Pangasinan Five Star Bus v. Barredo
REITERATIONFacts
The Antecedents: On April 14, 1994, a Pangasinan Five Star Bus Co., Inc. bus, driven by Emilio Credo, collided with the rear of an owner-type jeep operated by Leon Barredo, Jr. The accident resulted in serious injuries to Mr. Barredo, Jr., leading to his hospitalization and eventual loss of his employment as a forklift operator, where he earned $518.00 monthly. Consequently, on November 14, 1994, spouses Leon and Luisa Barredo initiated a complaint for damages against the bus company and its driver. Procedural History: The complaint was filed with the Regional Trial Court (RTC) of Valenzuela City. After numerous pre-trial conferences and delays, including attempts at amicable settlement, the RTC terminated pre-trial on May 2, 1996. Trial dates were set and subsequently cancelled due to the defendants' expressed willingness to settle. On April 22, 1997, the defendants and their counsel failed to appear for a scheduled trial, leading the RTC to declare them in default and allow the plaintiffs to present evidence ex parte. The RTC rendered judgment in favor of the plaintiffs on April 30, 1997. The defendants' subsequent motions to lift the order of default and for reconsideration were denied by the RTC on June 3, 1997. The defendants appealed to the Court of Appeals (CA), which affirmed the RTC's decision on July 6, 2001, and denied their motion for reconsideration on February 19, 2002. The Petition: Pangasinan Five Star Bus Co., Inc. filed the instant Petition for Review on Certiorari, arguing that the RTC erred in declaring them in default as the April 22, 1997 hearing was for the initial presentation of evidence, not a pre-trial conference. They contend that this erroneous declaration, coupled with the hasty issuance of judgment, deprived them of due process and the opportunity to present their defenses. The petitioner seeks to have the RTC's order of default and subsequent decision declared void and requests the case be remanded for the reception of their evidence. The petition raises issues regarding the propriety of declaring a party in default during initial trial proceedings and the validity of a judgment rendered under such circumstances.
Issue(s)
Whether the trial court could declare the defendants in default for failure to attend the initial trial after pre-trial had been terminated. Whether the erroneous declaration of default and precipitate issuance of judgment deprived the defendants of their standing in court and the right to adduce evidence, considering the petitioner's actions and inactions. Whether the judgment by default should be annulled for being void due to grave abuse of discretion amounting to lack or excess of jurisdiction, considering the procedural context and the pro forma motions.
Ruling
The Supreme Court denied the petition. It held that while the RTC erred in declaring the petitioner in default for failure to appear at the trial, the portion of the order allowing the plaintiffs to present evidence ex parte was correct. The Court found that the petitioner's failure to appear was inexcusable and that their subsequent motions were pro forma due to the lack of required affidavits of merit, rendering the trial court's decision final and executory.
Ratio Decidendi
On the propriety of the default order: The Court clarified that under Section 2, Rule 20 of the Rules of Court, a party failing to appear at a pre-trial conference may be declared in default. However, absence during the initial trial, without justifiable reason, does not warrant a declaration of default. Instead, the plaintiff may be allowed to present evidence ex parte, and the absent defendant waives their right to cross-examine and to adduce evidence. In this case, the pre-trial had already been terminated, and the April 22, 1997 setting was for the trial. Therefore, the RTC erred in declaring the petitioner in default for failure to appear at the trial. This error was admitted by the RTC itself in its subsequent order. On the waiver of the right to adduce evidence and due process: Despite the erroneous declaration of default, the Court found that the portion of the April 22, 1997 order allowing the plaintiffs to present evidence ex parte was correct. The petitioner's unexplained absence at the trial on April 22, 1997, led to the waiver of its right to adduce evidence. The excuse of the counsel's fever was not considered excusable, especially since the petitioner was represented by a law firm that could have sent another lawyer or requested a postponement. Furthermore, the petitioner failed to append the required affidavits of merit to its motion to lift the order of default and motion for reconsideration. Such failure rendered the motions pro forma, meaning they were insufficient in form and substance to merit consideration, and consequently, the judgment became final and executory. The Court cited Philippine Commercial and Industrial Bank v. Judge Rodolfo Ortiz to emphasize that a motion for new trial or reconsideration grounded on excusable negligence must be accompanied by affidavits of merit, otherwise, it is a mere scrap of paper that does not interrupt the period for appeal. On the alleged haste and void judgment: The Court found no grave abuse of discretion amounting to lack or excess of jurisdiction. While the trial court's declaration of default was erroneous, it correctly allowed the presentation of evidence ex parte. The subsequent judgment was rendered after the plaintiffs presented their evidence ex parte, and the defendants' subsequent motions were deemed pro forma due to the lack of required affidavits. The petitioner's failure to append its Answer to the Complaint and Amended Complaint to its petition further weakened its case. Therefore, the judgment was not void, and the case was not subject to remand for the reception of the defendants' evidence.
Main Doctrine
While a party failing to appear at a scheduled trial cannot be declared in default for such absence, they are deemed to have waived their right to cross-examine and to adduce evidence. Failure to file a motion to lift an order of default with the required affidavits of merit renders the motion pro forma, making the judgment final and executory.