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TITLE: Parañaque Kings Enterprises, Inc. vs.

Santos
CITATION: G.R. No. 194638. July 2, 2014.
TOPIC: Rule 18, Sec. 1 – When Conducted

Facts:
Catalina L. Santos entered into a Contract of Lease with Frederick O. Chua over 8 parcels of land located
in Parañaque City (leased premises), specifically giving Chua the “first option or priority to buy” the same
in case of sale.

Chua then caused the construction of a 6-door commercial complex on the leased premises but, by reason
of business reverses, he was constrained to assign his rights thereon to Lee Ching Bing, who likewise
assumed all obligations under the lease contract with Santos. Lee, in turn, executed a Deed of Assignment
over the leased premises, including all improvements thereon, in favor of petitioner Parañaque Kings
Enterprises, Inc.

Original case filed: (Wala gispecify unsay name sa complaint but about sya sa katong “first
option or priority to buy” nga supposedly magamit ni Paranaque pero
wala gi-honor ni Santos)
Jurisdiction: RTC
Original plaintiff: Parañaque Kings Enterprises, Inc.
Original defendants: Catalina L. Santos and David A. Raymundo to whom Santos allegedly sold
the leased premises

Decision of the RTC:


Dismissed for lack of cause of action

Decision of the CA:


Affirmed the RTC’s ruling

Decision of the SC:


Reversed CA’s decision upon a finding that the Complaint “sufficiently alleges an actionable contractual
breach” on the part of respondents.

The Court remanded the case to the trial court for further proceedings.

Respondents filed their Compulsory Counterclaims.

Petitioner filed a Motion to Strike out from the Answer with Compulsory Counterclaims Certain
Allegations or Matters. – denied by the RTC.

On July 2, 1998, petitioner filed a Motion to cancel Pre-Trial, claiming that it was preparing a petition for
certiorari and prohibition which was to be filed with the CA before the scheduled pre-trial on July 7, 1998.

Incidentally, the petition for certiorari and prohibition was actually filed at 2:17 in the afternoon of July 7,
1998, (contrary to petitioner’s assertion in its Motion to Cancel Pre-Trial that it was to be filed before the
July 7, 1998 pre-trial.)
Decision of the CA:
Granted the petition

Meanwhile, on July 7, 1998, the day of the pre-trial sought to be cancelled, the RTC denied petitioner’s
Motion to Cancel Pre-Trial in its First Order of even date. Accordingly, the RTC directed the parties to
proceed to pre-trial as scheduled.

The trial court then required petitioner to start the pretrial with the statement of its cause. However,
counsel for petitioner, Atty. Nelson Santos, refused to do so saying he would just furnish the court the
following day with a copy of the petition for certiorari and prohibition filed with the CA. Consequently,
upon motion of the opposing counsel, the RTC declared petitioner nonsuited, and dismissed the
Complaint in its Second Order of the same day.

Again, petitioner filed a motion for reconsideration, which was denied by the RTC, holding that the
dismissal of the Complaint was due to petitioner’s defiance of the order to proceed with the pre-trial.
Section 3, Rule 17 of the Rules of Court authorizes the court to dismiss the complaint, upon motion or
motu propio, for failure of the plaintiff to comply with any of its orders.

Issue:
Whether or not the dismissal of the complaint on the ground of failure of petitioner to proceed to pre-
trial is proper

Ruling:
Yes.

At the outset, it should be emphasized that the trial court has the discretion on whether to grant or deny
a motion to postpone and/or reschedule the pre-trial conference in accordance with the circumstances
obtaining in the case. This must be so as it is the trial court which is able to witness firsthand the events
as they unfold during the trial of a case. Postponements, while permissible, must not be countenanced
except for clearly meritorious grounds and in light of the attendant circumstances.

In this case, the RTC was able to explain to the satisfaction of the Court that the postponement of the
pretrial scheduled on July 7, 1998 was not warranted under the circumstances detailed below:
As far as the Court could gather, the sought postponement of the pre-trial on July 7 was dilatory,
if movant was not trifling with this court, because at the pre-trial scheduled on March 26, 1998 it
was plaintiff -movant through counsel, Justice Emilio Gancayco, who asked for time and was given
10 days to file motion for contempt and to strike out averments in defendants’ answer. Thus, pre-
trial was reset to May 21, 1998. But on May 21, 1998 the pre-trial was again reset to June 11, 1998
to enable movant’s counsel, Atty. Nelson Santos, to prepare for pre -trial as he was not ready for
pre-trial. The scheduled pre-trial on June 11, 1998 was blocked by plaintiff’s Motion for Inhibition
and to vacate and/or reconsider the order of May 18, 1998. Both counsel submitted the matter
for resolution and agreed that the pre-trial likewise be scheduled in that resolution, considering
that Atty. Tomacruz (counsel for defendants) may oppose the postponement of the pretrial of the
June 11 pre-trial if no date is fixed therein. The June 11 pre-trial was accordingly reset to July 7,
1998 as the court denied the motion for inhibition and reconsideration.

The pattern to delay the pre-trial of the instant case is quite evident from the foregoing. Petitioner clearly
trifled with the mandatory character of a pre-trial, which is a procedural device intended to clarify and
limit the basic issues raised by the parties and to take the trial of cases out of the realm of surprise and
maneuvering. More significantly, a 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 paves the way for a less cluttered trial and resolution of the case. It is,
thus, mandatory for the trial court to conduct pretrial in civil cases in order to realize the paramount
objective of simplifying; abbreviating, and expediting trial.

It should be recalled that the Complaint was filed by petitioner on March 19, 1991. Seven (7) years later,
or in 1998, no pre-trial had been conducted as yet. Petitioner’s refusal to proceed with the pre-trial could
not be justified by the filing of the petition for certiorari and prohibition.

The Court finally considers that this case was elevated to the CA for four (4) times, and this is the third
time that the Court has to resolve issues between the parties, at the instance of petitioner. If this case has
dragged on for more than two (2) decades, surely petitioner cannot wash its hands of any responsibility
therefor. The expeditious disposition of cases is as much the duty of petitioner, being the plaintiff, as the
court’s.

After more than two (2) decades, respondents certainly do not deserve the agony of going through the
same issues all over again with petitioner, which could have been settled had the latter simply proceeded
to pre-trial and had given the trial court the opportunity to evaluate the evidence, apply the law, and
decree the proper judgment.