Dulap v. Asian Surety & Insurance Co.
REITERATIONFacts
The Antecedents: Petitioners Pedro Dulap and Dolores Amparo were owners of a parcel of land covered by TCT No. 66821. Their duplicate certificate of title came into the possession of respondent Asian Surety & Insurance Co., Inc. (ASIC), which also held a deed of mortgage allegedly signed by the Dulaps over the same property. ASIC sent a letter of demand to the Dulaps, which they received. However, the Dulaps denied having obtained a loan or mortgaged their land to ASIC and filed a criminal complaint for forgery. Procedural History: ASIC filed an action for foreclosure of mortgage (Civil Case No. 52415) with the Court of First Instance of Manila, Branch XVII. Summons was issued through publication, and the Dulaps, failing to answer, were declared in default. A decision was rendered ordering the Dulaps to pay ASIC P10,000.00 with interest, attorney's fees, and costs. The judgment became final and executory, and a sheriff's sale was conducted, with ASIC as the highest bidder. The Dulaps opposed the confirmation of the sale and the writ of possession, alleging they were never properly summoned and had never executed the mortgage deed. The court denied their opposition but reserved their right to file an annulment suit. Subsequently, the Dulaps filed an action for annulment of judgment (Civil Case No. 56528) with Branch III of the same court, alleging lack of jurisdiction due to improper service of summons. Branch III annulled the judgment of Branch XVII, finding that summons by publication was defective as it was not sent to the Dulaps' last known address. ASIC appealed to the Court of Appeals, which reversed the decision of Branch III, relying on the doctrine that a court cannot annul a judgment rendered by another court of concurrent jurisdiction. The Petition: The Dulaps filed a petition for review by certiorari with the Supreme Court, questioning the Court of Appeals' decision.
Issue(s)
Whether a branch of the Court of First Instance has the power or authority to annul a judgment rendered by another branch of the same court. Whether the service of summons by publication in Civil Case No. 52415 was proper and conferred jurisdiction over the persons of the Dulaps.
Ruling
The Supreme Court reversed and set aside the decision of the Court of Appeals and upheld the judgment of Branch III of the Court of First Instance of Manila annulling the judgment of Branch XVII.
Ratio Decidendi
On the issue of whether a branch of the Court of First Instance can annul a judgment of another branch: The Supreme Court held that a court of first instance or a branch thereof has the authority and jurisdiction to take cognizance of, and to act in, a suit to annul a final and executory judgment or order rendered by another court of first instance or by another branch of the same court. The Court distinguished this from cases where different courts of concurrent jurisdiction are involved, noting that the cited American Jurisprudence authority on judicial stability explicitly excludes different departments of the same court from its application. The Court clarified that the various branches of the Court of First Instance are coordinate and co-equal courts, and the totality of which is only one Court of First Instance. Furthermore, the Court pointed out that in this specific case, Branch XVII had expressly reserved unto the petitioners the filing of their action for annulment of judgment, indicating no interference with a case still under consideration. The policy of judicial stability should be subordinate to an orderly administration of justice based on existing rules of procedure and law, especially when fraud is involved. On the issue of the propriety of service of summons by publication: The Supreme Court upheld the judgment of Branch III, finding that there was a fatal defect in the service of summons. Rule 14, Section 2 of the Revised Rules of Court requires an affidavit showing the deposit of a copy of the summons and order of publication in the post office, postage prepaid, directed to the defendant by registered mail to his last known address. It was undisputed that the summons and order of publication were sent to Maysilo, Malabon, Rizal, an address appearing in the deed of mortgage which the Dulaps disowned as a forgery. The Dulaps had always resided at Deparo, Caloocan City, and did not receive the mailed copies. The Court noted that ASIC had previously sent a demand letter to the Dulaps' correct address in Caloocan City, indicating knowledge of their actual residence. Therefore, the summons was not directed to their last known address, rendering the service defective and the judgment void for want of jurisdiction over their persons.
Main Doctrine
A court of first instance or a branch thereof has the authority and jurisdiction to take cognizance of, and to act in, a suit to annul a final and executory judgment or order rendered by another court of first instance or by another branch of the same court, provided venue is properly laid.