779 Phil. 32
PERALTA, J.:
WHEREFORE, premises considered, judgment is hereby rendered in favor of plaintiff Metropolitan Bank and Trust Company ordering defendants jointly and severally to pay plaintiff the amount of P17,479,371.86 representing deficiency obligation plus interest thereon at the legal rate of 12% per annum computed from August 1, 2001 until the obligation is fully paid, plus the amount of P50,000.00 as and for reasonable attorney's fees.After the denial of its motion for reconsideration, Metrobank appealed the case to the CA and the latter, on May 17, 2011, granted the appeal, thus, reversing and setting aside the decision of the RTC, thus:
SO ORDERED.[5]
WHEREFORE, premises considered, the instant appeal is GRANTED. The Decision dated March 8, 2006 of the Regional Trial Court, Branch 59, Makati City, in Civil Case No. 03-1262 ordering defendants to pay plaintiff P17,479,371.86 representing deficiency obligation plus 12% interest per annum and P50,000.00 as attorney's fees is REVERSED and SET ASIDE,In reversing the RTC, the CA ruled that during the ex parte hearing held on August 24, 2004, the petitioner's lone witness, Irene Sih-Tan identified and marked Exhibits "A" to "DD-4" only as shown in the TSN, however, the RTC admitted Exhibits "A" to "MM," contrary to this Court's resolution in Administrative Matter (A.M.) No. 03-1-09-SC[7] which provides that no evidence shall be allowed to be presented and offered during the trial in support of the party's evidence-in-chief other than those that have been identified below and pre-marked during the trial.
No pronouncement as to costs.
SO ORDERED.[6]
Section 5. Effect of failure to appear. - The failure of the plaintiff to appear when so required pursuant to the next preceding section shall be cause for dismissal of the action. The dismissal shall be with prejudice, unless otherwise ordered by the court. A similar failure on the part of the defendant shall be cause to allow the plaintiff to present his evidence ex parte and the court to render judgment on the basis thereof.The "next preceding" section mandates that:
Section 4. Appearance of parties. - It shall be the duty of the parties and their counsel to appear at the pre-trial. The non-appearance of a party may be excused only if a valid cause is shown therefor or if a representative shall appear in his behalf fully authorized in writing to enter into an amicable settlement, to submit to alternative modes of dispute resolution, and to enter into stipulations or admissions of facts and of documents.The RTC, therefore, did not commit an error in allowing the petitioner herein to present its evidence ex parte and rendering a judgment on the basis thereof. The CA, however, found an error in the RTC's admission of the evidence presented or offered by the petitioner. According to the CA, there is no showing in the Transcript of Stenographic Notes (TSN) whatsoever that Exhibits "EE" to "MM" were presented and identified by the petitioner's witness during the proceeding. Exhibits "EE" to "MM" were the basis of the RTC in awarding petitioner the amount of P17,479,371.86 equivalent to the deficiency obligation of respondents as of July 31, 2001, plus legal interest thereon from August 1, 2001, until fully paid, and attorney's fees in the amount of P50,000.00. By admitting those evidence that were not identified or testified to by the petitioner's witness, the CA ruled that the RTC did not follow the provisions of A.M. No. 03-1-09-SC. This is a wrong interpretation.
Under the present case, it is as if there was no pre-trial because the respondents did not appear nor file their pre-trial briefs despite due notice causing the RTC, on August 9, 2004 to allow petitioner, after the latter filed its motion, to present its evidence ex parte in accordance with Section 5, Rule 18 of the Rules of Court. In effect, the respondents were declared in default. Respondents, therefore, filed their Motion for Reconsideration[12] on the RTC's Order allowing petitioner to present its evidence ex parte but it was denied in an Order[13] dated September 21, 2004. Respondents, thereafter, filed a petition for certiorari under Rule 65 of the Rules of Court questioning the Orders dated August 9, 2004 and September 21, 2004 of the RTC. The CA, in its Resolution[14] dated January 12, 2005, dismissed the petition of the respondents. Meanwhile, an ex parte hearing was conducted on August 24, 2004 and on September 7, 2004, petitioner filed its Formal Offer of Evidence[15] and the RTC, in its Order dated October 25, 2005 resolved the formal offer stating as follows:GUIDELINES TO BE OBSERVED BY TRIAL COURT JUDGES AND CLERKS OF COURT IN THE CONDUCT OF PRE-TRIAL AND USE OF DEPOSITION-DISCOVERY MEASURES
The use of pre-trial and the deposition-discovery measures are undeniably important and vital components of case management in trial courts. To abbreviate court proceedings, ensure prompt disposition of cases and decongest court dockets, and to further implement the pre-trial guidelines laid down in Administrative Circular No. 3-99 dated January 15, 1999 and except as otherwise specifically provided for in other special rules, the following guidelines are issued for the observance and guidance of trial judges and clerks of court:
I. PRE-TRIAL
A. Civil Cases
1. Within one day from receipt of the complaint:1.1 Summons shall be prepared and shall contain a reminder to defendant to observe restraint in filing a motion to dismiss and instead allege the grounds thereof as defenses in the Answer, in conformity with IBP-OCA Memorandum on Policy Guidelines dated March 12, 2002. A copy of the summons is hereto attached as Annex "A;" andA copy of the order shall be served upon the defendant together with the summons and upon the plaintiff.
1.2 The court shall issue an order requiring the parties to avail of interrogatories to parties under Rule 25 and request for admission by adverse party under Rule 26 or at their discretion make use of depositions under Rule 23 or other measures under Rules 27 and 28 within five days from the filing of the answer.
Within five (5) days from date of filing of the reply, the plaintiff must promptly move ex parte that the case be set for pre-trial conference.
If the plaintiff fails to file said motion within the given period, the Branch COC shall issue a notice of pre-trial.
2. The parties shall submit, at least three (3) days before the pre-trial, pre-trial briefs containing the following:a. A statement of their willingness to enter into an amicable settlement indicating the desired terms thereof or to submit the case to any of the alternative modes of dispute resolution;
b. A summary of admitted facts and proposed stipulation of facts;
c. The issues to be tried or resolved;
d. The documents or exhibits to be presented, stating the purpose thereof. (No evidence shall be allowed to be presented and offered during the trial in support of a parry's evidence-in-chief other than those that had been earlier identified and pre-marked during the pre-trial, except if allowed by the court for good cause shown); xxx[11]
Acting on the plaintiffs Formal Offer of Evidence, Exhibits "A to Z," "AA to MM" their sub-markings and the testimony of witness Irene Tan are admitted for the purposes for which they are being offered.[16]Clearly, from the above recital of the facts leading to the rendering of the RTC judgment on March 8, 2006, the proper procedure was followed, to which the RTC, in its decision, narrated as follows:
xxxThe records, therefore, show that the documentary evidence being questioned by respondents in its appeal before the CA (Exhibits "EE" to "MM") were marked during the ex parte presentation of evidence and were formally offered and admitted by the RTC before the latter rendered its decision. Thus, the CA's ruling that Exhibits "EE" to "MM" should not have been considered simply because the TSN does not reflect that those evidence were presented and identified is mind-boggling because they could not have been marked had they not been presented during the ex parte hearing where the lone witness for the petitioner was able to testify. The fact that the questioned pieces of evidence were formally offered and admitted by the RTC should be the foremost consideration.
Records further show that defendants did not file their pre-trial brief and failed to appear during the pre-trial conference despite receipt of the Order of the Court. Hence, upon motion, plaintiff was allowed to present evidence ex-parte.
During the presentation of evidence, Irene Tan, Assistant Senior Manager of the plaintiff bank, was presented as lone witness. Together with her testimony, Exhibits A to Z, AA to MM, and their sub-markings were offered in evidence.
xxx[17]