Fortune Guarantee and Insurance Corporation v. Honorable Court of Appeals
REITERATIONFacts
The Antecedents: Isabela 1 Electric Cooperative, Inc. (ISELCO-I) secured a fire insurance policy from Fortune Guarantee and Insurance Corporation (FGIC) for P2,000,000.00, later amended to include expanded coverage for typhoons and floods. The policy covered ISELCO-I's distribution lines, electric posts, transformers, and other fixtures in various towns in Isabela. During the policy's subsistence in 1989, ISELCO-I's insured properties were destroyed by two typhoons, "ELANG" and "TACING." ISELCO-I filed claims with FGIC, but the latter refused to pay the full amount, contending that the insured properties were underinsured as their total value was P36,000,000.00, thus entitling ISELCO-I to only a fraction of the policy's face value. Procedural History: ISELCO-I filed a complaint against FGIC for the P2,000,000.00 insurance claim, plus damages, before the Regional Trial Court (RTC) of Cauayan, Isabela. The RTC ruled in favor of ISELCO-I, ordering FGIC to pay the full P2,000,000.00 with interest and attorney's fees. Subsequently, ISELCO-I filed a Motion for Execution Pending Appeal, which the RTC granted via a Special Order, requiring ISELCO-I to post a bond. FGIC moved for reconsideration of the decision and opposed the execution pending appeal. The RTC denied FGIC's motion for reconsideration and later issued the Special Order granting execution pending appeal. Aggrieved, FGIC filed a Petition for Certiorari with the Court of Appeals (CA), assailing the RTC's Special Order. The CA dismissed FGIC's petition and denied its motion for reconsideration. The Petition: FGIC filed a Petition for Certiorari under Rule 65 of the Rules of Court, seeking to annul the CA's resolutions that dismissed its petition and denied its motion for reconsideration. FGIC argues that the CA erred in affirming the RTC's Special Order, contending that the RTC Judge gravely abused his discretion in granting execution pending appeal. Specifically, FGIC claims the RTC Judge improperly determined the value of the insured properties, leading to a finding that they were not underinsured, and that the reasons for execution pending appeal were insufficient. FGIC also argues that its appeal was not dilatory and that the CA erred in denying its motion for reconsideration by ignoring additional corroborating documents.
Issue(s)
Whether the Court of Appeals erred in affirming the RTC's Special Order granting execution pending appeal. Whether the RTC, in granting execution pending appeal, committed grave abuse of discretion by allegedly misapplying judicial notice and piercing the value of the insured properties to make it appear that the properties were not underinsured. Whether the CA erred in denying FGIC's motion for reconsideration by allegedly ignoring documents submitted by FGIC.
Ruling
The petition is denied for lack of merit. The assailed Resolutions of the Court of Appeals dated April 19, 1993, and June 16, 1993, are affirmed. The case is remanded to the Court of Appeals for resolution of the appeal on its merits.
Ratio Decidendi
On the propriety of the remedy and the scope of review, and the grant of execution pending appeal: The Supreme Court affirmed the RTC's Special Order granting execution pending appeal, noting the requisites for such a grant: a motion by the prevailing party, notice to the adverse party, good reasons for the execution, and these reasons stated in a special order. The Court found that the RTC Judge exercised sound discretion based on the 'good reasons' presented by ISELCO-I. The Court reiterated that it is not its function to analyze and weigh evidence again, especially concerning the merits of the main case, which is pending appeal. The Court's focus in this certiorari proceeding is limited to resolving the wisdom of the trial court's exercise of discretion in ordering execution pending appeal, and whether there was grave abuse of discretion. On the issue of underinsurance and the alleged grave abuse of discretion: The Supreme Court stated that it would not delve into the merits of the main case, including the issue of underinsurance, as this was the subject of a separate appeal pending before the Court of Appeals. The Court disagreed with petitioner's claim that the RTC Judge abused his discretion, finding that the reasons cited by the RTC constituted 'good reasons' as contemplated by law for the extraordinary grant of execution pending appeal. The Court emphasized that the determination of 'good reasons' is within the sound discretion of the trial judge, and appellate courts should not interfere unless there is grave abuse of discretion or a change in circumstances. On the denial of the motion for reconsideration: The Supreme Court found no error in the CA's denial of FGIC's motion for reconsideration. The Court reiterated that it is not its function to re-evaluate evidence unless the findings of the lower court are totally devoid of support or glaringly erroneous. The findings of fact of the CA, supported by substantial evidence, are conclusive and binding on the parties, and FGIC failed to prove any exception to this rule.
Main Doctrine
Execution pending appeal may be granted upon a motion by the prevailing party, with notice to the adverse party, provided there are good reasons stated in a special order. The determination of what constitutes 'good reasons' is addressed to the sound discretion of the trial court, and appellate courts will generally not interfere unless there is grave abuse of discretion or a change in circumstances.