Mercado v. Court of Appeals
REITERATIONFacts
1. The Antecedents: The underlying dispute involves lessees of market stalls in Baliuag, Bulacan, who constructed new stalls at their own expense after a fire in 1956 and paid rentals to the Municipality. In 1972, municipal officials cancelled the original lessees' permits and recognized new lessees (the Mercado Group) who had sub-leased the stalls, citing a municipal ordinance prohibiting sub-leasing and a directive from the Office of the President. The original lessees (the Bulaong Group) sued to recover their stalls and damages, claiming ownership of the stalls they constructed. 2. Procedural History: The Court of First Instance (now Regional Trial Court) initially ruled in favor of the Bulaong Group, declaring them builders in good faith and annulling the leases granted to the Mercado Group. The court also ordered the Mercado Group to pay the Bulaong Group for the value of the stalls. The Mercado Group and the Municipality moved for reconsideration, which was denied. They then attempted to appeal the summary judgment, but the Trial Court deemed the appeal papers filed out of time and ordered the execution of the judgment. The Mercado Group then filed a special civil action of certiorari and prohibition with the Court of Appeals, seeking to annul the damages portion of the judgment and restrain its enforcement. The Court of Appeals dismissed their action, holding that the summary judgment was properly rendered, they were not denied due process, and certiorari could not substitute for their lost appeal. 3. The Petition: The Mercado Group is now before the Supreme Court on an appeal by certiorari, challenging the Court of Appeals' rulings. They argue that the Trial Court erred in rendering a summary judgment awarding damages based solely on affidavits without a formal hearing, thereby denying them due process. They also contend that the Trial Court erred in treating the Bulaong Group as builders in good faith under Article 526 of the Civil Code, rather than lessees under Article 1678. The Supreme Court, however, affirmed the Court of Appeals' decision, finding that the Mercado Group failed to perfect their appeal within the reglementary period and that certiorari was not a proper remedy to correct errors of judgment, especially when the right to appeal has been lost.
Issue(s)
Whether a special civil action of certiorari may be availed of to annul a summary judgment due to alleged misapplication of the Civil Code and insufficient evidence for damages, thereby denying due process, considering the Mercado Group's failure to perfect their appeal. Whether the RTC erred in declaring the Bulaong Group as builders in good faith instead of lessees entitled to reimbursement under Article 1678 of the Civil Code, and whether this error warrants certiorari. Whether the Mercado Group's appeal from the summary judgment was validly perfected, and the implications of their failure to appeal on the propriety of certiorari.
Ruling
The petition is dismissed. The Court of Appeals' decision is affirmed in toto.
Ratio Decidendi
On the propriety of certiorari, the finality of the summary judgment, and the alleged denial of due process and error in awarding damages: The Supreme Court held that the Mercado Group failed to perfect their appeal from the summary judgment within the reglementary period, precluding the use of certiorari as a substitute for a lost appeal. The Court found no denial of due process, as the Mercado Group had the opportunity to contest the damages but did not. Any error in awarding damages based on unopposed affidavits was an error in the exercise of jurisdiction, correctible only by appeal, not by certiorari. On the classification of the Bulaong Group as builders in good faith: The Court acknowledged that it was indeed an error for the RTC to have declared the Bulaong Group as builders in good faith under Article 526 of the Civil Code. As lessees, their right to improvements was governed by Article 1678 of the Civil Code. However, this error, like the issue of damages, was an error in the exercise of jurisdiction and not an error that rendered the judgment void, and therefore does not justify the extraordinary remedy of certiorari, especially after the judgment had become final. On the Mercado Group's failure to perfect their appeal: The Supreme Court held that the Mercado Group failed to perfect their appeal from the summary judgment within the reglementary period. Their attempt to file an appeal was futile because the notice of appeal, appeal bond, and motion for extension were filed beyond the prescribed deadlines. The Court emphasized that certiorari cannot be used as a substitute for a lost appeal, especially when the judgment is not void but merely erroneous. The RTC's summary judgment was a final adjudication on the merits, and the failure to appeal seasonably rendered it final and executory. The availability of the right of appeal, even if lost due to negligence, precludes recourse to the extraordinary remedy of certiorari. The Court reiterated that Section 1 of Rule 65 requires the absence of an appeal, or any plain, speedy, and adequate remedy in the ordinary course of law, as a condition for filing a certiorari petition.
Main Doctrine
A special civil action for certiorari cannot be used as a substitute for a lost appeal, especially when the judgment sought to be annulled is not void but merely erroneous, and the failure to appeal was due to the party's own fault or negligence.