In Rizal Commercial Banking Corporation v. F. Franco Transport, Inc., the Supreme Court addressed the extent of a trial court’s power to dismiss an appeal. The Court clarified that while both trial and appellate courts can dismiss appeals, a trial court’s authority is limited to instances where the appeal is filed late or when the required fees are not paid. The Supreme Court ultimately ruled in favor of Rizal Commercial Banking Corporation (RCBC), affirming the trial court’s dismissal of F. Franco Transport, Inc.’s appeal and directing the immediate implementation of the alias writ of possession.

Mortgage Default and Possession Disputes: When Can a Trial Court Dismiss an Appeal?

F. Franco Transport, Inc. obtained loans from Rizal Commercial Banking Corporation (RCBC), secured by a real estate mortgage. When F. Franco Transport defaulted, RCBC initiated extra-judicial foreclosure proceedings and emerged as the highest bidder at the public auction. After F. Franco Transport failed to redeem the property, RCBC petitioned the Regional Trial Court (RTC) for a writ of possession, which was initially granted. Subsequent motions and appeals filed by F. Franco Transport were denied, leading to RCBC’s renewed request for an alias writ of possession. The RTC granted this request, but when F. Franco Transport attempted to appeal the order, the RTC denied their notice of appeal, arguing that the order was merely incidental to the execution of a final order. This denial prompted F. Franco Transport to elevate the matter to the Court of Appeals (CA), which reversed the RTC’s decision. The CA directed the RTC to give due course to F. Franco Transport’s notice of appeal. RCBC then appealed to the Supreme Court, questioning whether the CA erred in ordering the RTC to allow the appeal.

The Supreme Court emphasized that an appeal is a statutory right that must be exercised following the provisions of law. While the right to appeal is essential to judicial process, it is not a natural right and must comply with legal requirements. Failure to comply with such requirements may result in loss of the right to appeal. Section 2, Rule 41 of the Rules of Court outlines the modes of appeal.

The Court acknowledged that both trial and appellate courts possess the power to dismiss an appeal, but their grounds for doing so differ. The CA had determined that the RTC committed a jurisdictional error by dismissing F. Franco Transport’s notice of appeal. The Supreme Court agreed. It cited Section 13, Rule 41 of the Rules of Court, which limits the RTC’s authority to dismiss appeals based on only two grounds:

Section 13. Dismissal of appeal. – Prior to the transmittal of the original record or the record on appeal to the appellate court, the trial court may, motu proprio or on motion, dismiss the appeal for having been taken out of time or non-payment of the docket and other lawful fees within the reglementary period.(13a)

The Court emphasized that the RTC’s competence to dismiss an appeal is strictly limited to these instances. The Supreme Court also noted that the determination of whether a case is appealable falls within the jurisdiction of the appellate court, not the trial court. As the Court stated, allowing the trial court to decide appealability would permit it to prevent the review of potentially erroneous rulings. It follows that the RTC’s dismissal of the appeal, based on the judgment not being appealable, constituted grave abuse of discretion, as this determination is reserved for the CA.

Despite agreeing that the RTC overstepped its bounds, the Supreme Court considered the prolonged nature of the case, which had been ongoing since May 2001. To prevent further delays, the Court decided to resolve the case directly, rather than remanding it to the RTC. Previous Supreme Court resolutions in G.R. No. 160925 had already upheld the RTC’s directive to implement the writ of possession, making further delays unacceptable.

The Court noted that the order F. Franco Transport sought to appeal was an order of execution, which is considered an interlocutory order and is therefore not appealable. Section 1, Rule 41 of the Rules of Court explicitly lists interlocutory orders and orders of execution as not subject to appeal. The Supreme Court defined an interlocutory order as one that does not fully resolve the case, leaving further decisions to be made by the trial court.

The Supreme Court highlighted several reasons why reviewing the validity of the alias writ of possession was impermissible. First, the order in question concerned the implementation of the writ of possession, which is a means of enforcing a court judgment to recover land possession. An alias writ is simply a subsequent writ issued when the original fails to achieve its purpose.

Furthermore, the Court cited the doctrine of conclusiveness of judgment, stating:

Under the doctrine of conclusiveness of judgment, which is also known as ‘preclusion of issues’ or ‘collateral estoppel,’ issues actually and directly resolved in a former suit cannot again be raised in any future case between the same parties involving a different cause of action.

The propriety of issuing the writ of possession had already been affirmed in G.R. No. 160925, making any further review redundant. The Court also noted that the pending action in the Quezon City RTC seeking annulment of the contract should not impede the foreclosure proceedings or the implementation of the writ of possession. Even if there were questions regarding the mortgage’s validity, the purchaser of the property (RCBC) was entitled to the writ of possession, without prejudice to the outcome of the annulment case.

Lastly, the Court addressed F. Franco Transport’s willingness to enter into a compromise agreement. While compromise is a valid means of resolving disputes, courts cannot force parties to compromise. RCBC’s reluctance to compromise, coupled with the multiple requests for a writ of possession, indicated that the parties were far from reaching an agreement. Therefore, the possibility of a compromise should not prevent the implementation of the alias writ.

FAQs

What was the central issue in this case?	The central issue was whether the trial court (RTC) acted correctly in dismissing the respondent’s notice of appeal concerning the implementation of a writ of possession.
What are the grounds for a trial court to dismiss an appeal?	A trial court can dismiss an appeal only if it was filed out of time or if the appellant failed to pay the required docket and other lawful fees within the prescribed period.
What is an alias writ of possession?	An alias writ of possession is a second writ issued when the first writ of possession fails to achieve its intended purpose, which is to enforce a judgment for land possession.
Is an order of execution appealable?	No, an order of execution is considered an interlocutory order and is not appealable under the Rules of Court.
What is the doctrine of conclusiveness of judgment?	The doctrine of conclusiveness of judgment, also known as collateral estoppel, prevents the relitigation of issues that have already been directly resolved in a previous case between the same parties.
Does a pending annulment case affect the issuance of a writ of possession?	No, a pending case seeking to annul a mortgage or foreclosure does not prevent the issuance of a writ of possession to the purchaser of the property.
Can a court compel parties to enter into a compromise agreement?	No, courts cannot compel parties to enter into a compromise. A compromise requires the voluntary agreement of all parties involved.
What was the Supreme Court’s final ruling?	The Supreme Court granted RCBC’s petition, affirmed the RTC’s dismissal of F. Franco Transport’s appeal, and directed the RTC to proceed with the immediate implementation of the alias writ of possession.

This case reinforces the importance of adhering to procedural rules in appeals and clarifies the distinct roles of trial and appellate courts in the Philippine legal system. By resolving the dispute promptly, the Supreme Court upheld the rights of the petitioner and prevented further delays in the execution of a valid court order. The decision underscores the principle that while the right to appeal is important, it must be exercised within the bounds of the law and cannot be used to indefinitely delay the execution of judgments.

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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: RCBC v. F. Franco Transport, G.R. No. 191202, November 21, 2018