Poliand Industrial Limited v. National Development Company
REVERSALFacts
The Antecedents: Poliand Industrial Limited (POLIAND) sought partial review of the Court’s Resolution dated November 23, 2005, which modified its August 22, 2005 Decision. The August 22, 2005 Decision denied both petitions but modified the Court of Appeals' decision, holding National Development Company (NDC) liable to POLIAND for US$1,193,298.56 plus 12% interest from September 25, 1991. Both POLIAND and NDC filed separate motions for partial reconsideration. POLIAND argued that interest should be reckoned from September 12, 1984, the date of the last foreclosure sale, aligning with the Court of Appeals' dispositive portion. The Court denied these motions in its November 23, 2005 Resolution, which, for the first time, specified the interest computation should be from the date of finality of judgment. Procedural History: The trial court found that POLIAND made extrajudicial demands on September 25, 1991, on NDC, Galleon Shipping Corporation, and Development Bank of the Philippines, concerning loan accommodations and, alternatively, a maritime lien for a specified amount. This finding was not modified by the Court of Appeals. The Petition: POLIAND filed the instant subsequent motion for reconsideration with leave of court, praying for the review of the November 23, 2005 Resolution, and in the alternative, that interest be computed from September 25, 1991, the date of extrajudicial demand, as ordered in the August 22, 2005 Decision.
Issue(s)
Whether the instant motion is a prohibited second motion for reconsideration. Whether the interest on POLIAND's maritime lien should be computed from September 25, 1991 (date of extrajudicial demand) or from the date of finality of judgment. Whether the institution of extrajudicial foreclosure proceedings tainted with bad faith provides a basis to reckon the computation of legal interest from the date of the foreclosure sale. Whether Section 17(a) of Presidential Decree No. 1521 is applicable to the question of interest payment.
Ruling
The Court GRANTED the instant "second" Motion for Partial Reconsideration and REINSTATED in full the dispositive portion of the Decision dated August 22, 2005. Consequently, the interest on POLIAND's maritime lien is to be computed from September 25, 1991.
Ratio Decidendi
On the nature of the motion: The Court held that the instant motion is not a prohibited second motion for reconsideration because it seeks to review the November 23, 2005 Resolution, which passed upon the issue of the computation of interest for the first time, thereby modifying the August 22, 2005 Decision. The Court clarified that it would be reverting to the August 22, 2005 Decision to ensure finality of the adjudication. On the computation of interest: The Court found merit in POLIAND's motion and modified its earlier finding that the claim was not due and demandable until finality of judgment. It noted the trial court's factual finding that extrajudicial demands were made by POLIAND on September 25, 1991, for a specified amount equivalent to its maritime lien. This amount, being ascertainable through mathematical computation, meant the claim was liquidated and thus due and demandable as of the date of demand. On the effect of bad faith in foreclosure: The Court dismissed POLIAND's contention that bad faith in the institution of extrajudicial foreclosure proceedings warrants reckoning interest from the date of the foreclosure sale. It stated that while bad faith may be a basis for other awards, it does not serve as a basis for the award of legal interest. On the applicability of PD 1521: The Court rejected POLIAND's argument that Section 17(a) of Presidential Decree No. 1521 mandates reckoning interest from the date of the last foreclosure sale. It clarified that this provision enumerates prioritized liens entitled to satisfaction upon the sale of a mortgaged vessel and is inapplicable to the question of interest payment.
Main Doctrine
A second motion for reconsideration may be entertained if it seeks to review a resolution that passed upon an issue for the first time, thereby modifying a prior decision. An extrajudicial demand for a specified amount, which is ascertainable through mathematical computation, renders a claim due and demandable.