Abad v. Aquino
REITERATIONFacts
1. The Antecedents: Asuncion Abad, acting as attorney-in-fact for Teresa Mendez Villa-Abrille, initiated a lawsuit against Amando Aquino to recover P1,700, which was the outstanding balance on a promissory note. The note was originally made by Aquino to Villa-Abrille on February 21, 1932. The dispute involved the sale of a rice mill and motor, with the intervener, Honolulu Iron Works, claiming a prior interest related to the machinery's purchase and a partial payment through a note endorsed to them. 2. Procedural History: The case proceeded in the Court of First Instance of Manila, where evidence was presented by both the plaintiff and defendant, and the Honolulu Iron Works was allowed to intervene. The trial court ruled in favor of the plaintiff, awarding the full P1,700 plus interest, attorney's fees, and costs. Both the defendant and the intervener appealed this decision. The Court of Appeals subsequently dismissed the case, finding that the action had not been commenced by the real party in interest. 3. The Petition: The petitioner, Asuncion Abad, sought review of the Court of Appeals' decision. The core of the petitioner's argument, presented via a petition for review, was that the Court of Appeals erred in dismissing the case. Citing the doctrine from Alonso vs. Villamor, the petitioner contended that the complaint should have been considered amended to substitute the real party in interest, Teresa Mendez Villa-Abrille, for the attorney-in-fact, Asuncion Abad. The Supreme Court, however, noted that the presence of an intervener complicated this amendment, necessitating a remand to the lower court.
Issue(s)
Whether the Court of Appeals erred in dismissing the case for failure to prosecute the action in the name of the real party in interest. Whether the complaint could be amended to substitute the real party in interest, considering the presence of an intervener.
Ruling
The appealed decision is affirmed. The case is ordered to be remanded to the Court of First Instance for the amendment of the complaint, with notice to all parties. The Court of First Instance may then consider all reproduced evidence and render the appropriate judgment. Costs in all three instances are to be paid by the plaintiff-petitioner.
Ratio Decidendi
On the issue of the real party in interest: The Court affirmed the dismissal by the Court of Appeals. It reiterated the imperative provision of Section 114 of the Code of Civil Procedure, which mandates that every action must be prosecuted in the name of the real party in interest. The Court emphasized that an attorney-in-fact or agent is not the real party in interest, and a judgment for or against them does not bind the real party, rendering the decision useless. The power of attorney presented did not authorize Asuncion Abad to bring the action for the recovery of the note. Therefore, all proceedings from the filing of the complaint to the rendition of judgment were null and void for lack of the real party plaintiff. On the issue of amendment of the complaint: The Court found that while the doctrine in Alonso vs. Villamor allows for amendment to substitute the real party in interest, this could not be done in the present case due to the presence of an intervener, the Honolulu Iron Works. The intervener is entitled to be heard before any amendment to the complaint could be made. This procedural necessity required the remand of the case to the Court of First Instance to allow for proper notice and hearing regarding the amendment, rather than allowing the amendment directly at the appellate level.
Main Doctrine
An action must be prosecuted in the name of the real party in interest. An attorney-in-fact, acting solely as an agent, is not the real party in interest and cannot file suit in their own name. Proceedings are null and void if initiated by a party without legal standing.