In Majestic Finance and Investment Co., Inc. v. Tito, the Supreme Court ruled that an intervenor’s right to prosecute a claim is contingent upon the diligence of the original plaintiff. If the original plaintiff fails to prosecute the action diligently, leading to its dismissal, the intervenor’s right to continue the case also ceases. This decision underscores the importance of actively pursuing legal claims and highlights that intervention is ancillary to the main action, not an independent right.

Intervention Interrupted: When Delay Dims the Intervenor’s Day in Court

The case began with a rescission case where Majestic Finance sought to recover property from Thomas Cort. After Cort’s death, Jose Tito, claiming to be Cort’s heir, filed an annulment case against Majestic, asserting that the court lacked jurisdiction over Cort. Subsequently, Tito transferred his interest in the property to spouses Jose and Rosita Nazal (Sps. Nazal), who then joined the annulment case as intervenors. However, the annulment case languished for years due to inaction, leading the Regional Trial Court (RTC) to dismiss it for failure to prosecute. The Court of Appeals (CA) reversed this decision, allowing Sps. Nazal to continue the case. Majestic then appealed to the Supreme Court, questioning whether the CA erred in allowing Sps. Nazal to prosecute their claim.

The Supreme Court emphasized that intervention is not an independent action but is ancillary to the existing litigation. The purpose of intervention is to allow a non-party with a right or interest in the case to join and protect those interests. However, this right is dependent on the original party’s diligent prosecution of the case. As the Court articulated:

Case law states that intervention is never an independent action, but is merely ancillary and supplemental to the existing litigation. Its purpose is not to obstruct or unnecessarily delay the placid operation of the machinery of trial, but merely to afford one not an original party, who is claiming a certain right or interest in the pending case, the opportunity to appear and be joined so he could assert or protect such right or interests. In other words, the right of an intervenor should only be in aid of the right of the original party.

Building on this principle, the Court noted that when the original party’s right ceases to exist, the intervenor’s right also ceases. In this case, Tito, the original plaintiff, failed to diligently prosecute the annulment case, leading to its dismissal. Therefore, Sps. Nazal’s right to intervene and continue the case was also extinguished.

The Court further clarified that because Tito had already transferred his interest in the property to Sps. Nazal before the annulment case was even initiated, Sps. Nazal should have been considered the actual plaintiffs. The Rules of Court state:

A real party in interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. Unless otherwise authorized by law or these Rules, every action must be prosecuted or defended in the name of the real party in interest.

This meant that Sps. Nazal bore the responsibility to diligently pursue the case. However, the RTC found that they failed to do so. Although Sps. Nazal filed a motion to set the case for pre-trial in 1987, they took no further action for almost eleven years, until 1998, when they were prompted to act by an unlawful detainer case filed against them. The Court found this delay unreasonable and unjustified.

The Rules of Court outline the duties of both the clerk of court and the plaintiff in setting a case for pre-trial. A.M. No. 03-1-09-SC, RE: PROPOSED RULE ON GUIDELINES TO BE OBSERVED BY TRIAL COURT JUDGES AND CLERKS OF COURT IN THE CONDUCT OF PRE-TRIAL AND USE OF DEPOSITION-DISCOVERY MEASURES (August 16, 2004) provides:

Within five (5) days from date of filing of the reply, the plaintiff must promptly move ex parte that the case be set for pre-trial conference. If the plaintiff fails to file said motion within the given period, the Branch [Clerk of Court] shall issue a notice of pre-trial.

While the clerk of court has a duty to set the case for pre-trial, this does not relieve the plaintiff of their duty to prosecute the case diligently. The Supreme Court has consistently held that the expeditious disposition of cases is the duty of both the plaintiff and the court. The Court observed:

Truth be told, the expeditious disposition of cases is as much the duty of the plaintiff as the court.

Sps. Nazal failed to offer a sufficient justification for their prolonged inaction. Their reliance on their counsel’s assurance that their claim was well-founded was deemed insufficient to excuse their failure to take any action for over a decade. Consequently, the Supreme Court reversed the Court of Appeals’ decision and dismissed the annulment case.

FAQs

What was the key issue in this case?	The key issue was whether intervenors could continue prosecuting a case after the original plaintiff failed to diligently prosecute it, leading to its dismissal.
What did the Supreme Court rule?	The Supreme Court ruled that the intervenors’ right to prosecute the claim ceased when the original plaintiff failed to diligently prosecute the action, resulting in its dismissal.
What is the basis for the Court’s ruling?	The Court based its ruling on the principle that intervention is ancillary to the main action and that the intervenor’s right is dependent on the original party’s diligent prosecution of the case.
Who were the intervenors in this case?	The intervenors were spouses Jose and Rosita Nazal, who had acquired an interest in the property subject of the litigation from the original plaintiff, Jose D. Tito.
What was the cause of the delay in the case?	The delay was due to the inaction of both the original plaintiff and the intervenors, who failed to take any action to move the case forward for an unreasonably long period of time.
What is the duty of a plaintiff in prosecuting a case?	A plaintiff has a duty to diligently prosecute their case within a reasonable time, including taking steps to ensure that the case is set for pre-trial and trial.
What is the effect of dismissing a case for failure to prosecute?	Dismissal for failure to prosecute has the effect of an adjudication upon the merits, unless otherwise declared by the court, meaning that the plaintiff is barred from refiling the same claim.
Can a transferee of interest be considered a real party in interest?	Yes, a transferee of interest can be considered a real party in interest if the transfer occurred before the commencement of the suit, making them the party who stands to be benefited or injured by the judgment.
What should the intervenors have done differently in this case?	The intervenors should have taken proactive steps to move the case forward, such as regularly following up with the court and ensuring that the case was set for pre-trial and trial.

This case serves as a reminder to all parties involved in litigation, including intervenors, of the importance of diligently prosecuting their claims. Failure to do so can result in the dismissal of the case and the loss of the opportunity to protect their interests. The court’s decision reinforces the principle that intervention is not an independent right and that intervenors must actively participate in the litigation to protect their claims.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: MAJESTIC FINANCE AND INVESTMENT CO., INC. VS. JOSE D. TITO, G.R. No. 197442, October 22, 2014