Case Summary (G.R. No. 250542)
Key Dates
Original sale alleged by respondent: Deed of Absolute Sale dated November 12, 1988 (Pio → Haru Gen). Subsequent conveyance to Myrna: Deed dated March 5, 1992 (Haru Gen → Myrna). Another Deed of Absolute Sale purporting direct sale from Pio to Myrna: May 28, 1997. Petitioners’ original Answer filed August 26, 2016. Pre-trial Order issued June 28, 2017. Motion for Leave to file Amended Answer filed July 6, 2018. RTC denial dated August 17, 2018; motion for reconsideration denied December 3, 2018. CA Decision dated August 7, 2019 and Resolution dated November 20, 2019. Supreme Court decision on review dated October 10, 2022.
Applicable Law and Governing Principles
Primary procedural authorities applied: 1987 Philippine Constitution (as governing law for decisions rendered after 1990), Rules of Court—Rule 10 (Sections 1 and 3 on amendments of pleadings), Rule 8 (Section 10 on specific denial), Rule 18 (pre-trial provisions, Section 2(c) regarding amendments), and A.M. No. 11-1-6-SC-PHILJA (guidelines on court-annexed mediation). Controlling jurisprudential precepts cited include the liberal policy favoring amendments to pleadings, the limitation that leave to amend may be refused only if the motion is made with intent to delay, and the trial court’s discretion to admit or deny amendments judged against those standards (cases referenced in the decision: Yujuico, Quirao, Chong, Spouses Tatlonghari, Valenzuela).
Procedural Posture and Relief Sought
Respondent filed a Complaint for Quieting of Title alleging valid chains of title derived from deeds of sale. Petitioners initially answered (August 26, 2016) asserting forgery of Pio’s signature on the deeds. After pre-trial and issuance of a Pre-Trial Order, petitioners, through counsel, filed a Motion for Leave (July 6, 2018) to admit an Amended Answer that would clarify admissions/denials and assert compulsory counterclaims: nullification of the alleged falsified deeds, declaration of petitioners’ ownership, damages, and attorney’s fees. The RTC denied the Motion for Leave; the CA affirmed; petitioners sought certiorari review in the Supreme Court under Rule 45.
RTC Findings and Orders
The RTC denied the Motion for Leave primarily because the case had already proceeded through preliminary conference and pre-trial, and a Pre-Trial Order had been issued (June 28, 2017). The RTC concluded the stage for considering amendments—namely pre-trial—had passed, and it ordered petitioners’ counsel to show cause for allegedly misrepresenting the procedural posture of the case. The RTC also referred the case to mediation per its earlier order.
Petitioners’ Explanation and Motion for Reconsideration
Counsel for petitioners explained that they reasonably believed the case remained at pre-trial because the RTC order of June 27, 2018 referred the case to mediation, and under the Consolidated and Revised Guidelines (A.M. No. 11-1-6-SC-PHILJA) mediation is part of the pre-trial stage. Petitioners argued the amendments were timely, not dilatory, and necessary to clarify issues and hasten the merits determination. Their motion for reconsideration of the RTC denial was denied.
Court of Appeals Decision
The CA dismissed petitioners’ certiorari petition, finding no grave abuse of discretion by the RTC. The CA concluded the record showed the case had already undergone pre-trial and that the material elements of petitioners’ defense (forgery assertions) were already present in the original Answer; therefore the Amended Answer was unnecessary. The CA affirmed the RTC’s denial and refusal to admit the amended pleading.
Issues Presented to the Supreme Court
The Supreme Court examined whether: (1) the RTC gravely abused its discretion in denying leave to file the Amended Answer; (2) the fact that the Motion for Leave was filed after the issuance of a Pre-Trial Order justified denial as a matter of law; and (3) the Amended Answer was dilatory or prejudicial to respondent.
Supreme Court’s Legal Analysis on Amendments
The Court reiterated the well-established policy that amendments to pleadings are to be liberally allowed so that cases are decided on their real facts and to afford complete relief, subject to the limitation that leave may be refused if the motion is made with intent to delay. The Court emphasized that the paramount consideration is not merely the timing of the motion (i.e., whether filed after pre-trial) but whether the amendment would aid the court in deciding the case on the merits without unnecessary delay and prevent multiplicity of suits. The Court cited Rule 10 (Sections 1 and 3) permitting amendments broadly, and Rule 8 (Section 10) requiring specific denials and setting forth matters supporting denials. The Court also relied on jurisprudence holding that motions to amend filed before trial should be treated liberally, and that rigid technical application of procedural rules that hinder substantial justice must be avoided.
Examination of the Amended Answer’s Substance
The Supreme Court compared the original Answer to the Amended Answer and found that the Amended Answer: (1) specified with particularity which allegations were admitted or denied in accordance with Rule 8, Section 10; (2) alleged special affirmative defenses not previously set out in that manner; and (3) asserted compulsory counterclaims including nullification of the alleged falsified deeds and claims for damages and attorney’s fees. The Court concluded these additions were material to the complete resolution of the controversy and would help prevent multiplicity of suits and facilitate a full disposition on the merits.
Consideration of Dilatory Motive and Prejudice
The Court observed that neither the RTC nor the CA explicitly determined whether petitioners’ Motion for Leave was interposed in bad faith or with intent to delay. The Supreme Court found
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Procedural Posture
- Petition for Review on Certiorari under Rule 45 of the Rules of Court filed by petitioners challenging the Court of Appeals (CA) Decision dated August 7, 2019 and Resolution dated November 20, 2019 in CA-G.R. SP No. 159049, which dismissed petitioners' Petition for Certiorari under Rule 65.
- The CA petition sought relief from the Regional Trial Court (RTC), Virac, Catanduanes, Branch 43, Orders dated August 17, 2018 and December 3, 2018 denying petitioners' Motion for Leave and to Admit Attached Amended Answer with Counterclaim (Motion for Leave).
- The Supreme Court (Second Division) resolved the Rule 45 petition by Decision dated October 10, 2022 (Lopez, M., J.), granting the petition, reversing the CA Decision and Resolution, and directing the RTC to admit the Amended Answer and continue proceedings.
Parties
- Petitioners: Heirs of Pio Tejada and Soledad Tejada, represented by Pio Domingo Tejada (petitioners).
- Respondent: Garry B. Hay, in substitution of Myrna L. Hay, represented by his attorney-in-fact Gomercindo (Gomersindo) Litong (respondent).
- Original complainant in RTC case: Myrna L. Hay (whose claim was later represented/substituted by respondent).
Underlying Facts
- Myrna L. Hay filed a Complaint for Quieting of Title against petitioners (RTC Civil Case No. 2471).
- Myrna alleged that petitioners' father, Pio Tejada, sold the disputed land to Haru Gen Beach Resort and Hotel Corporation (Haru Gen) on November 12, 1988, evidenced by a Deed of Absolute Sale.
- Haru Gen allegedly sold the property to Myrna on March 5, 1992, evidenced by another Deed of Absolute Sale.
- Myrna also presented another Deed of Absolute Sale purporting to show that Pio sold the same property to her on May 28, 1997.
- Petitioners, on their own, filed an original Answer dated August 26, 2016 asserting that the deeds of sale relied upon by Myrna were falsified and that Pio's signature thereon was forged.
Pleadings, Motions and Specific Relief Sought
- Original Answer (Aug. 26, 2016): denied and alleged forgery of Pio's signature on the deeds relied upon by Myrna.
- Motion for Leave and to Admit Attached Amended Answer with Counterclaim (filed July 6, 2018, through counsel): sought leave to admit an Amended Answer that (1) specifies with particularity which allegations are admitted and denied, and (2) asserts compulsory counterclaims including nullification of the deeds alleged to be falsified, declaration of petitioners' ownership, grant of damages, and attorney's fees.
- Petitioners argued the Amended Answer was needed to clarify matters and hasten determination on the merits, that there was no responsive pleading for the original Answer in certain aspects, and that the motion was not dilatory because the case had not proceeded to trial but was pending mediation.
Pre-trial, Mediation and Trial Scheduling
- Case initially set for pre-trial on September 28, 2016 but was postponed several times; pre-trial actually ensued on June 28, 2017.
- Pre-Trial Order issued on June 28, 2017, stating trial scheduled to begin on October 25, 2017.
- Trial was repeatedly postponed at the instance of Myrna or her counsel for various reasons (records show multiple postponements).
- RTC issued an Order dated June 27, 2018 referring the case to mediation scheduled for July 19, 2018; petitioners’ counsel believed mediation was part of pre-trial stage per A.M. No. 11-1-6-SC-PHILJA.
RTC Orders and Rationale for Denial of Motion for Leave
- RTC Order dated August 17, 2018 denied the Motion for Leave on the ground that the case had already gone through preliminary conference/pre-trial and a Pre-Trial Order had been issued; therefore leave to amend was no longer a matter of right.
- RTC found that petitioners actively participated in pre-trial through counsel (Atty. Loreto S. Ponti filed a Pre-Trial Brief for petitioners).
- RTC ordered petitioners’ counsel (Atty. Loreto S. Ponti, Atty. Santiago T. Gabionza, Jr., and Atty. Justin James D. Francisco) to show cause within 72 hours why they should not be cited in contempt for allegedly asserting falsely that the case had not yet called on preliminary conference/pre-trial stage.
- RTC reiterated that the case, covered by mediation, should be referred to a mediator.
Compliance with Show Cause and Motion for Reconsideration
- Petitioners’ counsels filed an Explanation dated September 5, 2018, stating their misconception about the stage of proceedings was due to the June 27, 2018 Order referring the case to mediation and their good faith belief—grounded on Sections II and XII, Part Three of A.M. No. 11-1-6-SC-PHILJA (Consolidated and Revised Guidelines to Implement the Expanded Coverage of Court-Annexed Mediation and Judicial Dispute Resolution)—that mediation proceedings are part of the pre-trial stage.
- Petitioners, through counsel, filed a Motion for Reconsideration dated September 7, 2018 of the RTC denial; the RTC denied reconsideration in an Order dated December 3, 2018 (order not attached to rollo).
CA Proceedings and Decision
- Petitioners filed a Petition for Certiorari under Rule 65 with the Court of Appeals challenging the RTC's denial as grave abuse of discretion.
- CA Decision dated August 7, 2019 dismissed the petition, finding no grave abuse of discretion by the RTC because records showed the case had indeed gone through preliminary conference/pre-trial.
- CA held that the Amended Answer was unnecessary because material elements of petitioners'