880 Phil. 18
LOPEZ, J.:
Aggrieved, Femina filed a petition for relief[11] from judgment based on her former counsel's excusable negligence. Allegedly, Atty. Solilapsi failed to timely read the order directing her to file an answer because his secretary placed it on a wrong case folder. Moreover, Atty. Solilapsi was saddled with health issues and seldom reported to his office that made it difficult for her to correspond with him. Femina also filed a motion for new trial[12] claiming mistake and/or excusable negligence and that she has a meritorious defense.
- The amount of FIFTEEN MILLION EIGHT HUNDRED TWENTY NINE THOUSAND EIGHT HUNDRED FORTY PESOS (PI 5,829,840.00) representing the principal obligation plus interest at the rate of twenty four (24%) per annum from the filing of the complaint.
- To pay the plaintiff the amount of Two Hundred Thousand Pesos (P200,000.00) as and for attorney's fees and;
- To pay the cost of suit.[10]
[T]his Court, after a careful review of the records, is of the view and so holds that the points raised therein, have been passed upon in the resolution of denial, hence, for lack of any compelling ground to warrant a modification or reversal thereof, the instant motion is hereby DENIED.Femina filed a petition for certiorari[15] before the CA, docketed as CA-G.R. SP No. 131472, faulting the RTC with grave abuse of discretion. On October 31, 2014, the CA reversed the April 1, 2011 judgment of default and remanded the case for further proceedings. It also ordered the RTC to admit Femina's answer,[16] thus:
Concerning herein defendants['] petition for relief, it is noted that the said petition is basically anchored upon similar grounds as her motion for new trial which, needless to state, have been dealt with extensively in the Order of June 7, 2012, hence, on that basis alone, the Court hereby finds no meritorious reason to give due course.
Neither can the Court grant defendants' prayer to appeal the default judgment in view of plaintiffs' opposition, defendant having failed to appeal the decision within the reglementary period.
SO ORDERED.[14]
The Court finds that the trial court gravely abused its discretion in rendering judgment by default, despite the several remedies resorted to by petitioner in order for her to be given her day in court. There is no denying that petitioner availed of the following remedies:Hence, this petition. Vitarich argued that there is no proof that Femina filed her motion to admit answer before the RTC declared her in default. Further, the health issues of Atty. Solilapsi and the mistake of his secretary do not constitute excusable negligence.[18](I) "Entry of Appearance and Motion to Admit Answerf;"]By availing of the foregoing remedies, petitioner had manifested a strong desire to file an answer to prove her defense which should not have been disregarded by the trial court. It must also be stressed that when petitioner filed her motion to admit answer on January 31, 2011, the trial court had not yet declared her in default. The Order of default was issued on February 8, 2011. x x x
(II) Petition for Relief of the Orders dated February 8, 2011 and March 1,2011;
(III) Motion for New Trial of the Decision dated April 1, 2011; and
(IV) Motion for Reconsideration of the Order dated June 7, 2012 denying petitioner's motion for new trial.x x x x
Thus, it would be in keeping with justice and equity to allow petitioner's prayer for new trial in order for her to present her evidence; and for the trial court to determine with certainty whether the computation presented by private respondent reflects the true and real obligation of petitioner.[17]
The rule is that the defendant's answer should be admitted where it is filed before a declaration of default and no prejudice is caused to the plaintiff. Where the answer is filed beyond the reglementary period but before the defendant is declared in default and there is no showing that defendant intends to delay the case, the answer should be admitted.In Sablas, we cited Indiana Aerospace University v. Comm. on Higher Educ.[22] which set aside an order of default. In that case, the petitioner sought to declare the respondent in default. On the same date, the respondent moved for an extension of time to file an answer. Yet, the trial court still issued an order of default even if the respondent submitted a responsive pleading within the requested period. We ruled that the trial court, committed grave abuse of discretion because placing the respondent in default served no practical purpose, thus:
Therefore, the trial court correctly admitted the answer of petitioner spouses even if it was filed out of time because, at the time of its filing, they were not yet declared in default nor was a motion to declare them in default ever filed. Neither was there a showing that petitioner spouses intended to delay the case.x x x x
Since the trial court already admitted the answer, it was correct in denying the subsequent motion of respondents to declare petitioner spouses in default.[21] (Emphasis supplied; citations omitted.)
Petitioner claims that in issuing the default Order, the RTC did not act with grave abuse of discretion, because respondent had failed to file its answer within fifteen days after receiving the August 14, 1998 Order.In Hernandez v. Agoncillo,[24] however, we clarified the ruling in Sablas and held that it is not mandatory on the part of the trial court to admit an answer which is belatedly filed even though the defendant is not yet declared in default. Settled is the rule that it is within the discretion of the trial court to permit the filing of an answer even beyond the reglementary period, provided that there is justification for the belated action and there is no showing that the defendant intended to delay the proceedings.[25] In that case, we found the petitioner guilty of inexcusable neglect and deliberately employing delay in the prosecution of the civil case against him. Also, we noted significant differences between the Sablas and Hernandez cases, to wit:
We disagree. Quite the contrary, the trial court gravely abused its discretion when it declared respondent in default despite the latter's filing of an Answer. Placing respondent in default thereafter served no practical purpose.
Petitioner was lax in calling the attention of the Court to the fifteen-day period for filing an answer. It moved to declare respondent in default only on September 20, 1998, when the filing period had expired on August 30, 1998. The only conclusion in this case is that petitioner has not been prejudiced by the delay. The same leniency can also be accorded to the RTC, which declared respondent in default only on December 9, 1998, or twenty-two days after the latter had filed its Answer on November 17, 1998. Defendant's Answer should be admitted, because it had been filed before it was declared in default, and no prejudice was caused to plaintiff, x x x[23] (Emphases supplied; citations omitted.)
Sablas differs from the instant case on two aspects, to wit: first, in Sablas, the petitioners' motion for extension to file their answer was seasonably filed while in the present case, petitioner's Motion for Extension to File His Answer was filed beyond the 15-day period allowed by the Rules of Court; second, in Sablas, since the trial court admitted the petitioners' Answer, this Court held that the trial court was correct in denying the subsequent motion of the respondent to declare the petitioners in default while, in the instant case, the MeTC denied due course to petitioner's Answer on the ground that the Motion for Extension was not seasonably filed and that the Answer was filed beyond the period requested in the Motion for Extension, thus, justifying the order of default. Thus, the principle enunciated in Sablas is not applicable in the present case.Given these precepts, we find that the CA correctly reversed the judgment of default. Foremost, Femina moved to admit her answer before she was declared in default. Femina filed her motion through registered mail on January 31, 2011 while the order of default was issued on February 8, 2011. The fact of mailing on the said date is undisputed. It was mentioned in the RTC and CA's findings and admitted in the parties' pleadings. Notably, Section 3, Rule 13 of the Rules of Court provides that if a pleading is filed by registered mail, then the date of mailing shall be considered as the date of filing. It does not matter when the court actually receives the mailed pleading.[27] Thus, this circumstance must be fully appreciated in favor of Femina. Applying the Sablas ruling, the RTC should have considered Femina's answer since it was filed before the declaration of default.
In this respect, the Court agrees with the CA in its ruling that procedural rules are not to be ignored or disdained at will to suit the convenience of a party.[26]
The controlling principle ignored by respondent court is that it is within sound judicial discretion to set aside an order of default and to permit a defendant to file his answer and to be heard on the merits even after the reglementary period for the filing of the answer has expired. This discretion should lean towards giving party-litigants every opportunity to properly present their conflicting claims on the merits of the controversy without resorting to technicalities. Courts should be liberal in setting aside orders of default, for default judgments are frowned upon, and unless it clearly appears that reopening of the case is intended for delay, it is best that the trial courts give both parties every chance to fight their case fairly and in the open, without resort to technicality, x x xIn sum, while there are instances when a party may be properly declared in default, these cases should be deemed exceptions to the rule and should be resorted to only in clear cases of obstinate refusal or inordinate neglect in complying with the orders of the court.[33] Otherwise, any judgment by default that the trial court may subsequently render is intrinsically void for having been rendered pursuant to a patently invalid order of default.[34]
xxx Moreover, petitioners' answer shows that they have a prima facie meritorious defense. They should, therefore, be given their day in court to avoid the danger of committing a grave injustice if they were denied an opportunity to introduce evidence in their behalf.[32] (Emphases supplied; citation omitted.)