Lopez v. Alvendia
REITERATIONFacts
The Antecedents: Private respondents David and Adelaida Minsberg purchased a residential lot from petitioners. They made a down payment and executed a written contract stipulating that upon full payment of P7,560.00, a certificate of title would be issued. After making the full payment of P5,560.00, completing the P2,000.00 down payment, the Minsbergs demanded the title, but petitioners failed to deliver it, citing pending paperwork. In 1960, the Minsbergs began constructing a house and, needing funds, again sought the title to mortgage it. Petitioners provided a certification of full payment, which was insufficient for bank loans. The Minsbergs alleged that the title was unavailable because the entire subdivision was mortgaged to the GSIS, a fact not disclosed to them. Procedural History: The Minsbergs filed a civil case (No. 49628) with the CFI of Manila, praying for the delivery of the title and damages amounting to P45,000.00 plus attorney's fees. During trial, the parties, with the court's intervention, reached a compromise agreement. The CFI rendered judgment based on this agreement, ordering petitioners to deliver the torrens title and pay P3,500.00 as damages by September 21, 1962. It stipulated that failure to deliver the title and/or damages would automatically raise the damages to P10,000.00, with a writ of execution to follow. The Petition: The Minsbergs filed a Motion for Execution on September 28, 1962, as one of the checks for P3,500.00 damages was dishonored with a "no arrangement" notation. Petitioners opposed this, claiming substantial compliance and a mere "oversight" by the bank cashier, attaching a certification from the bank and depositing P3,277.38 in cash. The respondent Judge denied the opposition and ordered the issuance of a writ of execution for P10,000.00. Petitioners moved for reconsideration, seeking to present evidence of the oversight and to suspend execution due to the death of Faustino Dolor, whose property was being levied. The respondent Judge denied the motion for reconsideration and the motion to suspend proceedings, citing Article 1249 of the Civil Code and the nature of checks as not being legal tender. Petitioners then filed a Petition for Certiorari, Mandamus, and/or Prohibition with Preliminary Injunction before the Supreme Court, alleging grave abuse of discretion by the respondent Judge.
Issue(s)
Whether the respondent Judge acted with grave abuse of discretion in ordering the execution of the judgment for P10,000.00 despite petitioners' claim of substantial compliance and alleged oversight by the bank cashier. Whether the delivery of a dishonored check constitutes payment under Article 1249 of the Civil Code. Whether the petitioners should have been allowed to present evidence to prove the alleged oversight by the bank cashier.
Ruling
The petition is dismissed for lack of merit. The Writ of Preliminary Injunction previously issued is dissolved. Costs are against the petitioners.
Ratio Decidendi
On Issue 1: The Court found no abuse of discretion, much less a grave one, committed by the respondent Judge. The petitioners failed to comply with the terms of the judgment, which was based on a compromise agreement where time was of the essence. Their claim of "mere oversight" by the bank cashier was deemed untenable, especially since a month had transpired between the rendition of the decision and the compliance date, during which they could have ascertained the bank's arrangement. The respondent Court's disbelief in the alleged arrangement was strengthened by the facts and circumstances of record. The Court also noted that if the fault lay with the bank, petitioners were free to sue the bank for damages. On Issue 2: The Court reiterated that under Article 1249 of the Civil Code, the delivery of mercantile documents like checks produces the effect of payment only when they have been cashed, or when through the fault of the creditor they have been impaired. The fact that the check was dishonored with a "no arrangement" notation meant that it did not constitute payment. Therefore, it was immaterial whether the petitioners had sufficient funds with the drawee bank, as the check itself, not being legal tender, could have been refused by the Minsbergs. On Issue 3: The Court held that the respondent Judge did not err in denying the petitioners' request to present evidence to prove the alleged oversight. Granting, for the sake of argument, that the acts were erroneous, they were considered mere mistakes of fact or errors of judgment and/or of law, which are not within the reach of a writ of certiorari. The Court emphasized that certiorari is not a substitute for appeal, and the petitioners had the remedy of appeal if they disagreed with the orders. The bank, by accepting the alleged arrangement, constituted itself as the agent of the petitioners, making the principal responsible for the agent's acts.
Main Doctrine
The Supreme Court affirmed that a writ of certiorari under Rule 65 of the Rules of Court is an extraordinary remedy that lies only when a lower court or tribunal has acted with grave abuse of discretion amounting to lack or excess of jurisdiction. It is not a substitute for appeal, and errors of judgment or fact, even if erroneous, are not correctible by certiorari. Furthermore, the Court reiterated that under Article 1249 of the Civil Code, the delivery of a check does not produce the effect of payment until it is cashed, or until through the fault of the creditor it has been impaired.