Yap vs. Tañada

A motion for reconsideration grounded on fraud, accident, mistake, or excusable negligence under Section 1(a), Rule 37 must be accompanied by an affidavit of merits; absent such affidavit, the motion is pro forma and does not interrupt the period to appeal, so the judgment becomes final and executory and execution issues as a matter of right. A water pump installed in a residence but removable without breaking or deterioration is not an immovable under Article 415(3) of the Civil Code.

Goulds Pumps International (Phil.), Inc. supplied and installed a water pump at the premises of Julian S. Yap. A collection suit for the unpaid balance and installation cost followed in the City Court of Cebu and was appealed to the Court of First Instance of Cebu, Branch V, presided by Judge Santiago O. Tañada. The proceedings implicated the Rules of Court on motions for new trial or reconsideration, appeal periods, and execution.

Goulds Pumps International (Phil.), Inc. filed a complaint in the City Court of Cebu against Julian S. Yap and his wife for P1,459.30, representing the balance of the price and installation cost of a water pump installed at Yap’s premises. Yap’s answer put up the defense that the purchase document did not reflect his real agreement with Goulds and that he had made several complaints about the pump to no avail; Goulds claimed that an examination of the pump showed it to be in good working order, but the Yaps refused to attest thereto despite being present during the examination.

On November 25, 1968, the City Court rendered judgment for Goulds, ordering Yap to pay P1,459.30 with interest at 12% per annum until fully paid, computed from August 12, 1968; P364.80 as reasonable attorney’s fees; and costs. Yap appealed to the Court of First Instance. On appeal, the pre-trial had already been postponed once at his instance and was reset as intransferable. When the case was called for pre-trial, neither Yap nor his counsel appeared despite notice; instead, an ex parte motion for postponement was received that morning. The court denied the motion and declared Yap in default, authorizing the Branch Clerk to receive Goulds’ evidence.

Goulds presented evidence ex parte, and on August 29, 1969, Judge Tañada rendered judgment by default ordering Yap to pay P1,459.30 as unpaid balance, 12% interest per annum until fully paid, and a sum equivalent to 25% of the amount due as attorney’s fees, costs, and other expenses. Notice of the judgment was served on Yap on September 1, 1969. On September 16, 1969, Yap filed a motion for reconsideration, insisting that his motion for postponement should have been granted because he wanted to explore an amicable settlement and that, failing settlement, he should be allowed to present evidence on his defenses of discrepancy as to price and breach of warranty. The motion was not verified and was not accompanied by a separate affidavit. Goulds opposed, citing Yap’s eleventh-hour postponement that had cancelled the June 30, 1969 hearing despite objection, the resetting to August 28, 1969 as intransferable, Yap’s failure ever to broach settlement, his pattern of last-minute postponements before the City Court, and the pump examination showing perfect condition.

The motion for reconsideration was denied by Order dated October 10, 1969; notice of denial was received on October 14, 1969. On October 15, 1969, Judge Tañada granted Goulds’ motion for issuance of a writ of execution. Yap filed an urgent motion for reconsideration on October 17, 1969, arguing that the judgment had not become final because his motion for reconsideration was not pro forma and did not require an affidavit of merits under Section 1(a), Rule 37. Goulds opposed on October 22, 1969, arguing that because Yap claimed valid defenses, the motion should have been supported by an affidavit of merit, and that its failure to specify findings or conclusions contrary to law or unsupported by evidence made it pro forma. On October 23, 1969, the court denied the motion and authorized execution. Yap’s subsequent motions for reconsideration were denied on January 26, 1970 and April 28, 1970.

In the meantime, the Sheriff levied on the water pump, and by notice dated November 4, 1969, scheduled its execution sale on November 14, 1969. Because Yap’s October 29, 1969 motion for reconsideration was pending, Judge Tañada ordered suspension of the sale on November 6, 1969, but the order was not transmitted to the Sheriff due to the Branch Clerk’s oversight, inadvertence, and pressure of work. The Deputy Provincial Sheriff proceeded with the auction sale and sold the pump to Goulds as the highest bidder; his report dated November 17, 1969 and the Sheriff’s Return dated February 13, 1970 stated that execution had been partially satisfied. Up to February 1970, Yap had not appealed from the August 29, 1969 judgment.

On May 9, 1970, Judge Tañada ordered an alias writ of execution on Goulds’ ex parte motion. Yap received notice on June 11 and, twelve days later, filed a motion to set aside the execution sale and quash the alias writ. He argued that the original execution was contrary to law because the judgment was not final and executory; that the sale was made without the notice required by Section 18, Rule 39 for real property because the pump and accessories had become immovable under Article 415 of the Civil Code; that the alias writ should not issue because the judgment was null and void for depriving him of his day in court and due process, incomplete and vague for lack of a starting point for interest and specification of “other expenses,” and defective for containing no statement of facts; and that a change in the parties’ situation made execution unjust and inequitable because he suffered damages from the illegal execution. Goulds opposed on July 6, 1970. The motion was denied on September 16, 1970. Judge Tañada held that the motion had become moot and academic because the August 29, 1969 decision, received on September 1, 1969, had long become final when execution issued on October 15, 1969; that Yap’s motion for reconsideration was in reality a motion for new trial requiring an affidavit of merits; and that if Yap desired amicable settlement, he should have appeared at the pre-trial. A September 21, 1970 Order granted Goulds’ motion for completion of execution by the City Sheriff. Yap’s motion for reconsideration of the September 16 and September 21, 1970 Orders was denied for lack of merits on November 21, 1970. In removing the pump, Goulds’ men allegedly trampled plants, destroyed the shed over the pump, plugged exterior casings with rags, and cut electrical and conduit pipes; Yap claimed actual damages of not less than P2,000 and moral damages of P10,000 from deprivation of water supply, but the court refused to allow him to prove these acts and recover damages. The pump was in fact separated from Yap’s premises without being broken or suffering deterioration.

• Non-final and Incomplete Judgment: Petitioner argued that the writ of execution issued on October 16, 1969 was contrary to law because the judgment was not yet final and executory and was incomplete and vague, there being no starting point for the computation of interest and no specification of the “other expenses” he was ordered to pay.
• Suspension of Execution: Petitioner maintained that the execution sale was carried out despite the trial court’s November 6, 1969 order suspending execution.
• Notice for Immovables: Petitioner argued that the pump and its accessories had become immovable property under Article 415 of the Civil Code and that the execution sale was void for lack of the notice by publication required by Section 18, Rule 39 for real property.
• Due Process and Nullity: Petitioner contended that the alias writ should not have issued because the judgment was null and void for depriving him of his day in court and due process, and because it contained no statement of facts but a mere recital of the evidence.
• Affidavit of Merits: Petitioner argued that his motion for reconsideration was not pro forma for lack of an affidavit of merits, since Section 1(a), Rule 37 did not require such an affidavit.
• Damages and Change in Situation: Petitioner claimed that he should have been allowed to prove irregularities in the execution—trampled plants, destroyed shed, plugged casings, and cut pipes—causing actual damages of not less than P2,000 and moral damages of P10,000, and that the change in the parties’ situation made execution unjust and inequitable.

• Pro Forma Motion: Respondent countered that petitioner’s motion for reconsideration was pro forma because it lacked an affidavit of merit and did not specify findings or conclusions claimed to be contrary to law or unsupported by evidence, so it did not interrupt the appeal period.
• Affidavit Required by Claimed Defenses: Respondent argued that because petitioner claimed valid defenses—discrepancy as to price and breach of seller’s warranty, in effect fraud on respondent’s part—the motion for reconsideration should have been supported by an affidavit of merit.
• Dilatory Tactics and No Bona Fide Compromise: Respondent maintained that petitioner’s eleventh-hour motions for postponement and repeated failures to appear showed dilatory tactics and negated the bona fides of his claimed desire for an amicable settlement, which he had never broached before.
• Pump Condition: Respondent averred that the examination of the pump, made on the City Court’s instructions, disclosed that it was in perfect condition.
• Finality and Proper Execution: Respondent maintained that petitioner’s motion for reconsideration did not interrupt the running of the appeal period, so the judgment had become final and execution was proper.

• Finality and Interruption of Appeal Period: Whether petitioner’s motion for reconsideration, grounded on Section 1(a), Rule 37 but unverified and unaccompanied by an affidavit of merits, was pro forma and failed to interrupt the 30-day appeal period, thereby rendering the default judgment final and executory.
• Propriety of Execution: Whether execution correctly issued on October 15, 1969 despite petitioner’s claim that the judgment was not yet final and was incomplete and vague.
• Completeness and Vagueness of Judgment: Whether the judgment was incomplete and vague for failing to fix the starting point for interest and to specify the “other expenses” awarded.
• Nature of the Water Pump and Notice of Sale: Whether the water pump and accessories were immovable property requiring notice by publication under Section 18, Rule 39, and whether the execution sale without such notice was invalid.
• Due Process and Default Judgment: Whether the default judgment was null and void for depriving petitioner of his day in court and due process, and whether it was defective for containing no statement of facts.
• Damages from Execution Irregularities: Whether petitioner was entitled to prove and recover actual and moral damages for alleged irregularities in removing the pump from his premises.

• Finality and Interruption of Appeal Period: No. The motion was pro forma because Section 2, Rule 37 required an affidavit of merits for a motion grounded on Section 1(a); it did not interrupt the appeal period, so the judgment became final and executory.
• Propriety of Execution: Yes. Execution properly issued as a matter of right after the judgment became final and executory; the alleged vagueness did not render the judgment incomplete.
• Completeness and Vagueness of Judgment: No. The starting point for interest was easily determinable from the decision—the day Yap defaulted on May 31, 1968—and the absence of a disposition on the counterclaim did not make the judgment incomplete.
• Nature of the Water Pump and Notice of Sale: No. The pump was not immovable under Article 415(3) because it could be and was separated from the premises without being broken or suffering deterioration; the publication notice for real property was not required.
• Due Process and Default Judgment: No. Yap’s unjustified failure to appear at the pre-trial despite notice caused the default and waived his right to controvert Goulds’ proofs and to prove his answer and counterclaim.
• Damages from Execution Irregularities: No. The loss of water supply arose from acts legitimately done—the seizure on execution of the pump in enforcement of a final and executory judgment—so Yap was not entitled to moral or other damages therefor.

• Finality and Interruption of Appeal Period: Section 2, Rule 37 requires that when a motion for new trial is founded on Section 1(a), it must be accompanied by an affidavit of merits. Yap himself asserted that his motion for reconsideration was grounded on Section 1(a), i.e., fraud, accident, mistake, or excusable negligence, and his motion theorized that he had been impaired in his rights because he was denied the right to present evidence of his defenses. It was therefore a fatal omission to fail to attach an affidavit of merits showing facts, not conclusions, constituting a valid defense. The requirement is essential because a new trial would waste the court’s time if the complaint turns out to be groundless or the defense ineffective. Yap’s claimed desire to compromise was not bona fide: it was manifested in an eleventh-hour motion for postponement of a pre-trial already reset as intransferable at his instance, had never been mentioned before, was appropriate for pre-trial, and was accompanied by dilatory tactics and disregard of the three-day notice rule for motions. The refusal to grant postponement was not grave abuse of discretion or serious mistake. Consequently, the motion for reconsideration did not interrupt the running of the appeal period. Under Section 3, Rule 41, the time during which a motion to set aside judgment or for new trial has been pending is deducted only if the motion satisfies Rule 37. Notice of judgment was received on September 1, 1969; the motion filed on September 16, 1969 did not interrupt the period; and the reglementary period expired on October 1, 1969 without an appeal. The judgment became final and executory, and execution correctly issued on October 15, 1969 as a matter of right.
• Propriety of Execution: Because the judgment had become final and executory, Yap could no longer appeal therefrom or from subsequent orders, and execution issued as a matter of right under Section 1, Rule 39. The trial court’s order granting execution was therefore proper.
• Completeness and Vagueness of Judgment: The decision did not fix the starting time for computing interest, but this was inconsequential because the time was easily determinable from the opinion—the day Yap defaulted in payment, May 31, 1968. The absence of any disposition regarding Yap’s counterclaim was also immaterial and did not render the judgment incomplete. Yap’s failure to appear at the pre-trial without justification and despite notice caused the declaration of default and waived his right to controvert Goulds’ proofs and to prove the averments of his answer, including the counterclaim. Moreover, the conclusion in the judgment on the merit of Goulds’ cause of action necessarily determined the absence of merit of Yap’s claim of untenability of the complaint and malicious prosecution.
• Nature of the Water Pump and Notice of Sale: Article 415(3) of the Civil Code considers as immovable property anything attached to an immovable in a fixed manner such that it cannot be separated therefrom without breaking the material or deterioration of the object. The pump did not fit this description. It could be, and was in fact, separated from Yap’s premises without being broken or suffering deterioration; the separation or removal involved nothing more complicated than loosening bolts or dismantling other fasteners. The pump was therefore not immovable, and the notice required for the sale of real property did not apply.
• Due Process and Default Judgment: Yap’s failure to appear at the pre-trial without justification and despite notice caused the declaration of default. This was a waiver of his right to controvert Goulds’ proofs and of his right to prove the averments of his answer, inclusive of the counterclaim. The judgment on Goulds’ cause of action necessarily determined the absence of merit of Yap’s claims. The default judgment was not rendered void on due process grounds.
• Damages from Execution Irregularities: As to the loss of Yap’s water supply, this arose from acts legitimately done—the seizure on execution of the water pump in enforcement of a final and executory judgment. Yap was therefore not entitled to claim moral or any other form of damages therefor.

• Affidavit of Merits Under Rule 37 — When a motion for new trial or reconsideration is founded on fraud, accident, mistake, or excusable negligence under Section 1(a), Rule 37, it must be accompanied by an affidavit of merits showing facts, not conclusions, constituting a valid defense. Absent such affidavit, the motion is pro forma and does not interrupt the appeal period. The Court applied this to Yap’s motion, which was grounded on Section 1(a) but was unverified and unaccompanied by an affidavit of merits.
• Finality of Judgment and Execution as a Matter of Right — Once a judgment becomes final and executory, execution issues as a matter of right, and the losing party may no longer appeal or attack subsequent orders. The Court applied this after finding that Yap’s defective motion did not interrupt the appeal period, making the August 29, 1969 judgment final and the October 15, 1969 execution proper.
• Immovable Property Under Article 415(3) of the Civil Code — Property attached to an immovable in a fixed manner is immovable only if it cannot be separated without breaking the material or deterioration of the object. The Court held that the water pump was not immovable because it was separated from Yap’s premises without being broken or suffering deterioration.
• Waiver of Defenses and Counterclaim by Default — A defendant’s unjustified failure to appear at pre-trial despite notice causes a declaration of default and waives the right to controvert the plaintiff’s proofs and to prove the averments of the answer, including any counterclaim. The Court applied this to Yap’s default.
• No Damages for Lawful Execution — Loss resulting from the lawful seizure of property on execution of a final and executory judgment does not entitle the judgment debtor to moral or other damages. The Court applied this to Yap’s claim for damages arising from the loss of his water supply.
• Bona Fide Compromise and Postponement — A claim of desire to explore an amicable settlement does not justify failure to attend an intransferable pre-trial where the claim is made in an eleventh-hour motion, never previously broached, and accompanied by dilatory tactics and disregard of the notice requirement for motions. The Court used this in rejecting Yap’s excuse for non-appearance.

• "Affidavit or affidavits of merits shall also be attached to a motion for the cause mentioned in subdivision (a) which may be rebutted by counter-affidavits." — The Court quotes Section 2, Rule 37 to establish that Yap’s motion for reconsideration, grounded on Section 1(a), required an affidavit of merits.
• "The time during which a motion to set aside the judgment or order or for a new trial has been pending shall be deducted, unless such motion fails to satisfy the requirements of Rule 37." — The Court quotes Section 3, Rule 41 to hold that Yap’s defective motion did not interrupt the appeal period.
• "Notice of the judgment having been received by Yap on September 1, 1969, and the period of appeal therefrom not having been interrupted by his motion for reconsideration filed on September 16, 1969, the reglementary period of appeal expired thirty (30) days after September 1, 1969, or on October 1, 1969, without an appeal being taken by Yap." — This passage states the ratio for finality and for execution as a matter of right.
• "The pump does not fit this description. It could be, and was in fact separated from Yap’s premises without being broken or suffering deterioration." — The Court applies Article 415(3) and rules that the pump is not immovable, so the notice required for the sale of real property did not apply.

• Coombs vs. Santos, 24 Phil. 446 — Cited for the requirement that a motion for new trial or reconsideration under Rule 37 must be supported by an affidavit of merits; also cited in connection with the Rule 41 deduction rule.
• Vda. de Yulo vs. Chua Chuco et al., 48 O.G. 554 — Cited for the principle that a new trial would be a waste of the court’s time if the complaint is groundless or the defense ineffective.
• Baguieran vs. Court of Appeals, L-14551, July 31, 1961, 2 SCRA 873 — Cited with Vda. de Yulo on the affidavit of merits requirement.
• Manila Surety & Fidelity Co. vs. Batu Construction Co., L-16636, June 24, 1965 — Cited for the requirement that notice of a motion be served at least three days before the hearing.
• Fulton Insurance Co. vs. Manila Railroad Co., L-24263, November 18, 1967 — Cited with Manila Surety on the notice of motion requirement.
• Alfonso vs. Bustamante, 98 Phil. 158 — Cited on the Rule 41 rule that the time during which a motion for new trial is pending is deducted only if the motion satisfies Rule 37.
• Capinpin et al. vs. Isip, L-14018, Aug. 31, 1959 — Cited on the same Rule 41 deduction rule.
• Amor vs. Jugo et al., 77 Phil. 703 — Cited for execution as a matter of right under Section 1, Rule 39.

• Section 1(a), Rule 37, Rules of Court — Provides the ground of fraud, accident, mistake, or excusable negligence for a motion for new trial. Yap invoked this ground in his motion for reconsideration.
• Section 2, Rule 37, Rules of Court — Requires that a motion for new trial founded on Section 1(a) be accompanied by an affidavit of merits. The Court applied this to hold Yap’s motion fatally defective.
• Section 3, Rule 41, Rules of Court — Provides that the time during which a motion to set aside judgment or for new trial has been pending is deducted unless the motion fails to satisfy Rule 37. The Court applied this to hold that Yap’s appeal period was not interrupted.
• Section 1, Rule 39, Rules of Court — Provides for execution as a matter of right after finality. The Court applied this to uphold the October 15, 1969 execution.
• Section 18, Rule 39, Rules of Court — Requires notice by publication for execution sale of real property. Yap invoked this, but the Court found the pump not immovable, so the provision did not apply.
• Article 415(3), Civil Code — Defines immovable property as including things attached to an immovable in a fixed manner such that they cannot be separated without breaking the material or deterioration. The Court applied this to hold the pump not immovable.
• Sections 4, 5, and 6, Rule 15, Rules of Court — Require notice of a motion to be served on all parties at least three days before the hearing. The Court cited this in finding Yap’s eleventh-hour motion for postponement and claimed compromise not bona fide.
• Republic Act No. 5440, Sections 2 and 3 — Cited as the basis for Yap’s appeal to the Supreme Court on certiorari only on questions of law.

Cruz, Gancayco, Griño-Aquino and Medialdea, JJ., concur.