Roasters Philippines, Inc. vs. Gaviola

A complaint may be dismissed for failure to prosecute under Section 3, Rule 17 of the Rules of Civil Procedure when the plaintiff fails to appear at the time of trial without justifiable cause, and the filing of a second motion for reconsideration (a prohibited pleading) does not interrupt the running of the period to appeal; however, such dismissal is without prejudice to the right of the defendant to prosecute any pending counterclaims in the same or separate action.

The Gaviola family (George, Maria Leisa, and their children) filed a complaint for damages against Roasters Philippines, Inc. after they suffered from acute gastroenteritis and possible food poisoning allegedly caused by food consumed at Kenny Rogers Roasters Duty-Free Branch in Parañaque. The case underwent multiple procedural delays, including the petitioner's unsuccessful attempts to have the case dismissed through motions and certiorari petitions, and the respondents' repeated failures to attend hearings and comply with procedural requirements.

• On 9 April 2003, respondents Georgia Gaviola, Maria Leisa M. Gaviola, and their children Karla Helene, Kashmeer Georgia, and Klaire Marlei filed a Complaint for Damages against Roasters Philippines, Inc. (doing business as Kenny Rogers Roasters) before the RTC of Las Piñas City, Branch 198.
• The complaint alleged that the family suffered from acute gastroenteritis and possible food poisoning after dining at Kenny Rogers Roasters Duty-Free Branch in Parañaque.
• Petitioner filed a Motion to Dismiss on the ground of failure to state a cause of action, which the trial court denied, as well as the subsequent motion for reconsideration.
• In its Answer Ad Cautelam, petitioner alleged lack of cause of action, denied ownership of the specific branch, and claimed no valid demand was made, while interposing a counterclaim for damages.
• Petitioner filed a Petition for Certiorari before the Court of Appeals questioning the refusal of the trial court to dismiss the complaint; the appellate court dismissed the petition on 14 March 2005, and the decision became final and executory on 20 July 2005.
• On 26 April 2007, petitioner filed a Motion to Dismiss on the ground of failure of respondents to prosecute, alleging that respondents had not filed any pleading to revive the case since the 14 March 2005 Decision became final; the trial court denied the motion and set pre-trial for 6 August 2007.
• On 6 August 2007, respondents and their counsel failed to appear for the scheduled pre-trial.
• On 12 November 2007, the trial court referred the case to mediation, which respondents failed to attend.
• On 19 May 2008, during the presentation of respondents' evidence-in-chief, respondents and their ten witnesses failed to attend the hearing; respondents' counsel manifested that he filed a motion for postponement on 15 May 2008 because Maria Leisa was supposed to attend a conference in the USA from 14-18 May 2008.
• The trial court dismissed the complaint for failure to prosecute pursuant to Section 3, Rule 17 of the Rules of Civil Procedure.
• In their Motion for Reconsideration, respondents claimed Maria Leisa was hospitalized due to profuse bleeding on the morning of 19 May 2008, preventing their travel to the USA, and submitted cancelled plane tickets, certificate of confinement, and medical certification.
• The trial court denied the motion, noting discrepancies in the evidence: the tickets showed a destination of Hong Kong, not the USA, and George Gaviola was not listed as a passenger, indicating lack of candor by respondents and counsel.
• Respondents filed a Second Motion for Reconsideration with an Affidavit of Merit from Maria Leisa explaining they were chance passengers for the USA leg and she suffered profuse vaginal bleeding, but the trial court denied this for lack of merit on 23 October 2008.
• Respondents filed a Notice of Appeal from the orders dated 19 May 2008, 26 August 2008, and 23 October 2008, which the trial court denied on 18 November 2008 on the ground that the orders were interlocutory.
• Respondents then filed a petition for certiorari before the Court of Appeals alleging grave abuse of discretion by the trial court judge.

• The 19 May 2008 Order dismissing the case for failure to prosecute and the 26 August 2008 Order denying the Motion for Reconsideration had already attained finality when respondents chose to file a second motion for reconsideration instead of a notice of appeal.
• The petition for certiorari before the Court of Appeals was filed out of time, more than 60 days after receipt of the denial of the first motion for reconsideration on 10 September 2008.
• Since the second motion for reconsideration is a prohibited pleading, the period to appeal began to run from the denial of the first motion for reconsideration, rendering the Notice of Appeal filed out of time.
• Negligence of counsel should bind the client, especially where the new counsel filed the second motion for reconsideration submitting the same arguments as the first.
• The petition for certiorari should have been dismissed outright for non-compliance with the requirements on verification and certification of non-forum shopping.
• There is no justifiable cause for the absence of respondents during the presentation of evidence-in-chief; their excuse is highly doubtful and respondents showed lack of interest in pursuing the case.
• There is a pattern of delay in the procedural history of the case tantamount to a failure to prosecute.

• The respondents claimed they had justifiable cause for their non-appearance on 19 May 2008 due to Maria Leisa's unexpected hospital confinement for profuse bleeding, which prevented their travel to the USA.
• They submitted documentary evidence including cancelled plane tickets, certificate of confinement, and medical certification to support their claim of fortuitous event.
• They argued that the trial court committed grave abuse of discretion in dismissing the case for failure to prosecute despite the existence of a justifiable cause.
• They contended that the order of dismissal was not an interlocutory order but a final order appealable by notice of appeal.
• They maintained that the Court of Appeals correctly found grave abuse of discretion in the denial of their second motion for reconsideration and notice of appeal.

• Procedural:
  • Whether the Court of Appeals violated the rule on finality of orders and judgments in granting the petition for certiorari.
  • Whether the second motion for reconsideration filed by respondents was a prohibited pleading that did not toll the reglementary period for appeal.
  • Whether the notice of appeal was filed within the reglementary period.
  • Whether respondents were bound by the actions of their former and new counsel.
  • Whether the petition for certiorari before the Court of Appeals should have been dismissed for failure to comply with verification and certificate of non-forum shopping requirements.
• Substantive Issues:
  • Whether the trial court committed grave abuse of discretion in dismissing the complaint for failure to prosecute under Section 3, Rule 17 of the Rules of Civil Procedure.
  • Whether there was justifiable cause for respondents' absence during the presentation of evidence-in-chief.
  • Whether there was a pattern of delay tantamount to failure to prosecute.
  • Whether the dismissal of the complaint affects the right of the defendant to prosecute its counterclaim.

• Procedural:
  • The Supreme Court held that the second motion for reconsideration is a prohibited pleading which does not toll the reglementary period for appeal; the period continued to run from the receipt of the denial of the first motion for reconsideration on 10 September 2008, and respondents had until 25 September 2008 to file their notice of appeal.
  • Since respondents filed the second motion for reconsideration and notice of appeal after the lapse of the reglementary period, the impugned RTC Orders became final and executory.
  • The trial court correctly denied the notice of appeal, though its reason (that the order was interlocutory) was erroneous; the correct reason was the lapse of the period to appeal.
  • The Court found that the petition for certiorari was filed out of time, but proceeded to resolve the case on its merits given the importance of the issues raised.
• Substantive:
  • The dismissal of the complaint for failure to prosecute under Section 3, Rule 17 was proper because respondents failed to show justifiable cause for their absence at the presentation of evidence-in-chief.
  • The trial court correctly found that respondents' excuse was not credible—the plane tickets showed a destination of Hong Kong, not the USA, and George Gaviola was not listed as a passenger, indicating lack of candor.
  • Respondents exhibited a pattern of delay and lack of interest: almost two years lapsed without filing any pleading to revive the case after the 2005 CA decision became final; they failed to appear at the 6 August 2007 pre-trial; they failed to attend mediation; and they failed to appear at the 19 May 2008 hearing.
  • The dismissal of the complaint is without prejudice to the right of the defendant to prosecute its counterclaim in the same or separate action, pursuant to Section 3, Rule 17 and the doctrine in Pinga v. Heirs of German Santiago; trial on the counterclaim must proceed.

• Dismissal due to fault of plaintiff (non prosequitur) — Under Section 3, Rule 17 of the 1997 Rules of Civil Procedure, a complaint may be dismissed if, for no justifiable cause, the plaintiff fails to appear on the date of presentation of evidence in chief, or fails to prosecute the action for an unreasonable length of time. The fundamental test is whether the plaintiff is chargeable with want of due diligence and unwillingness to prosecute. The dismissal shall have the effect of an adjudication upon the merits unless otherwise declared by the court.
• Second Motion for Reconsideration as Prohibited Pleading — A second motion for reconsideration is a prohibited pleading which shall not be allowed except for extraordinarily persuasive reasons and only after express leave shall have first been obtained. It is a pro forma motion that does not toll the reglementary period for appeal.
• Effect of Dismissal on Counterclaims — Following Pinga v. Heirs of German Santiago, the dismissal of a complaint due to fault of the plaintiff is without prejudice to the right of the defendant to prosecute any pending counterclaims of whatever nature in the same or separate action. The dismissal of the complaint does not automatically result in the dismissal of compulsory counterclaims; the counterclaim must be dismissed on its own merits if at all.

• "The fundamental test for non prosequitur is whether, under the circumstances, the plaintiff is chargeable with want of due diligence in failing to proceed with reasonable promptitude. There must be unwillingness on the part of the plaintiff to prosecute."
• "A second motion for reconsideration, as a rule, is a prohibited pleading which shall not be allowed except for extraordinarily persuasive reasons and only after an express leave shall have first been obtained."
• "The dismissal of a complaint due to fault of the plaintiff is without prejudice to the right of the defendant to prosecute any pending counterclaims of whatever nature in the same or separate action."
• "The formalistic distinction between a complaint and a counterclaim does not detract from the fact that both of them embody causes of action that have in their end the vindication of rights... A party with a valid cause of action against another party cannot be denied the right to relief simply because the opposing side had the good fortune of filing the case first."

• Pinga v. Heirs of German Santiago, 526 Phil. 868 (2006) — Controlling precedent that abandoned the BA Finance doctrine; held that dismissal of a complaint due to plaintiff's fault is without prejudice to the defendant's right to prosecute counterclaims in the same or separate action, and that counterclaims must be dismissed on their own merits, not automatically with the complaint.
• De Knecht v. CA, 352 Phil. 833 (1998) — Cited for the rule on dismissal for failure to prosecute under Section 3, Rule 17.
• Shimizu Philippines Contractors, Inc. v. Magsalin, et al., 688 Phil. 385 (2012) — Cited for the fundamental test for non prosequitur regarding want of due diligence and unwillingness to prosecute.
• Tirazona v. Phil. Eds Techno Service, Inc., 596 Phil. 683 (2009) — Cited for the rule that second motions for reconsideration are prohibited pleadings.
• Guzman v. Guzman, G.R. No. 172588, 13 March 2013, 693 SCRA 318 — Cited for the principle that a second motion for reconsideration is a pro forma motion that does not toll the reglementary period for appeal.

• Section 3, Rule 17 of the 1997 Rules of Civil Procedure — Governs dismissal due to fault of plaintiff for failure to appear, failure to prosecute for unreasonable length of time, or failure to comply with rules or court orders; provides that dismissal has effect of adjudication upon the merits unless otherwise declared, and is without prejudice to defendant's right to prosecute counterclaims.
• Rule 41, Section 1 of the 1997 Rules of Civil Procedure — Cited by the trial court regarding appeals from interlocutory orders, though the Supreme Court held this was erroneously applied.