rule 65 — Where a timely motion for reconsideration or new trial is filed, whether required or not, the sixty-day period to file certiorari is counted from notice of denial of said motion, giving the aggrieved party a fresh period rather than only the remaining balance. Applied here to hold the 17 August 2000 petition timely from 18 June 2000 receipt of denial.
• Curative and retroactive procedural amendments — Curative statutes enacted to cure defects in prior law or validate proceedings are retroactive by essence, and procedural laws apply to actions pending and undetermined at passage. Applied here to give A.M. No. 00-2-03-SC retroactive effect during Court of Appeals pendency, following Narzoles vs. National Labor Relations Commission and Sps. Javellana vs. Legarda.
• Permissive joinder of causes of action — A party may in one pleading assert as many causes of action as he may have against an opposing party subject to (a) compliance with joinder of parties, (b) exclusion of special civil actions or actions under special rules, (c) Regional Trial Court jurisdiction/venue where same parties but different venues/jurisdictions if one falls therein, and (d) aggregation for money claims as jurisdictional test. Construed liberally to avoid multiplicity and secure complete determination involving one subject matter, following Republic vs. Hernandez.
• Misjoinder not a ground for dismissal — Misjoinder occurs when Section 5, Rule 2 conditions are not met, but a misjoined cause may only be severed and proceeded with separately on motion or court initiative, not dismissed. Applied to annul the dropping of Hermano.
• Joinder involving different parties — When different parties are joined, there must be a question of fact or law common to all joined parties arising out of the same transaction or series of transactions, following Flores vs. Mallare-Phillipps. Found satisfied by common issues of alleged misleading, validity of sale versus mortgages under Article 2085 of the Civil Code, and fraud-based damages over the same five parcels.
• Computation of periods — In computing a period, the first day shall be excluded and the last day included. Applied to count exactly 60 days from 18 June 2000 to 17 August 2000.

• "In case a motion for reconsideration or new trial is timely filed, whether such motion is required or not, the sixty (60) day period shall be counted from notice of the denial of said motion." — States the amended Rule 65 formula that created the fresh-period rule decisive to timeliness.
• "procedural laws are construed to be applicable to actions pending and undetermined at the time of their passage, and are deemed retroactive in that sense and to that extent." — Defines the retroactivity principle justifying application of A.M. No. 00-2-03-SC to the pending Court of Appeals petition.
• "Misjoinder of causes of action is not a ground for dismissal of an action. A misjoined cause of action may, on motion of a party or on the initiative of the court, be severed and proceeded with separately." — States the controlling Section 6, Rule 2 rule negating dismissal for misjoinder.
• "While the rule allows a plaintiff to join as many separate claims as he may have, there should nevertheless be some unity in the problem presented and a common question of law and fact involved, subject always to the restriction thereon regarding jurisdiction, venue and joinder of parties." — Defines the limit on unlimited joinder and frames the common-question test applied to retain Hermano.

• Narzoles vs. National Labor Relations Commission, G.R. No. 141959, 29 September 2000, 341 SCRA 533 — Followed as describing A.M. No. 00-2-03-SC as curative, restoring the historic fresh period from denial of reconsideration and thus retroactive.
• Sps. Javellana vs. Legarda, G.R. No. 139067, 23 November 2004 — Followed for the rule that procedural laws apply to pending and undetermined actions and are deemed retroactive to that extent.
• Republic vs. Hernandez, G.R. No. 117209, 09 February 1996, 253 SCRA 509 — Followed as exhaustive exposition on joinder of causes of action, its permissive and liberal character, requisites, and objectives of avoiding multiplicity.
• Flores vs. Mallare-Phillipps, No. L-66620, 24 September 1986, 144 SCRA 377 — Followed for the requirement of a common question of fact or law arising from the same transaction or series of transactions when different parties are joined.

• Section 4, Rule 65, 1997 Rules of Civil Procedure as amended by Circular No. 39-98 — Provided a 60-day filing period interrupted by timely reconsideration, with filing within the remaining period of not less than five days from denial; identified as the rule prevailing at filing before further amendment.
• Section 4, Rule 65 as amended by A.M. No. 00-2-03-SC — Provides the petition shall be filed not later than sixty days from notice of judgment/order/resolution, counted from denial if timely reconsideration is filed, with no extension except for compelling reason not exceeding fifteen days; applied retroactively to hold the petition timely.
• Section 5, Rule 2, Rules of Court — Governs permissive joinder of causes of action subject to joinder of parties, exclusion of special actions, jurisdiction/venue, and aggregation of money claims; applied to sustain joinder against Zescon and Hermano.
• Section 6, Rule 2, Rules of Court — Provides misjoinder is not a ground for dismissal and misjoined causes may be severed; applied to annul dismissal/severance of Hermano.
• Article 13, Civil Code — Provides the first day is excluded and last day included in computing periods; applied to compute exactly 60 days from 18 June 2000 to 17 August 2000.
• Article 2085, Civil Code — Requires the mortgagor to be absolute owner for a valid mortgage; cited to show Hermano would be affected if the sale were upheld, supporting commonality.

Reynato S. Puno, Chairman, Ma. Alicia Austria-Martinez, Romeo J. Callejo, Sr., Dante O. Tinga