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Central Visayas Finance Corp. Vs Spouses Eliezer
Central Visayas Finance Corp. Vs Spouses Eliezer
212674
FIRST DIVISION
DECISION
This Petition for Review on Certiorari1 assails the February 15, 2013
Decision2 and April 24, 2014 Resolution3 of the Court of Appeals
(CA) which denied the appeal in CA-G.R. CEB-C.V. No. 02899 and
affirmed the July 31, 2008 Order4 of the Regional Trial Court of
Cebu City, Branch 8 (RTC), in Civil Case No. CEB-24841.
:
Factual Antecedents
Eliezer and Leila Adlawan failed to pay the loan, prompting petitioner
to file an action against respondents for replevin before Branch 58
of the Cebu Regional Trial Court, docketed as Civil Case No. CEB-
22294.
In a June 22, 1999 decision, the trial court ruled in petitioner's favor,
and respondents were ordered to deliver possession of the dump
truck to petitioner. Petitioner then foreclosed on the chattel
mortgage and caused the sale at public auction of the dump truck,
which was then sold to it as the highest bidder for Php500,000.00.8
xxxx
The Court agrees with the defendants that the instant complaint
is barred by res judicata under Section 47(b), Rule 39 of the
Rules of Court.
The judgment of the 58th Branch of this Court in Civil Case No.
CEB-22294, which involves, as in this case, the same parties,
subject matter and cause of action, i.e., non-payment of the loan,
secured by a mortgage over the above vehicle, obtained by
defendants Eliezer and Leila from the plaintiff, was one on the
merits, rendered by a court that had jurisdiction over the subject
matter thereof and the parties therein, and had become final.
The plaintiffs remedy should have been to appeal from the above
judgment for its alleged failure to consider defendants Eliezer
and Leila's whole obligation. If, for the sake of argument, the
amount of said defendants' whole obligation to the plaintiff was
not actually raised in said case, hence, the failure of the 58th
Branch of this Court to consider it, it is still covered and barred
:
by res judicata under the above-cited Rule because it is one that
could have been raised therein.
SO ORDERED.11
Petitioner appealed the above Order of the trial court before the CA,
claiming that the trial court erred in ruling that res judicata applied,
in that there is no identity of cause of action between Civil Case No.
CEB-22294 and Civil Case No. CEB-24841, as the first was one for
the recovery of personal property used as collateral in the loan,
while the latter case was one for deficiency judgment and based on
the continuing guaranty executed by Eliezer, Sr. and Elena Adlawan.
A reading of the reliefs prayed for in Civil Case No. 22294 would
show that the principal relief was for the recovery of the
possession of the dump truck, which was used as a collateral in
the mortgage contract between the parties. In the event that
delivery thereof cannot be effected, plaintiff stated an alternative
prayer, that is, for the defendants to pay the amount of
Php2,604,604.97 which represented the outstanding obligation
of the defendants. Since the first relief was granted by the trial
court, which is the delivery of the dump truck, was it necessary
for the trial court to pronounce the full monetary liability of the
defendants in the said action? Moreover, may the plaintiff still
recover the deficiency of the monetary obligation incurred by the
defendants?
The issue presented in this case is not novel. The instant case
has similar facts and circumstances with that of the case of PCI
Leasing v. Dai.12 In this case, the Supreme Court ruled that an
action for replevin, which is both an action in personam and in
rem, bars the deficiency suit because the deficiency could well
be raised in the replevin case. x x x
xxxx
Issues
I.
II.
Petitioner's Arguments
Respondents' Arguments
Our Ruling
2. costs of suit.18
Clearly, petitioner's prayer for relief in its complaint in Civil Case No.
:
CEB-22294 was in the alternative, and not cumulative or
successive, to wit: recover possession of the dump truck, or, if
recovery is no longer feasible, a money judgment for the
outstanding loan amount. Petitioner did not pray for both reliefs
cumulatively or successively. "The rule is that a party is entitled only
to such relief consistent with and limited to that sought by the
pleadings or incidental thereto. A trial court would be acting beyond
its jurisdiction if it grants relief to a party beyond the scope of the
pleadings."19
For res judicata to apply, four requisites must be met: (1) the
:
former judgment or order must be final; (2) it must be a judgment
or an order on the merits; (3) it must have been rendered by a
court having jurisdiction over the subject matter and the parties;
and (4) there must be, between the first and second actions,
identity of parties, of subject matter and cause of action.
xxxx
Petitioner ignores the fact that it prayed in the replevin case that
in the event manual delivery of the vessel could not be effected,
the court render judgment in its favor by ordering [herein
respondents] to pay ... the sum of P3,502,095.00 plus interest
and penalty thereon from October 12, 1994 until fully paid as
provided in the Promissory Note.
The Bachrach Motor Co., Inc. v. Icarangal and PCI Leasing &
Finance, Inc. v. Dai rulings were reiterated in Allandale Sportsline
Inc. v. The Good Development Corporation,23 where this Court
ruled that -
xxxx
xxxx
SO ORDERED.
Footnotes
5 Id. at 49.
6 Id. at 50-51.
7 Id. at 52.
9 Id. at 43-48.
10 Id. at 54-63.
11 Id. at 64-66.
14 Id. at 114-115.
15 Id. at 17.
16 Id. at 109-110.
17 Id. at 104-107.
18 Id. at 35.
:
19 Spouses Gonzaga v. Court of Appeals, 483 Phil. 424, 437
(2004).
22 Id. at 92-96.