Espinosa v. CA: 128686 : May 28, 2004 : J. Tinga : Second Division :
[G.R. NO. 128686 : May
HONORATO ESPINOSA, Petitioner, v. COURT OF APPEALS, HON. PRESIDING JUDGE, Branch 23, RTC Iloilo City and
Sps. RODOLFO and VIOLETA ALCANTARA, Respondents.
D E C I S I O N
This is a Petition for Review of the Decision1 dated October
11, 1996 of the Court of Appeals in CA-G.R. SP No. 39206, dismissing
the petition for the annulment of the Decision2 dated May
15, 1990 of the Regional Trial Court of Iloilo City (RTC) in Civil Case
The antecedents are recited below.
After finding through a relocation survey that a portion of their
Lot 933-A-1-A, covered by Transfer Certificate of Title
No. T-69242 (Iloilo),
was occupied by the petitioner Honorato Espinosas
(Espinosa) restaurant, known as Tatoys Manokan and Seafoods Restaurant,
the private respondents Rodolfo and Violeta Alcantara (Alcantaras) filed an
action for ejectment against Espinosa before the Municipal Trial Court in
Cities, Iloilo City (MTC),
on November 4, 1985.3 cralawred
Espinosa denied the encroachment.Also through his counsel then, Atty. Rex Castillon, Espinosa
succeeded in having the case tried as in a regular case, instead of a hearing
under the Rules on Summary Procedure.4 cralawred
After trial, the MTC rendered judgment on February
6, 1989 in favor of Espinosa, dismissing the complaint and ordering
the Alcantara spouses to pay moral damages, exemplary damages, attorneys fees,
litigation expenses, and costs of suit.
It found that Espinosa did not encroach on the lot of the Alcantaras as
his restaurant was situated on Lot 933-A-18 which he
The Alcantaras appealed the decision to the RTC.6 Its Presiding Judge, Hon. Tito G. Gustilo,
noted that the lot of the Alcantaras and the adjoining lots, including those of
Espinosa and the city street, are all titled properties. On that basis and with
the concurrence of the parties and their respective lawyers, the Judge issued
an Order on October
2, 1989, commissioning the Bureau of Lands to conduct a relocation
survey for the purpose of determining whether Espinosas restaurant has indeed
encroached on the Alcantaras lot.7 cralawred
Judge Gustilo presided over the ocular inspection and relocation
survey on October 2, 1989.
Present were the parties and their lawyers.8 cralawred
In due time, the Bureau of Lands through its authorized
representative submitted to the RTC the result of the relocation survey with
the corresponding sketch plan.9 The sketch plan indicates that Espinosas restaurant encroaches on eighty-nine
(89) square meters of the Alcantaras Lot 933-A-1-A and
also on a portion of the city street known as Melo
Boulevard and designated as Lot
933-A-1-B.10 Said street lot used to be a part of the bigger property owned by the
Alcantaras predecessor-in-interest from whom the City of Iloilo
purchased the street lot.11 cralawred
During the relocation survey, Judge Gustilo proposed a compromise
settlement to the parties and their lawyers whereby should the relocation
survey attest to the encroachment on the Alcantaras lot Espinosa would buy the
encroached area at
P250.00 per square meter from the Alcantaras.
Espinosa agreed to the proposal at the
However, when the Judge invited
the parties and their counsels to his chambers to explore or pursue the
proposed compromise agreement on three (3) occasions, namely: on December
27, 1989, April 2, 1990
and April 5, 1990, Espinosa
rejected the proffered settlement.12 cralawred
On May 15, 1990,
the RTC rendered its decision in favor of the Alcantaras, reversing the MTC
decision and ordering Espinosa to vacate the lot in question and to pay the
Alcantaras moral damages, attorneys fees, litigation expenses and costs of
Espinosa elevated the RTC decision to the Court of Appeals
through a Petition For Review which was docketed as CA-G.R. SP No.
On September 6, 1993,
the Court of Appeals promulgated its Decision
in the case, denying Espinosas Petition For Review.15 cralawred
Unfazed, Espinosa elevated the CA Decision to this Court and his Petition was docketed as G.R.
This Court denied the Petition in a Resolution dated February
27, 1995 for which the corresponding Entry of Judgment was made on August
18, 1995.16 cralawred
Less than three (3) months later, on December 6, 1995, Espinosa,
this time through his present counsel, Atty. Honorio S. Laguilles, Jr., filed a
petition for annulment of judgment with the Court of Appeals.
He alleged that the promulgation of the RTC
decision was attended with extrinsic fraud and denial of due process.17 In his verification and certification of non-forum shopping, however, Espinosa
was silent on the petitions he earlier filed
with the Court of Appeals (CA-G.R. SP No. 22398) and this Court (G.R.
No. 111752) and the decision or resolution on the petitions.18 cralawred
In the challenged Decision,
the Court of Appeals dismissed the petition for annulment of judgment.19 It also declared Espinosa and his present counsel in contempt of court and
fined each of them One Thousand Pesos (
P1,000.00) for forum-shopping.
Consequently, the issues before this Court are (a) whether the
RTC Decision may be annulled on the
ground of extrinsic fraud and denial of due process, and (b) whether Espinosa
and his present counsel are guilty of forum-shopping.
Annulment of judgment is a recourse equitable in character,
allowed only in exceptional cases as where there is no available or other
adequate remedy.20 Extrinsic fraud, the ground upon which Espinosa relies upon, is one of the
recognized grounds for annulment of judgment.21 However, the mere allegation of extrinsic fraud does not instantly warrant the
annulment of a final judgment, as the same has to be definitively established
by the claimant. Espinosa has failed to prove extrinsic fraud.
Extrinsic fraud exists when there is a fraudulent act of
prevailing party committed outside of the trial of the case, whereby the
defeated party was prevented from exhibiting fully his side of the case by
fraud or deception practiced on him by the prevailing party.22 The extrinsic fraud complained off by Espinosa refers to the act of conducting
the relocation survey while the case was on appeal to the RTC. Espinosa
suggests that it was highly questionable on the part of the RTC to have ordered
such a survey since the case was being heard on appeal, and given the nature of
an ejectment action, only the submission of memoranda by the parties are
Clearly, the conduct of the relocation survey was not occasioned
at the instigation of the prevailing party (the Alcantaras),
but upon lawful
order by the RTC.
procedure was consented to by all of the parties and their lawyers. The
relocation survey was ordered for the purpose of conclusively ascertaining a
factual issue, i.e., the exact location of the structure belonging to
Espinosa in relation to the lot of the Alcantaras. This is a proper question
for the RTC to have inquired into, and well within its competence as it is a
trier of facts. Every court has the inherent power to do all things reasonably
necessary for the administration of justice within the scope of its
Even assuming that the order for the relocation survey is
irregular on the premise that RTC may decide the appealed case based only on
the records and pleadings before it, such lapse is procedural in character
The findings would not be ipso
facto binding on the parties who consented to the survey, but would only
form part of the proofs on which the trial court would base its decision upon.
Despite such relocation survey, Espinosa was not prevented from challenging the
findings before the RTC.
Espinosa prevented from arguing against the adoption of such findings before
the Court of Appeals and the Supreme Court, considering that he had availed of
the proper appellate processes before these higher courts.
Indeed, Espinosa raised the same issue concerning the alleged
impropriety of the relocation survey ordered by the RTC before the CA in CA
G.R. SP No. 22398.
It was rejected by
the appellate court in its decision in the said case.The same issue was raised again in G.R. No. 111752 before this
Court, albeit unsuccessfully.
of extrinsic fraud would presuppose that the claimant was prevented exhibiting
fully his side of the case.
contrary, Espinosa has had multiple opportunities to raise the same issue on
the impropriety of the relocation survey before the courts. His claim has
acquired the veneer of a scratchy vinyl record that repeats its hoary tune ad
nauseum to the general effect of irritation.
Espinosa claims that he was deprived of due process and blames
his former counsel, Atty. Castillon, for having consented to the relocation
survey, implicitly suggesting that the lawyer too had an active hand in denying
him due process.
and his former counsel agreed to the relocation survey, were present during the
survey and are thus estopped from questioning its very conduct in the first
place. When a party retains the services of a lawyer, he is bound by his
counsel's decisions regarding the conduct of the case. The general rule is that
the client is bound by the mistakes of his counsel, save when the negligence of
counsel is so gross, reckless and inexcusable that the client is deprived of
his day in court.25 cralawred
Citing the cases of Legarda v. Court of Appeals26 and Alabanzas v. IAC27,
Espinosa invokes the exception to the general rule that a client need not be
bound by the actions of counsel who is grossly and palpably negligent.
These very cases cited demonstrate why Atty.
Castillons acts hardly constitute gross or palpable negligence.
Legarda provides a textbook example of
gross negligence on the part of the counsel. The Court therein noted the following negligent acts of lawyer
Petitioner's counsel is a well-known practicing lawyer and dean of
a law school. It is to be expected that he would extend the highest quality of
service as a lawyer to the petitioner. Unfortunately, counsel appears to have
abandoned the cause of petitioner. After agreeing to defend the petitioner in
the civil case filed against her by private respondent, said counsel did nothing
more than enter his appearance and seek for an extension of time to file the
answer. Nevertheless, he failed to file the answer. Hence, petitioner was
declared in default on motion of private respondent's counsel. After the
evidence of private respondent was received ex-parte, a judgment, was rendered
by the trial court.
Said counsel for petitioner received a copy of the judgment but
took no steps to have the same set aside or to appeal therefrom. Thus, the
judgment became final and executory.28 cralawred
Gross negligence on the part of the counsel in Legarda is
clearly established, characterized by a series of negligent omissions that led
to a final executory judgment against the client, who never once got her side
aired before the court of law before finality of judgment set in. The actions
of Atty. Castillon hardly measure up to this standard of gross negligence
exhibited in the Legarda case.
On the other hand, in Alabanzas counsel failed to file an
appellants brief, thereby causing the dismissal of the appeal before the Court
of Appeals.29 Despite such inexcusable and fatal lapse, the Court ruled that it was not
sufficient to establish such gross or palpable negligence that justified a
deviation from the rule that clients should be bound by the acts and mistakes
of their counsel.30 It strikes as odd that Espinosa should cite Alabanzas in the first
place, considering that the lapse of the counsel therein was far worse than
that imputed to Atty. Castillon, yet the Court anyway still refused to apply
the exception to the general rule.
Besides, there is nothing in the record that would tend to
establish that Atty. Castillon performed less than ably in representing
On the contrary, as noted by
the Alcantaras in their Comment,Atty. Castillon is a law
professor on Property and a distinguished practitioner in the City of Iloilo.31 Moreover, Atty. Castillon served as Espinosas counsel for more than ten years.32 Espinosas defeat is attributable not to the purported incompetence of his
former lawyer but to the untenability of his legal position. And even if Atty.
Castillon committed a tactical error in consenting to the relocation survey,
this was done out of the honest belief that the survey would benefit his
clients cause. Just because it did not, Espinosa and his new counsel could not
just turn about and pin the blame on the patsy of their convenient choice.
Another matter cited by the Court of Appeals is also worth
The Petition for Annulment
of Judgment is silent as to when Espinosa received a copy of the impugned
decision, or when he discovered the alleged extrinsic fraud.33 An action based on extrinsic fraud must be filed within four (4) years from its
discovery.34 Since the timeliness of the Petition could not be ascertained, it could
have very well been dismissed on that ground alone.
Anent the issue of forum-shopping, the Court agrees with the
Court of Appeals finding that Espinosa and his present counsel, Atty.
Laguilles, Jr., violated the rules on non-forum shopping. Revised Circular No.
28-91 (as amended) was already in force when the petition in CA G.R. SP No.
39206 was filed on October 11, 1996.
Under the Circular, which has since
been incorporated into the 1997 Rules of Civil Procedure,35 the petitioner has to attest that he has not commenced any other action or
proceeding involving the same issues in the Supreme Court, the Court of
Appeals, or any other tribunal or agency. If such an action or proceeding has
been instituted, the petitioner is obliged to state the status of the same.36 cralawred
In his Verification, Certification and Affidavit
of Merit, which contains the certificate of non-forum shopping in the
petition in CA G.R. SP No. 39206, Espinosa and his new counsel did not mention
the petitions in CA G.R. SP No. 22398 and G.R. No. 111752 and the decisions or
resolutions thereon. In his present petition before this Court, Espinosa does
mention the existence of the previous cases in his Verification With
Affidavit of Non-Forum Shopping, though with the disclaimer that those
cases involved different issues than those addressed in the current
The belated compliance,
however, is of no moment, as his failure to assert the same before the Court of
Appeals is sufficient to warrant liability.
Espinosa argues against this finding by noting that the issues of
denial of due process and fraud were raised for the first time in the Petition
for Annulment of Judgment. Yet, the proof of such fraud is the alleged
improper allowance of the relocation survey. As the Court of Appeals noted,
that same question of impropriety was already passed upon by the Court of
Appeals and the Supreme Court in two previous petitions filed by Espinosa. The
Court of Appeals noted that:
of the petition filed [in CA-G.R. SP No. 22398] vis-a-vis the one filed in
this case would readily reveal that not much difference exists between the two
except that the first is a Petition for Review while the present is one for
annulment of judgment.37 In the pithy words of the Court of Appeals, same dog, but with a different
However, this Court is unable to sustain the Court of Appeals
declaration that Espinosa and his counsel are in contempt of court and the
corresponding fine of One Thousand Pesos (
P1,000.00) imposed upon them.
Under Revised Circular No. 28-91, the submission of a false certification
constitutes indirect contempt of court, without prejudice to the filing of
criminal action against the guilty party and the institution of disciplinary
proceedings against the counsel. Unlike in cases of direct contempt, which can
be summarily adjudged and punished by a fine39,
a finding of guilt for indirect contempt must be preceded by a charge in
writing, an opportunity given to the respondent to comment thereon and to be
heard by himself or by counsel in a hearing.40 The Court of Appeals erred in summarily punishing Espinosa and his counsel,
considering that the charge against them only constitutes indirect contempt. In
cases of indirect contempt, no matter how palpable the errants bad faith might
appear to the court, due process as laid down in the rules of procedure must be
observed before the penalty is imposed.
Finally, the ejectment case against Espinosa was filed way back
in 1985, and the judgment therein attained finality in 1995. If the pendency of
this case has prevented the Alcantaras from enforcing the long-final judgment
in their favor, then such delay is understandably egregious. The immediate
execution of this judgment is declared exigent to enable the Alcantaras
deservedly to rest secure in the vindication of their rights and the enjoyment
of their property.
WHEREFORE, the Petition is DENIED for lack of merit. The assailed Decision of the Court of
Appeals Sixteenth Division is AFFIRMED, EXCEPT insofar as it imposes a fine of
One Thousand Pesos (
P1,000.00) on petitioner Honorato Espinosa and Atty.
Honorio S. Laguilles, Jr. Instead, the Court of Appeals is DIRECTED to initiate
indirect contempt proceedings against Espinosa and Atty. Laguilles, Jr., and
RESOLVE the same in conformity with Rule 71 of the 1997 Rules of Civil
Quisumbing, (Acting Chairman),
Austria-Martinez, and Callejo, Sr., JJ., concur.
J., on official leave.
1 Penned by Justice, now Presiding Justice Cancio C. Garcia, concurred in by
Justices Eugenio S. Labitoria and Artemio G. Tuquero.
2 Rendered by Hon. Tito G. Gustilo.
3 Rollo, p. 10. Docketed as Civil Case No. 15288.
See Section 2, Rule 47, 1997 Rules
of Civil Procedure.
24 Shioji v. Harvey, 43 Phil. 333, 344 (1922). Moreover, the Rules of Court recognize
that every court has the power to amend and control its process and orders so
as to make them conformable to law and justice. Section 5(g),
Rule 135, Revised
Rules of Court.
26 G.R. No. 94457, 18 March 1991,
195 SCRA 418.
27 G.R. No. 74697, 29 November 1991,
204 SCRA 304.
28 Legarda v. Court of Appeals, G.R. No. 94457, 18
March 1991, 195 SCRA 418, 424-425.
29 Alabanzas v. IAC, G.R. No. 74697, 29
November 1991, 204 SCRA 304, 306.
31 Rollo, p. 100. Espinosa does not refute Atty. Castillons apparent credentials,
merely noting without effect that even the high and mighty commit mistakes. See
Rollo, p. 126.
See Section 3, Rule 47, 1997 Rules
of Civil Procedure.
35 F. Regalado, I REMEDIAL LAW COMPENDIUM 147 (1997). See also Section 5,
Rule 7, 1997 Rules of Civil Procedure.
36 Par. 1, Revised Circular No. 28-91.
39 Section 1, Rule 71, Revised Rules of
See Section 3, Rule 71, Revised
Rules of Court. [T]here must be a hearing of the indirect contempt
charge after notice thereof is validly served on the person charged with
indirect contempt. Balasabas v. Hon. Aquilisan, 193 Phil. 639, 650 (1981).
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