Philippine National Bank vs. Pineda

Failure of the defendant and his counsel to appear at the scheduled pre-trial is a ground to authorize dismissal for failure to prosecute, and the judgment of the inferior court is thus revived, where the alleged withdrawal of counsel is not borne by the record and no valid defense is shown.

PNB sued Estanislao Pineda in the City Court of Manila, Civil Case No. 153045. The City Court rendered judgment ordering Pineda to vacate the premises within six months from receipt of the decision, provided he paid rent in arrears in the sum of P149.60 as of April 30, 1967 and updated payment of rental within ten days from receipt; if he failed to make those payments, he would not be entitled to the six-month grace. Attorney’s fees in the amount of P50.00 and costs were assessed against him.

Pineda appealed to the Court of First Instance of Manila, Civil Case No. 69965, Branch V. Issues having been joined, the case was set for pre-trial. After the case was repeatedly called for the scheduled pre-trial on October 20, 1967, the last time at 9:05 a.m., Pineda and his counsel failed to appear. The CFI dismissed the appeal for failure to prosecute. Pineda’s efforts at reopening were thwarted below, and he came to the SC on appeal.

Pineda’s excuse for his failure to appear was that his counsel, Atty. Pompeyo L. Bautista, had withdrawn from the case as his attorney. The lower court stated that this excuse was “very flimsy”; the record did not bear out such withdrawal. It was conceded that Pineda was a lessee without a fixed term, which explained why the City Court gave him time to vacate the premises. Pineda averred that he had a residential house on the land and claimed reimbursement of one-half of its value.

• Non-Appearance at Pre-Trial: Pineda, the defendant-appellant, argued that his failure to appear at the scheduled pre-trial was excused because his counsel, Atty. Pompeyo L. Bautista, had withdrawn from the case as his attorney.
• Valid Defense: Pineda averred that he had a residential house on the land and claimed reimbursement of one-half of its value.

• Dismissal for Failure to Prosecute: Whether the failure of the defendant and his counsel to appear at the scheduled pre-trial is a ground to authorize dismissal of the appeal for failure to prosecute and revive the inferior court’s judgment.
• Valid Defense and Reopening: Whether the defendant showed a valid defense such that reopening the case would not be futile.

• Dismissal for Failure to Prosecute: Yes. Failure of the defendant and his counsel to appear at the scheduled pre-trial authorized dismissal for failure to prosecute, reviving the inferior court’s judgment. The alleged withdrawal of counsel was not borne by the record, and notices are given to counsel.
• Valid Defense and Reopening: No. Pineda showed no valid defense; being a lessee without a fixed term and claiming reimbursement of one-half the value of his residential house did not advance his cause because the option to acquire improvements is on the landowner. Reopening would be futile.

• Dismissal for Failure to Prosecute: The SC applied the rule that the failure of the defendant and his counsel to appear at the scheduled pre-trial is a ground to authorize dismissal for failure to prosecute, citing Section 9, Rule 40, Rules of Court, and Vda. de Palanca vs. Chua Keng Kian. Because Pineda and his counsel failed to appear despite the case being repeatedly called, the CFI properly dismissed the appeal, and the judgment of the inferior court was thus revived. Pineda’s excuse that his counsel had withdrawn was correctly rejected as “very flimsy” because the record did not bear out such withdrawal; under Section 2, Rule 13, Rules of Court, notices are given to counsel.
• Valid Defense and Reopening: The SC found that Pineda had not shown any valid defense. It was conceded that he was a lessee without a fixed term, which explained why the City Court gave him time to vacate the premises. His averment that he had a residential house on the land did not advance his cause; he could not require reimbursement of one-half of its value because, under Article 1678, Civil Code of the Philippines, the option to acquire the improvements is on the owner of the land. The SC cited Lapeña vs. Morfe in this connection. Thus, reopening the case would be futile.

• Dismissal for Failure to Prosecute — Failure of the defendant and his counsel to appear at the scheduled pre-trial is a ground to authorize dismissal for failure to prosecute, and the judgment of the inferior court is revived. The SC applied this where Pineda and his counsel failed to appear despite repeated calls and the alleged withdrawal of counsel was not borne by the record.
• Lessee Without Fixed Term and Improvements — A lessee without a fixed term may be given time to vacate the premises, but his claim for reimbursement of one-half the value of a residential house on the land cannot prevail because the option to acquire the improvements is on the owner of the land. The SC applied this to reject Pineda’s defense.
• Futility of Reopening — Reopening is futile where the defendant has no valid defense. The SC applied this after finding that Pineda’s averments did not advance his cause.

• “Defendant and his counsel’s failure to appear is a ground to authorize dismissal for failure to prosecute. The judgment of the inferior court is thus revived.” — This states the SC’s core ruling on the effect of non-appearance at pre-trial.
• “The record does not bear out such withdrawal. Under the law, notices are given to counsel.” — This rejects Pineda’s excuse that his counsel had withdrawn from the case.
• “Nor will his averment that he has a residential house on the land advance his cause. He may not, as he claims, require reimbursement of one-half of the value thereof. Because, the option to acquire the improvements is on the owner of the land.” — This explains why Pineda’s claim did not constitute a valid defense.
• “So that reopening of the case will be futile.” — This concludes that no useful purpose would be served by reopening the case.

• Vda. de Palanca vs. Chua Keng Kian (1969), 27 SCRA 356, 365 — Cited in support of Section 9, Rule 40, Rules of Court, on dismissal for failure to prosecute and revival of the inferior court’s judgment.
• Lapeña vs. Morfe, 101 Phil. 997, 1001 — Cited in connection with Article 1678, Civil Code of the Philippines, on the owner’s option to acquire improvements.
• De la Cruz vs. Burgos, L-28095, July 30, 1969 — Cited by “Cf.” in relation to the futility of reopening the case.

• Section 9, Rule 40, Rules of Court — Cited as the basis for dismissal for failure to prosecute and revival of the inferior court’s judgment when the defendant and his counsel failed to appear at pre-trial.
• Section 2, Rule 13, Rules of Court — Cited for the rule that notices are given to counsel; applied to reject Pineda’s excuse that his counsel had withdrawn.
• Article 1678, Civil Code of the Philippines — Cited for the rule that the option to acquire improvements is on the owner of the land; applied to reject Pineda’s claim for reimbursement of one-half the value of his residential house.

• Justice Barredo (Concurring) — Concurred in the result. He distinguished Vda. de Palanca vs. Chua Keng Kian because there the CFI dismissed the appeal for failure to prosecute only because the defendant had not taken any move to have the case calendared for pre-trial for an unreasonable length of time, while here the case had been set for pre-trial several times and the dismissal was precisely due to Pineda’s failure to appear. He regarded the dismissal as virtually a judgment on the pleadings because Pineda had no substantial defense on the merits, and believed the pre-trial rules are broad enough to allow courts to adopt measures conducive to the early and expeditious termination of cases consistent with Section 1, Rule 20 and not expressly prohibited.