Sterling Investment Corporation v. Cabasbas
REITERATIONFacts
The Antecedents: The underlying dispute concerns a parcel of land originally owned by Teodorico Cabasbas, who obtained a homestead patent in 1940. His son, Alejandro Cabasbas, initiated a lawsuit in 1958 (Civil Case No. 4870) against several parties to recover this land. A decision was rendered in that case on May 3, 1958, based on a compromise agreement, which declared certain parties as registered owners of a portion of the land. The petitioners subsequently acquired ownership of this property through a series of transfers. Procedural History: Alejandro Cabasbas filed a second amended complaint in 1968 (Civil Case No. 10603) in a different branch of the Court of First Instance of Rizal, seeking to annul the 1958 decision. Cabasbas alleged that the prior decision was obtained through fraud, specifically claiming the conveyance of title was misrepresented as occurring in February 1946 when it actually took place on September 14, 1944, in violation of the Homestead Law. The petitioners, as defendants, denied these allegations and raised affirmative defenses, including being innocent purchasers for value. They moved to lift a notice of lis pendens, arguing the suit was for harassment and that the property had been subdivided and contracted for sale to numerous buyers. Respondent Judge V. M. Ruiz denied the motion to lift the lis pendens and subsequently denied an omnibus motion to dismiss the case on grounds of lack of jurisdiction, failure to state a cause of action, and res judicata. This led to the filing of the present petition. The Petition: The petitioners filed a petition for certiorari, prohibition, and mandamus seeking to annul the orders of respondent Judge Ruiz. They argued that the respondent Judge lacked jurisdiction to annul a decision rendered by another branch of the same court. Furthermore, they contended that the complaint failed to state a cause of action because the alleged fraud was intrinsic to the previous litigation (perjured testimony or false evidence presented during trial), not extrinsic fraud that prevented a party from presenting their case. The Supreme Court granted the petition, finding merit in the arguments regarding lack of jurisdiction and the insufficiency of the alleged fraud as a ground for annulment, and directed the dismissal of Civil Case No. 10603 and the cancellation of the notice of lis pendens.
Issue(s)
Whether respondent Judge Ruiz has jurisdiction to annul a decision rendered by another branch of the Court of First Instance. Whether the complaint in Civil Case No. 10603 states a cause of action, considering the alleged fraud is intrinsic and not extrinsic. Whether res judicata bars the suit.
Ruling
The petition is granted. The orders of respondent Judge denying the motion to lift the lis pendens and the omnibus motion for reconsideration are declared null and void and set aside. Respondent Judge is directed to order the cancellation of the notice of lis pendens and dismiss Civil Case No. 10603. The writ of prohibition is granted, perpetually restraining respondent Judge from further cognizance of the case. The writ of preliminary injunction is made permanent.
Ratio Decidendi
On the jurisdiction of respondent Judge: The Court held that the jurisdiction to annul a judgment of a branch of the Court of First Instance belongs solely to the very same branch which rendered the judgment. Any other branch, even if in the same judicial district, that attempts to annul a decision of a co-equal and coordinate branch either exceeds its jurisdiction or acts with grave abuse of discretion amounting to lack of jurisdiction. Therefore, certiorari and prohibition are proper remedies to prevent such an attempt. The assumption of jurisdiction by respondent Judge Ruiz over Civil Case No. 10603, which sought to annul a decision rendered by Branch VI, was an act beyond his competence. On the absence of a cause of action due to intrinsic fraud: The Court reiterated the doctrine that fraud must be extrinsic to the litigation to be a ground for nullifying a judgment. Intrinsic fraud, such as the use of perjured testimony or forged instruments during the trial, does not warrant setting aside a judgment because it pertains to matters brought within the court's jurisdiction and affects the presentation of the case, not the opportunity to present it. The allegation that the conveyance of title was made to appear to have occurred on a date in violation of the Homestead Law, when it actually occurred on an earlier date, constitutes intrinsic fraud. Such allegations do not prevent a party from presenting their side of the case but rather relate to the evidence presented during the trial. Therefore, the complaint did not state a cause of action for annulment based on intrinsic fraud. On res judicata: In view of the rulings on jurisdiction and cause of action, the Court found it unnecessary to pass on the issue of res judicata.
Main Doctrine
A branch of the Court of First Instance does not have jurisdiction to annul a decision rendered by another branch of the same court. Furthermore, fraud that is intrinsic to the litigation, such as perjury or forged documents presented during trial, is not a ground for nullifying a judgment; only extrinsic fraud, which prevents a party from presenting their case, is.