Title
Mercader vs. Bonto
Case
G.R. No. L-48564
Decision Date
Aug 20, 1979
Petitioners declared in default over land dispute; Supreme Court ruled excusable neglect, meritorious defense, and abuse of discretion, setting aside default orders.

Case Summary (G.R. No. L-48564)

Background of the Dispute

Arsenio Oliquino has been renting a parcel of land belonging to Joaquina Vda. de Palanca since 1951 via a verbal lease agreement. In 1971, Ruperto and Severina Mercader claimed ownership of a portion of this land covered by Tax Declaration No. 16696. Benjamin Revilla also laid claim to the entire property, prompting Oliquino to file a complaint for interpleader in 1975 to resolve these conflicting claims.

Procedural History

The summons and complaint for interpleader were served to Ruperto and Severina Mercader on September 25, 1975. Instead of filing an answer, they moved to dismiss the complaint soon after. The trial court denied the dismissal motion on January 6, 1976, and by February 9, 1976, the respondent filed a motion to declare the Mercaders in default for failing to answer the complaint.

Default Proceedings

On February 25, 1976, Judge Bonto declared the Mercaders in default due to their failure to file a timely answer. Following this, they filed a motion to set aside the default order, citing valid defenses and circumstances affecting their ability to respond on time, including the advanced age and health issues of their counsel.

Tribunal's Orders and Defendants' Appeals

The trial court denied the motion to set aside the default on May 24, 1976, and subsequent motions for reconsideration were also denied. The Mercaders later filed an appeal after initially withdrawing a notice of appeal when seeking further motions for reconsideration.

Arguments for Excusable Negligence

The Mercaders argued their late response was due to excusable negligence. Counsel's advanced age, health problems, and pressures of work contributed to not filing on time. They claimed that the failure to submit an answer should not lead to a default declaration that would deny them the opportunity for a fair hearing in their ownership dispute.

Court's Deliberations on Procedural Conduct

The Court noted that the respondent judge had strictly applied rules concerning default declarations, thereby giving insufficient consideration to the circumstances presented. Judicial precedents highlight that strict adherence to procedural rules should yield to substantive justice, especially when a party can present a valid defense and has indicated intentions to comply with procedural obligations.

Findings on Substantial J

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