G.R. No. L-22973 - Mambulao Lumber Co. vs. Philippine National Bank

Case Summary (G.R. No. L-22973)

Origins of the Case in the Lower Courts

In Civil Case No. 130 of the Municipal Court of Banga, South Cotabato, entitled “Jose V. Panes vs. Pablo Abandonio” for “Forcible Entry and Damages with Writ of Preliminary Injunction,” the Municipal Court rendered a decision in favor of petitioner. Abandonio appealed to the CFI of South Cotabato, Branch II, in Civil Case No. 311, where the CFI reversed the Municipal Court’s judgment.

Receipt of the CFI Decision and the Motion for Reconsideration

Petitioner received a copy of the CFI decision on September 19, 1980. Petitioner also prayed for reconsideration in the CFI, but the motion was denied.

Filing of the Motion for Extension and the Appellate Court’s Notice

On December 4, 1980, petitioner filed with the Court of Appeals, by registered mail, a Motion for Extension of thirty days within which to file a petition for review. In that motion, petitioner manifested that he would be able to file his petition for review up to December 9, 1980. The Court of Appeals received the motion on December 18, 1980. The thirty-day period requested would have extended up to January 8, 1981.

On January 5, 1981, the Acting Clerk of Court of the Court of Appeals sent petitioner’s counsel a letter by registered mail. The letter advised that the motion for extension had been received without the necessary docketing fees and required petitioner to remit the fees and the legal research fund fee; pending payment, the petition was to be held in abeyance. Before counsel received this registered letter, petitioner received it only on January 20, 1981, after the January 8, 1981 deadline had passed.

Filing of the Petition for Review on the Thirtieth Day of the Extended Period

On January 8, 1981, the thirtieth day of the extended period requested, petitioner filed, by registered mail, the Petition for Review with the Court of Appeals and included a postal money order for P53.00 representing docket and legal research fund fees. The Court of Appeals then issued on January 30, 1981 the resolution that dismissed the petition for review on the ground that the motion for extension and the petition for review were deemed filed only on January 8, 1981 when the filing fees had been remitted and deemed paid, and that the extension sought was therefore filed beyond the period to be extended. The Court of Appeals concluded that the petition for review was filed out of time and that the judgment of the CFI had become final.

Denial of Reconsideration and the Petition before the Supreme Court

Petitioner moved for reconsideration of the dismissal, but the Court of Appeals denied the motion on May 22, 1981. The Court of Appeals ruled that the dismissal was not a mere technicality, and it emphasized that once the period of appeal or the period within which a petition for review must be filed expires, the decision becomes final and executory and the court loses jurisdiction to alter it.

Petitioner then came to the Supreme Court through a petition seeking reversal of the Court of Appeals resolutions on the ground of grave abuse of discretion, arguing that the dismissal was unwarranted under the applicable rules and the circumstances of delayed payment of the docketing fees.

The Parties’ Contentions in the Supreme Court

The Court of Appeals grounded its dismissal on Ago Timber Corporation vs. Ruiz, et al., 21 SCRA 1381 (1967), which had held that, in that case, reckoning the filing depended on the date when the filing fee was paid rather than when the petition was received. Petitioner maintained that the factual situation and procedural posture in Ago Timber Corporation were materially different from his case because in the present controversy the controlling issue was whether the petition for review was filed within the reglementary period granted by the motion for extension, and the docketing fees were eventually paid at the time the petition for review was submitted.

Legal Issues Framed by the Records

The decisive question was whether the Court of Appeals acted with grave abuse of discretion in treating the petition for review as filed out of time due solely to the delayed payment of the docketing fees, despite the fact that petitioner filed the petition within the extended period and only had not yet remitted the fees at the moment he filed the motion for extension.

Legal Basis and Reasoning of the Court

The Court examined the governing rules on the payment of fees. It quoted Rule 141, section 3, Rules of Court, which provides that the fees of the clerk of court shall be paid at the time of the entry of the action or proceeding by the party who enters it by appeal or otherwise, and that the clerk shall give a receipt and enter the amount received. The rule further provides that if the fees are not paid, the court may refuse to proceed with the action until they are paid and may dismiss the appeal or the action or proceeding. The Court stressed that, under the rule’s text, failure to pay docketing fees did not automatically result in dismissal; dismissal was discretionary with the Court of Appeals.

The Court also relied on prior jurisprudential principles emphasizing that the discretion to dismiss for nonpayment must be exercised wisely, prudently, and with a view to substantial justice. In this connection, the Court referred to NAWASA vs. Secretary of Public Works and Communications, 16 SCRA 536 (1966), Cucio vs. Court of Appeals, 57 SCRA 64 (1974), and Lopez vs. Court of Appeals, 75 SCRA 401 (1977), in support of the doctrine that the power to dismiss is directory rather than mandatory, and therefore must be exercised circumspectly.

The Court found that petitioner’s counsel did not deliberately ignore the requirement to pay fees. The records showed that petitioner had filed the Motion for Extension within the thirty-day reglementary period. The only lapse was that counsel failed to remit the docket fees when he moved for extension. Counsel paid the fees simultaneously with the filing of the petition for review on the thirtieth day of the extended period. The Court regarded this as inconsistent with laches, intentional delay, or refusal to pay fees.

The Court further noted that counsel had filed the petition for review and paid the fees even before counsel received the Court of Appeals’ notice demanding remittance and stating that the petition would be held in abeyance. This circumstance supported the Court’s conclusion that the late remittance was not due to any scheme to delay or defeat proceedings, but rather to an oversight on counsel’s part in understanding the operation of **section 2 of the Rules on Appeal by Petition for Review under RA 6031, adopted by the Court of Appeals en banc on August 12, 1971. The Court explained that, while that rule stated that “upon filing of the petition, the petitioner shall pay to the Clerk of Court of Appeals the docketing fee,” counsel overlooked that the petition itself had to be filed within the period for appealing and that the fees were required “at the time of the entry of the action or proceeding in the court by the party who enters the same by appeal, or otherwise” under Rule 141, section 3.

With these facts, the Court held that applying the rules with the rigidity adopted by the Court of Appeals would block the right to review to which a party is entitled under law and would depart from prior guidance that dismissal powers are discretionary and directory, not mandatory. The Court acknowledged the admonition that the bar must still observe reglementary periods strictly, but it held that, in the attendant circumstan

Case Syllabus (G.R. No. L-22973)

Parties and Procedural Posture

Jose V. Panes sought appellate relief from Court of Appeals resolutions that dismissed his Petition for Review and denied his motion for reconsideration.
The challenged Court of Appeals resolution dismissed the petition as allegedly filed out of time.
The dismissal arose from a procedural issue involving the timing of payment of docketing fees for an appeal by Petition for Review.
The Court treated the case as an appeal by certiorari from the Court of Appeals dispositions.
Pablo Abandonio was the adverse party in the underlying forcible entry case and the respondent in the appellate proceedings.
Judge Filomeno Gapultos, in his capacity as presiding judge of the CFI of South Cotabato, Branch II, was included as respondent due to his role in the reversed trial court judgment.

Origin of Underlying Dispute

The controversy began in the Municipal Court of Banga, South Cotabato, in Civil Case No. 130, entitled “Jose V. Panes vs. Pablo Abandonio” for “Forcible Entry and Damages with Writ of Preliminary Injunction.”
The Municipal Court decision favored Jose V. Panes.
Panes faced reversal when the case was appealed to the CFI of South Cotabato, Branch II, in Civil Case No. 311.
The CFI reversed the municipal court judgment.

Timetable and Filing Steps

Panes received a copy of the CFI Decision on September 19, 1980.
His motion for reconsideration in the trial court was denied.
On December 4, 1980, Panes filed with the Court of Appeals by registered mail a Motion for Extension of thirty days to file a Petition for Review.
The motion stated that he had until December 9, 1980 to file the petition.
The Court of Appeals received the motion on December 18, 1980.
The thirty-day period requested would have extended the deadline to January 8, 1981.
On January 5, 1981, the Acting Clerk of Court of the Court of Appeals sent registered mail advice to Panes’ counsel that the motion for extension was received without the necessary docketing fees and legal research fund fee, pending which the Petition would be held in abeyance.
Before the advice was received by Panes on January 20, 1981, or specifically by January 8, 1981 which was the thirtieth day of the extended period, Panes filed the Petition for Review by registered mail.
The filing of the Petition for Review on January 8, 1981 was accompanied by postal money order in the amount of P53.00 representing the docket and legal research fund fees.
On January 30, 1981, the Court of Appeals issued a resolution dismissing the Petition for Review.
The Court of Appeals held that since the Petition for Extension and the Petition for Review were deemed filed only when the fees were remitted, the extension was filed beyond the period sought to be extended and the petition was therefore out of time.

Court of Appeals’ Reasoning

The Court of Appeals concluded that late remittance of fees affected the date of filing for purposes of timeliness.
The appellate court treated the extension and the eventual petition filing as outside the reglementary periods because fees were not remitted at the time the extension was moved.
In denying reconsideration, the Court of Appeals rejected Panes’ view that the dismissal involved only a technicality.
The Court of Appeals emphasized that once the appeal period expires, the judgment becomes final and executory and the appellate court loses jurisdiction to alter the decision.

Issues Raised

The core issue was whether the Petition for Review was timely filed when filed on the thirtieth day of the extended period but with docketing fees paid only upon filing the petition.
The case required determination of whether the payment of docketing fees affected the “filing date” for timeliness purposes, under the applicable rules and procedural framework.
The case also involved whether dismissal was required as a mandatory consequence of delayed payment or could be avoided through a liberal, equity-oriented application of procedural rules.

Statutory and Rules Framework

The Court relied on Rule 141, Section 3 of the Rules of Court, which governs fees paid to the clerk of the Court of Appeals or the Supreme Court.
Rule 141, Section 3 provides that the clerk may refuse to proceed until fees are paid and may dismiss the appeal or proceeding if fees are not paid.
The rule required fees to be paid “at the time of the entry of the action or proceeding in the court by the party who enters the same.”
The Court noted that the applicable procedure for appeals by Petition for Review was also shaped by a Court of Appeals en banc resolution adopting rules under RA 6031 dated August 12, 1971.
Under the August 12, 1971 resolution, Section 2 required that “upon filing of the petition, the petitioner shall pay to the Clerk of Court of Appeals the docketing fee.”
The Court treated this “upon filing of the petition” requirement as relevant to the timing question because Panes paid the fees upon filing the Petition for Review.

Principal Authorities Considered

The Court of