Case Digest (G.R. No. 154514)
Facts:
In Pinausukan Seafood House, Roxas Boulevard, Inc. (hereafter Pinausukan) vs. Far East Bank & Trust Company, now Bank of the Philippine Islands, and Hector Il. Galura, the petitioner corporation owned a 517-square-meter parcel in Pasay City (TCT No. 126636). In 1993, Bonier de Guzman, then president of Pinausukan, executed four real estate mortgages on that property in favor of the bank to secure various loans. By June 2001, the unpaid obligation had ballooned to ₱15,129,303.67, prompting the bank to initiate extrajudicial foreclosure proceedings on August 13, 2001, before the Pasay RTC ex officio sheriff, with the auction scheduled for October 8, 2001. On October 4, 2001, Pinausukan, represented by Zsae Carrie de Guzman, filed Civil Case No. 01-0300 in RTC Branch 108 seeking annulment of the mortgages on the ground that Bonier acted without corporate authority and without a board resolution. After initial hearings and settlement talks, Pinausukan’s counsel failed to appear on SCase Digest (G.R. No. 154514)
Facts:
- Background of the Mortgages and Loans
- In 1993, Bonier de Guzman, President of Pinausukan Seafood House, Roxas Boulevard, Inc. (Pinausukan), mortgaged its 517 sqm land in Pasay City under TCT No. 126636 to secure four loans from Far East Bank & Trust Company (now BPI) totalling ₱5,762,500.00.
- By June 2001, the unpaid obligation had ballooned to ₱15,129,303.67.
- Extrajudicial Foreclosure and RTC Action
- On August 13, 2001, the Bank commenced extrajudicial foreclosure; the sheriff set the sale for October 8, 2001.
- On October 4, 2001, Pinausukan (through counsel Atty. Villaflor) filed Civil Case No. 01-0300 in RTC Pasay for annulment of the mortgages, alleging Bonier acted in his personal capacity without corporate consent; it also sought a TRO/preliminary injunction.
- Dismissal for Failure to Prosecute and CA Petition
- Pinausukan presented one witness on May 30, 2002; subsequent hearings were repeatedly reset and parties attempted settlement.
- On September 5, 2002, counsel failed to appear; on October 31, 2002, the RTC dismissed the case for failure to prosecute; this order became final.
- Pinausukan learned of the dismissal only after receiving the sale notice on June 24, 2003. Claiming its counsel’s gross negligence deprived it of notice, it filed on July 24, 2003 a petition in the Court of Appeals to annul the RTC’s October 31, 2002 dismissal, alleging extrinsic fraud.
Issues:
- Procedural Compliance under Rule 47
- Must a petition for annulment of judgment under Rule 47 expressly attach affidavits of witnesses?
- Is a verified petition equivalent to the affidavits required by Section 4, Rule 47?
- Nature and Sufficiency of the Alleged Extrinsic Fraud
- Can the gross negligence of petitioner’s own counsel constitute “extrinsic fraud” to annul a judgment?
- Did Pinausukan demonstrate it was deprived of its day in court by an act of the adverse party?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)