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[ G.R. No. 132896. June 21, 1999]

SPS. ROGER DAVID DIZON, et al. vs. COURT OF APPEALS, et al.

FIRST DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated JUN 21, 1999.

G.R. No. 132896 (Spouses Roger David Dizon and Engracia-David Dizon, et al. vs. Court of Appeals, et al.)

The following facts are culled from the decision of the Court of Appeals:1 [Rollo, pp. 24-26.]

Petitioners obtained from private respondents a cash loan amounting to P340,000.00 payable within one month subject to 5% interest. To secure said loan, petitioners issued three post-dated checks in favor of private respondents, which were all subsequently dishonored. Private respondents informed petitioners of the dishonor and demanded payment of the loan. Having obtained no favorable response, private respondents instituted an action for collection before the Regional Trial Court, Branch 74 of Malabon. Petitioners, however, failed to file their answer despite service of summons purportedly because of a mistaken belief that they had already filed the same. Private respondents filed a motion to declare petitioners in default which motion the RTC granted. Three days after the issuance of the order granting default, petitioners filed a motion to lift the order of default and admit their answer. The RTC denied said motion. After presentation of private respondents' evidence the RTC rendered a decision in their favor. The RTC ordered petitioners:

(1) To pay the plaintiffs the sum of P340,000.00 as principal obligation plus five (5%) percent interest thereon;

(2) To pay to the plaintiffs the sum of P10,000.00 by way of accidental expenses;

(3) To pay the sum equivalent to ten (10%) percent of the total amount due and unpaid as and for attorney's fee.

(4) And to pay the costs of suit.

Upon appeal, the Court of Appeals affirmed the decision of the trial Court in toto. It held that petitioners failed to show that their failure to file an answer on time was due to a mistaken belief that they had already filed the same constitutes excusable neglect. Petitioners also question the award of damages by the trial court.

We find no error in the Court of Appeals' decision.

In rejecting petitioners' contention that its failure to file their answer was due to excusable neglect, the appellate court quoted the RTC's ratiocination on the point, thus:

x x x What constitute excusable negligence? The Supreme Court xxx pronounced that 'A person is expected to take ordinary care of his affairs.' Quality Tobacco Corporation vs. Intermediate Appellate Court, 181 SCRA 296. It further defined as 'a failure to take the proper steps at the proper time, not in consequence of party's own carelessness, inattention, or willful disregard of the process of unavoidable hindrance or accident or so on reliance on the care and vigilance of his counsel or on promises made by the adverse party. (p. 508, Black's Law Dictionary, Fifth Edition).

Thus, it is the well-considered opinion of the Court that the reason so of default is not an excusable negligence despite its support of an affidavit of merits. It is very clear [from the] cases decided by the Supreme Court [what constitutes] excusable negligence. In the case of:

*Antonio vs. Ramos, 2 SCRA 731 -

The fact that a party's counsel forgot to note notice of hearing in his calendar does not constitute accident, mistake or excusable negligence contemplated in the rules.

*Rivera vs. dela Cruz, 26 SCRA 58 -

Stenographer mixed paper and failed to refer immediately to counsel does not constitute excusable negligence.

*Herrera vs. Far Eastern Air Transprt, Inc., L-2507, September 19, 1950, 88 Phil. 787; Adaza vs. Barinaga, 104 SCRA 684 -

The lawyer was held culpably negligent in not seeing to it that the motion for reconsideration was filed on time. 2 [Id., at 28.]

Moreover, the facts stand out that petitioners presented no valid defense that would justify the lifting of the default order.3 [Development Corporation v. IAC 143 SCRA 62 (1986); Golden Country Farms, Inc. v. Sanvar Development Corporation, 214 SCRA 295 (1992)] Petitioners failed to pay their loan within the period stipulated, necessitating an action for collection filed against them by private respondents.

Neither do we see any reason to disturb the award of damages by the trial court, as affirmed by the Court of Appeals.

IN VIEW OF THE FOREGOING, the Court Resolved to DENY the petition.

Very truly yours,

(Sgd.) VIRGINIA ANCHETA-SORIANO

Clerk of Court

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