Lim v. National Power Corporation
REITERATIONFacts
1. The Antecedents: The National Power Corporation (NPC) initiated an expropriation suit against Natividad Lim for Lots 2373 and 2374, required for its Sual Coal-Fired Thermal Power Project. Summons was served on Lim, who resided in the United States, through her tenant. Subsequently, the spouses Roberto and Arabela Arcinue intervened, claiming ownership and possession of Lot 2374. 2. Procedural History: The Regional Trial Court (RTC) granted NPC's writ of possession. Lim filed an omnibus motion to dismiss and suspend the writ, which the RTC denied. After the Arcinues filed a complaint-in-intervention, both NPC and Lim failed to file their answers within the stipulated period. The Arcinues then filed a motion for judgment by default. Lim sought to have this motion expunged due to a lack of explanation for service by registered mail, but her counsel did not appear at the hearing. The RTC issued an order of default against both Lim and NPC, which it later denied to lift. Lim's subsequent petition for certiorari before the Court of Appeals (CA) was affirmed, as was the CA's denial of her motion for reconsideration. This Court initially denied Lim's petition for review but reinstated it upon her motion for reconsideration. 3. The Petition: This Court is asked to determine if the CA gravely abused its discretion in affirming the RTC's order of default against Lim. Lim argues that an answer to a complaint-in-intervention is permissive and that the motion for default judgment lacked the required explanation for service by registered mail. The Court considers whether Lim's failure to file the required answer to the complaint-in-intervention, under the current rules, could lead to default, and whether the RTC gravely abused its discretion in not striking out the motion for default judgment despite the lack of explanation for service by registered mail, given that Lim's counsel did receive the motion in a timely manner.
Issue(s)
Whether the Court of Appeals gravely abused its discretion in affirming the order of default entered against Lim. Whether a motion for judgment by default, which fails to provide a written explanation for resorting to registered mail instead of personal service, should be expunged from the records.
Ruling
The Court denies the petition and affirms the Court of Appeals' decision, upholding the RTC's order of default. The RTC is directed to proceed with the hearing and adjudication of the case.
Ratio Decidendi
On the issue of whether the Court of Appeals gravely abused its discretion in affirming the order of default: The Court found no grave abuse of discretion. While Lim argued that an answer-in-intervention is only permissive, Section 4, Rule 19 of the 1997 Rules of Civil Procedure mandates that original parties must file an answer to a complaint-in-intervention within 15 days from notice of the order admitting it, changing the previous rule where such an answer was optional. Therefore, Lim's failure to file the required answer could indeed give rise to default. The trial court had been liberal, treating Lim's motion for reconsideration as a motion to lift the default order and giving her an opportunity to explain her side. However, Lim's counsel did not appear at the hearing, and she failed to show that her non-filing was due to fraud, accident, mistake, or excusable negligence. Furthermore, she claimed a meritorious defense but could not specify it. On the issue of whether a motion for judgment by default, which fails to provide a written explanation for resorting to registered mail instead of personal service, should be expunged from the records: The Court acknowledged that the Arcinues' motion failed to comply with Section 11, Rule 13 of the 1997 Rules of Civil Procedure, which requires a written explanation for resorting to modes of service other than personal service. However, the Court noted that this rule does not provide for an automatic sanction of striking out the motion, as indicated by the use of the word "may." The RTC did not gravely abuse its discretion in not imposing this sanction because, despite the lack of explanation, Lim's counsel expressly admitted receiving a copy of the motion 10 days before its scheduled hearing. This ensured that the Arcinues were diligent enough to file their motion by registered mail long before the hearing. The Court emphasized that while personal service is preferred to ensure timely receipt, service by registered mail is not altogether prohibited when, as in this case, it ensures receipt by the adverse party before the hearing.
Main Doctrine
A party's failure to explain the resort to registered mail instead of personal service in a motion does not automatically render the motion as not filed, especially when the adverse party admits receipt of the motion and the service ensures timely receipt before the hearing.