Spouses Que v. CA

Facts:

Respondeny Isabel Arrieta-Costales has been occupying as owner a parcel of land in Sta. Monica, Magsingal, Ilocos Sur. The property was originally owned by one Lorenzo Cariño who died in 1960. In 1997, respondent declared the property in her name for taxation purposes.

Petitioner Adela Urian is Lorenzo's grandniece, being the adopted daughter of Lorenzo's nephew Gonzalo Cariño, son of Lorenzo's brother Mariano Cariño.

Respondent filed a complaint against Urian and petitioners spouses Que in the RTC Cabugao, Ilocos Sur "Annulment of Quitclaim[,] Ownership, Possession and Damages". Respondent claimed that she is Lorenzo's granddaughter and as such, she inherited the lot from him. Respondent sought the annulment of a Deed of Quitclaim and a handwritten Acknowledgment both signed by one Isabel Arrieta. Under the Deed of Quitclaim, Arrieta "renounce[d] all [her] rights, interests, participation, title and possession" over the lot to the spouses Que while in the Acknowledgment, Arrieta confirmed receiving P30,000 from Urian. Respondent alleged that she did not sign these documents.

When respondent filed her Complaint, the spouses Que had taken possession of the lot. The spouses Que also declared the land in their name for tax purposes.

After petitioners received the complaint with the summonses, they hired the services of one Atty. Ronnie Ranot. However, Atty. Ranot failed to file petitioners' Answer.

The RTC rendered judgment in respondent's favor.

Petitioners, through a new counsel, Atty. Benjamin Bateria, sought reconsideration or new trial. Petitioners blamed their previous counsel for the non-filing of their Answer. Petitioners attached to their motion a Deed of Adjudication With Sale in which Urian, as alleged sole heir of Gonzalo, adjudicated to herself the lot and sold it to the spouses Que. Petitioners claimed that in his last will and testament, Lorenzo devised the lot to Gonzalo.

The trial court denied petitioners' motion because as to Urian, its Decision had become final because although she received a copy of its Decision on 15 September 2000, the MR or new trial was filed only on 10 October 2000.

On 18 December 2000, petitioners, represented this time by one Atty. Oliver Cachapero, filed with the trial court a petition for relief from judgment under Rule 38 of the 1997 Rules of Civil Procedure. Petitioners claimed that their failure to file an Answer and to seek reconsideration or new trial on time was due to the excusable negligence of their previous counsels. Petitioners also invoked "mistake and fraud" as they were allegedly under the impression that Atty. Ranot had prepared and filed "the necessary pleading or that the necessary pleading to vacate the judgment and secure new trial was prepared xxx and filed xxx."

The trial court denied the petition for relief from judgment. The trial court held that the negligence of their counsels bound petitioners.

Petitioners filed a petition for certiorari in the CA to set aside the trial court's Order but was denied.

Issue:

The issue is whether the Court of Appeals erred in dismissing petitioners' petition.

Held:

No. Petitioners are not Entitled to Relief from Judgment.

The Court of Appeals did not err in ruling that petitioners are not entitled to relief from judgment because their petition was insufficient in form and substance, filed late, and improperly availed of.

Petitioners Failed to Prove Fraud, Mistake, or Excusable Negligence

Under Section 1, Rule 38, the court may grant relief from judgment only "[w]hen a judgment or final order is entered, or any other proceeding is taken against a party in any court through fraud, accident, mistake, or excusable negligence xxx." In their petition for relief from judgment in the trial court, petitioners contended that judgment was entered against them through "mistake or fraud" because they were allegedly under the impression that Atty. Ranot had prepared and filed "the necessary pleading." This is not the fraud or mistake contemplated under Section 1. As used in that provision, "mistake" refers to mistake of fact, not of law, which relates to the case.¹⁵ "Fraud," on the other hand, must be extrinsic or collateral, that is, the kind which prevented the aggrieved party from having a trial or presenting his case to the court.¹⁶ Clearly, petitioners' mistaken assumption that Atty. Ranot had attended to his professional duties is neither mistake nor fraud.

On the other hand, what petitioners appear to be claiming in this petition is that this Court should reverse the Court of Appeals and remand the case to the trial court for new trial on the ground that their previous counsels' negligence constitutes "excusable negligence" under Section 1.

This claim is similarly without merit.

Under Section 1, the "negligence" must be excusable and generally imputable to the party because if it is imputable to the counsel, it is binding on the client. To follow a contrary rule and allow a party to disown his counsel's conduct would render proceedings indefinite, tentative, and subject to reopening by the mere subterfuge of replacing counsel. What the aggrieved litigant should do is seek administrative sanctions against the erring counsel and not ask for the reversal of the court's ruling.

For a claim of counsel's gross negligence to prosper, nothing short of clear abandonment of the client's cause must be shown. Here, what petitioners' first, second, and third counsels did was fail to file the Answer, file a belated and defective motion for reconsideration or new trial, and belatedly and erroneously file a petition for relief from judgment, respectively. While these acts and omissions can plausibly qualify as simple negligence, they do not amount to gross negligence to justify the annulment of the proceedings below.

In Legarda v. Court of Appeals, where the Court initially held that the counsel's failure to file pleadings at the trial court and later on appeal amounted to gross negligence, the Court, on respondent's motion, granted reconsideration and applied the general rule binding the litigant to her counsel's negligence. The Court noted that the proceedings which led to the filing of the petition in that case "were not attended by any irregularity." The same observation squarely applies here. Neither can petitioners rely on Boyer-Roxas v. Court of Appeals because there, as here, the Court held that the petitioners' counsel was not grossly negligent.

Nor were petitioners denied procedural due process. In essence, procedural due process is simply the opportunity to be heard.²⁴ Petitioners were afforded such opportunity. Thus, petitioners were served a copy of the complaint and the summonses and given 15 days to file their Answer. While there is no showing from the records when petitioners received their copy of the Order declaring them in default, there is no dispute that Urian was present at the hearing when the trial court issued that Order in open court. Petitioners were also served a copy of the trial court's Decision from which they had 15 days to appeal, seek reconsideration, or new trial. Indeed, petitioners filed a motion for reconsideration or new trial albeit belatedly and without complying with proper formalities. Plainly, there was no denial of due process to petitioners.

But even assuming that the lapses of petitioners' counsels amount to gross negligence denying petitioners their day in court, petitioners' contention that if we sustain the Court of Appeals they will be deprived of property is baseless.