Do-All Metals Industries v. Security Bank Corp.
REITERATIONFacts
The Antecedents: Petitioners DO-ALL METALS INDUSTRIES, INC. (DMI) and spouses Domingo Lim and Lely Kung Lim (the Lims) had a lease agreement with respondent Security Bank Corporation (the Bank) for a property that the Lims had previously assigned to the Bank as security for loans. The lease contract included a right of first refusal for DMI should the Bank decide to sell the property. The Bank pre-terminated the lease and offered to sell the property to DMI. Negotiations for the purchase price failed. The Lims alleged that while negotiations were ongoing, Bank representatives and private security guards from Philippine Industrial Security Agency (PISA) padlocked entrances, barred entry, and even fired shots, causing DMI to lose business opportunities and the Lims to be unable to retrieve personal items. The Lims filed a complaint for damages. Procedural History: The Lims filed a supplemental complaint alleging that the Bank surreptitiously took their movable properties, claiming over ₱27 million in actual damages. The Regional Trial Court (RTC) allowed the Lims to present evidence ex parte due to the Bank's repeated cancellations of hearings, though it later allowed the Bank to present evidence but denied recalling witnesses for cross-examination. The Bank presented only one witness. The RTC rendered a decision in favor of the Lims, awarding actual, moral, and exemplary damages, and attorney's fees. The Bank moved for reconsideration, questioning the award of damages due to the non-payment of filing fees for the supplemental complaint. The RTC denied the motion. On appeal, the Court of Appeals (CA) reversed the RTC decision, finding for the Bank and dismissing the complaint. The Petition: DMI and the Lims filed a petition with the Supreme Court, seeking to reinstate the RTC decision, particularly the award of actual damages.
Issue(s)
Whether or not the RTC acquired jurisdiction to hear and adjudicate the plaintiff’s supplemental complaint against the Bank considering their failure to pay the filing fees on the amounts of damages they claim in it. Whether or not the Bank is liable for the intimidation and harassment committed against DMI and its representatives. Whether or not the Bank is liable to DMI and the Lims for the machineries, equipment, and other properties they allegedly lost after they were barred from the property.
Ruling
The Supreme Court partially granted the petition, reinstating the RTC decision with modification. It directed the Bank to pay petitioners DMI and spouses Domingo and Lely Kung Lim moral damages (₱500,000.00), exemplary damages (₱500,000.00), and attorney's fees (₱100,000.00). The award of actual damages of ₱27,974,564.00 was deleted.
Ratio Decidendi
On the issue of jurisdiction over the supplemental complaint: The Court ruled that the failure to pay the filing fees for the supplemental complaint did not divest the RTC of jurisdiction already acquired over the original complaint. However, it clarified that the supplemental complaint itself should have been treated as not filed due to the non-payment of the requisite fees. The Court emphasized that the filing fees for a supplemental complaint, which specifies the amount of damages sought, must be paid upon its filing, and the rules do not require the court to make special assessments for such fees. The Bank's objection, raised after the decision, did not constitute a waiver, as only the Supreme Court can grant exemptions from payment of court fees. Therefore, the trial court should have treated the supplemental complaint as not filed. On the claim of intimidation and harassment: The Court found ample proof of the Bank's representatives and guards harassing and intimidating the Lims and DMI's employees, disagreeing with the CA's discounting of eyewitness testimonies. The Court noted that the Bank's guards used superior strength and firepower, and a Bank representative instructed guards to prevent anyone from taking property out of the premises, even locking in Domingo Lim. The denial by the Bank's sole witness was based on relayed reports, not personal knowledge. Consequently, the RTC was correct in awarding moral damages, exemplary damages, and attorney's fees against the Bank for the acts of its representatives and guards, despite the lease having lapsed. On the claim for lost properties: The Court held that the plaintiffs failed to meet the burden of proving that the movable properties remained in the premises and that the Bank was responsible for their loss. The evidence presented, consisting of Domingo Lim's testimony and uncorroborated, undated, and unsigned inventories, was deemed self-serving and insufficient to establish the claim for actual damages. Therefore, the award of actual damages under the supplemental complaint was deleted.
Main Doctrine
Failure to pay the filing fees for a supplemental complaint does not divest the court of jurisdiction already acquired over the original complaint, but the supplemental complaint itself may be treated as not filed. The award of actual damages under a supplemental complaint filed without payment of the requisite filing fees is improper.