Facts:

This case involves the Bank of the Philippine Islands (BPI) as the petitioner and Domingo R. Dando as the respondent. The proceedings began with the filing of a Complaint for Sum of Money and Damages by BPI against Dando on March 13, 2003, before the Regional Trial Court (RTC) of Makati City, noted as Civil Case No. 03-281. The complaint asserted that on August 12, 1994, Dando obtained a loan amounting to ₱750,000.00 from the Far East Bank and Trust Company (FEBTC) under a Privilege Cheque Credit Line Agreement. The arrangement stipulated that Dando would repay the principal in a single payment at the end of 90 days with interest payable every 30 days. Dando subsequently defaulted on the repayment of the principal, interest, and any applicable penalties, despite multiple demands for payment.

In 2000, BPI merged with FEBTC, thereby assuming all rights and obligations related to Dando’s loan. Following Dando's submission of an Answer with Counterclaim, BPI moved to set a pre-t

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Facts:

Background of the Case

• The case originated from a Complaint for Sum of Money and Damages filed by Bank of the Philippine Islands (BPI) against Domingo R. Dando before the RTC of Makati City, Branch 149 (Civil Case No. 03-281).
• The Complaint arose from a loan transaction wherein on or about 12 August 1994, Dando availed of a loan amounting to P750,000.00 from Far East Bank and Trust Company (FEBTC) under a Privilege Cheque Credit Line Agreement.
• The parties agreed that Dando would pay the principal in a lump sum after 90 days with interest computed every 30 days. Dando failed to pay the principal, interest, and penalties despite repeated demands.

Merger and Procedural Initiation

• In 2000, BPI merged with FEBTC, with BPI succeeding as the surviving entity and absorbing the rights and obligations of FEBTC.
• After Dando filed his Answer with a Counterclaim, BPI moved to set the case for pre-trial, prompting the RTC to schedule the pre-trial conference.

Pre-Trial Brief Filing and RTC Order

• The RTC, via Acting Presiding Judge Oscar B. Pimentel, ordered that the pre-trial briefs be filed and served at least three days prior to the pre-trial conference.
• Dando submitted his pre-trial brief on 11 August 2003, whereas BPI submitted its pre-trial brief on the day of the pre-trial conference (18 August 2003), which was argued to be in contravention of the procedural rule.

Motion to Dismiss and Subsequent RTC Orders

• At the pre-trial conference on 18 August 2003, Dando moved orally for the case’s dismissal on the ground of non-compliance with Rule 18 concerning the timely filing of pre-trial briefs.
• The RTC issued an Order requiring Dando to file his motion to dismiss in writing and for BPI to comment on the said motion.
• Dando filed his written Motion to Dismiss on 25 August 2003, contending that BPI’s failure to file the pre-trial brief within the prescribed period warranted dismissal.
• On 10 October 2003, the RTC granted Dando’s Motion to Dismiss, dismissing the case with prejudice based on the mandatory provisions of Sections 5 and 6, Rule 18 of the Rules of Court.

Motions for Reconsideration and Reversal of Dismissal

• BPI filed a Motion for Reconsideration of the dismissal order, arguing for a liberal interpretation of the procedural rules.
• On 13 January 2004, the RTC, under Judge Cesar O. Untalan, set aside the 10 October 2003 dismissal order and rescheduled the case for a new pre-trial conference on February 13, 2004, explaining that procedural technicalities could be relaxed in the interest of substantial justice.
• Dando then filed a Motion for Reconsideration which the RTC denied on 3 March 2004, allowing the pre-trial set for March 19, 2004, to proceed.

Appeal and the Involvement of the Court of Appeals

• Dando sought relief by filing a Petition for Certiorari under Rule 65 before the Court of Appeals challenging the RTC’s reconsideration order.
• The Court of Appeals rendered a Decision on 20 November 2006 and, later on 4 April 2007, issued a Resolution denying BPI’s Motion for Reconsideration.
• The Court of Appeals held that BPI’s delay in filing its pre-trial brief did not justify a relaxation of the procedural rules, emphasizing the mandatory nature of the rules regarding pre-trial brief filing.

Issues Raised in the Petition

• BPI questioned whether the Court of Appeals correctly applied the Rules of Procedure strictly.
• The petition also challenged the declaration by the Court of Appeals that the RTC committed grave abuse of discretion when it reconsidered and set aside the dismissal order, despite having the power to relax compliance with procedural rules.

Issue:

• Whether the Court of Appeals was correct in strictly applying the mandatory provisions of Rule 18, particularly Sections 5 and 6, concerning the timely filing and service of pre-trial briefs.
• Whether the Court of Appeals correctly declared that the RTC committed grave abuse of discretion when it reconsidered and set aside the dismissal order, notwithstanding the inherent power of the RTC to relax procedural rules in the interest of justice.
• Whether the delay exhibited by BPI in filing and serving its pre-trial brief, justified by “heavy work pressures” of its counsel, is a sufficient ground to mandatorily dismiss the action as provided by the Rules of Court.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)