628 Phil. 52

THIRD DIVISION

[ G.R. No. 173181, March 03, 2010 ]

HUTAMA-RSEA/SUPERMAX PHILS., J.V., PETITIONER, VS. KCD BUILDERS CORPORATION, REPRESENTED BY ITS PRESIDENT CELSO C. DIOKNO, RESPONDENT.

D E C I S I O N

NACHURA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court, assailing the Decision[1] dated October 14, 2005 and the Resolution[2] dated June 19, 2006 of the Court of Appeals (CA) in CA-G.R. CV No. 78262.

The Facts

The facts of the case, as summarized by the CA, are as follows:

On 10 December 2001, appellee KCD Builders Corporation filed a complaint for sum of money against appellants [Hutama-RSEA/Super Max, Philippines and/or Charles H.C. Yang] before the Regional Trial Court of Makati. Its cause of action arose from a written contract which was the Notice to Proceed dated 10 November 2000 executed by the parties whereby appellant [Hutama] as principal contractor of Package 2-Site Works in Philips Semiconductors Phils. Inc. - Integrated Circuits Plant Phase II Project located at the Light Industry and Science Park of the Philippines-2 (LISPP-2) Calamba, Laguna contracted with appellee [KCD] as sub-contractor for the said project. The final billing dated 20 September 2001 was submitted to appellant Charles H.C. Yang, and despite a joint evaluation by the parties through their respective representatives who agreed on the amount [of] P2,967,164.71 as HUTAMA's total obligation to appellee [KCD], and a letter of demand, appellant corporation [Hutama] failed and refused to pay.

Summons was served on appellants [Hutama and Yang] on 8 February 2002 which was received by their secretary, Ms. Evelyn Estrabela in behalf of the two defendants [Hutama and Yang]. On 21 February 2002, their counsel filed an Entry of Appearance and Motion for Extension of time to File Responsive Pleading. They were given a 20-day extension period to file the responsive pleading, or until 16 March 2002.

On 11 April 2002, appellee [KCD] filed a Motion to Declare Defendant/s [Hutama and Yang] in Default for failure to file the responsive pleading within the extended period, and set the same for hearing on 26 April 2002.

On 23 April 2002, appellant Charles H.C. Yang filed a Motion to Dismiss for failure of the complaint to state a case of action against him, as he merely signed the sub-contract between the parties not for his personal benefit but only in behalf of appellant HUTAMA. On the same date, appellant HUTAMA filed an Urgent Motion to Admit Attached Answer with Compulsory Counterclaim, together with the said answer.

During the hearing on appellee's [KCD's] motion to declare defendant/s [Hutama and Yang] in default, the trial court noted the filing of appellants' [Hutama and Yang's] respective motion to dismiss and answer with counterclaim but noted that the filing thereof on 27 March 2002 was too late considering that they were only given an extended period up [to] 16 March 2002 to do the same. Thus, the trial court granted the motion to declare defendants [Hutama and Yang] in default and directed, upon appellee's [KCD's] motion, the presentation of evidence ex-parte before the branch clerk of court who was appointed as commissioner to received evidence.

Appellants [Hutama and Yang] filed an Urgent Motion to Set Aside Order of Default. During the hearing, the trial court ordered appellee [KCD] to file an opposition or comment. After the Manifestation filed by appellee [KCD] on 24 June 2002, the trial court set anew the hearing on the motion to set aside order of default on 22 August 2002, but appellants [Hutama and Yang] failed to appear. The trial court then denied the said motion in the Order dated 19 September 2002.

During the ex-parte presentation of evidence, appellee's [KCD's] witness Celso C. Dioko testified that there was a contract executed between appellants [Hutama and Yang] and appellee [KCD] regarding the construction of Package 2 Site Works in Philips Semiconductor Phils. Inc., Calamba, Laguna where appellee [KCD] was the sub-contractor as evidenced by a Notice to Proceed. After the completion of the project, he [Dioko] billed them the total amount of P3,009,954.05. After they [Hutama and Yang] received the bill, they asked him [Dioko] to have a joint evaluation by their engineer and his engineer on site. The authorized engineer to evaluate the amount arrived at was Engr. Jose De Asis. Thus, their authorized engineers came out with the total amount of P2,967,164.71 as cost of the project. After the joint evaluation, he [Dioko] again sent the bill to appellant Charles H.C. Yang and wrote a letter to HUTAMA to pay the final billing. The appellants [Hutama and Yang], however, failed to comply with the demand. Upon the filing of this case, appellee [KCD] paid P30,000.00 acceptance fee and P3,000.00 per appearance fee and a contingency of 15% of the total amount due as attorney's fees.

Engr. Jose De Asis testified that he is an employee of appellee corporation [KCD] and knows the appellants [Hutama and Yang] to be the representatives of HUTAMA. He was the one who prepared the final evaluation and the total outstanding obligation inside the office of Philips Conductors [in] Calamba, Laguna. He and appellants [Hutama and Yang] were present when the agreement was prepared and the amount agreed upon was promised to be paid to Dioko.[3]

On February 20, 2003, the Regional Trial Court (RTC) rendered a decision[4] in favor of KCD Builders Corporation (KCD), viz.:

WHEREFORE, in view of the foregoing premises, judgment is rendered in favor of the plaintiff [KCD] as against the defendant[s Hutama and Yang], ordering the defendants to:

1.) Pay the plaintiff [KCD] the amount of P2,967,164.71 representing the defendants [Hutama and Yang's] total indebtedness in favor of the plaintiff [KCD] with interest of 12% per annum from October 11, 2001, until the same has been fully paid;

2.) Pay the plaintiff [KCD] 5% of the total amount awarded plus P30,000.00 acceptance fees and P3,000.00 appearance fees as and by way of attorney's fees; and

3.) Costs of the suit.

SO ORDERED.[5]

Aggrieved, Hutama Semiconductor Phils., Inc. (Hutama) and Charles H.C. Yang (Yang) filed an appeal before the CA. On October 14, 2005, the CA rendered a Decision,[6] the dispositive portion of which reads:

WHEREFORE, the foregoing considered, the assailed decision is hereby modified by dismissing the complaint against appellant Charles H.C. Yang for lack of cause of action. The decision is AFFIRMED in all other respects.

SO ORDERED.[7]

Unsatisfied, Hutama and Yang filed a motion for reconsideration; however, the same was denied in a Resolution[8] dated June 19, 2006.

Hence, this petition.

The Issues

Petitioner assigned the following errors:
I

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS, REVERSIBLE ERROR, IF NOT GRAVE ABUSE OF DISCRETION, IN REFUSING TO RESOLVE AS TO -

(A) WHETHER OR NOT THE COURT A QUO COMMITTED SERIOUS, REVERSIBLE ERROR, WHEN IT FAILED TO CONSIDER THAT RESPONDENT ABANDONED THE PROJECT AND IT IS THE LATTER (sic) LIABLE TO PETITIONER;

(B) WHETHER OR NOT THE COURT A QUO COMMITTED SERIOUS, REVERSIBLE ERROR, WHEN IT DENIED PETITIONER'S RIGHTS TO PRESENT ITS EVIDENCE IN VIOLATION OF ITS CONSTITUTIONAL RIGHTS TO DUE PROCESS; AND

(C) WHETHER OR NOT THE COURT A QUO COMMITTED SERIOUS, REVERSIBLE ERROR, WHEN IT FAILED TO CONSIDER THAT RESPONDENT FAILED TO COMPLY WITH SECTION 5, RULE 7 OF THE 1997 RULES OF CIVIL PROCEDURE ON VERIFICATION AND CERTIFICATION OF NON-FORUM SHOPPING;
II

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS, REVERSIBLE ERROR, IF NOT GRAVE ABUSE OF DISCRETION, IN DENYING PETITIONER['S] MOTION FOR RECONSIDERATION WITHOUT STATING CLEARLY AND DISTINCTLY THE FACTUAL AND LEGAL BASIS THEREOF.[9]

In sum, the sole issue for resolution is whether the CA erred in affirming the decision of the RTC as to the liability of Hutama to KCD.

The Ruling of the Court

We resolve to deny the petition.

First, Hutama assails the decision of the CA based on its claim that it is KCD which owes them a sum of money because the latter abandoned the project. In other words, Hutama is asking this Court to review the factual findings of the RTC and the CA. This position of petitioner is untenable.

A petition under Rule 45 of the Rules of Court shall raise only questions of law. As a rule, findings of fact of a trial judge, when affirmed by the CA, are binding upon the Supreme Court. This rule admits of only a few exceptions, such as when the findings are grounded entirely on speculations, surmises or conjectures; when an inference made by the appellate court from its factual findings is manifestly mistaken, absurd or impossible; when there is grave abuse of discretion in the appreciation of facts; when the findings of the appellate court go beyond the issues of the case, run contrary to the admissions of the parties to the case, or fail to notice certain relevant facts which, if properly considered, will justify a different conclusion; when there is a misappreciation of facts; when the findings of fact are conclusions without mention of the specific evidence on which they are based, are premised on the absence of evidence, or are contradicted by the evidence on record.[10] However, not one of the exceptions is present in this case.

Based on the findings of fact of the RTC, which were affirmed by the CA, it was proven that Hutama contracted the services of KCD as a sub-contractor of Package 2 Site Works at Phillips Semiconductors Philippines, Inc. - Integrated Circuits Plant Phase II Project, located in Calamba, Laguna. After the completion of the project, KCD billed Hutama Three Million Nine Hundred Nine Thousand Nine Hundred Sixty-Four Pesos and 05/100 (P3,909,964.05). The amount was reduced to Two Million Nine Hundred Sixty-Seven Thousand One Hundred Sixty-Four Pesos and 71/100 (P2,967,164.71) by agreement of the parties. Thus, on October 11, 2001, KCD sent Hutama the final bill. However, Hutama refused to settle the obligation and its refusal compelled KCD to file the collection suit before the RTC.

Second, Hutama avers that the CA committed a reversible error when it upheld the decision of the RTC, which was based on the ex-parte evidence presented by KCD. Allegedly, its constitutional right to due process was violated when the RTC issued an order of default[11] which resulted in its failure to present evidence.

However, we find that the RTC acted within the confines of its discretion when it issued the order of default upon the motion of KCD when Hutama failed to file an answer within the extended period. The RTC did not hastily issue the order of default. It gave Hutama the opportunity to explain its side. On August 22, 2002, the motion to set aside the order of default was set for hearing, but neither Hutama's counsel, nor any other representative of petitioner corporation, appeared. According to the counsel of Hutama, in his Memorandum,[12] he failed to file an answer on time because he went to the province for the Lenten season. He assigned the case to his associate, but the latter also went to the province. This flimsy excuse deserves scant consideration.

Third, Hutama questions the verification and certification on non-forum shopping of KCD, issued by its board of directors, because the same was signed by the latter's president without proof of authority to sign the same.

A pleading is verified by an affidavit that an affiant has read the pleading and that the allegations therein are true and correct as to his personal knowledge or based on authentic records. The party does not need to sign the verification. A party's representative, lawyer, or any person who personally knows the truth of the facts alleged in the pleading may sign the verification.[13]

On the other hand, a certification of non-forum shopping is a certification under oath by the plaintiff or principal party in the complaint or other initiatory pleading, asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith, that (a) he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.[14]

It is true that the power of a corporation to sue and be sued is lodged in the board of directors that exercises its corporate powers.[15] However, it is settled - and we have so declared in numerous decisions - that the president of a corporation may sign the verification and the certification of non-forum shopping.

In Ateneo de Naga University v. Manalo,[16] we held that the lone signature of the University President was sufficient to fulfill the verification requirement, because such officer had sufficient knowledge to swear to the truth of the allegations in the petition.

In People's Aircargo and Warehousing Co., Inc. v. CA,[17] we held that in the absence of a charter or bylaw provision to the contrary, the president of a corporation is presumed to have the authority to act within the domain of the general objectives of its business and within the scope of his or her usual duties. Moreover, even if a certain contract or undertaking is outside the usual powers of the president, the corporation's ratification of the contract or undertaking and the acceptance of benefits therefrom make the corporate president's actions binding on the corporation.

Finally, Hutama questions the resolution of the CA on its motion for reconsideration on the ground that it denied the same without stating clearly and distinctly the factual and legal basis thereof.

In denying petitioner's motion for reconsideration, the CA ruled that it found no plausible reason to depart from its earlier decision wherein all the issues had been exhaustively passed upon. That ruling contained a sufficient legal reason or basis to deny the motion. There was no need for the CA to restate the rationale for its decision that the petitioner wanted reconsidered.

WHEREFORE, in view of the foregoing, the instant petition is DENIED. The Decision dated October 14, 2005 and the Resolution dated June 19, 2006 of the Court of Appeals in CA-G.R. CV No. 78262 are hereby AFFIRMED. Costs against petitioners.

SO ORDERED.

Corona, (Chairperson), Velasco, Jr., Del Castillo,* and Mendoza, JJ., concur.



* Additional member in lieu of Associate Justice Diosdado M. Peralta per Special Order No. 824 dated February 12, 2010.

[1] Penned by Associate Justice Josefina Guevara-Salonga, with Associate Justices Delilah Vidallon-Magtolis and Fernanda Lampas-Peralta, concurring; rollo, pp. 28-35.

[2] Rollo, pp. 36-37.

[3] Id. at 29-31.

[4] Penned by Judge Romeo F. Barza, RTC, Makati City, Branch 61; id. at 86-88.

[5] Id. at 88.

[6] Supra note 1.

[7] Rollo, p. 35.

[8] Supra note 2.

[9] Rollo, pp. 173-174.

[10] Halili v. Court of Appeals, G.R. No. 113539, March 12, 1998, 287 SCRA 465.

[11] Rules of Court, Rule 9, Sec. 3 reads:

Sec. 3. Default; declaration of. -- If the defending party fails to answer within the time allowed therefore, the court shall, upon motion of the claiming party with notice to the defending party, and proof of such failure, declare the defending party in default. Thereupon, the court shall proceed to render judgment granting the claimant such relief as his pleading may warrant, unless the court in its discretion requires the claimant to submit evidence. Such reception of evidence may be delegated to the clerk of court.

(a) Effect of order of default. - A party in default shall be entitled to notice of subsequent proceedings but not to take part in the trial.

(b) Relief from order of default. - A party declared in default may at any time after notice thereof and before judgment file a motion under oath to set aside the order of default upon proper showing that his failure to answer was due to fraud, accident, mistake or excusable negligence and that he has a meritorious defense. In such case, the order of default may be set aside on such terms and conditions as the judge may impose in the interest of justice.

(c) Effect of partial default. - When a pleading asserting a claim states a common cause of action against several defending parties, some of whom answer and the others fail to do so, the court shall try the case against all upon the answers thus filed and render judgment upon the evidence presented.

(d) Extent of relief to be awarded. - A judgment rendered against a party in default shall not exceed the amount or be different in kind from that prayed for nor award unliquidated damages.

(e) Where no defaults allowed. - If the defending party in an action for annulment or declaration of nullity of marriage or for legal separation fails to answer, the court shall order the prosecuting attorney to investigate whether or not a collusion between the parties exists, and if there is no collusion, to intervene for the State in order to see to it that the evidence submitted is not fabricated.

[12] Rollo, pp. 164-178.

[13] Rules of Court, Rule 7, Sec. 4; LDP Marketing, Inc. v. Monter, G.R. No. 159653, January 25, 2006, 480 SCRA 137.

[14] Rules of Court, Rule 7, Sec. 5 (par. 1).

[15] LDP Marketing, Inc. v. Monter, supra note 13.

[16] G.R. No. 160455, May 9, 2005, 458 SCRA 325.

[17] G.R. No. 117847, October 7, 1998, 297 SCRA 170.



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