G.R. No. 260118 – PAOLO MARTIN M. ORTIGAS, DENISE MARIE O. TING and CARISSA KATRINA O. KO, HEIRS OF JOCELYN M. ORTIGAS, petitioners, vs. COURT OF APPEALS and HESILITO N. CARREDO, respondents.

LAZARO-JAVIER, J.

Rule Synopsis

The requisites for a petition for annulment of judgment are: (a) the petitioner can no longer resort to the ordinary remedies (new trial, appeal, petition for relief, etc) without fault on his part; (b) the grounds are limited to either extrinsic fraud, lack of jurisdiction, or denial of due process; (c) must be filed within 4 years from the discovery of the extrinsic fraud, or before it is barred by laches or estoppel if based on lack of jurisdiction; and (d) The petition must be verified, and should allege with particularity the facts and the law relied upon, as well as those supporting the petitioner’s good and substantial cause of action or defense.

Facts

In 1999, Spouses Cicero and Maria Luz Lumauig allegedly mortgaged a parcel of land to Jocelyn Ortigas (Jocelyn) for a consideration of Php5 million. In 2000, the corresponding deed of real estate mortgage was annotated on the title of the property.

Upon Jocelyn’s death, her heirs (Ortigas heirs) discovered the deed of real estate mortgage and found that Spouses Lumauig defaulted in the payment of their mortgage debt. Ortigas heirs demanded payment of P20 million consisting of principal and interest. Later, the heirs further discovered that the property was already foreclosed and sold at public auction due to non-payment of real estate taxes. It was sold to Hesilito Carredo (Carredo) in whose name a TCT was issued. A memorandum of encumbrance was also annotated in Carredo’s title.

The Ortigas heirs then filed a petition for extrajudicial foreclosure of mortgage with the Quezon City Office of the Clerk of Court acting as Ex-Officio Sheriff. When notified of the petition, Carredo informed the latter of his pending petition for the cancellation of the memorandum of encumbrance annotated on his title (subject civil case) which he filed in September 2018. The trial court granted Carredo’s petition. Carredo’s counsel then notified the Ortigas heirs of trial court’s decision.

The Ortigas heirs then filed a petition for the annulment of the trial court’s decision in the subject civil case before the Court of Appeals (CA). The CA dismissed the petition. It also denied the heirs’ Motion for Reconsideration.

Aggrieved, the Ortigas Heirs filed the instant Petition for Certiorari under Rule 65 of the Rules of Court before the Supreme Court.

Issues

1. Did the petitioners properly avail of Rule 65 as a remedy against the Decision and Resolution of the CA?
2. Is the petition for annulment of judgment the proper remedy against the decision of the trial court granting Carredo’s petition for the cancellation of the memorandum of encumbrance annotated on the title of the subject property?

Ruling and Discussion

1. Yes. The petitioners properly availed of Rule 65 as a remedy against the Decision and Resolution of the CA.
   
   While Rule 45 of the Rules of Court prescribes petitions for review on certiorari as the remedy for errors of law committed by the appellate court, it does not preclude the availment of Rule 65 in cases of grave abuse of discretion amounting to excess or lack of jurisdiction or denial of due process where Rule 45 does not appear to be a plain, speedy, or adequate remedy in the ordinary course of law, as in the present case.
   
   Grave abuse of discretion means a capricious and whimsical exercise of judgment that is patent and gross as to amount to an evasion of positive duty or a virtual refusal to perform a duty enjoined by law. It is a form of limited review that is only confined to errors of jurisdiction. A decision rendered in violation or due process, such as one issued despite improper service of summons, suffers a jurisdictional defect.
   
   Thus, the Court takes cognizance of, and accepts the present petition for certiorari as the proper remedy to nullify the affirmance of the trial court’s dispositions which were rendered without jurisdiction and in violation of the constitutional right to due process of the Ortigas Heirs as well as of their predecessor in interest.
2. Yes, the petition for annulment of judgment is the proper remedy against the decision of the trial court granting Carredo’s petition for the cancellation of the memorandum of encumbrance annotated on the title of the subject property.
   
   The requisites for a petition for annulment of judgment are present in the instant case, namely:
   
   a. The petitioner can no longer resort to the ordinary remedies (new trial, appeal, petition for relief, etc) without fault on his part;
   
   b. The grounds are limited to either extrinsic fraud, lack of jurisdiction, or denial of due process;
   
   c. Must be filed within 4 years from the discovery of the extrinsic fraud, or before it is barred by laches or estoppel if based on lack of jurisdiction;
   
   d. The petition must be verified, and should allege with particularity the facts and the law relied upon, as well as those supporting the petitioner’s good and substantial cause of action or defense.
   
   As applied in the instant case:
   
   a. There is no question that Jocelyn was never made aware of the subject civil case as it was filed in 2018 when she had been dead for almost 9 years. Her heirs knew of the case only when they received a notice of the decision from Carredo’s counsel, and were never impleaded in the case. Neither Jocelyn nor her heirs legally became parties to the case. In view of the peculiar circumstances, it is clear why the heirs could not have availed of the remedies of a motion for reconsideration, appeal, new trial, or relief from judgment.
   
   b. There was denial of due process in this case which constitutes a defect in the court’s jurisdiction. It was not denied that by the time subject civil case was filed, Jocelyn had long passed away. The trial court could not have validly acquired jurisdiction over her person. As a consequence of a void petition against a dead party, the entire proceedings become equally void and jurisdictionally infirm.
   
   c. The action for annulment of judgment in this case was brought before it is barred by laches or estoppel. The Ortigas Heirs have been consistently proactive and diligent in their pursuit of the available remedy to annul the adverse judgment of the trial court. The action was filed 5 months or so from the grant of the cancellation of the encumbrance. They were also not shown to have acted or incurred any omission which would otherwise amount to estoppel. The fact that they filed an application for extrajudicial foreclosure of mortgage did not preclude them from seeking the annulment of the subject decision ordering the cancellation of the annotation of real estate mortgage.
   
   d. The attachment of the records to the petition itself is no longer necessary as the Ortigas Heirs were not parties to subject civil case, and it is even undisputed that no factual issues are involved. Further, a verified statement that the petition was not intended to harass or cause injustice or delay applies only to cases wherein the annulment of judgment is sought on the ground of fraud and not when the ground brought to fore is lack of jurisdiction which is a question of law, as in the present case.

dispositive

Petition granted. Resolutions of the Court of Appeals nullified and set aside.