Five Star Marketing v. Booc
REITERATIONFacts
The Antecedents: Petitioner, Five Star Marketing Co., Inc. (Five Star), a corporation whose shares were contributed by the heirs of Antonio Booc and Ong Chuy Tiok, purchased Lot 69-A. A four-storey building was constructed on the lot, financed by a loan secured by the property. Different floors were allotted to Rufino, Ong Chuy Tiok, and Sheikding. Respondent, James L. Booc, son of Sheikding, was allowed to use a portion of the ground floor for his business rent-free. Later, an Agreement was entered into where respondent became the lessee of certain spaces. The board of directors of Five Star resolved to terminate free-rental privileges, setting March 31, 1999, as the deadline, after which rental rates would apply. Respondent was informed of the P40,000.00 monthly rental for his space effective April 1, 1999. Respondent failed to enter into a lease contract and vacate the premises. Procedural History: Petitioner filed an unlawful detainer case against respondent before the MTCC. Respondent filed an Answer raising defenses, including lack of cause of action and petitioner's lack of legal personality. Respondent's motion to reset the preliminary conference was denied for failure to comply with procedural rules and lack of merit. Consequently, the MTCC rendered judgment based on the complaint. Respondent's motion for reconsideration was denied. The MTCC rendered a Decision in favor of petitioner, ordering respondent to vacate, pay rentals, attorney's fees, and costs. Respondent appealed to the RTC, arguing that the MTCC erred in deciding ex parte and in denying his motion for continuance and reconsideration. The RTC set aside the MTCC decision and order, remanding the case to the MTCC for further proceedings, opining that respondent was denied his day in court and that the MTCC should have passed upon the issue of ownership. Petitioner filed a motion to set aside the RTC order, which the RTC granted, allowing petitioner to submit its memorandum. However, the RTC later reiterated its order to remand the case, stating that procedural laws are means to realize law and justice and that respondent was denied his day in court. Petitioner's motion for reconsideration was denied. The Petition: Petitioner filed a petition for review on certiorari before the Supreme Court, assailing the RTC's Decision and Order, raising issues on whether the RTC erred in holding that respondent was denied his day in court, in setting aside the MTCC's orders and decision without justified conclusion, and in remanding the case instead of deciding it on the merits.
Issue(s)
Whether the Regional Trial Court (RTC) erred in holding that the respondent was denied his day in court by the Municipal Trial Court in Cities (MTCC) despite the respondent and his counsel's unjustified failure to appear during the mandatory preliminary conference. Whether the RTC can set aside the MTCC's Order dated October 12, 1999, by mere conclusion, and whether the RTC can set aside the MTCC's Decision dated November 10, 1999, without a justified conclusion of its own void order of January 14, 2000. Whether the RTC should have decided the case based on the record, pleadings, or memoranda filed pursuant to the rules, instead of remanding the case to the MTCC for further proceedings, which would unduly prolong and delay the resolution of the ejectment suit.
Ruling
The Supreme Court granted the petition, annulled and set aside the Decision and Order of the RTC dated April 25, 2000, and May 30, 2000, respectively, and reinstated and affirmed the Decision of the MTCC dated November 10, 1999.
Ratio Decidendi
On the issue of the RTC's error in holding that the respondent was denied his day in court: The Court held that the MTCC was empowered to decide the case based on the complaint filed by the petitioner, as the respondent and his counsel failed to appear at the preliminary conference without justifiable cause. The Revised Rules on Summary Procedure mandate the appearance of parties and their counsels, and the word "shall" makes this appearance mandatory. The Court reiterated that the failure to appear, without a clear justification, constitutes defiance of a lawful order and the rules of procedure. The RTC's relaxation of the rules based on a perceived denial of due process was deemed erroneous, especially since the respondent offered no explanation for his defiance and did not exert effort to substantially comply by appearing even without his counsel. On the issue of the RTC's authority to set aside the MTCC's orders and decision: The Court found that the RTC erred in remanding the case to the MTCC. The RTC, in the exercise of its appellate jurisdiction, should have decided the case on the merits based on the records and the parties' memoranda, as required by the rules governing summary procedure. Remanding the case contradicts the summary nature of ejectment suits, which are designed for expeditious resolution. The MTCC's decision, based on the complaint, was fully warranted due to the respondent's failure to appear and present evidence. The RTC's conclusion that there was a denial of due process was mistaken. On the issue of whether the RTC should have decided the case on the merits instead of remanding: The Court emphasized that in cases governed by the Rules on Summary Procedure, no hearing is conducted; parties submit position papers. On appeal to the RTC, parties submit memoranda. Therefore, the RTC should have decided the appeal based on the elevated records and the parties' memoranda. Remanding the case is a superfluity and contrary to the summary nature of the proceedings. Had the RTC decided the case on the merits, it should have affirmed the MTCC decision, as the respondent did not contest it on the merits, and the petitioner's ownership of the building was undisputed.
Main Doctrine
The failure of a defendant and their counsel to appear at a mandatory preliminary conference in an ejectment case governed by the Revised Rules on Summary Procedure, without justifiable cause, empowers the Municipal Trial Court in Cities (MTCC) to render judgment based on the facts alleged in the complaint. An appeal to the Regional Trial Court (RTC) should be decided on the merits based on the records and memoranda, not remanded for further proceedings, as remanding contradicts the summary nature of ejectment cases.