G.R. No. 98043 - Baguio Colleges Foundation vs. National Labor Relations Commission

Lucio L. Yu, Jr., in his capacity as Vice President/Assistant Chief Legal Counsel of the GSIS, filed a Complaint-Affidavit on June 17, 2010 and a Supplemental Complaint on November 4, 2010.
The complaints charged Presiding Judge Jesus B. Mupas of RTC Branch 112, Pasay City with grave misconduct, ignorance of the law, violation of the Code of Judicial Ethics, and rendering an unjust order in Civil Case No. 07-1139-CFM, “Government Service Insurance System v. Felix D. Mendoza.”

GSIS initiated a civil action against Felix D. Mendoza related to a loan obligation that became due upon his separation from service.
A Complaint for Collection of Sum of Money and Damages with Prayer for Preliminary Attachment was filed, seeking to enforce the loan payment through judicial process.

On August 3, 2007, Judge Mupas issued an Order granting the issuance of a Writ of Preliminary Attachment, which led to the seizure of Mendoza’s Ford Explorer Pick-up on April 28, 2008.
GSIS subsequently moved to declare Mendoza in default due to his failure to file an Answer within 15 days.
On September 5, 2008, Judge Mupas declared Mendoza in default and allowed GSIS to present evidence ex parte before the Branch Clerk of Court.
During the proceeding on October 20, 2008, GSIS presented its evidence ex parte, although Mendoza later appeared and indicated his intention to file a responsive pleading.
Mendoza filed an Omnibus Motion with his belated Answer seeking several reliefs, including the setting aside of the default declaration, quashing the writ of attachment, reception of evidence, admission of his Answer, and dismissal of the case on the ground that the loan obligation was already settled through voluntary surrender of his vehicle.

On February 4, 2009, Judge Mupas issued an Order granting Mendoza’s Omnibus Motion, thereby dismissing the case, on the basis that the loan obligation was deemed fully satisfied through the surrender of the motor vehicle.
The dismissal was rendered without a proper hearing on the merits, despite a prior order declaring default.
GSIS sought reconsideration of the dismissal, which was denied on May 29, 2009.

GSIS, through complainant Yu, Jr., alleged that Judge Mupas committed judicial misconduct by arbitrarily disregarding his earlier order of default and by failing to adhere to proper procedural requirements.
The complainant argued that the dismissal was premature and that Judge Mupas’ actions reflected gross ignorance of the law.
In his comment, Judge Mupas contended that the filing of the administrative complaint while a petition was pending before the CA amounted to forum shopping and that judicial remedies should be exhausted first.

The CA issued a decision on August 11, 2010 (CA-G.R. SP No. 110402), holding that Judge Mupas had committed grave abuse of discretion by issuing two conflicting orders on the same motion (the order declaring default and the later dismissal).
The CA emphasized that the trial court should have either set aside the order of default or, after duly hearing the parties, specifically denied it.

On January 30, 2017, the OCA reported that Judge Mupas was guilty of gross ignorance of the law and violation of the Code of Judicial Conduct, recommending a fine of P25,000.00 and a stern warning.
The OCA noted that Judge Mupas failed to follow established procedural rules (e.g., Section 3(b), Rule 9; Section 6, Rule 16) when dismissing the case, and that GSIS had diligently pursued its legal remedies.
The OCA found no substantial evidence to hold him responsible for grave misconduct or knowingly rendering an unjust judgment.

The Court adopted the OCA’s finding regarding gross ignorance of the law but modified the penalty to a P35,000.00 fine.
The Court underscored that the dismissal of the case without a proper hearing amounted to a serious error in applying the rules of procedure and that a judge must exhibit competence and integrity.
The ruling referenced prior decisions and stated that any deliberate or careless disregard for basic legal standards constitutes gross ignorance of the law.

Whether Judge Mupas committed gross ignorance of the law by dismissing the subject case without affording the parties the opportunity for a proper hearing as mandated by procedural rules.

Specifically, whether the dismissal under Section 2, Rule 16 without a requisite preliminary hearing violated established legal standards.

Whether the dismissal based on the alleged voluntary surrender of the motor vehicle can be considered conclusive as full satisfaction of Mendoza’s loan obligation.
Whether the administrative complaint filed by GSIS against Judge Mupas constitutes improper forum shopping given the pending appeal before the Court of Appeals.
Whether the dismissal of the case under Section 3, Rule 17 is justified, given that the records indicate GSIS was not remiss in prosecuting its claim.