12/16/24, 1:19 PM Edron Construction Corp. vs.
Provincial Government of Surigao del Sur
Title
Edron Construction Corp. vs. Provincial Government of Surigao del Sur
Case Decision Date
G.R. No. 220211 Jun 5, 2017
Edron Construction Corporation secures payment from the Provincial Government of
Surigao Del Sur following dismissal of the case for lack of cause of action by the Court
of Appeals.
Jur.ph - Case Digest (G.R. No. 220211)
Comprehensive
Facts:
The case involves Edron Construction Corporation and Edmer Y. Lim (petitioners)
against the Provincial Government of Surigao del Sur, represented by Governor Vicente
T. Pimentel, Jr. (respondent).
Petitioners filed a Complaint for specific performance and damages on August 5, 2008,
in the Regional Trial Court (RTC) of Quezon City, Branch 77.
They claimed to have entered into three construction agreements with the respondent
for various projects, including the Learning Resource Center of Tandag.
Despite completing the projects and receiving Certificates of Final Acceptance, the
respondent failed to pay P8,870,729.67, despite multiple demands.
Petitioners sought this amount, along with P500,000.00 in actual damages and
P250,000.00 for attorney's fees.
The respondent admitted the existence of the contracts but claimed there was no
unpaid balance and that petitioners were liable for underruns and defective works.
The respondent also argued that petitioners waived their right to collect due to
prescription and failed to meet contract specifications.
On May 24, 2010, the respondent filed a Motion to Dismiss, citing the petitioners'
failure to submit a sworn statement required for final payment, which the RTC denied
on August 11, 2010.
During the trial, it was revealed that a Presidential Flagship Committee valued the
respondent's arrears at P4,326,174.50, which the petitioners accepted.
The RTC ruled in favor of the petitioners on December 28, 2010, ordering the
respondent to pay P4,326,174.50, plus interest and attorney's fees.
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12/16/24, 1:19 PM Edron Construction Corp. vs. Provincial Government of Surigao del Sur
The respondent's motion for reconsideration was denied, leading to an appeal to the
Court of Appeals (CA).
On November 26, 2014, the CA reversed the RTC ruling, dismissing the complaint for
lack of cause of action due to the alleged non-submission of the sworn statement.
The petitioners' motion for reconsideration was denied on September 8, 2015,
prompting the current petition for review on certiorari.
Issue:
Whether the Court of Appeals correctly reversed and set aside the RTC ruling,
dismissing the petitioners' complaint for lack of cause of action.
Ruling:
The Supreme Court granted the petition, reversing the CA's Decision and Resolution.
The RTC's ruling was reinstated, holding the respondent liable to the petitioners for
P4,326,174.50, plus legal interest and attorney's fees.
Ratio:
The Court found the CA's dismissal of the petitioners' complaint was improperly based
on the alleged non-submission of the sworn statement.
It emphasized that under Section 1, Rule 9 of the Rules of Court, defenses not raised in
a motion to dismiss or in the answer are deemed waived, with specific exceptions.
The respondent's Answer with Counterclaim did not mention the sworn statement, and
the motion to dismiss was filed over a year later, making it untimely.
The Court concluded that the respondent was precluded from raising this defense at
that stage.
The RTC's findings were supported by the Certificates of Final Acceptance, confirming
the satisfactory completion of the projects.
Thus, the Court upheld the RTC's ruling, affirming the respondent's liability to the
petitioners and the legal basis for the awarded amounts, including applicable interest
rates.
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12/16/24, 1:22 PM Magdiwang Realty Corp. vs. Manila Banking Corp.
Title
Magdiwang Realty Corp. vs. Manila Banking Corp.
Case Decision Date
G.R. No. 195592 Sep 5, 2012
The Supreme Court upholds Manila Banking Corporation's victory, enforcing payment
of debts, interest, penalties, and attorney's fees from Magdiwang Realty Corporation
and its associates.
Jur.ph - Case Digest (G.R. No. 195592)
Comprehensive
Facts:
The case involves Magdiwang Realty Corporation, Renato P. Dragon, and Esperanza
Tolentino as petitioners against The Manila Banking Corporation (TMBC), later
substituted by First Sovereign Asset Management (SPV-AMC), Inc.
The dispute began with a complaint filed on April 18, 2000, in the Regional Trial Court
(RTC) of Makati City, where TMBC claimed the petitioners defaulted on debts under
five promissory notes totaling Php 2,500,000.00.
The promissory notes had different maturity dates and amounts.
Despite multiple payment demands, the petitioners did not respond, prompting TMBC
to file a complaint for a sum of money.
The case was assigned to Branch 148 of the RTC.
Instead of a timely responsive pleading, the petitioners filed a Motion for Leave to
Admit Attached Motion to Dismiss and a Motion to Dismiss on October 12, 2000, which
was late.
The RTC declared the petitioners in default on July 5, 2001, for not filing a responsive
pleading within the required period.
The petitioners' motion for reconsideration was denied, leading them to file a petition
for certiorari with the Court of Appeals (CA), which upheld the RTC's decision.
On May 20, 2007, the RTC ruled in favor of TMBC, ordering the petitioners to pay the
amounts due, including interest and attorney's fees.
The petitioners' appeal to the CA was dismissed on October 11, 2010, resulting in the
current petition for review on certiorari.
Issue:
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12/16/24, 1:22 PM Magdiwang Realty Corp. vs. Manila Banking Corp.
Did the Court of Appeals err in holding that the prescriptive period for the enforcement
of the promissory notes was legally interrupted?
Did the Court of Appeals err in rejecting the petitioners' defense of novation?
Did the Court of Appeals err in affirming the trial court's ruling that the petitioners
were liable for attorney's fees?
Ruling:
The Supreme Court dismissed the petition, affirming the decisions of the Court of
Appeals and the Regional Trial Court.
The Court confirmed that the prescriptive period was interrupted, the defense of
novation was not established, and the award of attorney's fees was warranted.
Ratio:
The Supreme Court noted that the issues raised were primarily factual, which are not
suitable for a petition for review on certiorari.
The Court highlighted that the prescriptive period for filing an action is interrupted by
written demands or acknowledgments of debt, which were present in this case
through various letters exchanged.
The petitioners' claims regarding the interruption of the prescriptive period were
deemed unfounded, as evidence showed that TMBC made several demands for
payment, including a final demand letter on September 10, 1999.
Regarding the defense of novation, the Court found that the petitioners did not prove
the necessary elements for valid novation, such as the clear release of the original
debtor and the creditor's consent.
The Court upheld the award of attorney's fees, referencing Article 2208(2) of the New
Civil Code, which permits such fees when a party's actions compel litigation to protect
interests.
The petitioners' failure to respond timely and their subsequent default were significant
factors in the Court's decision.
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12/16/24, 1:23 PM Philippine Tourism Authority vs. Philippine Golf Development & Equipment, Inc.
Title
Philippine Tourism Authority vs. Philippine Golf Development and Equipment, Inc.
Case Decision Date
G.R. No. 176628 Mar 19, 2012
The Philippine Supreme Court upheld the dismissal of the PTA's petition for annulment,
ruling that counsel's negligence does not equate to extrinsic fraud and the PTA cannot
claim immunity in a commercial contract dispute.
Jur.ph - Case Digest (G.R. No. 176628)
Comprehensive
Facts:
The Philippine Tourism Authority (PTA) is the petitioner; Philippine Golf Development
& Equipment, Inc. (PHILGOLF) is the respondent.
On April 3, 1996, PTA contracted Atlantic Erectors, Inc. (AEI) for the Intramuros Golf
Course Expansion Projects, valued at ₱157,954,647.94.
AEI subcontracted the project to PHILGOLF for ₱127,000,000.00 due to its inability to
complete the work.
The subcontract required PHILGOLF to submit progress billings directly to PTA for
payment.
On October 2, 2003, PHILGOLF filed a collection suit against PTA for ₱111,820,550.53,
plus interest, for unpaid work.
PTA requested extensions to respond, which the Regional Trial Court (RTC) granted,
but ultimately failed to file an answer.
The RTC declared PTA in default on April 6, 2004, ordering payment to PHILGOLF
along with damages and attorney's fees.
PTA appealed to the Court of Appeals (CA) on July 11, 2005, but PHILGOLF filed a
motion for execution pending appeal, which the RTC granted.
PTA's petition for certiorari with the CA initially favored PTA, but PTA later withdrew its
appeal and filed for annulment of judgment.
The CA dismissed PTA's annulment petition for lack of merit on December 13, 2006,
leading to the current petition for certiorari.
Issue:
Did the negligence of PTA's counsel constitute extrinsic fraud warranting annulment of
judgment?
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12/16/24, 1:23 PM Philippine Tourism Authority vs. Philippine Golf Development & Equipment, Inc.
Should PTA, as a government entity, be exempt from the consequences of its counsel's
negligence?
Were there any other available remedies for PTA aside from a petition for annulment of
judgment?
Ruling:
The Supreme Court dismissed PTA's petition for certiorari, affirming the CA's decision.
The Court ruled that PTA's counsel's negligence did not amount to extrinsic fraud.
PTA could not evade liability due to its status as a government entity.
Other remedies, such as appeal, were available to PTA.
Ratio:
The Court highlighted that the Rules of Court impose strict deadlines for legal actions
to ensure orderly case management.
Clients are generally bound by their counsel's actions, except in cases of gross
negligence, which was not applicable here.
PTA received proper notice of the complaint but failed to respond in time, justifying the
RTC's declaration of default.
The Court rejected PTA's argument regarding state immunity, clarifying that it applies
only to sovereign acts, not commercial transactions.
By entering a business contract, PTA consented to be sued.
A petition for annulment of judgment is an extraordinary remedy, only available when
no other legal remedies exist.
Since PTA had the option to appeal the RTC's decision, the Court found no grounds for
annulment, leading to the dismissal of the petition and holding PTA accountable for its
obligations to PHILGOLF.
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12/16/24, 1:24 PM Spouses Lumanas vs. Sablas
Title
Spouses Lumanas vs. Sablas
Case Decision Date
G.R. No. 144568 Jul 3, 2007
The Supreme Court affirmed that a defending party cannot be declared in default
without a prior motion and , thus upholding the trial court's admission of the
petitioners' answer.
Jur.ph - Case Digest (G.R. No. 144568)
Comprehensive
Facts:
The case involves Guillerma S. Sablas and Pascual Lumanas (petitioners) against
Esterlita S. Sablas and Rodulfo S. Sablas (respondents).
Respondents filed a complaint for judicial partition, inventory, and accounting on
October 1, 1999, in the Regional Trial Court of Baybay, Leyte, Branch 14.
Petitioners received summons and a copy of the complaint on October 6, 1999.
On October 21, 1999, petitioners requested a 15-day extension to file their answer,
extending the deadline to November 5, 1999.
Petitioners filed their answer on November 8, 1999, which was late.
The trial court admitted the late answer since no motion for default was filed.
Respondents filed a motion to declare petitioners in default on November 9, 1999,
which the trial court denied on December 6, 1999.
Respondents' motion for reconsideration was also denied.
Respondents then filed a petition for certiorari with the Court of Appeals, claiming
grave abuse of discretion by the trial court.
On July 17, 2000, the Court of Appeals ruled in favor of the respondents, stating the
trial court erred in not declaring petitioners in default.
Petitioners subsequently filed a petition for review on certiorari to the Supreme Court.
Issue:
Did the Court of Appeals err in ruling that the trial court committed grave abuse of
discretion by admitting the late answer of the petitioners?
Can a declaration of default be made without a motion filed by the claiming party?
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12/16/24, 1:24 PM Spouses Lumanas vs. Sablas
Is it permissible for a trial court to admit an answer filed after the reglementary period
if no declaration of default has been made?
Ruling:
Yes, the Court of Appeals erred in ruling that the trial court committed grave abuse of
discretion by admitting the late answer of the petitioners.
A declaration of default cannot be made without a motion filed by the claiming party.
Yes, it is permissible for a trial court to admit an answer filed after the reglementary
period if no declaration of default has been made.
Ratio:
The Supreme Court held that the trial court acted within its discretion in admitting the
late answer of the petitioners.
The Court emphasized that a motion from the claiming party is required to declare the
defending party in default, along with proper notice.
Essential elements for a valid declaration of default include the court's jurisdiction, the
defending party's failure to file an answer on time, and the filing of a motion for default.
Since no motion was filed before the admission of the late answer, the trial court's
decision was correct.
The Court reiterated that the law favors resolving cases on their merits and generally
discourages judgments by default.
The trial court has discretion to allow late filings as long as no prejudice is caused to
the opposing party.
The Supreme Court reversed the Court of Appeals' decision, reinstated the trial court's
order, and remanded the case for further proceedings.
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