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325 Phil. 469


[ G.R. No. 102360, March 20, 1996 ]




The instant case illustrates a long drawn-out litigation between parties who already entered into a compromise agreement some thirty-five (35) years ago and which agreement was given judicial imprimatur. One of them, up to now, still refuses to be bound by the said judicial compromise.

Petitioner Rosita Domingo was one of the bona fide tenants-occupants of an eighty-seven (87) hectare land located at Barrio Baesa, Caloocan City then known as the Gonzales Estate.

Upon petition of the tenants sometime in 1947, the Republic of the Philippines through the Rural Progress Administration (RPA) instituted an action which was docketed as Civil Case No. 131 with the then Court of First Instance of Rizal for the expropriation of the Gonzales Estate and its subsequent resale to the tenants thereof. The court ruled in favor of the Republic and on appeal to this Court, the said decision was affirmed.[1]

The Republic of the Philippines thereafter acquired title over the estate. Administration of the estate was later transferred to the Peoples’s Homesite and Housing Corporation (PHHC) by the RPA. With the change in administration came a change of policy with regard to the resale of the subdivided lots. On March 16, 1960, the President ordered PHHC to sell a bigger portion of the estate to persons other than the bona fide tenants-occupants of the estate.

On October 29, 1960, fifty-two (52) tenants-occupants of the estate, petitioner included, filed an action to compel the Republic of the Philippines through the PHHC to sell the entire estate to them pursuant to Commonwealth Act No. 539 and the decision of the Supreme Court in Civil Case No. 131. Said case was docketed as Civil Case No. 6376 (later redocketed as Civil Case No. C-760).

On May 3, 1961, private respondent Araneta Institute of Agriculture (AIA) filed a complaint in intervention on the basis of a document entitled "KASUNDUAN NA MAY PAGBIBIGAY KAPANGYARIHAN HINGGIL SA ASYENDA GONZALES SA BAESA, CALOOCAN RIZAL." The said KASUNDUAN was actually a document of sale or transfer whereby the 52 tenants conveyed unto AIA their respective landholdings in the estate. AIA was allowed to intervene.

On November 28, 1961, AIA submitted to the lower court a Compromise Agreement it entered into with 13 tenants-occupants of the estate. The said agreement reads in full:

Intervenor and plaintiffs Fausto Bajamonde, Gregorio Bajamonde, Juan Bajamonde, Damaso Bajamonde, Andres Bajamonde, Perfecto Bajamonde, Sixta Cleofas, Rosita Domingo, Catalina Pascual, Macaria Santos, Evaristo Aquino, Narciso Aquino and Lazaro Pineda, assisted by their respective counsel, respectfully manifest that they have arrived at an amicable settlement of their case, as follows:

1. That plaintiffs herein admit all the allegations and prayer of intervenor’s complaint in intervention;

2. That immediately upon acquisition of title to their respective lots, plaintiffs herein shall convey the same to intervenor by way of absolute sale, free from all liens and encumbrances, except any prior lien in favor of defendants, for the purchase price of P5.55 per square meter, to be paid by intervenor, in the following manner:
-previously paid to and acknowledged by plaintiffs herein.
-upon execution of this agreement, as follows:
-directly to plaintiffs herein.
-to defendant PHHC, for plaintiffs’ account, as 10% initial down-payment on the purchase price of the lots, due to said defendants from plaintiffs.
-upon court approval of this agreement - to be paid to defendant PHHC, for the account of plaintiffs herein, to complete the required 30% downpayment on said lots.
-upon transfer of title in the name of intervenor.
-balance of purchase price, to be liquidated in five years, in ten equal semestral installments.
in accordance with the schedule, marked Annex ‘A’, which is attached hereto and made an integral part hereof;

3. That the purchase price to be paid by intervenor for the individual lots of plaintiffs herein shall be subject to adjustment, in accordance with the actual survey of said lots to be made by defendant PHHC, duly approved by the proper government office;

4. That plaintiffs shall, immediately upon demand of intervenor, execute any and all other documents which may be necessary to carry out the provisions of this agreement;

5. That plaintiffs shall deliver possession of said lots to intervenor, immediately upon payment of the aforesaid sum of P101,269.24, free from all other occupants;

6. That intervenor is hereby authorized to advance, for the account of plaintiffs herein, any and all amounts necessary to expedite the latter’s acquisition of title, which amounts shall be deducted from the purchase price of their respective lots, due to them from intervenor;

7. That for the sake of expediency, payments of the amounts mentioned herein above, except those to defendants, shall be made by intervenor thru plaintiff Marciano Baylon, who is hereby authorized by plaintiffs herein to receive the same for and in their behalf, and to issue the corresponding receipts there for;

8. That documentation, notarization and other incidental expenses to be incurred in the transfer of title from plaintiffs to intervenor shall be for the account of the latter;

9. That if, for any reason whatsoever, conveyance of title to intervenor could not be affected, plaintiffs herein shall, upon demand from intervenor, reimburse the latter of any and all amounts paid by intervenor under this agreement; provided, however, that intervenor’s right to reimbursement under this agreement shall be without prejudice to other legal remedies which intervenor may elect in the alternative, including the right to ask for and receive the refund of whatever amounts it has advanced or paid for plaintiffs’ account;

10. That, as security for the performance of plaintiffs’ obligation under this agreement, plaintiffs herein hereby assigns, transfers and conveys to intervenor, all their rights, interests and participation over their lots aforementioned;

11. That in the event of default by either of the parties hereto, the defaulting party shall pay liquidated damages and attorney’s fees equivalent to 25% of the amount involved.
WHEREFORE, the parties hereto respectfully pray that judgment be rendered in accordance with the foregoing compromise agreement, without pronouncement as to costs.

Quezon City and Malabon, Rizal, for Pasig, Rizal, November 28, 1961.




























    Counsel for Plaintiffs Shurdut Bldg., Manila






        Counsel for Intervenor

        R-410 Phil. Bank of Commerce Bldg.

    Plaza Sta. Cruz, Manila[2]
On December 23, 1961, the trial court approved the above Compromise Agreement in a partial decision embodying the said agreement.[3]

On February 6, 1962, counsel for the tenants filed a motion for immediate execution of the partial decision. The same was granted by the court on February 23, 1962. Thereafter, PHHC filed a petition for certiorari and prohibition with this Court seeking to annul the order of execution. On November 5, 1965, said petition was dismissed.

Meanwhile, some of the 13 tenants who entered into the Compromise Agreement with AIA filed separate proceedings against the latter before the trial courts of Caloocan City to annul the partial decision approving their agreement. All the cases were dismissed. On her part, petitioner filed Civil Case No. 473 but the same was dismissed for failure to prosecute.

Subsequently, counsel for AIA filed a Motion for Issuance of a Writ of Execution of the Partial Decision dated December 23, 1961.

On May 23, 1986, the lower court issued an order enforcing the said decision, the decretal portion of which reads:
WHEREFORE, the PHHC (now National Housing Authority) is ordered to comply with the Partial Decision dated December 23, 1961 by executing a Deed of Conveyance and/or transfer and delivering the titles of the lots originally awarded to plaintiffs Rosita Domingo respecting Lot 48 free from all liens and encumbrances in favor of Intervenor Araneta Institute of Agriculture upon proof of payment by the intervenor of the purchase price.

So Ordered.[4]
Petitioner filed a motion for reconsideration of the above-quoted order but the same was denied on January 22, 1988.[5]

In the meantime, even before the court could resolve the motion for reconsideration, intervenor-private respondent filed another motion for execution of the decision of December 23, 1961.

On July 7, 1988, the trial court issued an order which dispositively reads as follows:
WHEREFORE, the Motion for Reconsideration of the Order dated January 22, 1988 [filed by intervenor-private respondent] is hereby GRANTED.

As prayed for, let a writ of execution be issued for the enforcement of the Compromise Agreement dated November 28, 1961 and the partial Decision dated December 23, 1961, ordering plaintiff Rosita Domingo:

1. To execute a deed of absolute sale of Lot 48 in favor of Intervenor Araneta Institute of Agriculture; and

2. To deliver immediately the possession of said lot to said Intervenor Araneta Institute of Agriculture.

From the said order, petitioner appealed to the Court of Appeals raising as issues the following, to wit: (a) the validity of the Compromise Agreement and the propriety of its approval in the decision of December 23, 1961; (b) the applicability of the nullification of the Compromise Agreement and Partial Decision by the same court on December 20, 1985; and (c) assuming that the Compromise Agreement is valid, the correctness of the finding that intervenor-private respondent complied with the terms and obligations of the agreement.

However, petitioner fared no better in the said appellate court. In dismissing her petition, the Court of Appeals declared:
We shall address the first and second issues.

Plaintiff-appellant maintains that the so-called compromise agreement dated November 28, 1961 and the partial decision dated December 23, 1961 approving said agreement are null and void, as discussed and decided in the Order of December 20, 1985 x x x.

We find appellant’s contention unmeritorious.

Plaintiff-appellant filed Civil Case No. 473 against Araneta Institute of Agriculture, et al., before the Regional Trial Court of Caloocan City, Branch 120, to annul the partial decision of December 23, 1961, involving the thirteen (13) tenants of whom she was one of them. That case was dismissed for failure to prosecute. The order of dismissal was not appealed.


It will be observed that whatever the court a quo said about the Partial Decision dated December 23, 1961, rendered by Judge Andres Reyes, approving and embodying the Compromise Agreement dated November 23, 1961 were obiter dicta. Being a compromise judgment, it was final and immediately executory (Pamintuan vs. Muñoz, 22 SCRA 1109, 1111; Pasay City Government vs. CFI Manila, 132 SCRA 156, 157), unless a motion is filed to set aside the compromise on the ground of fraud, mistake, duress, in which event, an appeal may be taken from the order denying the motion (De los Reyes v. Ugarte, 75 Phil. 505 [1945]; Piano vs. Cayanong, et al., 7 SCRA 397 [1963]; Cadano, et al. vs. Cadano, 49 SCRA 33 [1973]; Zagala vs. Jimenez, 152 SCRA 147, 157 [1987]). In the case at bar, no such motion was filed. Moreover, said partial decision of Judge Reyes was not an issue submitted to the trial court in the Motion to Execute Partial Decision dated December 23, 1961 on the basis of the Compromise Agreement dated December 11, 1961. As a matter of fact, tbe dispositive portion of the Order of December 20, 1985 did not declare the aforesaid partial decision (compromise judgment) dated March 23, 1961 null and void.


On the third issue, appellant contends that the alleged intervenor’s compliance with its contractual obligation has not been proven; that the trial court has ruled on the tenants’ right of recission vis-a-vis the alleged agreement; and that the illegible photocopies of alleged payment receipts were not duly presented and offered in evidence.
Appellant’s contention cannot be sustained.
To the motion for reconsideration of the Order dated January 22, 1988, filed by Intervenor-appellee on February 19, 1988, has been attached Annexes "A" to "E", including Official Receipts dated December 6, 1961 and December 22, 1961 showing payments made by Intervenor in compliance with the compromise judgment. We agree with the trial court in finding them to be sufficient proof of compliance by the Intervenor with the terms and conditions of the compromise judgment in question. In the Order of July 7, 1988, the trial court ruled:

Now in the intervenor’s Motion for Reconsideration, it has averted that the sum of P1 10,634.62 and the sum of P101,269.24 have been paid in compliance with the provisions of said Compromise Agreement and which are evidence by documents and receipts marked as Annexes "A" to "E" and Exhibits "1", "1-A" to "1-K"; Exhibits "4", "4-A" to "4-K".

Worthwhile noting is the Official Receipt No. 6094757, marked as Annex "1-D", dated December 6, 1961, evidencing payment of P4,883.00 to plaintiff Rosita Domingo for the ten (10%) percent down payment of the purchase price of the lot awarded to her by the PHHC consisting of 12,800 square meters. Likewise, in another Official Receipt No. 6096479, marked as Annex "4-D", dated December 29, 1961, for the payment of P9,766.00 to plaintiff Rosita Domingo, as part payment of the price of the lot equivalent to twenty (20%) percent of the Gonzales Estate, Baesa, Caloocan City.

It bears emphasis that the aforementioned payments of P4,683.00 (Annex "1-D") and P9,766.00 (Annex "4-D") to Rosita Domingo are NOT DENIED either in the Opposition to the Motion for Execution or in the Memorandum for Rosita Domingo.

Parenthetically, the photo copies of the receipts submitted by the intervenor are legible enough for credible accounting purposes, contrary to plaintiff’s claim.

Viewed from the foregoing, the ineluctably follows, that the Intervenor, indeed, has fulfilled its obligation under the aforementioned compromise agreement of November 28, 1961, as approved by the partial decision dated December 23, 1961.[7]
The petitioner is now before this Court raising the same issues brought to respondent court for consideration, viz: (a) the validity of the Compromise Agreement and the partial decision approving the same; and (b) the admission in evidence of the receipts of payment made by private respondent to petitioner.[8]

The petition is not impressed with merit and we find no reason to discuss the foregoing issues, the same having been raised before, and resolved at length, by the trial court and respondent court in their respective decisions. However, we shall reiterate the applicability of the following pertinent principles to the instant case for clarity and emphasis.

A compromise is a contract whereby the parties, by making reciprocal concessions, avoid a litigation or put an end to one already commenced.[9] Essentially, it is a contract perfected by mere consent, the latter being manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract.[10] Once an agreement is stamped with judicial approval, it becomes more than a mere contract binding upon the parties; having the sanction of the court and entered as its determination of the controversy, it has the force and effect of any other judgment.[11]

Consequently, a judgment rendered in accordance with a compromise agreement is immediately executory as there is no appeal from such judgment. The reason for this rule being that when both parties enter into an agreement to end a pending litigation and request thaç a decision be rendered approving said agreement, it is only natural to presume that such action constitutes an implicit waiver of the right to appeal against said decision.[12]

A compromise may however be disturbed and set aside for vices of consent or forgery.[13] Hence, where an aggrieved party alleges mistake, fraud, violence, intimidation, undue influence, or falsity in the execution of the compromise embodied in a judgment, an action to annul it should be brought before the Court of Appeals, in accordance with Section 9(2) of Batas Pambansa Bilang 129, which gives that court exclusive original jurisdiction over actions for annulment of judgments of regional trial courts.

Here, petitioner filed an action[14] to annul the compromise judgment with the Regional Trial Court of Caloocan City, Branch 120 on the ground of forgery. Said case was however dismissed for failure to prosecute. Clearly then petitioner has forfeited her right to challenge the compromise judgment not only because she did not appeal from the order of dismissal but more so because she ventilated her remedy to the wrong court which had undoubtedly no jurisdiction to annul the judgment of a concurrent court.

All told, we find no reason to reverse the assailed decision of respondent court. Perforce, the partial decision dated December 23, 1961 must accordingly be enforced and executed with deliberate dispatch and without further delay.

WHEREFORE, the instant petition is hereby DENIED.


Padilla (Chairman), Bellosillo, Vitug, and Hermosisima, Jr., JJ., concur.

G.R. No. L-491 8, May 14, 1954,94 Phil. 956.

[2] Rollo, pp. 249-253.

[3] Id., at 255-258, Original Records, pp. 8-10.

[4] Original Records, p.87.

[5] Id., at 44.

[6] Id., at 93.

[7] Court of Appeals Decision, pp. 8-11; Rollo, pp. 244-247.

[8] Petition, p. 13; Rollo, p. 13-a.

[9] Article 2028, New Civil Code.

[10] Juliana del Rosario vs. Hon. Job Madayag, et al., G.R. No. 118531, August 28, 1995 citing Go v. Intermediate Appellate Court, 183 SCRA 82, 86 [1990].

[11] Asirot v. Vda. de Rodriguez, 28 SCRA 258 [1969] citing Marquez v. Marquez, 73 Phil. 74 [1941]; See also Soler v. Reyes, 8 SCRA 691 [1963] and Araneta v. Perez, 7 SCRA 933 [1963].

[12] World Machine Enterprises v. Intermediate Appellate Court, 192 SCRA 459 [1990] citing Serrano v. Reyes, 110 Phil 536 [1960].

[13] Periquet, Jr. v. Intermediate Appellate Court, 238 SCRA 697, 713 [1994] citing Master Tours and Travel Corporation v. Court of Appeals, 219 SCRA 321,325 [1993]; United Housing Corp. v. Dayrit, 181 SCRA 285 [1990]; Binamira v. Ogan-Occena, 148 SCRA 677 [1987]; Go v. Trocino, 114 SCRA 443 [1982]; Sabino v. Cuba, 18 SCRA 981 [1966]; and Araneta v. Perez, supra.

[14] See page 6.

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