Title
Nocom vs. Camerino
Case
G.R. No. 182984
Decision Date
Feb 10, 2009
Tenants granted redemption rights over disputed land; petitioner paid for contingent rights, but Power of Attorney was later contested, leading to summary judgment and appeal. SC remanded for trial due to factual disputes.
power of attorney
annulment
deception
A

Case Summary (G.R. No. 149275)

Prior Case Background (G.R. No. 161029) and Origins of the Dispute

Respondents were agricultural tenants tilling rice and corn on parcels formerly owned by Victoria Homes, Inc. Victoria Homes sold the lots to Springsun Management Systems Corporation (SMSC) without notifying the tenants. SMSC’s titles were subsequently mortgaged to Banco Filipino and foreclosed; SMSC redeemed the lots on May 10, 2000. Respondents filed Civil Case No. 95-020 (RTC Muntinlupa, Branch 256) seeking reconveyance/redemption and related reliefs. The RTC (Jan. 25, 2002) and CA (Sept. 23, 2003, affirmed with modification) found respondents to be tenants entitled to redeem; the Supreme Court (G.R. No. 161029) affirmed this entitlement on Jan. 19, 2005, with entry of final judgment on May 4, 2005. The prior proceedings established respondents’ statutory right of redemption under agrarian legislation and set the stage for subsequent transactions and disputes over the incidents of that right.

Transactions Between Parties and the Irrevocable Power of Attorney

On December 3, 2003 petitioner Nocom delivered several Philtrust Bank manager’s checks of P500,000 each to respondents, which respondents encashed. On December 18, 2003 respondents and their spouses executed an “Irrevocable Power of Attorney” (POA) in favor of petitioner. The POA granted broad powers — including to sell, assign, transfer, mortgage, and to procure transfer certificates of title in the attorney-in-fact’s (petitioner’s) name — and expressly stated that it was “irrevocable,” “coupled with interest,” and for the attorney-in-fact’s exclusive benefit. The POA referenced the respondents’ right of redemption adjudicated in Civil Case No. 95-020.

Redemption, Registration Acts, and the Proceedings to Revoke the POA

Following denial by SMSC to accept the tender of the redemption amount from petitioner, respondents deposited the redemption price and commission with RTC Branch 256 on August 4, 2005. The RTC granted execution of the earlier judgment, cancelled SMSC’s titles, and issued new TCTs (Nos. 15895, 15896, 15897) in respondents’ names. The POA was annotated in the memorandum of encumbrances on those new titles pursuant to the Branch 256 order. On October 24, 2005 respondent Oscar Camerino filed Civil Case No. 05-172 in RTC Branch 203 seeking annulment of the POA, turnover of titles, and payment of attorney’s fees and other reliefs, alleging lack of informed consent, fraud, misrepresentation, and that the POA was procured by counsel and used to deprive the tenants of their rights.

Pleadings and Opposing Contentions

Petitioner’s position: he legitimately purchased respondents’ inchoate and contingent rights to redeem by paying each respondent P500,000 (documented by manager’s checks), and later paid commission; the POA was irrevocable and coupled with interest and thus not revocable at will; he asserted ownership interests and sought dismissal of the revocation action. Respondents’ allegations: they executed the POA at the behest of their counsel (Atty. Arturo S. Santos) under misrepresentation and without full explanation; they lacked intent to appoint anyone to alienate the properties; they later deposited the redemption price and caused issuance of titles in their favor; they alleged the POA was void ab initio as contrary to law/public policy and champertous; they sought annulment and restoration of rights. Intervenors (co-plaintiffs) joined alleging vitiated consent, champerty, and fraud involving their counsel and petitioner.

Trial Court Proceedings: Intervention, Motions, and Summary Judgment

RTC Branch 203 admitted the intervention of the other plaintiffs/intervenors (co-plaintiffs from Civil Case No. 95-020) and entertained cross-motions. Respondent Oscar Camerino moved for summary judgment, and petitioner sought preliminary hearing on affirmative defenses and moved to dismiss on procedural grounds (insufficient docket fees, contention the suit was a real action). The RTC granted summary judgment (June 15, 2006) annulling the POA and set forth extensive legal reasoning: (1) the POA was contrary to R.A. No. 3844, Sec. 62, because the POA’s authorization to procure transfer of title in the attorney-in-fact’s name amounted to a disguised conveyance/assignment of statutory redemption rights prior to actual acquisition, in conflict with agrarian policy and the ten-year limitation on resale/transfer; (2) the POA constituted a champertous contract because it involved a lawyer (Atty. Santos) facilitating a deal where third parties and counsel benefited from the litigation by procuring a share in the subject property; such arrangements violate public policy and fiduciary duties; (3) even if coupled with interest, the parties sought court determination rather than arbitrary revocation; and (4) relief ordered included nullification of the POA, turnover and return of amounts, and payment of attorney’s fees and costs where applicable.

Court of Appeals Ruling and Dismissal of Appeal

Petitioner timely appealed to the Court of Appeals. The CA (Feb. 14, 2008) affirmed the RTC’s Joint Order and Summary Judgment but dismissed petitioner’s appeal for lack of jurisdiction on the ground that the appeal raised pure questions of law — therefore the proper remedy was a Rule 45 petition for certiorari to the Supreme Court, not an ordinary appeal under Rule 41. The CA relied on precedents and a circular (Circular No. 2-90) mandating dismissal of appeals to the CA when they allege pure questions of law. The CA denied reconsideration (May 23, 2008).

Issues Presented to the Supreme Court

Petitioner raised four principal issues: (I) whether the CA erred in dismissing his appeal; (II) whether the CA erred in upholding summary judgment despite genuine issues of fact in petitioner’s answer; (III) whether the CA was correct in not voiding the summary judgment for failure to implead an indispensable party (Atty. Santos); and (IV) whether the CA erred in not dismissing Civil Case No. 05-172 for nonpayment of correct docket fees (alleging the suit was effectively an action to recover ownership and thus required higher fees).

Supreme Court Analysis on Appealability and Summary Judgment Standards

The Supreme Court found merit in parts of the petition. First, the Court held the CA erred in dismissing the appeal for want of jurisdiction. The Court explained that a summary judgment is effectively an adjudication on the merits; a party aggrieved by such an adjudication may appeal via notice of appeal and appellate brief under Rule 41. Thus petitioner’s appeal to the CA was a proper mode to challenge the RTC’s summary judgment. Second, the Court concluded that summary judgment was improperly applied in this case because genuine issues of material fact existed. Citing Rule 35 (summary judgment requisites) and pertinent jurisprudence, the Court reiterated that summary judgment is only appropriate where there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law. The Court found significant factual disputes in the record — conflicting accounts about whether respondents freely and intelligently executed the POA, whether the POA was truly coupled with interest, whether the P500,000 checks represented consideration for assignment of contingent rights, whether respondents were deceived by counsel and petitioner, and whether the arrangement was champertous. These factual variances required presentation of evidence at a full trial rather than summary disposition.

Supreme Court Findings on Champerty, Agrarian Law Conflict, and Indispensable Parties

While the RTC’s legal reasoning invoked R.A. No. 3844 Section 62 and champerty doctrine to nullify the POA, the Supreme Court focused on the necessity of resolving contested facts before applying those legal principles conclusively. The Court observed that whether the transaction amounted to a prohibited pre-acquisition conveyance or champertous arrangement hinges on

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