National Power Corporation v. Court of Appeals
REITERATIONFacts
The Antecedents: Spouses Romulo and Elena Javellana (Spouses Javellana) filed a case against National Power Corporation (NPC) and National Transmission Corporation (Transco) for the fixation of lease rental, just compensation, collection of sum of money, and damages. The Regional Trial Court (RTC) rendered a Decision in favor of Spouses Javellana. While NPC and Transco appealed, Spouses Javellana filed a Motion for Execution Pending Appeal, which the RTC granted. Procedural History: Transco negotiated with Spouses Javellana for an extra-judicial settlement, resulting in Transco purchasing the property for ₱80,380,822.00. Subsequently, Atty. Rex C. Muzones, counsel for Spouses Javellana, filed a Notice of Attorney's Lien. Transco filed a Motion to Dismiss due to the settlement, while Atty. Muzones filed a Motion for Partial Satisfaction of Judgment and Opposition to the Motion to Dismiss. The RTC issued an Order directing NPC and Transco to pay Atty. Muzones ₱52,469,660.00 as attorney's lien, separate from the amount paid to Spouses Javellana. The RTC denied NPC's subsequent motions for reconsideration. The Petition: Aggrieved, NPC filed a Petition for Certiorari with the Court of Appeals (CA) assailing the RTC Orders. The CA dismissed NPC's petition for being filed out of time. NPC then filed a Petition for Certiorari with the Supreme Court, assailing the CA's dismissal.
Issue(s)
Whether the Petition for Certiorari filed with the Court of Appeals was filed within the reglementary period. Whether the RTC erred in holding NPC and Transco solidarily liable for the payment of attorney's fees to Atty. Muzones. Whether the attorney's fees awarded to Atty. Muzones were reasonable and properly computed.
Ruling
The petition is GRANTED. The Decision and Resolution of the Court of Appeals are REVERSED and SET ASIDE. The Order and Clarificatory Order of the RTC are MODIFIED by DELETING the joint and solidary liability of NPC and Transco for the payment of attorney's fees to Atty. Muzones. This is without prejudice to any action Atty. Muzones may bring against Spouses Javellana for the satisfaction of his attorney's fees.
Ratio Decidendi
On the propriety of the remedy and reglementary period: The Supreme Court held that NPC's resort to a Petition for Certiorari under Rule 65 before the CA was an improper remedy. The CA's Decision dismissing NPC's petition for being filed out of time was a final judgment, and the proper remedy was an appeal by way of a Petition for Review on Certiorari under Rule 45. The Court noted that the "Comment" filed by NPC before the RTC was in the nature of a Motion for Reconsideration, and upon its denial, NPC should have immediately filed a Petition for Certiorari with the CA. However, the Court opted not to dismiss the case on purely technical grounds to serve substantial justice. On the liability for attorney's fees: The Court reiterated the principle that the payment of attorney's fees is generally the personal obligation of the client who benefited from the legal services. In this case, the Contract of Legal Services was between Spouses Javellana and Atty. Muzones. Therefore, NPC, not being a party to this contract, cannot be held solidarily liable for the attorney's fees. The RTC committed a reversible error in holding NPC and Transco jointly and solidarily liable for the attorney's fees. On the reasonableness and computation of attorney's fees: The Court found the contingent fee arrangement of 12.5% of the amount realized to be reasonable, as it was not disputed by Spouses Javellana. However, the RTC erred in computing the 12.5% based on the original award of ₱419,757,280.00. The fee should have been pegged on the amount actually received by Spouses Javellana under the compromise agreement, which was ₱80,380,822.00. Thus, Atty. Muzones was only entitled to ₱10,047,602.75 based on this computation. Nevertheless, this did not alter the fact that NPC was not liable for its payment.
Main Doctrine
A Petition for Certiorari under Rule 65 is an improper remedy when a plain, speedy, and adequate remedy of appeal by way of a Petition for Review on Certiorari under Rule 45 exists. Furthermore, the liability for attorney's fees, especially under a contingent fee arrangement, is a personal obligation of the client who benefited from the legal services, and not a solidary liability of the client's adversary unless expressly stipulated.