Lapulapu Dev. & Housing Corp. v. Risos

G.R. No. 118633 (September 6, 1996)

Lapulapu Dev. petition to annul Group Mgmt.’s ruling was dismissed for lack of standing.

Facts:

On February 4, 1974, Lapulapu Development and Housing Corporation (LLDHC), then known as B. Sunga Corporation, entered into a Project and Loan Agreement with the Government Service Insurance System (GSIS) for a loan of P25 million. This loan was intended for the development, subdivision, and sale of 423,177 square meters of land in Barrio Marigondon, Lapulapu City, owned by LLDHC. To secure the loan, LLDHC executed a promissory note and a real estate mortgage on seventy-eight parcels of land.

Due to LLDHC's failure to develop the properties and repay the loan, GSIS foreclosed on the mortgaged properties. GSIS was the sole bidder at the public auction and subsequently acquired the properties, consolidating its title.

On April 23, 1980, LLDHC filed a complaint for Annulment of Foreclosure against GSIS, which was pending in the Regional Trial Court (RTC) of Manila. Meanwhile, on February 26, 1980, GSIS executed a Deed of Conditional Sale of the same properties in favor of Group Management Corporation (GMC).

On November 3, 1989, GMC filed a complaint for Specific Performance with Damages against GSIS in the RTC of Cebu, which was assigned to Judge Teodoro K. Risos. LLDHC intervened in this case, filing a Motion to Dismiss, which was denied.

On February 24, 1992, after a full trial, Judge Risos ruled in favor of GMC, ordering GSIS to execute a Final Deed of Absolute Sale and pay damages to GMC. LLDHC's complaint-in-intervention was dismissed for lack of standing and failure to substantiate a cause of action.

Both LLDHC and GSIS appealed the decision, but their appeals were dismissed by the Court of Appeals on December 6, 1993. Subsequently, LLDHC won its case against GSIS in the RTC of Manila on May 10, 1994, leading LLDHC to file a Petition for Annulment of Judgment against the February 24, 1992 decision in the Court of Appeals, which was dismissed for lack of jurisdiction.

On February 2, 1995, LLDHC filed a petition for certiorari under Rule 65, seeking to annul the February 24, 1992 decision of Judge Risos.

Legal Issues:

  1. Whether the petition for certiorari was a valid legal remedy given that it was essentially a petition for annulment of judgment.
  2. Whether the RTC had jurisdiction over the subject matter and the parties in Civil Case No. 2203-L.
  3. Whether there was a lack of due process or fraud in the proceedings that would warrant annulment of the judgment.

Arguments:

  • Petitioner (LLDHC): LLDHC argued that the RTC lacked jurisdiction over the case and that it was denied due process. It contended that the judgment was void and should be annulled.

  • Respondents (GSIS and GMC): The respondents maintained that the RTC had proper jurisdiction over the case and that LLDHC had ample opportunity to present its case as an intervenor. They argued that the decision was valid and that LLDHC's claims of lack of due process and fraud were unfounded.

Court's Decision and Legal Reasoning:

The Supreme Court dismissed LLDHC's petition for certiorari. The Court found that the petition was essentially a repetition of the previous annulment petition filed in the Court of Appeals, which had already been dismissed. The Court emphasized that under Batas Pambansa Blg. 129, the Court of Appeals had exclusive jurisdiction to annul judgments of Regional Trial Courts.

The Court also ruled that LLDHC failed to demonstrate that the RTC lacked jurisdiction over the subject matter or the parties involved. The Court noted that the action for specific performance was within the jurisdiction of the RTC, and LLDHC had participated in the proceedings without any challenge to the court's jurisdiction.

Furthermore, the Court found no evidence of lack of due process or fraud. LLDHC had actively participated in the trial, and any failure to succeed in its intervention was due to the merits of the case rather than any procedural impropriety.

Finally, the Court pointed out that the petition was filed almost three years after the decision was rendered, which was beyond the reasonable time frame for filing a certiorari petition.

Significant Legal Principles Established:

  1. The exclusive jurisdiction of the Court of Appeals to annul judgments of Regional Trial Courts under Batas Pambansa Blg. 129.
  2. The requirement for a petition for annulment of judgment to demonstrate either lack of jurisdiction or due process violations, or fraud.
  3. The importance of timely filing petitions for certiorari, with a reasonable time frame established for such actions.