2. In Civil Case No.

1429, petitioner Calimbas allegedly borrowed

P202,800.18 as evidenced by Cash Disbursement Voucher
No. 3962 but the net loan was only P60,024.00 as supported
by PNB Check No. 0000005088; 6
SECOND DIVISION 3. In Civil Case No. 1430, petitioner Aguilar allegedly borrowed
P126,849.00 as evidenced by Cash Disbursement Voucher
[G.R. No. 209605. January 12, 2015.] No. 3902 but the net loan was only P76,152.00 as supported
by PNB Check No. 0000005026; 7
NEIL B. AGUILAR and RUBEN CALIMBAS, petitioners, vs.
Tantiangco, Aguilar and Calimbas filed their respective answers. They
LIGHTBRINGERS CREDIT COOPERATIVE, respondent.
uniformly claimed that the discrepancy between the principal amount of the
loan evidenced by the cash disbursement voucher and the net amount of loan
reflected in the PNB checks showed that they never borrowed the amounts
DECISION
being collected. They also asserted that no interest could be claimed because
there was no written agreement as to its imposition. cEAIHa

MENDOZA, J : p On the scheduled pre-trial conference, only respondent and its counsel
appeared. The MCTC then issued the Order, 8 dated August 25, 2009,
This is a petition for review on certiorari filed by petitioners Neil B. allowing respondent to present evidence ex parte. Respondent later
Aguilar (Aguilar) and Ruben Calimbas (Calimbas), seeking to reverse and set presented Fernando Manalili (Manalili), its incumbent General Manager, as its
aside the April 5, 2013 1 and October 9, 2013 2 Resolutions of the Court of sole witness. In his testimony, Manalili explained that the discrepancy
Appeals (CA) in CA-G.R. SP No. 128914, which denied the petition for review between the amounts of the loan reflected in the checks and those in the cash
outright, assailing the January 2, 2013 Decision 3 of the Regional Trial Court, disbursement vouchers were due to the accumulated interests from previous
Branch 5, Dinalupihan, Bataan (RTC) and the May 9, 2012 Decision 4 of the outstanding obligations, withheld share capital, as well as the service and
First Municipal Circuit Trial Court, Dinalupihan-Hermosa, Bataan (MCTC). miscellaneous fees. He stated, however, that it was their bookkeeper who
could best explain the details.
In the lower courts, one of the issues involved was the proper
application of the rules when a party does not appear in the scheduled pre- Aguilar and Calimbas insisted that they should have the right to cross-
trial conference despite due notice. In this petition, the dismissal by the CA of examine the witness of respondent, notwithstanding the fact that these cases
the petition filed under Rule 42 for failure to attach the entire records has also were being heard ex parte. In the interest of justice, the MCTC directed the
been put to question, aside from the veracity of indebtedness issue. counsels of the parties to submit their respective position papers on the issue
of whether or not a party who had been declared "as in default" might still
The Facts
participate in the trial of the case. Only respondent, however, complied with
This case stemmed from the three (3) complaints for sum of money the directive. In its Order, 9 dated April 27, 2011, the MCTC held that since the
separately filed by respondent Lightbringers Credit Cooperative (respondent) proceedings were being heard ex parte, the petitioners who had been
on July 14, 2008 against petitioners Aguilar and Calimbas, and one Perlita declared "as in default" had no right to participate therein and to cross-
Tantiangco (Tantiangco) which were consolidated before the First Municipal examine the witnesses. Thereafter, respondent filed its formal offer of
Circuit Trial Court, Dinalupihan-Hermosa, Bataan (MCTC). The complaints evidence. 10
alleged that Tantiangco, Aguilar and Calimbas were members of the
cooperative who borrowed the following funds: IaAScD
MCTC Ruling
On May 9, 2012, the MCTC resolved the consolidated cases in three
1. In Civil Case No. 1428, Tantiangco allegedly borrowed
P206,315.71 as evidenced by Cash Disbursement Voucher separate decisions. In Civil Case No. 1428, 11 the MCTC dismissed the
No. 4010 but the net loan was only P45,862.00 as supported complaint against Tantiangco because there was no showing that she
by PNB Check No. 0000005133. 5
received the amount being claimed. Moreover, the PNB check was made
payable to "cash" and was encashed by a certain Violeta Aguilar. There was,
however, no evidence that she gave the proceeds to Tantiangco. Further, the
dates indicated in the cash disbursement voucher and the PNB check varied On January 2, 2013, the RTC rendered separate decisions in Civil Case
from each other and suggested that the voucher could refer to a different loan. No. DH-1300-12 18 and Civil Case No. DH-1299-12 19 which affirmed the
DCcIaE
MCTC decisions. It held that the PNB checks were concrete evidence of the
indebtedness of the petitioners to respondent. The RTC relied on the findings
The decisions in Civil Case No. 1429 12 and 1430, 13 however, found
of the MCTC that the checks bore no endorsement to another person or entity.
both Calimbas and Aguilar liable to respondent for their respective debts. The
The checks were issued in the name of the petitioners and, thus, they had the
PNB checks issued to the petitioners proved the existence of the loan
right to encash the same and appropriate the proceeds. The decretal portions
transactions. Their receipts of the loan were proven by their signatures
of the RTC decision in both cases similarly read:
appearing on the dorsal portions of the checks as well as on the cash
disbursement vouchers. As a matter of practice, banks would allow the WHEREFORE, premises considered, the appeal is hereby
encashment of checks only by the named payee and subject to the DENIED. The Decision dated May 9, 2012 of the First Municipal
presentation of proper identification. Nonetheless, the MCTC ruled that only Circuit Trial Court (1st MCTC), Dinalupihan-Hermosa, Bataan is
the amount shown in the PNB check must be awarded because respondent hereby affirmed in toto.
failed to present its bookkeeper to justify the higher amounts being claimed. SO ORDERED. EAIaHD

The court also awarded attorney's fees in favor of respondent. The dispositive
portion of the decision in Civil Case No. 1429 reads: On January 18, 2013, the petitioners filed their joint motion for
reconsideration/new trial 20 before the RTC. Aguilar and Calimbas reiterated
WHEREFORE, premises considered, judgment is hereby
their position that they did not receive the proceeds of the checks. As an
rendered in plaintiff's favor and against the defendant, ordering the
alternative prayer, petitioners moved that the RTC remand the case to the
latter to pay plaintiff the amount of P60,024.00 with interest at the
MCTC for a new trial on account of the Sinumpaang Salaysay of Arcenit Dela
rate of 12% per annum from April 4, 2007 until fully paid, plus
P15,000.00 as attorney's fees.
Torre, the bookkeeper of respondent.

Costs against the defendant. On February 11, 2013, the RTC issued separate orders 21 denying the
motion of the petitioners. It explained that all the issues were already passed
SO ORDERED. 14 EaICAD
upon and the supposed newly discovered evidence was already available
during appeal, but the petitioners failed to present the same in time.
And in Civil Case No. 1430, the dispositive portion states:
WHEREFORE, premises considered, judgment is hereby
CA Ruling
rendered in plaintiff's favor and against the defendant, ordering the Aggrieved, Aguilar and Calimbas filed a petition for review 22 before the
latter to pay the plaintiff the amount of P76,152.00 with interest at the CA on March 11, 2013. It was dismissed, however, in the questioned
rate of 12% per annum from February 28, 2007 until fully paid. resolution, 23 dated April 5, 2013, stating that the petition was formally
Defendant is further directed to pay attorney's fees equivalent defective because the "verification and disclaimer of forum shopping" and the
to 25% of the adjudged amount. "affidavit of service" had a defective jurat for failure of the notary public to
indicate his notarial commission number and office address. Moreover, the
Costs against the defendant.
entire records of the case, inclusive of the oral and documents evidence, were
SO ORDERED. 15 not attached to the petition in contravention of Section 2, Rule 42 of the Rules
of Court.
On July 12, 2012, a notice of appeal 16 was filed by the petitioners, and
on August 15, 2012, they filed their joint memorandum for appeal 17 before the A motion for reconsideration 24 was filed by the petitioners which sought
Regional Trial Court, Branch 5, Bataan (RTC). Aguilar and Calimbas argued the leniency of the CA. They attached a corrected verification and disclaimer
out that had they been allowed to present evidence, they would have of forum shopping and affidavit of service. They asked the CA to simply order
established that the loan documents were bogus. Respondent produced the RTC to elevate the records of the case pursuant to Section 7, Rule 42 of
documents to appear that it had new borrowers but did not lend any amount the Rules of Court. Moreover, the petitioners could not attach the records of
to them. Attached to the joint memorandum were photocopies of the dorsal the case because the flooding caused by "Habagat" in August 2012 soaked
portions of the PNB checks which showed that these checks were to be the said records in water.
deposited back to respondent's bank account.
RTC Ruling
 In the other questioned resolution, dated October 9, 2013, the CA On May 21, 2014, the petitioners filed their reply before this Court, 27
denied the motion because the petitioners still failed to attach the entire adding that the elevation of the entire records of the case was not a
records of the case which was a mandatory requirement under Section 2, mandatory requirement, and the CA could exercise its discretion that it
Rule 42. furnished with the entire records of the case by invoking Section 7, Rule 42 of
Hence, this petition. the Rules of Court.

SOLE ASSIGNMENT OF ERROR The Court's Ruling

THE COURT OF APPEALS COMMITTED GRAVE ABUSE First Procedural Issue

OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF On the sole assignment of error, the Court agrees with the petitioners
JURISDICTION WHEN IT DISMISSED THE PETITION FOR that Section 2, Rule 42 does not require that the entire records of the case be
REVIEW FILED BEFORE IT BY THE PETITIONERS UNDER RULE attached to the petition for review. The provision states:
42 OF THE RULES OF COURT CITING THAT THE SAID PETITION
IS FORMALLY DEFECTIVE FOR FAILURE OF THE PETITIONERS Sec. 2. Form and contents. — The petition shall be filed in
TO SUBMIT WITH THE SAID PETITION THE ENTIRE RECORDS seven (7) legible copies, with the original copy intended for the court
OF THE APPEALED CIVIL CASE NOS. DH-1300-12 AND DH- being indicated as such by the petitioner, and shall (a) state the full
names of the parties to the case, without impleading the lower courts
1299-12. 25
or judges thereof either as petitioners or respondents; (b) indicate the
THaDEA

The petitioners argue that contrary to the findings of the CA, they specific material dates showing that it was filed on time; (c) set forth
substantially complied with the required form and contents of a petition for concisely a statement of the matters involved, the issues raised, the
review under Section 2, Rule 42 of the Rules of Court. There is nothing in the specification of errors of fact or law, or both, allegedly committed by
provision which requires that the entire records of the appealed case should the Regional Trial Court, and the reasons or arguments relied upon
for the allowance of the appeal; (d) be accompanied by clearly
be endorsed to the CA. Such requirement would definitely be cumbersome to
legible duplicate originals or true copies of the judgments or
poor litigants like them.
final orders of both lower courts, certified correct by the clerk of
They assert that they submitted the following pleadings and material court of the Regional Trial Court, the requisite number of plain
portions of the court records in their petition for review: (1) certified copies of copies thereof and of the pleadings and other material portions
the decisions, orders or resolutions of the RTC and the MCTC; (2) complaints of the record as would support the allegations of the petition.
against the petitioners attached with documents used by respondent in its [Emphasis and underscoring supplied] cCaEDA

formal offer of evidence; (3) answer of the petitioners; (4) order of the MCTC
The abovequoted provision enumerates the required documents that
declaring the petitioners in default; (5) respondent's formal offer of evidence;
must be attached to a petition for review, to wit: (1) clearly legible duplicate
(6) notice of appeal; (7) joint memorandum of appeal; and (8) joint motion for
originals or true copies of the judgments or final orders of both lower courts,
reconsideration/new trial. According to the petitioners, these pleadings and
certified correct by the clerk of court of the Regional Trial Court; (2) the
records were sufficient to support their petition for review.
requisite number of plain copies thereof; and (3) of the pleadings and other
Assuming that there was a reason to dismiss the petition on account of material portions of the record as would support the allegations of the petition.
technicalities, the petitioners argue that the CA should not have strictly Clearly, the Rules do not require that the entire records of the case be
applied the rules of procedure and provided leniency to the petitioners. They attached to the petition for review. Only when these specified documents are
also ask the Court to give a glance on the merits of their case brought before not attached in the petition will it suffer infirmities under Section 3, Rule 42,
the CA. which states:
On February 7, 2014, respondent filed its comment 26 contending that Sec. 3. Effect of failure to comply with requirements. —
the petitioners had no excuse in their non-compliance with Section 2, Rule 42. The failure of the petitioner to comply with any of the foregoing
They claim that the court records were not attached because these were requirements regarding the payment of the docket and other lawful
soaked in flood water in August 2012, but the RTC rendered its decision in fees, the deposit for costs, proof of service of the petition, and the
January 2013. The petitioners failed to secure a certification from the RTC contents of and the documents which should accompany the petition
shall be sufficient ground for the dismissal thereof.
that these records were indeed unavailable.
ATESCc
THcEaS
 In Canton v. City of Cebu, 28 the Court discussed the importance of The rule is that a court can only consider the evidence presented by
attaching the pleadings or material portions of the records to the petition for respondent in the MCTC because the petitioners failed to attend the pre-trial
review. "[P]etitioner's discretion in choosing the documents to be attached to conference on August 25, 2009 pursuant to Section 5, Rule 18 of the Rules of
the petition is however not unbridled. The CA has the duty to check the Court. 33 The Court, however, clarifies that failure to attend the pre-trial does
exercise of this discretion, to see to it that the submission of supporting not result in the "default" of the defendant. Instead, the failure of the defendant
documents is not merely perfunctory. The practical aspect of this duty is to to attend shall be cause to allow the plaintiff to present his evidence ex parte
enable the CA to determine at the earliest possible time the existence of and the court to render judgment on the basis thereof. HCaDET

prima facie merit in the petition." 29 In that case, the petition was denied
The case of Philippine American Life & General Insurance Company v.
because the petitioner failed to attach the complaint, answer and appeal
memorandum to support their allegation. Joseph Enario 34 discussed the difference between non-appearance of a
defendant in a pre-trial conference and the declaration of a defendant in
In Cusi-Hernandez v. Diaz, 30 a case where the petitioner did not attach default in the present Rules of Civil Procedure. The decision states:
to her petition for review a copy of the contract to sell that was at the center of
Prior to the 1997 Revised Rules of Civil Procedure, the phrase
controversy, the Court nonetheless found that there was a substantial
"as in default" was initially included in Rule 20 of the old rules, and
compliance with the rule, considering that the petitioner had appended to the which read as follows:
petition for review a certified copy of the decision of the MTC that contained a
verbatim reproduction of the omitted contract. cSCADE
Sec. 2. A party who fails to appear at a pre-trial
conference may be non-suited or considered as in default.
Recently, in Galvez v. CA, 31 it was held that attaching the other records
It was however amended in the 1997 Revised Rules of Civil
of the MTC and the RTC were not necessary based on the circumstances of
Procedure. Justice Regalado, in his book REMEDIAL LAW
the case. The petitioner therein was not assailing the propriety of the findings COMPENDIUM, explained the rationale for the deletion of the phrase
of fact by the MTC and the RTC, but only the conclusions reached by the said "as in default" in the amended provision, to wit:
lower courts after their appreciation of the facts. In dealing with the questions
of law, the CA could simply refer to the attached decisions of the MTC and the 1. This is a substantial reproduction of Section 2 of
RTC. the former Rule 20 with the change that, instead of defendant
being declared "as in default" by reason of his non-
Thus, the question in the case at bench is whether or not the petitioners appearance, this section now spells out that the procedure will
attached the sufficient pleadings and material portions of the records in their be to allow the ex parte presentation of plaintiff's evidence and
petition for review. The Court rules that the petition was in substantial the rendition of judgment on the basis thereof. While actually
compliance with the requirements. TCcDaE the procedure remains the same, the purpose is one of
semantical propriety or terminological accuracy as there were
The assignment of error 32 in the petition for review clearly raises criticisms on the use of the word "default" in the former
questions of fact as the petitioners assail the appreciation of evidence by the provision since that term is identified with the failure to file a
MCTC and the RTC. Thus, aside from the decisions and orders of the MCTC required answer, not appearance in court. DAEcIS

and the RTC, the petitioners should attach pertinent portions of the records
such as the testimony of the sole witness of respondent, the copies of the If the absent party is the plaintiff, then his case shall be dismissed. If it
cash disbursement vouchers and the PNB checks presented by respondent in is the defendant who fails to appear, then the plaintiff is allowed to present his
the MCTC. In the petition for review, the petitioners attached respondent's evidence ex parte and the court shall render judgment on the basis thereof.
complaints before the MCTC which contained the photocopies of the cash Thus, the plaintiff is given the privilege to present his evidence without
disbursement vouchers and PNB checks. These should be considered as objection from the defendant, the likelihood being that the court will decide in
ample compliance with Section 2, Rule 42 of the Rules of Court. favor of the plaintiff, the defendant having forfeited the opportunity to rebut or
present his own evidence. 35
Second Procedural Issue
The pre-trial cannot be taken for granted. It is not a mere technicality in
Nevertheless, instead of remanding the case to the CA, this Court
court proceedings for it serves a vital objective: the simplification, abbreviation
deems it fit to rule on the merits of the case to once and for all settle the
and expedition of the trial, if not indeed its dispensation. 36 More significantly,
dispute of the parties.
the pre-trial has been institutionalized as the answer to the clarion call for the
speedy disposition of cases. Hailed as the most important procedural
innovation in Anglo-Saxon justice in the nineteenth century, it paved the way rule in the relatively recent Lim v. Mindanao Wines and Liquour
for a less cluttered trial and resolution of the case. It is, thus, mandatory for Galleria stating that a check, the entries of which are in writing, could
the trial court to conduct pre-trial in civil cases in order to realize the prove a loan transaction. 42 acCETD

paramount objective of simplifying, abbreviating and expediting trial. 37 cAEaSC

There is no dispute that the signatures of the petitioners were present

In the case at bench, the petitioners failed to attend the pre-trial on both the PNB checks and the cash disbursement vouchers. The checks
conference set on August 25, 2009. They did not even give any excuse for were also made payable to the order of the petitioners. Hence, respondent
their non-appearance, manifestly ignoring the importance of the pre-trial can properly demand that they pay the amounts borrowed. If the petitioners
stage. Thus, the MCTC properly issued the August 25, 2009 Order, 38 allowing believe that there is some other bogus scheme afoot, then they must institute
respondent to present evidence ex parte. a separate action against the responsible personalities. Otherwise, the Court
can only rule on the evidence on record in the case at bench, applying the
The MCTC even showed leniency when it directed the counsels of the appropriate laws and jurisprudence.
parties to submit their respective position papers on whether or not Aguilar
and Calimbas could still participate in the trial of the case despite their As to the award of attorney's fees, the Court is of the view that the
absence in the pre-trial conference. This gave Aguilar and Calimbas a second same must be removed. Attorney's fees are in the concept of actual or
chance to explain their non-attendance and, yet, only respondent complied compensatory damages allowed under the circumstances provided for in
with the directive to file a position paper. The MCTC, in its Order, 39 dated Article 2208 of the Civil Code, and absent any evidence supporting its grant,
April 27, 2011, properly held that since the proceedings were being heard ex the same must be deleted for lack of factual basis. 43 In this case, the MCTC
parte, Aguilar and Calimbas had no right to participate therein and to cross- merely stated that respondent was constrained to file the present suit on
examine the witness. account of the petitioners' obstinate failure to settle their obligation. Without
any other basis on record to support the award, such cannot be upheld in
Thus, as it stands, the Court can only consider the evidence on record favor of respondent. The settled rule is that no premium should be placed on
offered by respondent. The petitioners lost their right to present their evidence the right to litigate and that not every winning party is entitled to an automatic
during the trial and, a fortiori, on appeal due to their disregard of the
grant of attorney's fees. 44
mandatory attendance in the pre-trial conference.
WHEREFORE, the petition is PARTIALLY GRANTED.
Substantive Issue
In accord with the discourse on the substantive issue, the January 2,
And on the merits of the case, the Court holds that there was indeed a
2013 decision of the Regional Trial Court, Branch 5, Dinalupihan, Bataan, is
contract of loan between the petitioners and respondent. The Court agrees
AFFIRMED. The award of attorney's fees is, however, DELETED.
with the findings of fact of the MCTC and the RTC that a check was a
sufficient evidence of a loan transaction. The findings of fact of the trial court, SO ORDERED. SIcEHD

its calibration of the testimonies of the witnesses and its assessment of the
probative weight thereof, as well as its conclusions anchored on the findings Carpio, Velasco, Jr., * Del Castillo and Leonen, JJ., concur.
are accorded high respect, if not conclusive effect. 40 CDISAc

The case of Pua v. Spouses Lo Bun Tiong 41 discussed the weight of a Footnotes
check as an evidence of a loan: * Designated Acting member in lieu of Associate Justice Arturo D. Brion,
In Pacheco v. Court of Appeals, this Court has expressly per Special Order No. 1910, dated January 12, 2015.
recognized that a check constitutes an evidence of indebtedness and 1. Penned by Associate Justice Mario V. Lopez with Associate Justice Amy
is a veritable proof of an obligation. Hence, it can be used in lieu of C. Lazaro-Javier and Associate Justice Socorro B. Inting, concurring; rollo,
and for the same purpose as a promissory note. In fact, in the pp. 135-136.
seminal case of Lozano v. Martinez, We pointed out that a check
functions more than a promissory note since it not only contains an 2. Id. at 137-138.
undertaking to pay an amount of money but is an "order addressed to 3. Penned by Executive Judge Jose Ener S. Fernando; id. at 51-55 and
a bank and partakes of a representation that the drawer has funds on 57-61.
deposit against which the check is drawn, sufficient to ensure
payment upon its presentation to the bank." This Court reiterated this 4. Penned by Presiding Judge Franco Paulo R. Arago; id. at 62-66 and 67-
71.
5. Id. at 107. 34. 645 Phil. 166, 174-175 (2010).
6. Id. at 82. 35. Tolentino v. Laurel, G.R. No. 181368, February 22, 2012, 666 SCRA
561, 569-570.
7. Id. at 73.
36. United Coconut Planters Bank v. Magpayo, 473 Phil. 739, 746 (2004).
8. Id. at 96-97.
37. Parañaque Kings Enterprise, Inc. v. Santos, G.R. No. 194638, July 2,
9. Id. at 102-103.
2014.
10. Id. at 104-106.
38. Id. at 96-97.
11. Id. at 107-111.
39. Id. at 102-103.
12. Id. at 62-66.
40. People v. Warriner, G.R. No. 208678, June 16, 2014.
13. Id. at 67-71.
41. G.R. No. 198660, October 23, 2013, 708 SCRA 571.
14. Id. at 66.
42. Id. at 584.
15. Id. at 71.
43. People v. Likiran, G.R. No. 201858, June 4, 2014.
16. Id. at 112.
44. First Lepanto-Taisho Insurance Corporation v. Chevron Philippines,
17. Id. at 114-132. Inc., G.R. No. 177839, January 18, 2012, 663 SCRA 309, 325.
18. Id. at 51-55.
19. Id. at 57-61.
20. Id. at 124-132.
21. Id. at 50 and 56.
22. Id. at 27-49.
23. Id. at 135-136.
24. Id. at 139-145.
25. Id. at 14.
26. Id. at 160-171.
27. Id. at 178-188.
28. 544 Phil. 369 (2007).
29. Id. at 377.
30. 390 Phil. 1245, 1252 (2000).
31. G.R. No. 157445, April 3, 2013, 695 SCRA 10, 24.
32. Rollo, pp. 36-37.
33. Sec. 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.