6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

 
 

G.R. No. 214593.  July 17, 2019.*

 
DANA S. SANTOS, petitioner,  vs.  LEODEGARIO R. SANTOS,
respondent.

Remedial Law; Civil Procedure; Relief from Judgment; There is no

provision in Administrative Matter (A.M.) No. 02-11-10-SC prohibiting
resort to a petition for relief from judgment in a marriage nullity case.—
There is no provision in A.M. No. 02-11-10-SC prohibiting resort to a
petition for relief from judgment in a marriage nullity case. Furthermore, the
said Rule sanctions the suppletory application of the Rules of Court to cases
within its ambit. It cannot, therefore, be said that Dana availed of an
inappropriate remedy to question the decision of the trial court. Indeed, the
trial court admitted Dana’s petition for relief, heard the parties on the issues
thereon, and rendered an order denying the petition. Dana then properly and
seasonably assailed the order of denial  via  certiorari  to the CA. It is,
therefore, clear that the proceedings in Civil Case No. 03-6954 continued
even after the trial court had rendered judgment and even after the lapse of
the 15-day period for appealing the decision.
Same; Same; Same; The 1997 Rules of Civil Procedure changed the
nature of an order of denial of a petition for relief from judgment, making it
unappealable and, hence, assailable only via a petition for certiorari.—The
1997 Rules of Civil Procedure changed the nature of an order of denial of a
petition for relief from judgment, making it unappealable and, hence,
assailable only  via  a petition for  certiorari. Nevertheless, the appellate
court, in deciding such petitions against denials of petitions for relief,
remains tasked with making a factual determination, i.e., whether or not the
trial court committed grave abuse of discretion in denying the petition. To
do so, it is still obliged, as  Service Specialists  instructs, to “determine not
only the existence of any of the grounds relied upon whether it be fraud,
accident, mistake or excusable negligence, but also and primarily the merit
of the petitioner’s cause of action or defense, as the case may be.” Stated
otherwise, the finality of the RTC’s decision cannot bar the appellate court
from determining the issues raised in the petition for relief, if only to
determine the existence of grave abuse of discre-

_______________

* THIRD DIVISION.

 
 
328
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 1/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

328 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

tion on the part of the trial court in denying such petition. While a Rule
38 Petition does not stay the execution of the judgment, the grant thereof
reopens the case for a new trial; and thus, if merit be found in Dana’s
certiorari petition assailing the trial court’s denial of her petition for relief,
the case will be reopened for new trial.
Same; Same; Judgment on Compromise; Like any other judgment, a
judgment upon compromise which is contrary to law is a void judgment;
and “[a] void judgment or order has no legal and binding effect. It does not
divest rights, and no rights can be obtained under it; all proceedings
founded upon a void judgment are equally worthless.”—The Court now
resolves the question regarding the propriety of setting aside the judgment
on compromise. On one hand, the immutability and immediate effect of
judgments upon compromise is well-settled. In Magbanua v. Uy, 458 SCRA
184 (2005), it was held that: When a compromise agreement is given
judicial approval, it becomes more than a contract binding upon the parties.
Having been sanctioned by the court, it is entered as a determination of a
controversy and has the force and effect of a judgment. It is immediately
executory and not appealable, except for vices of consent or forgery. The
nonfulfillment of its terms and conditions justifies the issuance of a writ of
execution; in such an instance, execution becomes a ministerial duty of the
court. However, like any other judgment, a judgment upon compromise
which is contrary to law is a void judgment; and “[a] void judgment or order
has no legal and binding effect. It does not divest rights, and no rights can
be obtained under it; all proceedings founded upon a void judgment are
equally worthless.”
Civil Law; Persons and Family Relations; Marriages; Annulment of
Marriage by Compromise; In a long line of cases, the Supreme Court (SC)
has censured and punished lawyers, and even judges, who have drafted
agreements to dissolve marriages or to sanction adulterous relations.—In a
long line of cases, the Court has censured and punished lawyers, and even
judges, who have drafted agreements to dissolve marriages or to sanction
adulterous relations. The rule applies a fortiori to the CA. It was, therefore,
erroneous for the appellate court to terminate Dana’s suit — which puts in
issue the validity of her marriage — by virtue of the execution of the
Decision 11 Q.R. No. 214593 compromise agreement which only covers the
property relations of the spouses. While these issues are intertwined, a
compromise of the latter issue should not and cannot operate as a
compromise of the former, per Article 2035 of the Civil Code.

 
 

329

VOL. 909, JULY 17, 2019 329

Santos vs. Santos

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 2/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

Remedial Law; Civil Procedure; Remand of Cases; It has been held

that “remand is not necessary if the Supreme Court (SC) is in a position to
resolve a dispute on the basis of the records before it; and if such remand
would not serve the ends of justice.”—While the remaining issues in the
petition partake of a factual nature, the Court deems it necessary to write
finis to this case at this level in order to avoid remanding the case to the
appellate court. It has been held that “remand is not necessary if the Court is
in a position to resolve a dispute on the basis of the records before it; and if
such remand would not serve the ends of justice.” A careful perusal of the
petitions filed by Dana before the trial court, the appellate court and this
Court betrays the lack of allegations sufficient to support a petition for relief
from judgment under Rule 38.
Same; Same; Relief from Judgment; Extrinsic Fraud; Words and
Phrases; Jurisprudence provides that fraud, as a ground for a petition for
relief, refers to extrinsic or collateral fraud which, in turn, has been defined
as fraud that prevented the unsuccessful party from fully and fairly
presenting his case or defense and from having an adversarial trial of the
issue, as when the lawyer connives to defeat or corruptly sells out his
client’s interest.—Jurisprudence provides that fraud, as a ground for a
petition for relief, refers to extrinsic or collateral fraud which, in turn, has
been defined as fraud that prevented the unsuccessful party from fully and
fairly presenting his case or defense and from having an adversarial trial of
the issue, as when the lawyer connives to defeat or corruptly sells out his
client’s interest. Extrinsic fraud can be committed by a counsel against his
client when the latter is prevented from presenting his case to the court.

PETITION for review on certiorari of the resolutions of the Court of

Appeals.
The facts are stated in the opinion of the Court.
   C.B. Brillantes Law Office for petitioner.
           Napoleon Uy-Galit for respondent.

 
 

330

330 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

A. REYES, JR.,  J.:

 
This is a petition for review on certiorari1 under Rule 45 of the
Revised Rules of Court, dated November 24, 2014, assailing two
Resolutions of the Court of Appeals (CA) in C.A.-G.R. S.P. No.
115420, respectively dated April 15, 2014,2 which denied petitioner
Dana S. Santos’ (Dana) Motion to Open and/or Reinstate Petition;
and September 26, 2014,3 which denied Dana’s Motion for
Reconsideration and/or to Submit Petition for Decision (with Plea to
Preserve Marital Union). The case arose from a petition for relief
from judgment against the Decision4 dated June 24, 2009 of the
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 3/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

Regional Trial Court (RTC) of Antipolo City, Branch 72, in Civil

Case No. 03-6954 declaring the marriage between Dana and
respondent Leodegario S. Santos (Leodegario) null and void on the
ground of psychological incapacity under Article 36 of Executive
Order No. 209, otherwise known as the Family Code of the
Philippines.
 
The Facts
 
Dana and Leodegario first met each other in 1982, in a wake,
through a common friend. Their relationship developed into a
romance. Soon, the couple began living together. Their cohabitation
produced two children. As their business ventures prospered, Dana
and Leodegario married each other on December 3, 1987, before a
Catholic priest. Two more children were born to the couple after the
marriage. However, their relationship started to deteriorate as time
passed by. Heated arguments and suspicions of infidelity marred
their marriage so much, so that in 2001, Dana and Leodegario filed a
joint

_______________

1 Rollo, pp. 8-28.

2  Penned by Associate Justice Magdangal M. De Leon, with Associate Justices
Mario V. Lopez and Socorro B. Inting, concurring; id., at pp. 33-39.
3 Id., at pp. 41-43.
4 Rendered by Judge Ruth C. Santos; id., at pp. 70-79.

 
 

331

VOL. 909, JULY 17, 2019 331

Santos vs. Santos

petition for the dissolution of their conjugal partnership, which was

granted.5
The final straw came on September 11, 2003, when Leodegario
filed a petition for declaration of absolute nullity of marriage with
the RTC, docketed as Civil Case No. 03-6954, alleging
psychological incapacity on the part of Dana. The case was assigned
to Branch 72 of the aforesaid court. On April 2, 2004, Dana filed her
Answer, alleging that Leodegario filed the petition in order to marry
his paramour, with whom he had a son.6
The case proceeded to trial on the merits. The Public Prosecutor
found no evidence of collusion between Dana and Leodegario. Both
parties appeared in the pretrial conference and marked their
documentary exhibits. Leodegario presented as witnesses a clinical
psychologist, a former employee of the couple’s joint business, and
himself. However, when it was Dana’s turn to present evidence, her
counsel failed to appear despite notice. On February 26, 2009, the
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 4/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

trial court issued an Order declaring Dana to have waived her right
to present evidence and ordering Leodegario to submit his
memorandum, after which the case would be deemed submitted for
decision.7
On June 24, 2009, the trial court rendered its Decision.8  It
declared the marriage between Dana and Leodegario null and void
on the ground of psychological incapacity. The court held that Dana
was afflicted with grave, incurable and juridically antecedent
Histrionic Personality Disorder. Dana received a copy of the
decision on August 26, 2009.
Dana filed a Notice of Appeal on September 4, 2009; but she
withdrew her appeal and instead filed a Petition for Relief from
Judgment with the RTC, dated October 19, 2009, alleg-

_______________

5 Id., at p. 11.
6 Id., at pp. 52-65.
7 Id., at p. 80.
8 Id., at pp. 70-79.

 
 

332

332 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

ing that extrinsic fraud and mistake prevented her from presenting
her case at the trial. Leodegario filed a comment on the petition.
In an Order9 dated February 17, 2010, the trial court denied
Dana’s petition, ruling that there was no sufficient allegation of
fraud or mistake in the petition.
Dana filed a motion for reconsideration, which the trial court
denied in an Order10  dated April 22, 2010. Aggrieved, she filed a
petition for  certiorari  with the CA,11  ascribing grave abuse of
discretion on the part of the trial court when it denied her petition for
relief and allowed the Decision dated June 24, 2009 to stand despite
her inability to present her evidence. After a further exchange of
pleadings, the appellate court, in a Resolution12  dated February 7,
2011, referred Dana’s petition to the Philippine Mediation Center.
On June 6, 2011, under the auspices of the appellate court
mediator, Dana and Leodegario entered into a compromise
agreement,13 where they agreed to transfer the titles to their conjugal
real properties in the name of their four common children. On June
16, 2011, Dana moved for the archival of the case. On July 19, 2011,
the CA issued a Resolution14  declaring the case closed and
terminated by virtue of the compromise agreement and ordering the
issuance of entry of judgment.
On July 3, 2012, Dana filed a Manifestation15  alleging that
Leodegario was not complying with the compromise agreement. She
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 5/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

reiterated this allegation in her Motion to Reopen and/or Reinstate

the Petition16  which she filed on August 14, 2012. Ordered by the
appellate court to comment on the Mo-

_______________

9 Id., at pp. 91-94.

10 Id., at p. 103.
11 Docketed as C.A.-G.R. S.P. No. 115420; id., at pp. 104-127.
12 Id., at p. 148.
13 Id., at pp. 149-150.
14 Id., at p. 151.
15 Id., at pp. 154-156.
16 Id., at pp. 157-161.

 
 

333

VOL. 909, JULY 17, 2019 333

Santos vs. Santos

tion to Reopen, Leodegario countered that he has complied with the

essential obligations under the compromise agreement. He,
subsequently, filed a Manifestation showing such compliance,
attaching the copies of the transfer certificates of title with the
required annotations thereon, deeds of sale in favor of their common
children, and the new transfer certificates of title in the names of
their common children.17
 
Resolution dated
April 15, 2014

 
On April 15, 2014, the Former 15th Division of the CA rendered
the first assailed Resolution18  denying Dana’s Motion to Reopen,
thusly:

WHEREFORE, the motion to open and/or reinstate the petition

is hereby DENIED for lack of merit. Respondent’s manifestation
showing compliance with the compromise agreement is hereby
NOTED.
SO ORDERED.19

 
The appellate court noted Leodegario’s Manifestation showing
his compliance with the terms of the compromise agreement; on the
other hand, it found that Dana did not make any allegation or
showing of her compliance with the terms of the compromise
agreement. It then concluded that the motion was unmeritorious
since Dana, as a party to the compromise agreement herself, should
also prove her faithful compliance therewith.
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 6/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

Undaunted, Dana filed a Motion for Reconsideration and/or to

Submit Petition for Decision (with Plea to Preserve Marital
Union),20 asserting that the compromise agreement was never

_______________

17 Id., at p. 37.
18 Id., at pp. 32-39.
19 Id., at p. 39.
20 Id., at pp. 162-166.

 
 

334

334 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

intended to settle the issue of the validity and subsistence of her

marriage to Leodegario.
 
Resolution dated Sep-
tember 26, 2014
 
On September 26, 2014, the Former 15th Division of the CA
rendered the second assailed Resolution21 denying Dana’s Motion
for Reconsideration and/or to Submit Petition for Decision,
disposing, thus:

WHEREFORE, the Motion for Reconsideration and/or to

Submit Petition for Decision is DENIED for lack of merit.
SO ORDERED.22

 
The appellate court found the Motion for Reconsideration and/or
to Submit Petition for Decision unmeritorious. It held that the
marital ties between Dana and Leodegario had been severed by the
trial court’s decision of June 24, 2009; hence, the compromise
agreement did not involve the validity of their marriage but only
their property relations. Furthermore, the appellate court found that
Dana, in her Motion to Archive Case, had conceded her intention to
have the case dismissed upon compliance with the stipulations of the
Compromise Agreement.23
Aggrieved, Dana filed the present petition for review
on certiorari before this Court on November 24, 2014. The Office of
the Solicitor General (OSG) and Leodegario filed their respective
Comments on the petition.

_______________

21 Id., at pp. 40-43.

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 7/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

22 Id., at p. 43.
23 Id.

 
 

335

VOL. 909, JULY 17, 2019 335

Santos vs. Santos

The Issues
 
Dana raises the following issues for resolution by this Court:

1)  Whether or not the assailed resolutions of the CA, which

terminated her case by reason of the compromise agreement, were
erroneous for being contrary to the State’s legal mandate to defend
the sanctity of marriage;
2)  Whether or not the assailed resolutions of the CA, which in
effect upheld the order of the trial court dismissing her petition for
relief, violated her right to due process; and
3)  Whether or not the CA erred in ruling that the trial court’s
decision declaring the marriage void had attained finality despite the
filing of the petition for relief from judgment.24

 
Dana argues that she never intended to compromise the issue of
the validity of her marriage, as this cannot be the subject of
compromise under Article 2035 of the New Civil Code. She further
asserts that under Article 2041 of the New Civil Code, as applied
in  Miguel v. Montanez,25  she is entitled to simply consider the
compromise agreement as rescinded, since Leodegario committed a
breach of the agreement. Dana also claims that the termination of the
case on the basis of the compromise agreement violated her right to
due process, since she was unable to present her side of the
controversy. Lastly, she contends that the appellate court erred in
ruling that the trial court decision declaring the marriage void had
become final, claiming that her petition for relief amounted to a mo-

_______________

24 Id., at pp. 196-205.

25 680 Phil. 356; 664 SCRA 345 (2012).

 
 

336

336 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 8/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

tion for new trial, the filing of which is one of the requirements for
filing an appeal under A.M. No. 02-11-10-SC.26
The defensor vinculi, in his Comment, asserts that Dana’s failure
to file a motion for reconsideration or an appeal paved the way for
the trial court judgment to attain finality. Due to Dana’s failure to file
an appeal in accordance with Section 20 of A.M. No. 02-11-10-SC,
the OSG now contends, as the appellate court similarly concluded,
that the trial court decision had attained finality.
 
Ruling of the Court
 
The petition has no merit.
The core issue in this petition is the propriety of setting aside the
judgment upon compromise rendered by the court  a quo. Dana
maintains that the judgment should be vacated because of
Leodegario’s alleged breach of their compromise; and because she
did not intend to compromise the issue of the validity of her
marriage. To bolster her stand, she invokes Sections 1 and 2, Article
XV of the Constitution and urges the State to uphold, or at least try
to uphold, her marriage. Leodegario, on the other hand, asserts the
binding force of the trial court’s decision and the judgment on
compromise, claiming that the courts a quo  acted according to law
and jurisprudence in rendering the assailed judgments.
It must be borne in mind that Civil Case No. 03-6954 is a
proceeding for the declaration of nullity of the marriage between
Dana and Leodegario on the ground of psychological incapacity.
The applicable substantive laws are, therefore, the Family Code and
the New Civil Code, while the governing procedural law is A.M.
No. 02-11-10-SC, with the Rules of Court applying suppletorily.27

_______________

26 The Rule on Declaration of Absolute Nullity of Void Marriages and Annulment

of Voidable Marriages.
27 Id., Section 1.

 
 

337

VOL. 909, JULY 17, 2019 337

Santos vs. Santos

In the case at bar, the CA28 and the OSG29 both concluded that
the trial court decision had attained finality after Dana’s inability to
file an appeal therefrom. The two resolutions of the appellate court
presuppose that the judgment on the validity of Dana and
Leodegario’s marriage had attained finality. Dana, on the other hand,
asserts that it had not.
The Court agrees with the conclusion of the CA and the defensor
vinculi regarding the finality of the RTC’s decision; however, we do
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 9/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

not agree with their assertions as to the effect of the decision on the
subsequent proceedings a quo.
There is indeed no showing in the record that Dana moved for
reconsideration or new trial from the RTC’s decision. She,
nevertheless, filed an appeal. However, probably cognizant of the
proscription in Section 2030 of A.M. No. 02-11-10-SC, which makes
the filing of a motion for reconsideration or a motion for new trial a
precondition for filing an appeal, she withdrew her appeal and filed a
petition for relief from judgment.
There is no provision in A.M. No. 02-11-10-SC prohibiting resort
to a petition for relief from judgment in a marriage nullity case.
Furthermore, the said Rule sanctions the suppletory application of
the Rules of Court31 to cases within its

_______________

28 Resolution dated September 26, 2014, Rollo, p. 42.

29 Comment of the OSG, id., at pp. 199-200.
30 SEC.  20.  Appeal.—
(1)  Precondition.—No appeal from the decision shall be allowed unless the
appellant has filed a motion for reconsideration or new trial within fifteen days from
notice of judgment.
(2)  Notice of appeal.—An aggrieved party or the Solicitor General may appeal
from the decision by filing a Notice of Appeal within fifteen days from notice of
denial of the motion for reconsideration or new trial. The appellant shall serve a copy
of the notice of appeal on the adverse parties.
31  Pertinently, Section 1 of Rule 38 provides that the petition for relief from
judgment shall be filed in the same court that rendered the assailed judgment or final
order; and that the petition shall be filed in the same case.

 
 

338

338 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

ambit. It cannot, therefore, be said that Dana availed of an

inappropriate remedy to question the decision of the trial court.
Indeed, the trial court admitted Dana’s petition for relief, heard the
parties on the issues thereon, and rendered an order denying the
petition. Dana then properly and seasonably assailed the order of
denial  via  certiorari  to the CA. It is, therefore, clear that the
proceedings in Civil Case No. 03-6954 continued even after the trial
court had rendered judgment and even after the lapse of the 15-day
period for appealing the decision.
Nevertheless, considering the nature and office of a petition for
relief, which is to set aside a final judgment,32 the Court cannot
agree with Dana’s assertion that the decision of the RTC in Civil
Case No. 03-6954 had not attained finality. In fact, the decision has
already been annotated in their marriage contract.33 This finding,
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 10/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

however, does not detract from the fact that the proceedings in Civil
Case No. 03-6954 continued even after the trial court had rendered
judgment, precisely because Dana filed a petition for relief from that
judgment. From the denial of her petition, she sought recourse to the
appellate court. The appellate court, in dismissing the case upon the
parties’ compromise on their conjugal properties, invoked the
finality of the RTC’s decision as a bar to the litigation of the other
issues raised by Dana’s petition. This conclusion is untenable.
In  Samia v. Medina,34  which involved the application of the
statutory ascendant of Rule 38 in the old Code of Civil Procedure,
the Court held:

There is a great deal of similarity between an order granting a

motion for a new trial based upon “accident or surprise which
ordinary prudence could not have guarded

_______________

32 Aboitiz International Forwarders, Inc. v. Court of Appeals, 577 Phil. 452, 465;
488 SCRA 492, 505-506 (2006).
33 Rollo, p. 234.
34 56 Phil. 613 (1932).

 
 
339

VOL. 909, JULY 17, 2019 339

Santos vs. Santos

against” under Section 145 of the Code of Civil Procedure, and an

order granting a motion for a new trial based upon “mistake,
inadvertence, surprise, or excusable neglect,” under Section 113 of
the Code of Civil Procedure, as both set aside the judgment, order, or
proceeding complained of; both call for a new trial, and in both the
injured party may question the order granting the motion for the new
trial upon appeal from the new judgment rendered upon the merits of
the case. The only fundamental difference lies in this, that while the
judgment, order, or proceeding coming under Section 145 of the
Code of Civil Procedure is not final, that coming under Section 113 is
final. But this does not alter the nature or effect of the order granting
the new trial, for this order does not put an end to the litigation in
the sense that the party injured thereby has no other remedy
short of appeal; he may question the propriety of the new trial on
appeal from an adverse judgment rendered after such trial.35
(Emphasis and underscoring Ours)

 
In Service Specialists, Inc. v. Sheriff of Manila,36 decided prior to
the enactment of the 1997 Rules of Civil Procedure, the Court held:

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 11/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

There is no question that a judgment or order denying relief under

Rule 38 is final and appealable, unlike an order granting such relief
which is interlocutory. However, the second part of the above quoted
provision (that in the course of an appeal from the denial or dismissal
of a petition for relief, a party may also assail the judgment on the
merits) may give the erroneous impression that in such appeal the
appellate court may reverse or modify the judgment on the merits.
This cannot be done because the judgment from which relief is
sought is already final and executor. x x x
The purpose of the rule is to enable the appellate court to
determine not only the existence of any of the

_______________

35 Id., at pp. 613-614.

36 229 Phil. 165; 145 SCRA 139 (1986).

 
 

340

340 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

grounds relied upon whether it be fraud, accident, mistake or

excusable negligence, but also and primarily the merit of the
petitioner’s cause of action or defense, as the case may be. If the
appellate court finds that one of the grounds exists and, what is of
decisive importance, that the petitioner has a good cause of action or
defense, it will reverse the denial or dismissal, set aside the judgment
in the main case and remand the case to the lower court for a new
trial in accordance with Section 7 of Rule 38.37 (Citations omitted)

 
The 1997 Rules of Civil Procedure changed the nature of an
order of denial of a petition for relief from judgment, making it
unappealable38  and, hence, assailable only  via  a petition
for  certiorari.39  Nevertheless, the appellate court, in deciding such
petitions against denials of petitions for relief, remains tasked with
making a factual determination,  i.e., whether or not the trial court
committed grave abuse of discretion in denying the petition. To do
so, it is still obliged, as  Service Specialists  instructs, to “determine
not only the existence of any of the grounds relied upon whether it be
fraud, accident, mistake or excusable negligence, but also and
primarily the merit of the petitioner’s cause of action or defense, as
the case may be.”40  Stated otherwise, the finality of the RTC’s
decision cannot bar the appellate court from determining the issues
raised in the petition for relief, if only to determine the existence of
grave abuse of discretion on the part of the trial court in denying
such petition. While a Rule 38 Petition does not stay the execution
of the judgment,41 the grant thereof re-
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 12/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

_______________

37 Id., at pp. 173-174; p. 148.

38 1997 Rules of Civil Procedure, Rule 41, Section 1(a).
39 Azucena v. Foreign Manpower Services, 484 Phil. 316, 325-326; 441 SCRA
346, 353 (2004).
40 Service Specialists, Inc. v. Sheriff of Manila, supra note 36 at pp. 173-174; p.
148.
41  Rule 38, Section 5. See also Lui Enterprises, Inc. v. Zuellig Pharma
Corporation, 729 Phil. 440, 472; 719 SCRA 88, 120 (2014).

 
 
341

VOL. 909, JULY 17, 2019 341

Santos vs. Santos

opens the case for a new trial;42  and thus, if merit be found in
Dana’s  certiorari  petition assailing the trial court’s denial of her
petition for relief, the case will be reopened for new trial.
The CA, therefore, erred in refusing to reopen Dana’s petition on
the basis of the finality of the trial court decision.
The Court now resolves the question regarding the propriety of
setting aside the judgment on compromise.
On one hand, the immutability and immediate effect of
judgments upon compromise is well-settled. In Magbanua v. Uy,43 it
was held that:

When a compromise agreement is given judicial approval, it becomes

more than a contract binding upon the parties. Having been
sanctioned by the court, it is entered as a determination of a
controversy and has the force and effect of a judgment. It is
immediately executory and not appealable, except for vices of
consent or forgery. The nonfulfillment of its terms and conditions
justifies the issuance of a writ of execution; in such an instance,
execution becomes a ministerial duty of the court.44

 
However, like any other judgment, a judgment upon compromise
which is contrary to law is a void judgment; and “[a] void judgment
or order has no legal and binding effect. It does not divest rights, and
no rights can be obtained under it; all proceedings founded upon a
void judgment are equally worthless.”45
On the other hand, Article 2035(2) and Article 5 of the New Civil
Code provide:

ART.  2035.  No compromise upon the following questions shall be

valid:

_______________

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 13/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

42 Rule 38, Section 6.

43 497 Phil. 511; 458 SCRA 184 (2005).
44 Id., at p. 519; p. 191.
45 American Power Conversion Corporation v. Lim, G.R. No. 214291, January 11,
2018, 851 SCRA 65, citing Go v. Echavez, 765 Phil. 410, 424; 764 SCRA 505, 518
(2015).

 
 

342

342 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

x x x x
(2)  The validity of a marriage or a legal separation;
x x x x
 
ART.  5.  Acts executed against the provisions of mandatory or
prohibitory laws shall be void, except when the law itself authorizes
their validity.

 
Again, the Court reiterates, at the risk of being repetitive, that the
petition which gave rise to these proceedings is for the declaration of
nullity of Dana and Leodegario’s marriage. Dana’s petition for
certiorari with the CA, which is nothing but a consequence of the
proceedings before the RTC, alleges the fraudulent deprivation of
her chance to refute and controvert Leodegario’s allegations and to
present her side of the issue, which she also lays down in her
petition. The core issue of Dana’s petition is, therefore, the validity
of her marriage to Leodegario. The termination of the case by virtue
of the compromise agreement, therefore, necessarily implies the
settlement by compromise of the issue of the validity of Dana and
Leodegario’s marriage.
In Uy v. Chua,46 which also involves an issue not subject to
compromise under Article 2035, the Court held:

The Compromise Agreement between petitioner and respondent,

executed on 18 February 2000 and approved by RTC-Branch 9 in its
Decision dated 21 February 2000 in Special Proceeding No. 8830-
CEB, obviously intended to settle the question of petitioner’s status
and filiation, i.e., whether she is an illegitimate child of respondent.
In exchange for petitioner and her brother Allan acknowledging that
they are not the children of respondent, respondent would pay
petitioner and Allan P2,000,000.00 each. Although unmentioned, it
was a necessary consequence of said Compromise Agreement
that petitioner also waived away her rights to

_______________

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 14/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

46 616 Phil. 768; 600 SCRA 806 (2009).

 
 

343

VOL. 909, JULY 17, 2019 343

Santos vs. Santos

future support and future legitime as an illegitimate child of

respondent. Evidently, the Compromise Agreement dated 18
February 2000 between petitioner and respondent is covered by
the prohibition under Article 2035 of the Civil Code.47 (Emphasis
and underscoring Ours)

 
In a long line of cases,48  the Court has censured and punished
lawyers, and even judges, who have drafted agreements to dissolve
marriages or to sanction adulterous relations. The rule applies  a
fortiori to the CA. It was, therefore, erroneous for the appellate court
to terminate Dana’s suit — which puts in issue the validity of her
marriage — by virtue of the execution of the compromise agreement
which only covers the property relations of the spouses. While these
issues are intertwined, a compromise of the latter issue should not
and cannot operate as a compromise of the former, per Article 2035
of the Civil Code.
The Court cannot give its imprimatur to the dismissal of the case
at bar even if, as the appellate court held, it was Dana’s intention49 to
have the case terminated upon the execution of the compromise
agreement. Nevertheless, the Court agrees with the appellate court
when it ruled that the scope of the compromise agreement is limited
to Dana and Leodegario’s property relations vis-à-vis their children,
as Article 2036 of the Civil Code provides that “[a] compromise
comprises only those objects which are definitely stated therein, or
which by necessary implication from its terms should be

_______________

47 Id., at p. 780; p. 818.

48 Espinosa v. Omaña, 675 Phil. 1; 659 SCRA 1 (2011); Albano v. Gapusan, 162
Phil. 884; 71 SCRA 26 (1976); Selanova v. Mendoza, 159-A Phil. 360; 64 SCRA 69
(1975); Balinon v. De Leon, 94 Phil. 277 (1954); In re: Atty. Roque Santiago, 70 Phil.
66 (1940); Biton v. Momongan, 62 Phil. 7 (1935); and Pañganihan v. Borromeo, 58
Phil. 367 (1933).
49 Rollo, p. 43. See also Manifestation filed by petitioner Dana, Rollo, p. 155.

 
 

344

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 15/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

344 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

deemed to have been included in the same.” As held by the appellate

court:

The agreement makes no mention of the marital ties between

[Leodegario] and [Dana] but is limited only to their property
relations vis-à-vis their children.50

 
However, despite the error committed by the appellate court,
absent vices of consent or other defects, the compromise agreement
remains valid and binding upon Dana and Leodegario, as they have
freely and willingly agreed to, and have already complied with, the
covenants therein. The agreement operates as a partial compromise
on the issue of the disposition of the properties of the marriage.
Nevertheless, the Court is constrained to uphold the appellate
court’s decision, because the trial court’s denial of Dana’s petition
for relief from judgment does not amount to grave abuse of
discretion.
While the remaining issues in the petition partake of a factual
nature, the Court deems it necessary to write finis to this case at this
level in order to avoid remanding the case to the appellate court. It
has been held that “remand is not necessary if the Court is in a
position to resolve a dispute on the basis of the records before it; and
if such remand would not serve the ends of justice.”51  A careful
perusal of the petitions filed by Dana before the trial court, the
appellate court and this Court betrays the lack of allegations
sufficient to support a petition for relief from judgment under Rule
38.
Jurisprudence provides that fraud, as a ground for a petition for
relief, refers to extrinsic or collateral fraud52 which, in

_______________

50 Id., at pp. 42-43.

51 Canlas v. Republic, 746 Phil. 358, 381; 739 SCRA 404, 429 (2014).
52 City of Dagupan v. Maramba, 738 Phil. 71, 90; 728 SCRA 520, 541 (2014),
citing Heirs of Jose Sy Bang v. Sy, 604 Phil. 606,

 
 
345

VOL. 909, JULY 17, 2019 345

Santos vs. Santos

turn, has been defined as fraud that prevented the unsuccessful party
from fully and fairly presenting his case or defense and from having
an adversarial trial of the issue, as when the lawyer connives to
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 16/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

defeat or corruptly sells out his client’s interest. Extrinsic fraud can
be committed by a counsel against his client when the latter is
prevented from presenting his case to the court.53  In  Lasala v.
National Food Authority,54  the Court defined extrinsic fraud in
relation to parties represented by counsel, viz.:

Extrinsic fraud x x x refers to “any fraudulent act of the prevailing

party in litigation committed outside of the trial of the case, where
the defeated party is prevented from fully exhibiting his side by fraud
or deception practiced on him by his opponent, such as by keeping
him away from court, by giving him a false promise of a
compromise, or where an attorney fraudulently or without authority
connives at his defeat.”
Because extrinsic fraud must emanate from the opposing party,
extrinsic fraud concerning a party’s lawyer often involves the latter’s
collusion with the prevailing party, such that his lawyer connives at
his defeat or corruptly sells out his client’s interest.
In this light, we have ruled in several cases that a lawyer’s
mistake or gross negligence does not amount to the extrinsic fraud
that would grant a petition for annulment of judgment.
We so ruled not only because extrinsic fraud has to involve the
opposing party, but also because the negligence of counsel, as a rule,
binds his client.55 (Citations omitted)

_______________

625; 603 SCRA 534, 575 (2009); and Garcia v. Court of Appeals, 279 Phil. 242, 249;
202 SCRA 228, 234 (1991).
53 Id., at p. 91; pp. 541-542.
54 767 Phil. 285; 767 SCRA 430 (2015).
55 Id., at pp. 301-302; pp. 447-448.

 
 
346

346 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

Given this definition, the Court found the following circumstances

sufficient to make out a case for extrinsic fraud:

The party in the present case, the NFA, is a government agency

that could rightly rely solely on its legal officers to vigilantly protect
its interests. The NFA’s lawyers were not only its counsel, they were
its employees tasked to advance the agency’s legal interests.
Further, the NFA’s lawyers acted negligently several times in
handling the case that it appears deliberate on their part.
First, Atty. Mendoza caused the dismissal of the NFA’s complaint
against Lasala by negligently and repeatedly failing to attend the
hearing for the presentation of the NFA’s evidence-in-chief.

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 17/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

Consequently, the NFA lost its chance to recover from Lasala the
employee benefits that it allegedly shouldered as indirect employer.
Atty. Mendoza never bothered to provide any valid excuse for this
crucial omission on his part. Parenthetically, this was not the first
time Atty. Mendoza prejudiced the NFA; he did the same when he
failed to file a motion for reconsideration and an appeal in a prior
1993 case where Lasala secured a judgment of P34,500,229.67
against the NFA.
For these failures, Atty. Mendoza merely explained that the NFA’s
copy of the adverse decision was lost and was only found after the
lapse of the period for appeal. Under these circumstances, the NFA
was forced to file an administrative complaint against Atty. Mendoza
for his string of negligent acts.
Atty. Cahucom, Atty. Mendoza’s successor in handling the case,
notably did not cross-examine Lasala’s witnesses, and did not present
controverting evidence to disprove and counter Lasala’s
counterclaim. Atty. Cahucom further prejudiced the NFA when he
likewise failed to file a motion for reconsideration or an appeal from
the trial court’s September 2, 2002 decision, where Lasala was
awarded the huge amount of P52,788,970.50, without any convincing
evidence to support it.

 
 

347

VOL. 909, JULY 17, 2019 347

Santos vs. Santos

When asked to justify his failure, Atty. Cahucom, like Atty.

Mendoza, merely mentioned that the NFA’s copy of the decision was
lost and that he only discovered it when the period for appeal had
already lapsed.
The trial court’s adverse decision, of course, could have been
avoided or the award minimized, if Atty. Cahucom did not waive the
NFA’s right to present its controverting evidence against Lasala’s
counterclaim evidence. Strangely, when asked during hearing, Atty.
Cahucom refused to refute Lasala’s testimony and instead simply
moved for the filing of a memorandum.
The actions of these lawyers, that at the very least could be
equated with unreasonable disregard for the case they were handling
and with obvious indifference towards the NFA’s plight, lead us to
the conclusion that Attys. Mendoza’s and Cahucom’s actions
amounted to a concerted action with Lasala when the latter secured
the trial court’s huge and baseless counterclaim award. By this
fraudulent scheme, the NFA was prevented from making a fair
submission in the controversy.56

 
Lasala  has been subsequently reiterated in  Cagayan Economic
Zone Authority v. Meridien Vista Gaming Corporation,57 where the
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 18/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

Court held that:

[I]n cases of gross and palpable negligence of counsel and of

extrinsic fraud, the Court must step in and accord relief to a client
who suffered thereby. x  x  x [F]or the extrinsic fraud to justify a
petition for relief from judgment, it must be that fraud which the
prevailing party caused to prevent the losing party from being heard
on his action or defense. Such fraud concerns not the judgment itself
but the manner in which it was obtained. Guided by these
pronouncements, the Court in the case of Apex Mining, Inc. v. Court
of Appeals wrote:
 
If the incompetence, ignorance or inexperience of counsel
is so great and the error

_______________

56 Id., at pp. 303-304; pp. 449-450.

57 779 Phil. 492; 782 SCRA 345 (2016).

 
 
348

348 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

committed as a result thereof is so serious that the client, who

otherwise has a good cause, is prejudiced and denied his day
in court, the litigation may be reopened to give the client
another chance to present his case. Similarly, when an
unsuccessful party has been prevented from fully and fairly
presenting his case as a result of his lawyer’s professional
delinquency or infidelity, the litigation may be reopened to
allow the party to present his side. Where counsel is guilty of
gross ignorance, negligence and dereliction of duty, which
resulted in the clients being held liable for damages in a
damage suit, the client is deprived of his day in court and the
judgment may be set aside on such ground.58 (Citations
omitted and emphases in the original)

 
As in Lasala, the Court found sufficient factual justification for the
grant of CEZA’s petition for relief, viz.:

At the inception, CEZA was already deprived of its right to

present evidence during the trial of the case when Atty. Baniaga filed
a joint manifestation submitting the case for decision based on the
pleadings without informing CEZA. In violation of his sworn duty to
protect his client’s interest, Atty. Baniaga agreed to submit the case
for decision without fully substantiating their defense. Worse, after

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 19/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

he received a copy of the decision, he did not even bother to inform

his client and the OGCC of the adverse judgment. He did not even
take steps to protect the interests of his client by filing an appeal.
Instead, he allowed the judgment to lapse into finality. Such reckless
and gross negligence deprived CEZA not only of the chance to seek
reconsideration thereof but also the opportunity to elevate its case to
the CA.59

_______________

58 Id., at pp. 503-504; pp. 355-356.

59 Id., at p. 507; pp. 359-360.

 
 

349

VOL. 909, JULY 17, 2019 349

Santos vs. Santos

Turning now to the case at bar, it is clear that Dana’s allegations

in her petition for relief fall way short of the jurisprudential
threshold for extrinsic fraud. The Court quotes the allegations Dana
made in her petition for relief with the trial court:

In all candor, [Dana] wanted to present her side of the controversy

and all she intended was to take the witness stand. Without her
knowing it, however, her time to present her evidence passed without
her being able to do so. Her previous counsel did not remind, much
less advice [sic], her of the hearing dates to present her case.
Particularly, she was not simply aware of the hearings held by this
[h]onorable [c]ourt on February 26 and March 26, 2009. She can
only surmise that somebody must have maneuvered to impress, if not
mislead, the [h]onorable [c]ourt that she was not interested to present
her side.
This must be so since after [Dana] confronted her counsel about
the promulgation of the Decision without her being able to present
evidence, her counsel nonchalantly told her that it was their mutual
decision not to present any evidence. This was not what [Dana]
thought and knew. In the first place, she filed her Answer to the
petition and assailed all the material allegations therein. She found no
reason to abandon her case.
[Dana], by these assertions does not accuse her previous
counsel any wrongdoing or neglect, or any other parties probably
in cahoots with her said counsel. But it certainly had caused some
harm to and, in fact, defrauded this [h]onorable [c]ourt which was led
into believing that [Dana] was not interested in presenting her
evidence. Hence, this [h]onorable [c]ourt found that [Dana] failed to
appear despite notice as already mentioned above. Had it known that
she was interested on [sic] presenting her side, this [h]onorable
[c]ourt certainly would not have denied her that right. Otherwise put,
https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 20/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

by the deception, this Honorable Court was not aware that [Dana]
was deprived of her day in court.60 (Emphasis and underlining Ours)

_______________

60 Rollo, pp. 84-85.

 
 

350

350 SUPREME COURT REPORTS ANNOTATED

Santos vs. Santos

Dana’s petition is anchored on two main allegations: first, that

her counsel failed to notify her of the hearings dated February 26
and March 26, 2009; and second, that her counsel nonchalantly told
her that it was their mutual decision to not present any evidence.
However, she categorically admits that she “does not accuse her
previous counsel [of] any wrongdoing or neglect, or any other
parties probably in cahoots with her said counsel.”61 Furthermore,
the petition makes no specific citation of other acts or circumstances
attributable to her counsel that fraudulently deprived Dana of her
opportunity to fully ventilate her claims and defenses with the trial
court. The acts complained of in the petition constitute neither
“gross and palpable negligence” nor corruption or collusion
amounting to extrinsic fraud. The general rule, which binds the
client to the negligence of her counsel, remains applicable to this
case. All told, the trial court did not commit grave abuse of
discretion amounting to lack or excess of jurisdiction when it
dismissed her petition for relief.
WHEREFORE, premises considered, the petition is
hereby  DENIED. The Resolutions dated April 15, 2014 and
September 26, 2014 of the Court of Appeals in C.A.-G.R. S.P. No.
115420, are hereby  AFFIRMED  insofar as they declared the
proceedings CLOSED and TERMINATED.
SO ORDERED.

Peralta (Chairperson),  Leonen, Gesmundo**  and  Hernando,

JJ., concur.

Petition denied, resolutions affirmed.

_______________

61 Id., at p. 84.
**  Designated additional member per Raffle dated June 26, 2019 vice Associate
Justice Henri Jean Paul B. Inting.

 
 

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 21/22
6/16/2021 SUPREME COURT REPORTS ANNOTATED VOLUME 909

351

VOL. 909, JULY 17, 2019 351

Santos vs. Santos

Notes.—A judgment on compromise agreement is a judgment on

the merits and operates as  res judicata. (National Electrification
Administration [NEA] vs. Maguindanao Electric Cooperative,
Inc., 861 SCRA 1 [2018])
Section 3, Rule 38 of the Rules of Court provides that a petition
for relief from judgment must be filed within: (1) sixty (60) days
from knowledge of the judgment, order or other proceeding to be set
aside and (2) six (6) months from the entry of such judgment, order
or other proceeding. These two (2) periods must concur. Further,
these periods could not be extended and could never be interrupted.
(Lasam vs. Philippine National Bank, 888 SCRA 331 [2018])

 
——o0o——

© Copyright 2021 Central Book Supply, Inc. All rights reserved.

https://central.com.ph/sfsreader/session/0000017a126b8f8524163063000d00d40059004a/t/?o=False 22/22