G.R. No. 234491 - Duremdes vs. Jorilla

Case Summary (G.R. No. 234491)

Factual Background

The respondents filed a Complaint for Collection of Sum of Money plus Damages on August 27, 2009 against Kenneth C. Duremdes and Emerflor B. Manginsay, Jr., alleging that they were majority stockholders of Vitamins & Cebu Artists International, Inc. and that the respondents were victims of illegal recruitment who made payments to that corporation. The case was docketed as Civil Case No. Q-09-65496 before Branch 97, RTC, Quezon City.

Service and Default Judgment

The RTC found that summons was served upon petitioner and Manginsay by publication in issues of Viewliner Weekly News dated March 29 to April 18, 2010. Both defendants did not file answers or other responsive pleadings. Upon respondents’ motion, the RTC declared them in default, received respondents’ evidence ex parte, and rendered judgment awarding actual and moral damages against petitioner and Manginsay in the Decision dated March 20, 2014.

Petition for Relief from Judgment

On May 22, 2014, Kenneth C. Duremdes filed a Petition for Relief from Judgment under Section 1, Rule 38 of the Rules of Court accompanied by an affidavit. He alleged extrinsic fraud in that respondents knowingly supplied an erroneous address to effectuate service of summons, thereby preventing his participation and depriving the RTC of jurisdiction over his person. He further contended respondents could have obtained his address from the corporation’s General Information Sheet and accused respondents of violating procedural rules on forum shopping and false certification in their pleadings.

RTC Ruling on the Petition for Relief

The RTC denied the petition for relief in its Decision dated July 21, 2016 and ordered that a writ of execution issue in view of the earlier March 20, 2014 judgment. The RTC subsequently denied petitioner’s motion for reconsideration by Order dated April 12, 2017, after which the writ of execution was to be issued as the March 20, 2014 Decision had become final.

Petition for Certiorari to the Court of Appeals and Its Dismissal

Petitioner filed a petition for certiorari with application for injunctive relief before the Court of Appeals on July 17, 2017. In its Resolution dated July 25, 2017, the CA dismissed the petition on grounds of fatal defects: absence of any explanation why petitioner did not appeal the RTC Decision of March 20, 2014; failure to attach an original, duplicate original, or certified true copy of the July 21, 2016 RTC decision as required by Section 1, Rule 65 in relation to Section 3, Rule 46; and omission of pertinent pleadings and portions of the record as annexes. The CA denied petitioner’s motion for reconsideration in its Resolution dated September 26, 2017.

Supreme Court on the Requirement to Implead the Court of Appeals

The Supreme Court rejected respondents’ contention that the CA should have been impleaded as a public respondent. The Court explained that petitioner invoked a petition for review on certiorari under Rule 45, which does not require the impleading of the public respondent as a nominal party, in contrast to petitions under Rule 65 where a public respondent is included as a nominal party.

Supreme Court on Substantial Compliance with Formal Requirements

The Supreme Court analyzed the CA’s reliance on procedural deficiencies and applied the doctrine of substantial compliance. It reviewed the interplay of Section 3, Rule 46 and Section 1, Rule 65, and the Court’s precedents in Air Philippines Corp. v. Zamora and related cases. The Court found that although the copy of the July 21, 2016 RTC Decision initially attached bore only the notation “ORIGINAL SIGNED” and was not a proper duplicate original, petitioner later filed a motion for reconsideration in the CA with a certified true copy of that decision. The Court treated the subsequent submission as substantial compliance and held that the CA should not have dismissed the petition on those technicalities, especially where the missing documents were later produced and where a photocopy of the March 20, 2014 Decision sufficed for the purposes of the petition attacking the July 21, 2016 ruling.

Supreme Court on the Remedy of Petition for Relief and the Jurisdictional Consequences of Extrinsic Fraud

The Supreme Court examined the CA’s conclusion that petitioner failed to explain why he did not appeal the March 20, 2014 judgment, and it expounded the nature and requirements of a petition for relief under Section 1, Rule 38 and the timeliness requirements of Section 3, Rule 38. The Court reiterated that a petition for relief is an equitable remedy allowed only when no other adequate remedy exists and when the petitioner was prevented by fraud, accident, mistake, or excusable negligence from taking available remedies. Importantly, the Court carved the exception that when a petition for relief is grounded on extrinsic fraud and that fraud results in lack of valid service and thus lack of jurisdiction over the defendant, the resulting judgment is void and may be attacked at any time. The Court surveyed precedents including Bilag v. Ay-ay, Sps. Laus v. Court of Appeals, and NHA v. Commission on Settlement of Land Problems, and concluded that, if petitioner’s allegations of extrinsic fraud were true, the RTC’s July 21, 2016 decision denying his petition for relief would also be void for lack of jurisdiction and therefore not susceptible to dismissal on grounds of untimeliness or failure to appeal.

Rationale for Remand and Limits on Rule 45 Review

Because the CA disposed of the petition on grounds that intertwined with factual assertions of extrinsic fraud and jurisdictional consequences, the Supreme Court concluded that the CA’s dismissal precluded consideration of those merits.

Case Syllabus (G.R. No. 234491)

Parties and Procedural Posture

Petitioner Kenneth C. Duremdes filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court seeking to annul the Court of Appeals Resolutions dated July 25, 2017 and September 26, 2017 in CA-G.R. SP No. 151644.
Respondents Caroline G. Jorilla, Rodolfo C. De Leon, Manolito Sioson, Elmer B. Gasang, Michael De Castro, Gennete E. Rivera, Sylvia Orbase, Irene Magsombol, Nenita R. Domaguing, and Cherilyn Palma were plaintiffs in the underlying civil action.
The underlying action was Civil Case No. Q-09-65496 filed by the Respondents against petitioner and Emerflor B. Manginsay, Jr. for Collection of Sum of Money plus Damages.
The Regional Trial Court, Branch 97, Quezon City rendered a Decision dated March 20, 2014 awarding damages to the Respondents, and later denied petitioner’s Petition for Relief from Judgment in its Decision dated July 21, 2016.
The Court of Appeals dismissed petitioner’s petition for certiorari for formal defects and denied his motion for reconsideration, prompting the present appeal to the Supreme Court.

Key Factual Allegations

Respondents alleged that they were victims of illegal recruitment and that Petitioner and Manginsay were majority stockholders of Vitamins & Cebu Artists International, Inc. (VCAII).
Respondents averred that summons to Petitioner and Manginsay was effected by publication in the Viewliner Weekly News in March and April 2010.
Petitioner did not file an answer and the RTC declared him in default after allowing Respondents to present evidence ex parte.
Petitioner filed a Petition for Relief from Judgment dated May 22, 2014 alleging that Respondents committed extrinsic fraud by specifying an erroneous address to defeat service of summons.
Petitioner further alleged that Respondents could have consulted the General Information Sheet of VCAII for his true address and asserted other alleged fraudulent acts and procedural improprieties in the institution of the civil action.

Trial Court Ruling

The RTC rendered its Decision dated July 21, 2016 and denied Petitioner’s Petition for Relief from Judgment for lack of merit.
The RTC ordered the issuance of a writ of execution in view of the Decision dated March 20, 2014 after denying petitioner’s motion for reconsideration by Order dated April 12, 2017.
The RTC concluded that summons by publication had been effected and that Petitioner failed to avail himself of any responsive pleading.

Court of Appeals Ruling

The Court of Appeals dismissed Petitioner’s petition for certiorari in its Resolution dated July 25, 2017 for fatal procedural infirmities and denied reconsideration on September 26, 2017.
The CA found that Petitioner failed to explain why he did not appeal the March 20, 2014 Decision and that the Petition for Relief was being used as a substitute for a lost appeal.
The CA ruled that the petition lacked a duplicate original or certified true copy of the RTC Decision dated July 21, 2016 and that the March 20, 2014 decision appended to the petition was an illegible photocopy.
The CA also found that copies of pertinent pleadings and relevant portions of the record were not attached as annexes to the petition.

Issues Presented

Whether the Court of Appeals properly dismissed the petition for certiorari on the cited procedural grounds.
Whether Petitioner substantially complied with the documentary requirements of Section 3, Rule 46 in relation to Section 1, Rule 65 of the Rules of Court.
Whether Petitioner could properly invoke a Petition for Relief under Rule 38 despite his failure to appeal the tri