Title
Fortune Corporation vs. Court of Appeals
Case
G.R. No. 108119
Decision Date
Jan 19, 1994
Fortune Corp. sought oral deposition of Inter-Merchants' chairman after written interrogatories; trial court denied, citing redundancy. Supreme Court reversed, ruling deposition permissible under liberal discovery rules, absent proven "good cause" for denial.
breach of contract
oral deposition
abuse of discretion

Case Summary (G.R. No. 108119)

Factual Background

Petitioner instituted an action for breach of contract against respondent Inter-Merchants Corporation before the Regional Trial Court of San Pablo City, docketed as Civil Case No. SP-3469. After the filing of an Answer by private respondent, petitioner served written interrogatories under Rule 25 and received answers through the corporate chairman, Juanito A. Teope. Pre-trial dates were set for January 9, February 12 and April 22, 1992. On March 26, 1992 petitioner served a Notice to Take Deposition Upon Oral Examination pursuant to Section 15, Rule 24, scheduling the oral deposition of Juanito A. Teope for April 7, 1992 in San Pablo City.

Trial Court Proceedings

Private respondent filed an Urgent Motion Not to Take Deposition and Vehement Opposition dated March 27, 1992, asserting among other things that petitioner had already obtained full discovery by written interrogatories, that no justification existed for the oral deposition, that the deposition would annoy, embarrass and oppress the proposed deponent, that Teope did not intend to leave the country, and that Teope was available to testify at trial. The trial court issued an order dated April 3, 1992 disallowing the deposition on the grounds that the proposed deponent had answered interrogatories, had signified his availability to testify in court, and that taking the deposition would deprive the court of the opportunity to ask clarificatory questions of a vital witness.

Intermediate Remedies and Referral

Petitioner sought reconsideration in the trial court, which was denied, and then filed an original action for certiorari with the Supreme Court, docketed as G.R. No. 101526. In a resolution dated May 20, 1992 the Supreme Court referred the case to the Court of Appeals for consideration on the merits, resulting in the Court of Appeals' decision of September 23, 1992 which dismissed petitioner’s certiorari and affirmed the trial court’s protective order.

Court of Appeals Ruling

The Court of Appeals held that the trial court had discretion under Sections 16 and 18, Rule 24 to prevent the taking of a deposition if valid reasons existed, and that the right to take depositions under the Rules of Court was not absolute. Citing prior authority, including Caguiat v. Torres, the appellate court accepted the trial court’s three stated reasons — prior answers to written interrogatories, the deponent’s availability to testify at trial, and the need for the court to observe the witness’s demeanor — as valid grounds for its protective order. The Court of Appeals also concluded that where the objection to taking a deposition is discretionary and interlocutory, appeal and not certiorari was the ordinary remedy.

Issues Presented to the Supreme Court

Petitioner presented the following issues: whether the Court of Appeals’ conclusion rested on a misapprehension of facts and constituted reversible error; whether the trial court’s three stated reasons were arbitrary or contrary to reason and therefore did not constitute “good cause” under Section 16, Rule 24; whether a mere allegation without proof that the examination was intended to annoy, embarrass, or oppress the deponent constituted good cause; and whether, absent good cause, a trial court had unbridled discretion to forbid taking a deposition under Section 15, Rule 24.

Petitioner’s Contentions

Petitioner argued that the trial court’s order was a grave abuse of discretion because the facts relied upon by the court did not exist in the sense asserted by respondents: no deposition had been previously taken and nothing had been offered or rejected as evidence. Petitioner maintained that the deposition was sought for discovery and preparatory purposes and therefore should have been permitted before trial, and that appeal would be inadequate because a trial conducted without the deposition would render any subsequent reversal impractical and prejudicial.

Respondent’s Contentions and Trial Court Justifications

Private respondent and the trial court relied principally upon the procedural history and alleged redundancy and inconvenience as grounds for protective relief. They emphasized that the deponent had answered written interrogatories, had expressed willingness to testify at trial, and that denial of the deposition protected the court’s ability to observe the witness’s demeanor and to avoid annoyance, embarrassment or oppression of the corporate officer. The Court of Appeals accepted those contentions as falling within the discretionary power granted trial courts under Section 16, Rule 24.

Legal Framework and Governing Principles

The Supreme Court reviewed the deposition-discovery provisions of Rule 24, emphasizing the broad and liberal scope of discovery designed to disclose the facts in dispute and to prevent trials from proceeding in the dark. The Court reiterated that Section 16, Rule 24 vests in the trial court the power to issue protective orders and that such discretion must not be exercised arbitrarily, capriciously, or oppressively. The Court acknowledged the general rule that certiorari ordinarily does not lie to review interlocutory discovery orders, but noted the exception permitting review where there is action without or in excess of jurisdiction, a clear or serious abuse of discretion, or where interlocutory action may cause material injury rendering appeal inadequate.

Supreme Court Analysis on Good Cause

Applying the statutory standard, the Supreme Court held that “good cause” required particular and specific demonstration of facts and that the burden of proof rested on the party seeking the protective order. The Court analyzed each stated ground: it ruled that prior answers to written interrogatories did not, as a matter of law, constitute good cause to bar a subsequent oral deposition because discovery devices are cumulative and oral depositions are often superior to written interrogatories for detailed inquiry; that the deponent’s availability to testify at trial likewise did not justify denial because the right to take depositions and the right to use them at trial are distinct and depositions serve the preparatory function irrespective of later viva voce availability; and that the inability of the court to observe demeanor in a depositi

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