Case Summary (G.R. No. 167886)
Petitioner’s Claim and Relief Sought
LANDBANK sought relief from DARAB’s Order of August 2, 2004 denying due course to a Notice of Entry of Appearance and a Notice of Appeal filed by Attys. Montarde and Mesa on LANDBANK’s behalf, and from the Court of Appeals’ April 15, 2005 decision dismissing LANDBANK’s certiorari petition that challenged DARAB’s denial.
Key Dates
- DARAB decision fixing just compensation: April 27, 2004 (P58,237,301.68 for TCT No. T‑4972, 274.9037 hectares).
- Denial of petitioner’s motion for reconsideration (and receipt by petitioner): June 11, 2004.
- Notice of Entry of Appearance filed by Attys. Montarde and Mesa: June 4, 2004.
- Notice of Appeal filed via registered mail by those counsels: June 15, 2004 (within reglementary period).
- DARAB order denying due course to the notices: August 2, 2004.
- Court of Appeals decision dismissing certiorari: April 15, 2005.
- Supreme Court resolution granting temporary restraining order: June 6, 2005.
- Supreme Court final disposition reversing the Court of Appeals: October 25, 2005.
Applicable Law and Authorities
Constitutional basis: 1987 Philippine Constitution (decision date after 1990). Controlling procedural rule cited: Section 21, Rule 138, Rules of Court, which establishes the presumption that an attorney appearing in a cause is properly authorized and that no written power of attorney is required, while allowing the presiding judge to require proof of authority on reasonable grounds. Relevant precedents and authorities relied upon by the Court include: Cebu Stevedoring Co., Inc. v. Ramolete; Sublay v. NLRC; Ong Ching v. Ramolete; Pittsburg Plate Glass Co. v. Director of Patents; Tan Lua v. O’Brien; and authorities on ratification and effect of counsel’s acts.
Procedural History
DARAB issued a decision preliminarily determining just compensation and denied LANDBANK’s motion for reconsideration. During the appeal period, new counsels filed a Notice of Entry of Appearance and a Notice of Appeal on LANDBANK’s behalf. Respondent opposed, challenging the authority of Attys. Montarde and Mesa. DARAB denied due course to the notices, concluding the new counsels lacked authority and that the decision had become final and executory. LANDBANK’s motion for reconsideration of that denial was denied. LANDBANK sought certiorari relief in the Court of Appeals, which dismissed the petition affirming DARAB’s conclusion. LANDBANK then filed a petition for certiorari with the Supreme Court, which issued a TRO and ultimately reversed the Court of Appeals, directing DARAB to give due course to the notices.
Facts Material to the Issue
DARAB’s April 27, 2004 decision fixed just compensation for PAMDEVCO’s titled land. LANDBANK’s motion for reconsideration was denied, and the denial was received June 11, 2004. Within the reglementary period, Attys. Montarde and Mesa filed their notice of entry and notice of appeal (certified by Loreto B. Corotan). When their authority was challenged, the new counsels submitted a Special Power of Attorney executed by Gilda E. Pico authorizing Loreto B. Corotan to represent the bank and designating Attys. Montarde and Mesa as counsel, plus memoranda from Atty. Danilo B. Beramo confirming their authority. DARAB found the substitution of counsel invalid and treated the notice of appeal as ineffective; DARAB and the Court of Appeals concluded the decision became final and executory.
Issue Presented
Whether DARAB (and the Court of Appeals) gravely abused its discretion in denying due course to the notices filed by Attys. Montarde and Mesa on the ground that they lacked authority to represent LANDBANK, thereby allowing DARAB’s decision to become final and executory despite a timely-filed notice of appeal.
Court’s Holding
The Supreme Court found that DARAB gravely abused its discretion and that the Court of Appeals erred in affirming DARAB. The Supreme Court granted the petition, reversed and set aside the Court of Appeals’ decision, and directed DARAB to give due course to LANDBANK’s Notice of Entry of Appearance and Notice of Appeal.
Reasoning — Presumption of Counsel’s Authority
The Court applied Section 21, Rule 138, emphasizing the strong presumption that an attorney who appears is properly authorized and that a written power of attorney is not required to authorize a court appearance. The filing of a notice of entry of appearance by Attys. Montarde and Mesa gave rise to that presumption. Once their authority was challenged, they presented documentary evidence (the SPA executed by Gilda E. Pico and memoranda from Atty. Danilo B. Beramo) sufficient to prove their authority. The Court held that these documents validated their authority to file the notice of appeal.
Reasoning — Ratification and Timing Irrelevant
The Court explained that even an initially unauthorized appearance may be ratified by the client, expressly or impliedly, and that such ratification retroacts to the date of the lawyer’s first appearance, thereby validating actions taken (including filing a notice of appeal). The DARAB’s doubts about the timing of execution of the SPA and memoranda were immaterial in light of LANDBANK’s clear and vigorous assertion that it had authorized the new lawyers.
Reasoning — Substitution vs Collaboration; Precedent Applicat
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Facts of the Case
- DARAB Case No. 1204-0545-2003 was for "Preliminary Determination of Just Compensation."
- On April 27, 2004, the Department of Agrarian Reform Adjudication Board (DARAB) rendered a Decision fixing the just compensation of respondent Pamintuan Development Company’s 274.9037-hectare lot (TCT No. T-4972, San Vicente, Makilala, Cotabato) at P58,237,301.68.
- The dispositive portion of DARAB’s April 27, 2004 Decision reads in full: WHEREFORE, foregoing considered, the just compensation of TCT No. T-4972 registered in the name of Pamintuan Development Company (PAMDEVCO) containing an area of 274.9037 hectares located at San Vicente, Makilala, Cotabato is preliminary determined at FIFTY EIGHT MILLION TWO HUNDRED THIRTY SEVEN THOUSAND THREE HUNDRED ONE AND 68/100 (P58,237,301.68) PESOS. SO ORDERED.
- Petitioner (LANDBANK) moved for reconsideration of the DARAB decision but that motion was denied; the order denying the motion for reconsideration was received by petitioner on June 11, 2004.
Parties, Counsel and Filings
- At proceedings before the trial court, petitioner was represented by the law firm Piczon, Beramo & Associates (counsel of record).
- On June 4, 2004, Attorneys Engilberto F. Montarde and Felix F. Mesa filed a Notice of Entry of Appearance in behalf of petitioner.
- Within the period to appeal, on June 15, 2004, Attorneys Montarde and Mesa filed a Notice of Appeal via registered mail. The Certification attached to the Notice of Appeal was signed by Loreto B. Corotan, Head of petitioner’s Agrarian Operations Center.
- Respondent Pamintuan Development Company filed an Opposition arguing that the notice of appeal and the notice of entry of appearance should be denied due course because Attorneys Montarde and Mesa failed to show they were authorized by petitioner to appear.
- New counsels (Montarde and Mesa) submitted a Comment asserting they were duly authorized, attaching a Special Power of Attorney (SPA) executed by Gilda E. Pico, Executive Vice President of petitioner, authorizing Loreto B. Corotan to represent LANDBANK and designating Attorneys Montarde and Mesa as counsels for LANDBANK.
- Petitioner later appended to its motion for reconsideration two memoranda signed by Atty. Danilo B. Beramo, Department Manager and Head, CARP Legal Services Department, confirming the authority of Atty. Montarde to file a notice of appeal.
DARAB’s Action of August 2, 2004
- On August 2, 2004, DARAB issued an order holding that Attorneys Montarde and Mesa were without authority to represent petitioner because petitioner failed to effect a valid substitution of their former counsel of record (Piczon, Beramo & Associates).
- DARAB ruled that the April 27, 2004 decision had become final and executory because the notice of appeal filed by the purported new counsels was a mere scrap of paper which did not toll the running of the reglementary period to appeal.
- DARAB’s dispositive language: WHEREFORE, foregoing considered, the instant Notice of Entry of Appearance and the Notice of Appeal are hereby not given DUE COURSE for LACK OF LEGAL BASIS. The decision dated April 27, 2004 has become FINAL and EXECUTORY. SO ORDERED.
Proceedings Before the Court of Appeals
- Petitioner filed a petition for certiorari with the Court of Appeals challenging the DARAB order denying due course to the Notice of Entry of Appearance and the Notice of Appeal.
- The Court of Appeals, in a Decision dated April 15, 2005, dismissed LANDBANK’s petition and sustained the August 2, 2004 Order of DARAB, holding that Attorneys Montarde and Mesa were not clothed with authority to file the notice of appeal. (Penned by Associate Justice Rodrigo F. Lim, Jr., concurred in by Associate Justices Arturo G. Tayag and Normandie B. Pizarro.)
- The Court of Appeals’ dispositive portion read: WHEREFORE, the Petition is hereby ordered DISMISSED. SO ORDERED.
Supreme Court Petition, Temporary Restraining Order and Relief Sought
- Petitioner filed the instant petition for review on certiorari to the Supreme Court with prayer for the issuance of a temporary restraining order (TRO).
- In a resolution dated June 6, 2005, the Supreme Court issued a temporary restraining order enjoining the execution of the DARAB’s April 27, 2004 decision.
- The Supreme Court then reviewed the propriety of DARAB’s and the Court of Appeals’ rulings that denied due course to the notice of appeal and entry of appearance.
Governing Rule and Its Quotation (Section 21, Rule 138, Rules of Court)
- The Supreme Court quoted Section 21, Rule 138, which provides in the source text:
- SEC. 21. Authority of attorney to appear . - An attorney is presumed to be properly authorized to represent any cause in which he appears, and no written power of attorney is required to authorize him to appear in co