Remington Industrial Sales v. Maricalum Mining
REITERATIONFacts
The Antecedents: Remington Industrial Sales Corporation (Remington) filed a complaint for sum of money against Marinduque Mining and Industrial Corporation (MMIC) for unpaid purchases of construction materials totaling P921,755.95, plus interest. The complaint was later amended to include Philippine National Bank (PNB), Development Bank of the Philippines (DBP), Nonoc Mining and Industrial Corporation, Maricalum Mining Corporation (Maricalum), Island Cement Corporation, and the Asset Privatization Trust as defendants, alleging they were transferees of MMIC's foreclosed assets. The Regional Trial Court (RTC) initially ruled in favor of Remington, holding all defendants jointly and severally liable for P920,755.95 plus interest and penalties. Procedural History: Following the RTC's decision, all defendants appealed to the Court of Appeals (CA), which affirmed the RTC's ruling. PNB and DBP then appealed to the Supreme Court (SC). Maricalum's motion for extension to file its petition for review was denied, and the resolution became final. Subsequently, the RTC granted Remington's motion for execution against Maricalum, leading to the garnishment of Maricalum's bank deposits. Maricalum filed a petition for certiorari and prohibition with the CA. Crucially, the SC, in separate decisions concerning DBP and PNB, reversed the CA's decision and ordered the dismissal of Remington's original complaint against them and their transferees, including Maricalum. Despite this, the CA initially affirmed the RTC's order of execution against Maricalum. Maricalum appealed this CA decision to the SC, which then annulled the RTC's execution orders. Remington moved for reconsideration, which was denied. Maricalum then filed a motion for restitution with the RTC. The Petition: The RTC denied Maricalum's motion for restitution, citing the principle of immutability of final judgment. Maricalum appealed this denial to the CA, which reversed the RTC's order and directed Remington to return the garnished amounts with interest. Remington now petitions the Supreme Court, arguing that the CA erred in annulling the RTC's orders and in ordering the restitution of the garnished amounts with interest. Remington contends that the RTC decision had become final and executory against Maricalum, and that the subsequent SC decisions dismissing the complaint did not constitute supervening events that would justify setting aside the executed judgment. Remington seeks to uphold the finality of the earlier judgment and prevent what it views as unending litigation.
Issue(s)
Whether the Court of Appeals erred in annulling and setting aside the Orders dated December 19, 2008 and July 30, 2009 of the Regional Trial Court of Manila, Branch 19, and ordering the return and restitution to Maricalum of the garnished amounts of ₱920,755.95 and ₱32,256.48. Whether the Court of Appeals erred in ordering payment of interest at the rate of 12% per annum.
Ruling
The petition is denied. The Decision of the Court of Appeals is affirmed with modification regarding the rate of interest.
Ratio Decidendi
On the issue of annulling the RTC Orders and ordering restitution: The Supreme Court affirmed the Court of Appeals' decision. While acknowledging that the RTC decision had become final and executory as against Maricalum due to its failure to appeal, the Court recognized the existence of a supervening event that justified the annulment of the execution orders. This supervening event was the Supreme Court's own decisions in the DBP and PNB cases, which ultimately dismissed Remington's complaint in Civil Case No. 84-25858. The Court emphasized that the dismissal of the original complaint from which the execution orders emanated left no legal basis for the garnishment. The Court reiterated its ruling in Maricalum Mining Corp. v. Remington Industrial Sales Corp. (G.R. No. 158332) that the dismissal in DBP v. CA constituted a supervening event that virtually blotted out the RTC decision, meaning no vested right accrued to Remington, and thus no ministerial duty impelled the CA to allow execution. Consequently, the prior execution of the RTC decision was rendered unjust and inequitable, necessitating restitution as sanctioned by Section 5, Rule 39 of the Rules of Court. On the issue of the rate of interest: The Supreme Court modified the Court of Appeals' imposition of a 12% interest rate. Citing Nacar v. Gallery Frames and BSP-MB Circular No. 799 (Series of 2013), the Court clarified that the legal rate of interest is now six percent (6%) per annum. The Court held that the 12% legal interest shall apply only until June 30, 2013, and thereafter, the new rate of six percent (6%) per annum shall be the prevailing rate until full satisfaction. This modification aligns the interest rate with current jurisprudence and regulatory pronouncements on the matter, ensuring consistency in the application of legal interest.
Main Doctrine
The dismissal of a complaint by the Supreme Court, which constitutes a supervening event, can justify the annulment of execution orders based on a prior RTC decision that has become final and executory, thereby necessitating restitution.