G.R. No. L-20034 - Astraquillo vs. Javier

Case Summary (G.R. No. L-20034)

Factual Background

After a “protracted trial,” the trial court rendered judgment in Civil Case No. Q-2276 on 23 August 1961, dismissing petitioners’ complaint and ordering, among others, that petitioners vacate the premises and surrender possession to respondents. The decision also declared the real estate mortgage marked in evidence as “inexistent and void,” and imposed multiple monetary awards on petitioners, including rentals, actual damages, and other damages, all bearing interest at 6% per annum from the filing of the complaint until fully paid. The judgment further addressed reimbursement to petitioners for certain amounts, conditional on petitioners’ surrender of possession and with deductions from petitioners’ liabilities.

Petitioners filed on 27 September 1961 their notice of appeal, appeal bond, and record on appeal. Respondents objected to approval of the record on the ground that it was incomplete and defective, prompting the trial court to require amendment. Petitioners submitted an amended record, which was set for approval and subsequently reset. While these steps were pending, respondents filed on 10 October 1961 a motion for execution pending appeal based on petitioners’ alleged insolvency, later amended on 25 October 1961 substantially on the same ground. Petitioners opposed the motion.

Trial Court’s Order for Execution Pending Appeal

On 28 October 1961, the trial court granted respondents’ amended motion for execution pending appeal. The order recited that the “special reasons” advanced were that petitioners were insolvent, anchored on factual matters claimed to have appeared in the record, namely: (a) an earlier attempt by the PHHC/PHUC to eject petitioners for nonpayment that was allegedly averted only because respondents paid the balance due; (b) petitioners’ admission during testimony that petitioners needed funds; and (c) petitioners’ gross income for 1959 amounting to only P4,400.00, with the portion of Isabelo’s income limited and the remainder allegedly coming from Juanita’s teaching salary.

The trial court rejected petitioners’ opposition that mere allegation of insolvency without proof was insufficient. It reasoned that accrued rentals continued to increase during the pendency of the appeal, that there were “strong indications” petitioners could not pay them as the years passed, and that circumstances would render the decision nugatory if execution did not issue. The order thus concluded that insolvency was the “primordial reason” to grant immediate execution and provided a mechanism for staying execution: petitioners could file a supersedeas bond in the amount of P20,000.00 within ten (10) days from receipt of the order; otherwise, the Clerk of Court would issue the writ of execution.

Petitioners filed a motion for reconsideration on 28 November 1961, which the trial court denied on 2 December 1961. Because petitioners failed to post the supersedeas bond, the trial court directed that the corresponding writ be enforced, and it required the sheriff to proceed.

Proceedings in the Court of Appeals and Subsequent Execution

Petitioners then filed a petition for certiorari in the Court of Appeals to annul and set aside the writ of execution pending appeal. The Court of Appeals, as stated in the text, ultimately denied that petition. Before petitioners could seek reconsideration and before the resolution became final and executory, respondents secured on 14 July 1962 an alias writ of execution. Pursuant thereto, the sheriff levied on petitioners’ personal properties and scheduled the sale for 25 July 1962. The sheriff also threatened to eject petitioners from the premises.

Petitioners responded by filing on 23 July 1962 the instant petition for review on certiorari with a prayer for a writ of preliminary injunction in the Supreme Court. The Supreme Court gave due course and issued the writ upon petitioners’ posting of a bond in the amount of P10,000.00.

Issues Raised in the Supreme Court

The Supreme Court confined the controversy to a single issue: whether the Court of Appeals correctly upheld the trial court’s order executing its decision pending appeal. The case therefore presented the narrower question of whether the trial judge acted with “grave abuse of discretion amounting to lack or excess of jurisdiction” in issuing the special order.

Petitioners also attacked the Court of Appeals’ procedural conduct, arguing that it reversed its earlier decision on certiorari despite respondents’ motion for reconsideration allegedly raising substantially the same issues and grounds already present in respondents’ answer. Substantively, petitioners contended that respondents bore the burden of proving insolvency because they were the prevailing parties and the movants for execution pending appeal. Petitioners further asserted that no evidence was submitted to substantiate insolvency; hence, the special order should not have been issued.

Respondents maintained that the Court of Appeals correctly sustained the trial court’s order as consistent with the applicable law and jurisprudence.

Governing Rule on Execution Pending Appeal and the Standard of Review

The Court treated the governing rule as settled. Under Section 2, Rule 30, Rules of Court, the power to grant or deny a motion for execution pending appeal was discretionary with the trial court, referencing Federal Films vs. Quimpo, 78 Phil. 479. It was equally settled that the appellate court would not interfere with the exercise of that discretion unless there was an abuse. The Court cited multiple decisions as reflecting that doctrine, including Calvo vs. Gutierrez, 4 Phil. 203; Case vs. Metropole Hotel, 5 Phil. 49; Gamay vs. Gutierrez David, 48 Phil. 768; Buenaventura vs. Pena, 78 Phil. 795; Ong Sit vs. Piccio, 78 Phil. 785; Naredo vs. Yatco, 80 Phil. 220, and it also referenced Federation of United Namarco Distributors vs. National Marketing Corp., et al., & National Marketing Corp. vs. Tan, et al., with the decision date March 31, 1962.

The Parties’ Contentions on Insolvency and the Court of Appeals’ Factual Findings

The Supreme Court found it significant that respondents filed their motion for execution pending appeal before petitioners perfected their appeal and that respondents expressly averred petitioners’ insolvency as the special and good reason, citing facts drawn from the record. The trial judge, in granting the motion, was “satisfied” that the evidence already submitted warranted execution pending appeal, and the Court of Appeals confirmed that conclusion in the disputed resolution.

As to petitioners’ first contention, the Supreme Court held that it was within the “inherent powers” of the court “to amend and control its process and orders so as to make them conformable to law and justice” under Section 5, Rule 135, Revised Rules of Court. That includes the right of a court to reverse itself when it honestly believes an error was committed and adherence to the previous ruling would cause injustice. On that premise, the Court held that the Court of Appeals acted within its prerogatives in

Case Syllabus (G.R. No. L-20034)

Parties and Procedural Posture

Petitioners Isabelo Astraquillo and Juanita J. Astraquillo pursued a petition for review on certiorari seeking reversal of a resolution of the Court of Appeals (Special Fourth Division) in CA-G.R. No. 30249-R.
The Court of Appeals resolution, upon motion for reconsideration by respondents Primitivo Javier and Amparo S. Javier, reversed its earlier decision that had granted petitioners’ petition for certiorari.
The reversed Court of Appeals ruling upheld a special order of execution pending appeal issued by respondent Judge Nicasio Yatco of the Court of First Instance of Rizal (Quezon City, Branch V) in Civil Case No. Q-2276.
Petitioners’ subsequent petition to review on certiorari before the Supreme Court raised a single issue: whether the Court of Appeals correctly sustained the trial court’s execution order pending appeal.
The Supreme Court treated the inquiry as one focused on whether the trial judge acted with grave abuse of discretion amounting to lack or excess of jurisdiction in issuing the special execution order.

Underlying Civil Case

The underlying dispute arose from Civil Case No. Q-2276 decided by the Court of First Instance of Rizal (Quezon City, Branch V).
On 23 August 1961, the trial court rendered judgment in favor of the defendants Primitivo Javier and Amparo S. Javier and against the plaintiffs Isabelo Astraquillo and Juanita J. Astraquillo.
The dispositive portion included multiple monetary awards and ancillary reliefs, including dismissal of the complaint, declaration of a real estate mortgage as inexistent and void, orders to vacate and surrender possession, and awards for rentals, actual damages, and other damages.
The decision also required the payments to bear interest at the rate of 6% per annum from the date of the filing of the complaint until fully paid.
The judgment further provided that plaintiffs were entitled to be reimbursed specified amounts, with understanding that reimbursement would occur after surrender of possession and with deductions from amounts payable by the plaintiffs.

Appeal and Record on Appeal

After the unfavorable 23 August 1961 decision, plaintiffs filed on 27 September 1961 their notice of appeal, appeal bond, and record on appeal.
Defendants objected to approval of the record on the ground that it was incomplete and defective.
The trial court required plaintiffs to amend the record, and plaintiffs submitted an amended record on appeal.
The trial court scheduled approval of the amended record on 11 October 1961, later resetting it to 28 October 1961.

Motion for Execution Pending Appeal

Before plaintiffs perfected their appeal, defendants filed on 10 October 1961 a motion for execution pending appeal, alleging plaintiffs’ insolvency as the special and good reason for immediate execution.
Defendants amended the motion on 25 October 1961, substantially repeating the insolvency theory.
Plaintiffs opposed the motion to execute pending appeal.
On 28 October 1961, the trial court granted the amended motion and issued an order authorizing a writ of execution pending appeal unless plaintiffs posted a supersedeas bond in the amount of P20,000.00 within ten (10) days from receipt of the order.
The trial court’s order anchored its grant on the conclusion that plaintiffs were insolvent, while emphasizing that if plaintiffs were not insolvent, they had no proof to show otherwise.
The trial court identified circumstances supporting the insolvency finding, including the years accumulating rentals and the possibility that the decision would become nugatory if plaintiffs could not pay pending appeal.
The trial court also reasoned that accrued rentals would increase automatically with time pending appeal, and that defendants had pointed to strong indications plaintiffs could not pay.

Trial Court’s Factual Basis

Defendants alleged that as early as March 1955, PHHC attempted to eject plaintiffs for nonpayment of installments, and that the attempt was not carried out because defendants paid the balance due.
Defendants contended that petitioner Isabelo Astraquillo admitted on the witness stand that he was in need of funds.
Defendants asserted that petitioners’ gross income for 1959 amounted to P4,400.00, with petitioner Isabelo Astraquillo earning P1,500.00 and the balance attributable to the salary of petitioner Juanita J. Astraquillo from teaching.
In opposition, plaintiffs argued that mere allegation of insolvency without corresponding proof did not constitute special or good reason, and that discretion should be based on circumstances after the decision rather than trial-era circumstances.
The trial court nevertheless deemed the evidence already before it sufficient to justify execution pending appeal, concluding that circumstances would render the decision nugatory without immediate execution.

Post-Order Events

Plaintiffs filed a motion for reconsideration of the execution order on 28 November 1961, which the trial court denied on 2 December 1961.
For failure to post the required supersedeas bond, the trial court ordered the Sheriff to enforce the writ on 28 November 1961.
Plaintiffs filed a petition for certiorari with the Court of Appeals to annul and set aside the writ of execution pending appeal.
The Court of A