G.R. No. 170026
June 20, 2012
Second Division
Ponente: Brion, J.
Gist:
A dismissal order should conform with Section 1, Rule 36 of the Rules of Court on the writing of valid judgments and final orders. Failure to disclose how and why the petitioner failed to prosecute his complaint constitutes a denial of due process.
Facts:
Petitioner alleges that one Leticia Magsalin, doing business under Karens Trading, had breached their subcontract agreement for the supply, delivery, installation, and finishing of parquet tiles for certain floors in the petitioner’s condominium project. As a result, the contract was terminated. When Magsalin refused to return to the petitioner’s unliquidated advance payment and to account for other monetary liabilities despite demand, the petitioner sent a notice to respondent FGU Insurance Corporation demanding damages pursuant to the surety and performance bonds the former had issued for the subcontract.
The petitioner filed a complaint against both Magsalin and FGU insurance. While the latter was properly served with summons, the former and Karens Trading could not be located at their given address.
FGU Insurance filed a motion to dismiss the complaint. The petitioner filed its opposition to the motion. The motion to dismiss was denied as well as the ensuing motion for reconsideration, and FGU Insurance was obliged to file an answer.
In order for the RTC to acquire jurisdiction over Magsalin, the petitioner filed a motion for leave to serve summons on respondent Magsalin by way of publication. The petitioner then filed its reply to FGU Insurance’s answer.
FGU Insurance filed a motion for leave of court to file a third-party complaint which subject complaint named Reynaldo Baetiong, Godofredo Garcia and Concordia Garcia as the third-party defendants. FGU Insurance claims that the three had executed counter-guaranties over the surety and performance bonds it executed for the subcontract with Magsalin and that they should be held jointly and severally liable together with FGU Insurance.
The RTC admitted the third-party complaint and denied the motion to serve summons by publication on the ground that the action against respondent Magsalin was in personam.
Baetiong filed his answer to the third party complaint. He denied any personal knowledge about the surety and performance bonds for the subcontract with Magsalin. He was the only party, among the three (3) persons named as third-party defendants, to file an answer.
The petitioner argues that FGU Insurance, which is the plaintiff in the third party complaint, had failed to exert efforts to serve summons on the Garcias. It also asserts that the RTC should have scheduled a hearing to determine the status of the summons to the third party defendants.
However, the RTC dismissed the case for failure of the petitioner to prosecute. It also denied petitioner’s motion for reconsideration.
On appeal, the CA agreed with the contention of FGU Insurance that the appeal should be dismissed for lack of jurisdiction as it raised a pure question of law and did not dispute the proceedings before the issuance of the dismissal order.
Issues:
1. Whether the dismissal order is void;
2. Whether the appeal was properly filed under Rule 41 of the Rules of Court;
3. Whether the dismissal of Civil Case No. 02-488 is supported by the facts of the case
Ruling:
The petition for certiorari was granted. The Court noted that FGU Insurance failed to discharge its burden of proving its claim that some material portions of the record of petitioner was not sufficiently specified and attached to the petition. The dismissal order was void for violation of due process. The appeal to challenge the dismissal order was properly filed under Rule 41 of the Rules of Court. In addition, the dismissal of the case for failure to prosecute is not supported by facts, as shown by the records of the case.
1. The dismissal order is void. The nullity of the dismissal order is patent on its face. It simply stated its conclusion that the case should be dismissed for non prosequitur, a legal conclusion, but does not state the facts on which this conclusion is based.
Dismissals of actions for failure of the plaintiff to prosecute is authorized under Section 3, Rule 17 of the Rules of Court. The subject dismissal order shows that it was an unqualified order and, as such, is deemed to be a dismissal with prejudice. Dismissals of actions (under Section 3) which do not expressly state whether they are with or without prejudice are held to be with prejudice.
As a prejudicial dismissal, the subject dismissal order can no longer be refiled on the principle of res judicata. Procedurally, when a complaint is dismissed for failure to prosecute and the dismissal is unqualified, the dismissal has the effect of an adjudication on the merits.
As an adjudication on the merits, it is imperative that the dismissal order conforms with Section 1, Rule 36 of the Rules of Court on the writing of valid judgments and final orders.
The subject dismissal order clearly violated this rule for its failure to disclose how and why the petitioner failed to prosecute its complaint. Neither the petitioner nor the reviewing court is able to know the particular facts that had prompted the prejudicial dismissal.
A trail court should always specify the reasons for a complaint’s dismissal so that on appeal, the reviewing court can readily determine the prima facie justification for the dismissal.
Thus, the Court agrees with the petitioner that the dismissal order constituted a denial of due process. Elementary due process demands that the parties to a litigation be given information on how the case was decided, as well as an explanation of the factual and legal reasons that led to the conclusions of the court.
A void decision is open to collateral attack. While the validity of the dismissal order with respect to Section 1, Rule 36 of the Rules of Court was never raised by the petitioner as an issue in the present petition, the Supreme Court is vested with ample authority to review an unassigned error if its finds that consideration and resolution are indispensable or necessary in arriving at a just decision in an appeal.
2. The appeal was properly filed under Rule 41 of the Rules of Court.
In dismissing the appeal, the CA articulated the case of Joaquin vs. Navarro which operative legal principle is this: Where a case is submitted upon an agreement of facts, or where all the facts are stated in the judgment and the issue is the correctness of the conclusions drawn therefrom, the question is one of law which is properly subject to the review of the Supreme Court.
In this case, the facts supposedly supporting the trial court’s conclusion of non prosequitur were not stated in the judgment. This defeats the application of Joaquin. The filing of the appeal under Rule 41 of the Rules of Court was proper as it necessarily involved question of fact.
An authority material to this case is the case of Olave v. Mistas. Directly addressed in Olave was the CA’s jurisdiction over an ordinary appeal supported by undisputed facts and seeking a review of the prejudicial order of dismissal. Despite undisputed records, the CA, in its review, still had to respond to factual questions of law. Among the critical factual questions was whether, based on the records, there had been factual basis for the dismissal of the subject complaint as it did not even indicate the factual basis for such dismissal order.
A court could only issue a motu proprio dismissal pursuant to the grounds specified in Section 3 , Rule 17 of the Rules of Court and for lack of jurisdiction over the subject matter. Thus, given that the dismissal order does not disclose its factual basis, the Court held that the petitioner had properly filed its appeal from the dismissal order under Rule 41 of the Rules of Court.
3. The dismissal of the civil case is not supported by the facts of the case.
Under Section 3, Rule 17 of the Rules of Court, for the motu proprio dismissal of a case for failure to prosecute, the grounds are as follows:
a. Failure of the plaintiff, without justifiable reasons, to appear on the date of the presentation of his evidence in chief;
b. Failure of the plaintiff to prosecute his action for an unreasonable length of time;
c. Failure of the plaintiff to comply with the Rules of Court; or
d. Failure of the plaintiff to obey any order of the court.
The fundamental test for non prosequitur is whether, under the circumstances, the plaintiff is chargeable with want of due diligence in failing to proceed with unreasonable promptitude. There must be unwillingness on the part of the plaintiff to prosecute.
