G.R. No. 233068 - Republic vs. Merle M. Maligaya

The Regional Trial Court (RTC) rendered a decision on October 11, 2000, awarding the plaintiff a monetary judgment of P516,797.63 plus interest, penalties, and attorney’s fees.
The Court of Appeals (CA) affirmed the RTC decision in its decision dated February 28, 2006.
The Supreme Court, in its Resolution dated October 18, 2006, denied petitioner DMG Industries, Inc.’s petition for review on certiorari, holding that the CA failed to commit any reversible error and that the issues raised were primarily factual in nature.

DMG Industries, Inc. filed a Motion for Reconsideration of the October 18, 2006 Resolution.
Pending the resolution of this motion, on February 14, 2007, DMG and The Philippine American Investments Corporation (PAIC) entered into a Compromise Settlement Agreement.
The motion for reconsideration was ultimately denied with finality on February 26, 2007, before the Compromise Agreement was addressed.

The agreement was executed by the parties on February 14, 2007, wherein DMG agreed to pay Two Million Pesos (P2,000,000.00).
The settlement was premised on humanitarian considerations, given that most of the monetary award in the RTC decision comprised penalties and attorney’s fees that had significantly increased due to prolonged litigation.
PAIC, represented by its Liquidator, and DMG, represented by its Chairman, jointly agreed that the payment would serve as full and complete settlement of the obligation, leading to the dismissal of the case.
The document explicitly states that such settlement is legally valid under the provisions of Article 1306 of the Civil Code of the Philippines, emphasizing that compromise agreements are contracts where reciprocal concessions are made to resolve differences.

On March 1, 2007, both parties filed an Urgent Joint Motion for Approval of the Compromise Settlement Agreement.
The Supreme Court, acknowledging that such agreements are generally favored and not contrary to law, approved the settlement.
The Court recalled its previous Resolution dated February 26, 2007 and rendered judgment in accordance with the terms of the Compromise Settlement Agreement.
The case was ultimately dismissed without any pronouncement on costs.

Whether the Court of Appeals committed any reversible error in affirming the RTC decision.

The petitioner’s petition for review on certiorari alleged reversible error, which the Court found unsubstantiated.

Whether DMG Industries, Inc. sufficiently showed the existence of reversible error to warrant a reconsideration of the earlier decisions.

The issues raised in the petition were primarily factual in nature, failing to meet the threshold for appellate review.

Whether the Compromise Settlement Agreement entered between DMG and PAIC is valid and enforceable.

The agreement must conform to legal standards, including not being contrary to law, morals, or public policy.

Whether it was appropriate for the Court to recall its resolution denying the motion for reconsideration in light of the entered settlement.

The Court needed to balance the finality of its earlier ruling with the parties’ amicable resolution of the dispute.