G.R. No. 167398 - Gonzales vs. Pe

Petitioners: Augustus Gonzales and Spouses Engr. Nestor Victor and Dr. Ma. Lourdes Rodriguez, engaged in construction projects awarded by the Department of Public Works and Highways (DPWH).
Respondent: Quirico Pe, engaged in the construction materials business and supplier of cement in the projects.

Respondent supplied cement for the petitioners’ DPWH-awarded projects: Lanot-Banga Road (Kalibo Highway) and Laua-an Pandan Road.
Petitioner Nestor Rodriguez availed of DPWH’s pre-payment program for cement, requiring presentation of official receipts and providing an advance payment.
Petitioners issued a blank Land Bank of the Philippines (LBP) Check No. 6563066 signed by Nestor Victor Rodriguez, his wife Ma. Lourdes Rodriguez, and Augustus Gonzales, but left amount and date blank, intended as collateral for payment of 15,698 bags of cement valued at P1,507,008.00.
One year later, respondent filled in the blank LBP check with the amount P2,062,000.00 and a date of June 30, 1999.

On December 9, 1999, petitioners filed an amended complaint for declaration of payment, cancellation of documents (the LBP check), and damages. They alleged full payment of cement value and wrongful filling of the blank check by respondent.
Respondent answered, alleging delivery of 40,360 bags of cement valued higher than paid, claimed outstanding amount of P2,062,000.00, and presented compulsory counterclaim for balance with interest. He explained filling the check due to petitioners stopping bank-to-bank online payments.
Pre-trial issues included whether petitioners had already paid respondent for cement, whether the LBP check should be cancelled, damages, attorney’s fees, and dismissal of the complaint to proceed with counterclaim.

RTC ruled respondent’s act of filling up blank check was unauthorized and beyond reasonable time under Section 14 of Negotiable Instruments Law.
Payment for 23,360 bags of cement (P2,167,340.00) already settled—petitioners no longer liable.
Declared LBP Check No. 6563066 dated June 30, 1999 in amount P2,062,000.00 null and void.
Ordered respondent to pay petitioners damages and attorney’s fees; dismissed respondent’s counterclaim.

Respondent timely filed a Notice of Appeal on July 30, 2002.
RTC initially gave due course to appeal (August 5, 2002), ordered records transmitted to Court of Appeals (CA).
Petitioners moved for reconsideration and dismissal of appeal citing non-payment of docket and other lawful fees, supported by Clerk of Court certification that no payment was made.
RTC issued order on September 23, 2002 dismissing respondent’s appeal for non-payment of fees and directed issuance of writ of execution.
Writ of execution issued on October 2, 2002.

Respondent filed petition for certiorari and application for writ of preliminary injunction to stop implementation of writ of execution.
CA granted temporary restraining order (October 9, 2002), approved injunction bond, and issued writ of preliminary injunction (August 20, 2003).
CA decision (June 23, 2004) granted respondent’s petition, set aside RTC order dismissing appeal and writ of execution, and ordered RTC to allow payment of docket fees and give due course to appeal.
CA denied petitioners’ motion for reconsideration (February 23, 2005).

Petitioners filed a petition for review on certiorari under Rule 45, questioning the CA’s reversal allowing respondent to pay docket fees belatedly.
Respondent argued that filing a notice of appeal perfected the appeal and that failure to pay fees stemmed from the RTC clerk’s failure to assess fees.

Whether respondent’s appeal was perfected despite non-payment of docket and other legal fees within the reglementary period under Section 4, Rule 41 of the Rules of Court.
Whether the CA erred in setting aside the RTC order dismissing the appeal due to non-payment of appellate fees and allowing respondent to pay such fees belatedly.
Whether the RTC lost jurisdiction over the case upon filing of respondent’s notice of appeal without the payment of required fees.
Whether petitioners filed the proper remedy (petition for review on certiorari under Rule 45) in challenging the CA decision enjoining execution of the RTC decision.