G.R. No.
95863 July 1, 1993 against PAL before the Regional Trail Court of Cebu, docketed as Civil Case No.
CEB-7546.
AUTOGRAPHICS, INC., Petitioner, vs. COURT OF APPEALS and PHILIPPINE
AIRLINES, INC., Respondents. On 27 January 1989, the trial court issued a writ of preliminary
attachment 3over PAL 's personal and real properties upon AGI's filling a bond.
Jesus N. Borromeo & Albert KL. Hontanosa for petitioner.
On 30 January 1989 PAL filed a petition for certiorari and prohibition with
Villar, Cordova Mancao and Ontal Law Office collaborating counsel for application for a temporary restraining order and preliminary injunction with
petitioner. the Court of Appeals questioning the legality of the writ issued by the trial
court. On the same day, the First Division of the Court of Appeals 4issued a
Leighton R. Siazon & Associates for private respondent. restraining order to enjoin further implementation of the order and writ of
BELLOSILLO, J.: preliminary attachment.
AUTOGRAPHICS, INC., files this petition for review on certiorari seeking to set On 1 February 1989, PAL filed with the trial court a motion to dismiss on the
aside the Decision 1of the Court of Appeals in CA-G.R. SP No. 19725 declaring ground that it did not have jurisdiction over the case for failure of private
the order of 20 December 1989, the Decision of 28 December 1989 and the respondents to pay the correct amount of the docket fees.
Order of 12 January 1990 of the Regional Trial court of Cebu in Civil Case No. On 22 February 1989, AGI filed before the trail court an Ex-parte Motion to
CEB-7546 (Autographics, Inc. v. Philippine Airlines, Inc.) null and void and Admit Amended Complaint and to Issue a Replevin order.
remanding the records to the trial court for further reception of evidence.
On 23 February 1989, the trial court issued an order admitting the Amended
Petitioner Autographics, Inc. (AGI, for brevity), and private respondent Complaint.
Philippine Airlines, Inc. (PAL, for brevity), entered into several contracts which
would provide support services to PAL's operations. Under these contracts, On 3 March 1989, PAL filed a Supplemental Petition impugning the Order of 23
AGI would provide PAL with cars, motorcycles, crew-cab pick-ups, shuttle February 1989.
buses for twenty-four (24) hours a day, seven (7) days a week, inclusive oil,
On 7 March 1989, The First Division of the Court of Appeals issued a
maintenance staff and facilities, tools, spare parts, seat covers, insurance
restraining order enjoining the court from further proceeding with the case.
coverage and LTC registration. For its part, private respondent undertook to
pay petitioner a semi-monthly contract price payable every 14th and 29th of On 6 April 1989, the First Division of the Court of Appeals rendered a
each month. Decision 5dismissing PAL's petition for certiorari for lack of merit and lifting the
temporary restraining orders of 30 January and 7 March 1989
AGI and PAL likewise entered into a Sale and Leaseback Contract over 20 units
of NORDCO USA Foodloader and 1 unit Jet Refueller Truck. They also agreed to On 27 April 1989, AGI filed a Motion to Admit Second Amended Complaint.
an Air Mail Van Leasing Contract to serve PAL's Mactan station at Cebu.
On 2 May 1989, the trial court granted the aforesaid motion and admitted the
Initially, the parties complied with their respective undertakings. Thereafter, Second Amended Complaint. Summons was then issued to PAL.
while these contracts were still in force, PAL notified AGI of their termination
On 29 June 1989, PAL filed its Answer with Compulsary Counterclaim.
inasmuch as said contracts were prejudicial to PAL's interest and violative of its
franchise. On 30 June 1989, upon AGI's ex-parte motion, the trial court issued an alias
writ of preliminary attachment over the properties of PAL.
On 25 January 1989, AGI filed a complaint 2to recover the sum of thirty million
pesos (P30,000,000.00) with damages, preliminary attachment and injunction
On 7 July 1989, PAL put up a counterbond issued by the Government Services Upon the other hand, counsel for AGI objected to the manifestation of Atty.
Insurance System. Tanco and moved that PAL's right to present evidence be considered waived
and the case be deemed submitted for decision.
On 16 August, trial started with AGI presenting its oral and documentary
evidence. In open court, the trial court granted 7the oral motion of counsels for AGI and
declared the case submitted for decision, PAL having been considered to have
On 8 November 1989, AGI rested its case with a a 42-page Offer of Exhibits
waived its right to present evidence.
consisting of three hundred eighty two (382) annexes. On the same date, the
trial court issued an order setting the continuation of the trial on 22 and 23 of On 28 December 1989, the trial court rendered its decision 8adverse to PAL.
November 1989 with PAL presenting its evidence. However, these scheduled On the same date, PAL, despite not having received a written Order of 20
trial dates were later cancelled because of typhoon "Saling" which caused the December 1989, filed a motion for reconsideration 9of the same.
cancellation of PAL's flights from Manila to Cebu. The hearing then was reset
On 12 January 1990, the trial court denied 10the motion for reconsideration
for trial on 27 and 28 November 1989.
thus -
On 27 November 1989, the trial court had to reset the hearing to 20 and 21
The Court fails to find any justification for defendant's (PAL's) actuations on 20
December 1989 because of the non-availability of PAL's witnesses.
December 1989 for not only did it conveniently coincide at the exact time and
On 14 December 1989, the trial court admitted the exhibits formally offered by date for it to present its witness the taking of the deposition in Makati of the
AGI. On the same date, PAL filed before the trial court a very same witness it undertook in open court to so present on said date, but it
Manifestation/Motion 6stating that it had conferred with the persons whom it also failed to present a medical certificate to excuse his coming to Cebu, nor
intended to present as witnesses on 20 and 21 December 1989; that said did it present some other witness in his stead, nor did it even present in
witnesses by reason of distance and personal matters (previously scheduled evidence a deposition taken prior to December 20, 1989 which it could have
appointments/meetings) had expressed willingness to testify by deposition; taken even as early as January 25, 1989 when this case commenced, if it was
that PAL was thus constrained to avail of rule 24 (Depositions and Discovery) serious in producing evidence in court to meet plaintiffs action. Resort to
of the Rules of Court; that consequently, PAL sent to AGI and the trial court improper dilatory tactics by litigants has always been frowned upon by the
copies of a Notice to take Deposition on 20 and 21 December 1989 before courts.
Regional Trial Court Judge Santiago Ranada, Jr., or his Branch Clerck of Court,
On 19 January 1990, PAL filed a Notice of Appeal Ex Abundantia Ad
Atty. Bernabe Solis, at Makati; and, that such remedy allowed by the rules was
Cautelam with respondent Court of Appeals. However, instead of filing the
not a show of PAL's disrespect to the trial court but rather a sincere effort
appeal, PAL chose to file a petition for 11certiorari and prohibition with the
towards the early disposition of the case. PAL prayed that its manifestation be
appellate court claiming that respondent Judge gravely abused its discretion.
noted and that the hearings before the trial court on 20 and 21 December 21,
1989 be cancelled. On 24 January 1990, the Fifth Division of the Court of Appeals found the
petition sufficient in form and substance and required AGI to (a) answer the
No action was taken thereon by the trial court on the request of PAL for the
petition and (b) show cause why a writ of preliminary injunction should not
cancellation of the hearings scheduled on 20 and 21 December 1989. On 20
issued in the case. 12It likewise issued a temporary restraining order 13to enjoy
December 1989, only PAL's Cebu counsel, Atty. Joseph Tanco, appeared. Its
the implementation of the decision of 28 December 1989.
principal counsel, Atty. Leighton R. Siazon, was absent. Atty. Tanco sought the
resetting of the hearing because Atty. Siazon was attending to the taking of the On 15 February 1990, respondent Court of Appeals issued a writ of preliminary
deposition of PAL's witnesses before the Regional Trial Court of Makati. injunction. 14AGI moved to reconsider the aforesaid resolution, while PAL
opposed the motion.
On 16 April 1990, the appellate Court denied AGI's motion for reconsideration to appeal therein by availing of the special civil action for certiorari; and (c)
for lack of merit. whether res judicata applies in view of G.R. No. 93211.
On 15 of May 1990, AGI filed a petition for certiorari and prohibition before There is no need to delve into the propriety of the petition for certiorari filed
this Court assailing the jurisdiction of the Court of Appeals in granting PAL's by PAL in lieu of appeal from the decision of 28 December 1989. This issue was
application for a writ of preliminary injunction beyond the 20-day period from already been passed upon in G.R. No. 93211 thus -
the issuance of a temporary restraining order and in giving due course to PAL's
Since the Court of Appeals in the exercise of its sound discretion has already
petition for certiorari and prohibition
granted the petition of the Philippine Airlines, Inc. in the case before it, and
On 23 July 1990, we dismissed AGI's petition for its failure to show that the remanded the records to the court a quo, the issue of whether or not the
appellate court committed a grave abuse of discretion. appeal is the only appropriate remedy has become moot and academic.
On 4 August 1990, AGI filed a motion for reconsideration of our Resolution of CONSIDERING THE FOREGOING, the COURT RESOLVED TO DENY the motion
23 July 1990. for reconsideration. This DENIAL is FINAL.
On 15 August 1990, a decision 17was rendered by respondent Court of Appeals The only decisive issue to be resolved is whether the trial court was correctly
the dispositive portion of which states - adjudged to have committed a grave abuse of the discretion in issuing the oral
Order of 20 December 1989 and in rendering the judgment of 28 December
WHEREFORE, herein petition is hereby GRANTED.
1989 without giving PAL the chance to present evidence.
The Order dated 20 December 1989, the Decision dated 28 December 1989,
We answer categorically in the affirmative. The proceedings in the court a
and the Order denying the Motion for Reconsideration dated 12 January 1990
quo were indeed manifestly inequitable and irregular involving as it does a
are declared null and void and are hereby SET ASIDE.
claim of THIRTY MILLION PESOS (P30,000,000.00) in damages against PAL. In
Let the records of this case be remanded to the Court a quo for continuation its haste to comply with Administrative Circular No. 4 23promulgated 22
of hearing for the reception of evidence of petitioner. September 1988, the trial court prodded PAL to present its evidence within a
period of one (1) month. Perhaps, this arrangements could have been proper
On 5 October 1990, AGI filed its motion for reconsideration. had both litigants been given equal opportunity to ventilate their respective
On 10 October 1990, we denied with finality AGI's motion for reconsideration claims. Unfortunately, this was not the case.
On 19 October 1990, the Court of Appeals denied AGI's motion for The records show that AGI presented its oral and documentary evidence on 16
reconsideration for being "flimsy and whimsical and does not raise any August 1989. It rested its case on 8 November 1989, with a 42-page formal
question of substance." offer of exhibits consisting of three hundred eighty-two (382) annexes.
AGI then elevated the case to us by way of a petition for review The first schedule hearing on 22 November 1989 did not take place because of
on certiorari 21 raising the following issues: 22(a) whether the Court of Appeals typhoon "Saling." Still, the trial court pressed for the early resolution of the
committed a reversible error in ruling that the decision of the trial court of 28 case by resetting intransferably the trial date to 27 November 1989
December 1989 as well as its order of 20 December 1989 and 12 January 1990 notwithstanding the manifestation of PAL's Cebu-based counsel that he had a
were issued with grave abuse of discretion, hence null and void; (b) whether prior scheduled court appearance in an out-of-town case on the same date
the decision of the trial court of 28 December 1989 had already become final and that he would inform PAL's principal counsel of the new date. 24In the
and executory in view of the abandonment by private respondent of its right second hearing of 27 November 1989, 25the trial court granted PAL's first
motion for postponement but insisted on the one (1) month period for PAL's COURT:
proffer of evidence:
In that case, therefore, the Court will have to ask for an extension.
COURT: (to interpreter)
ATTY. CORTES:
Call the case. (interpreter calls the witness)
Yes, Your Honor.
Appearances.
ATTY. SIAZON:
ATTY. BORROMEO:
I don't think that that particular ruling is applicable to this Honorable Court.
For the plaintiff Your Honor in collaboration with Atty. Cortes and Atty. There are certain orders that are not applicable to this Honorable Court
Hontanosas, ready Your Honor. because this Court is not a pilot court as yet. I don't think this is applicable to
this Honorable Court. This will, in effect, expedite the presentation of
ATTY. CORTES:
defendant's evidence rather than have all the witnesses come Your Honor. I
Also for the plaintiff Your Honor, ready. have 7 witnesses. And also Your Honor, it would be convenient for counsel for
plaintiff to cross examine the witnesses before the Deposition Officer. The
ATTY. SIAZON: right of the plaintiff will not be prejudiced in any way as most of their evidence
For the defendant Your Honor. Your Honor please, last November 17 we filed a are in Manila.
motion for resetting of the case for that day as well as for the 22nd and 23rd in COURT:
view of the fact that a resolution has yet to be issued by this Honorable Court
on its ruling of plaintiff's formal offer of exhibits. Also, on said date, all flights Is there no other way to expedite? We only have this month to comply with the
to Cebu were cancelled and then I understand that this case was set today, 90-day period (emphasis supplied).
and tomorrow, morning and afternoon. Last Friday, upon advice of the counsel
With AGI's voluminous exhibits/annexes and the limited period alloted to it by
of Angara Law Office, I filed a motion for resetting in view of the proximity of
the trial court within which to present its evidence, PAL's resource to Sec. 1
time coupled with the fact that there is yet a resolution to be issued. For this
Rule 24, of the Rules of Court is well-taken. Section 1 provides:
reason, I am reiterating our motion for the cancellation of today and
tomorrow's hearing. It is not our intention to delay Your Honor and in fact I Sec. 1. Depositions pending action, when may be taken. - By leave of court
have filed a motion for the deposition taking of the testimonies of the after jurisdiction has been obtained over any defendant or over property
witnesses who cannot come to Cebu and testify. However, when I served which is the subject of the action, or without such leave after an answer has
notice to counsel for plaintiff, it was refused. I have conferred with counsel for been served, the testimony of any person, whether a party or not, may be
plaintiffs today and I believe they have some comments to make of record. taken, at the instance of any party, by deposition upon oral examination or
written interrogatories, the attendance of witnesses may be compelled by the
COURT:
use of a subpoena as provided in Rule 23. Depositions shall be taken only in
So we will resort to deposition. accordance with these rules. The depositions of a person confined in prison
may be taken only by leave of court on such terms as the court prescribes.
ATTY. SIASON:
Under the aforequoted provisions, a party, without a court intervention, can
Yes, Your Honor considering that one of my witnesses is the Vice-President in take a deposition of any person after answer has been served. This right,
Manila and the other is new presently based in Australia. however, is not absolute. The trial court may, in its discretion, order that a
deposition shall not be taken. The trial court's discretion on his matter must which is for the presentation of defense evidence, at which same time for
nonetheless be exercised not arbitrary, capriciously, or oppressively, but in a deposition of said witnesses shall instead be taken before judge Santiago
reasonable manner and in consonance with the spirit of the law. 26In one Ranada, Jr.
case 27we held:
Under the same date, PAL also filed with the trial court, a Notice to Take
That the right of a party to take depositions as means of discovery is not Deposition 29of five (5) witnesses before the Regional Trial Court of Makati, Br.
exactly absolute is implicit in the provisions of Rules of Court cited by 137. We note that sufficient notice was furnished AGI's counsel it appearing
appellants themselves, sections 16 and 18 of Rule 24, which are precisely that the latter failed to rebut the contention of PAL that is sent a copy of its
designed to protect parties and their witnesses, whenever in the opinion in the Notice To Take Deposition via registered mail on 17 December 1989 to AGI's
trial court, the move to take their depositions under the guise of discovery is counsel, and that said mail was claimed only on 10 January 1990 using the
actually intended to annoy, embarrass or oppress them. In such instances, third notice sent by the Central Post Office per certification of the Postmaster
these provisions expressly authorize the court to either prevent the taking of a of 20 December 1990. 30As provided in Sec. 8, Rule 13, of the Rules of
deposition or stop one that is already being taken (emphasis supplied). Court, "(s)ervice by registered mail is completed upon actual receipt by the
addressee; but if he fails to claim his mail from the post office within five (5)
In its Manifestation/Motion 28dated 14 December 1989 filed with the trial
days from the date of first notice of the postmaster, service shall take effect at
court, PAL stated:
the expiration of such time.”
1. Undersigned counsel has already conferred with the persons whom
The trial court surprisingly did not act on these pleadings. If indeed it felt then
defendant intends to present as witnesses on the December 20/21, 1989
that PAL was engaged in dilatory tactics, the trial court could have prevented
hearing at 2:30 p.m.;
the deposition of its witnesses.
2. Said witnesses however, by reason of distance and of personal matters,
Moreover, we fail to see how the trial court could have considered PAL to have
have expressed willingness to testify through the taking of their depositions;
waived the presentation of its evidence. In availing of the provision of Sec. 1,
3. Defendant is now thus constrained to avail of Rule 24 of the Rules of Court Rule 24, of the Rules of Court, PAL clearly indicated its keen interest in the
which is the taking of deposition upon oral examination; early resolution of the case. As aptly observed by the appellate court:
4. Consequently therefore, defendant sent today, December 13, 1989, a When the petitioner manifested to the court that it will take the deposition of
Notice to Take Deposition to plaintiff's counsel, a copy of which is likewise the witness who they intended to present at the hearing in Cebu on 20
furnished to this Honorable Court; December 1989 the petitioner did not actually postpone the taking of the
testimony of the witness but merely change the venue where said testimony
5. This remedy allowed by the Rules is not a show of disrespect by defendant shall be taken.
to this Honorable Court as claimed by plaintiff but rather sincere efforts for the
early disposition of this case; It is very evident from the manifestation filed by the petitioner on 13
December 1989 that far from losing interest to prosecute the case, it has taken
6. It shall not unduly burden plaintiff and counsel considering steps to insure the taking of the testimony of the witness who can not appear
that both plaintiff and counsel maintain their principal offices in Manila (FEMS at the hearing in Cebu. The means used by it is permitted by Rule 24 of the
Tower I, 1289 Zobel Roxas cor. South superhighway, Manila); Rules of Court. 32
7. In view of the foregoing, it is now necessary to cancel the holding of
hearings on December 20-21, 1989 at 2:30 p.m. before this Honorable Court
In its Order of 12 January 1990, the trial court cited the case of Pimentel v. Also, nowhere in the records do we find that PAL made use of Rule 24 prior to
Gutierrez 33as basis for denying PAL's motion for reconsideration of the oral 13 December 1989 when it filed its Manifestation/Motion and Notice To Take
Order of 20 December 1989. Deposition. At any rate, the trial court need not be overly concerned if ever
PAL omitted to present a deposition allegedly taken prior to 20 December
To emphasize, the ruling in the Pimentel case does not persuade us inasmuch
1989. It will have an occasion to exercise its discretion with regard to the use
as the circumstances in that case are totally different from the case at bar. In
of such deposition when the same is formally offered on evidence
the Pimentel case, we sustained the trial court's refusal to grant the motion of
defendant that he be allowed to take the deposition of his witness on the We significantly note too that the oral Order of 20 December 1989 was not
same date as the scheduled time for the trial upon finding that the cause had reduced to writing. Worse, the trial court did not give PAL a chance to defend
been at issue for more than a year before the time set for the trial. Likewise its action because it subsequently rendered a decision on the merits of the
the defendant had not shown that he used due diligence in securing the case on 28 December 1989. We also had occasion 38to declare that -
presence of his witness and that he could not safely proceed with the trial
In the first place, Courts of First Instance, being courts of record, are bound to
without the presence of his witness or his deposition.
keep a record of their proceedings, which must appear in writing. According to
In the present case, trial of the cause already started with the trial court giving the definition given in 2 Cyc., 657-658, courts of records are those which are
AGI a period of more than two (2) months to fully ventilate its claim. On the bound to keep a record of their proceedings for a perpetual memorial and
other hand, PAL was afforded only a period of one month to present evidence. testimony thereof. This being so, and applying it to the question under
The grounds adduced by PAL to avail itself of Rule 24 do not appear to be consideration, it cannot said that the appellants were notified of the order
unreasonable. Factors such as the Christmas season, its witnesses being key denying their motion for a new trial, until said order had been reduced to
personnel of PAL with prior commitments and personal reasons (the witness writing and filed in the clerck's office.
who was scheduled to appear, Mr. Benigno Datoc, being unavailable due to
More importantly, the law mandates that "every order required by its terms to
pressure of official duties, particularly the ongoing investigation of certain
be served" shall be served upon the parties affected thereby either personally
irregularities in Australia where Pal was defrauded in millions of pesos), 34the
or by mail. 39 Obviously, court orders affecting the rights of the parties such as
distance of the place of trial and the sentiment of the trial court to finish the
the oral Order of 20 December 1989 should be in writing and furnished the
presentation of its evidence within the month, indicate that PAL's action was a
parties concerned. The due process clause of the Constitution requires notice
sincere effort to abide with the directive of the trial court. Such effort should
and opportunity to be heard before any litigant can be lawfully deprived of his
be favorably considered, rather than condemned, in the interest of justice.
rights.
Further to its Order of 12 January 1990, the trial court took PAL's counsel to
In fine, the trial court's overly strict adherence to Administrative Circular No. 4
task for his failure "to present a medical certificate to excuse his coming to
runs roughshod over PAL's substantial and procedural rights. It is repulsive to
Cebu, nor did it present some other witness in his stead, nor did it even
its fundamental right to due process. The appellate court was therefore
present a deposition taken prior to 20 December 1989 which it could have
correct in nullifying the orders and decision of the trial court. It bears
taken even as early as 25 January 1989 when this case commenced."
repeating that the whole purpose and object of procedure is to make the
The trial court may not have given PAL's Manifestation/Motion a thorough powers of the court fully and completely available for justice; its proper aim is
reading. A medical certificate cannot be required because PAL's counsel did to facilitate the application of justice to the rival claims of contending parties.
not feign illness in requesting for the cancellation of the hearing of 20
WHEREFORE, the petition is DENIED. The assailed decision of the Court of
December 1989. The reasons for the unavailability of PAL's witnesses were
Appeals is AFFIRMED. SO ORDERED.
palpably stated in the said pleading 36and in the Notice to Take Deposition.
