Case Digest (G.R. No. 191353)
Facts:
Ultra Mar Aqua Resource, Inc. v. Fermida Construction Services, G.R. No. 191353, April 17, 2017, Supreme Court Third Division, Tijam, J., writing for the Court.The dispute arose from a December 8, 2003 Contract Agreement between Fermida Construction Services (contractor) and Ultra Mar Aqua Resource, Inc. (owner) for the construction of a warehouse in Subic, Zambales, with a contract price of P1,734,740. During construction Fermida performed additional or varied works allegedly upon Ultra Mar’s request; upon completion on January 17, 2004 Fermida submitted billing statements excluding variation costs and posted a surety bond to cover the 10% retention required by the contract. Fermida also executed a Contractor’s Affidavit attesting settlement of labor and material claims. Ultra Mar objected, alleging defective/substandard work, delay, and the absence of required reports and permits; Fermida repaired defects and presented another billing statement but Ultra Mar withheld payment.
Fermida filed a Complaint for Collection of Sum of Money with Prayer for Injunction before the Regional Trial Court (RTC), which ordered a court-appointed independent engineer’s ocular inspection and set the case for pre-trial. Ultra Mar’s counsel repeatedly sought postponements, failed to appear at pre-trial on September 7, 2004, and did not file the required pre-trial brief. The RTC declared Ultra Mar “in default,” allowed Fermida to present evidence ex parte, and on October 7, 2004 rendered judgment in favor of Fermida ordering Ultra Mar to pay P1,106,000.38 with interest, attorney’s fees, litigation expenses and nominal damages.
Ultra Mar moved to lift the default and to admit its pre-trial brief, explaining counsel’s illness and later submitting a medical certificate; the RTC denied the Omnibus Motion for failure to comply with its conditional order and treated a subsequent motion as a prohibited second motion for reconsideration, thus denying relief. Ultra Mar appealed to the Court of Appeals (CA) by filing a Rule 45 petition; the CA, in a July 28, 2009 Decision (with a February 9, 2010 Resolution denying reconsideration), affirmed the RTC’s denial of the Omnibus Motion and, on the merits, found Fermida established the construction agreement and Ultra Mar’s nonpayment. The CA relied on the independent engineer’s reports concluding the project had defects but that the 10% retention covered such defects; it modified the RTC judgment to order Ultra Mar to pay P1,106,038.82 with interest, subject to...(Subscriber-Only)
Issues:
- Did the Court of Appeals err in upholding the RTC’s denial of Ultra Mar’s Omnibus Motion and in allowing Fermida to present evidence ex parte because Ultra Mar failed to appear at pre-trial and to file a pre-trial brief?
- Can Ultra Mar be relieved from the consequences of its counsel’s alleged gross negligence so as to reopen its right to present evidence?
- Was the CA correct in ordering Ultra Mar to pay Fermida P1,106,038.82, and was Ultra Mar entitled to withhold the 10...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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