galicia 1

G.R. No. L-44959 April 15, 1987

PIONEER INSURANCE AND SURETY CORPORATION, petitioner, 
vs
THE HONORABLE WILLELMO C. FORTUN, PRESIDING JUDGE, COURT OF FIRST INSTANCE OF PANGASINAN, LINGAYEN BRANCH I, ASUNCION TORIO ONG AND BEN ONG, respondents.

FACTS:

On October 16, 1973, the Spouses Ong, private respondents herein, owners of the discount Restaurant in Lingayen, Pangasinan, insured themselves with petitioner Overseas Insurance Corporation (OIC) against any liability, not exceeding P15,000.00 per employee, that might be adjudged against them by the Workmen's Compensation by reason of injury and/or death of any of their employees in said establishment. To that end, OIC issued to them Policy No. WC-1714 effective from October 16, 1973 to October 16, 1974. On May 18, 1973, the policy being then in force, Soledad Saura, a waitress employed by the Ongs in the discount Restaurant and covered by the policy, died of illness. Her heirs filed against the Ongs and OIC a compensation claim for her death with the Department of Labor, Regional Office No. 1 in Dagupan City. That Office, through the Chief, Workmen's Compensation Unit, found that Soledad had died from an illness contracted in the course of her employment, and on July 23, 1974 handed down an award of P6,000.00 in favor of her heirs, and P61.00 payable to the Workmen's Compensation Commission in fees.OIC having refused, despite demand, to pay the amounts awarded, the Spouses Ong sued it in the Court of First Instance to compel payment and to recover moral damages, attorney's fees and costs allegedly consequent upon that refusal to pay. OIC's answer alleged in the main that the complaint stated no cause of action because the plaintiff's, the Ongs, had not yet paid the award to the deceased employee's heirs, and hence had sustained no loss; and that when the complaint was filed, OIC was already under receivership, with Pioneer In. insurance and Surety Corporation (petitioner herein) as the statutory receiver, appointed by the Insurance Commissioner pursuant to the Insurance Code (PD 612).

On August 19, 1976, the respondent Judge rendered judgment, the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of the plaintiffs, ordering defendant OIC to pay to plaintiffs the sum of P6,000.00 as adjudged by the WCC to pay plaintiffs' liabilities to the heirs of the deceased Soledad Saura, plus the sum of P61.00 as payment to WCC, plus P1,000.00 as attorney's fees, and costs of suit. Defendant PISC is absolved from liability.

Five days later, on August 24, 1976, apparently, and for all that the record shows, motuproprio, the Judge issued an order declaring that he had erred in absolving Pioneer from liability and modifying the judgment thus:

WHEREFORE, the dispositive portion of said Decision of August 19, 1976, is hereby amended to read as follows:

WHEREFORE, judgment is hereby rendered in favor of the plaintiffs, ordering defendant OIC to pay to plaintiffs the sums of P6,000.00 as adjudged by the WCC to pay plaintiffs' liabilities to the heirs of the deceased Soledad Saura, plus the sum of P61.00 as payment to WCC, plus P1,000.00 as attorney's fees, and costs of suit. Defendant PISC, Statutory Receiver of OIC, is ordered to pay to plaintiffs said amounts in the event that OIC fails to make such payments.

From this decision, as modified, Pioneer seasonably perfected an appeal, purely on questions of law; and in this Court, it ascribes two errors to the respondent Judge, namely: (1) in pronouncing it subsidiarily liable for the Ongs' claim for payment on their insurance policy; and (2) in not dismissing the Ongs' amended complaint on the ground that, as receiver appointed under the Insurance Code, it is exempted by Section 251 thereof from "any action, claim or demand by, or liability to, any person in respect to anything done or omitted to be done in good faith in the exercise, or in connection with the exercise, of the powers conferred upon it.

ISSUE:

Is the contention of Pioneer correct that the respondent Judge erred in his modified judgement?

RULING:

It is immediately evident, without having to distinguish, as petitioner does, between a statutory receivership under the Insurance Code and one judicially instituted under Rule 59 of the Rules of Court, that the first error assigned by petitioner Pioneer is well taken. The fact is that the event giving rise to the Ongs' claim against OIC the requirement by the Workmen's Compensation Commission that they (the Ongs) pay death benefits to the heirs of Soledad Saura-antedated the appointment of petitioner as OIC's receiver by almost a year. Plainly then, petitioner was a complete stranger to this award of death benefits, or the insurance contract insuring the Ongs' liability therefor, or any of the events giving rise to the Ongs' claim against OIC. Petitioner cannot therefore be held liable upon such a claim, even in a subsidiary capacity.

Res inter aliosactaalterinocere non debet

Contracts take effect only between the parties, their assigns and heirs, except in case where the rights and obligations arising from the contract are not transmissible by nature, or by stipulation or by provision of law. The heir is not able beyond the value of the property he received from the decedent.

Since the amended judgment clearly makes petitioner liable, on its own account, for the Ongs' claim under the policy issued to it by OIC in the event that the latter fail to pay the same, it is to that extent erroneous and must be reversed.Shorn of the objectionable amendment, but with petitioner remaining in the action in a representative capacity, or as receiver of the real party in interest, Overseas Insurance Corporation, the judgment may be satisfied from any available funds or assets of the latter under the custody and control of the petitioner.

WHEREFORE, the petition is granted. The questioned order of August 24, 1976 of the respondent Judge is set aside, and the earlier decision of August 19, 1976 that it purports to amend is reinstated in toto. Said decision may be satisfied from any available assets of OIC in the custody of Pioneer as receiver. No pronouncement as to costs.

SO ORDERED.

G.R. No. L-59514 February 25, 1988

PACIANO REMALANTE, petitioner,
vs.
CORNELIA TIBE and THE COURT OF APPEALS, respondents.

FACTS:

Disputed in this case is the ownership of six (6) parcels of land. The trial court awarded three (3) parcels to petitioner and the other three (3) to private respondent, but the Court of Appeals held otherwise and awarded all six (6) to private respondent. Hence the instant petition.

In a complaint filed before the trial court, private respondent Cornelia Tibe, as plaintiff, sought the annulment of certain contracts and other documents which became the bases for the transfer of six (6) parcels of land from private respondent to petitioner PacianoRemalante, the defendant below. Private respondent claimed that petitioner, through fraud, deceit, abuse of confidence and misrepresentation, induced her to sign three (3) affidavits of transfer (Exhibits I-3, K and M), purported to be bail bonds, that transferred three (3) parcels of land under Tax Declaration Nos. 20280, 20273 and 20274 to petitioner. Petitioner thereafter presented the affidavits to the Provincial Assessor and caused the three (3) parcels of land to be declared under Tax Declaration Nos. 20323, 20324 and 20325.

Private respondent also claimed that petitioner forged her signature in a deed of absolute sale (Exhibit 22) whereby her other three parcels of land described under Tax Declaration Nos. 13959, 17388 and 16999 were transferred to petitioner's name.

Petitioner in his answer denied the allegations of private respondent and claimed that he is the absolute owner of the six (6) parcels of land described in the complaint. He further claimed that the first three (3) parcels of land mentioned were bought by him from SilvinoAlminario and that it was private respondent, who, by means of fraud and misrepresentation caused the transfer of the three (3) parcels of land to her name, and declared them under Tax Declaration Nos. 20280, 20273 and 20274, purportedly so that she can use the land as collateral to secure a loan from a bank in Leyte. Petitioner also claimed that he bought the three (3) parcels of land described under Tax Declaration Nos. 13959,17388 and 16999 from private respondent, as evidenced by a deed of absolute sale (Exhibit 22) executed by her in his favor.

ISSUES:

1.    WHETHER OR NOT THE COURT OF APPEALS ERRED IN AWARDING THE OWNERSHIP OF THE THREE PARCELS OF LAND TO PRIVATE RESPONDENT UNDER TAX DECLARATION NOS. 20323, 20324 AND 20325, RESPECTIVELY, AS THE SAME BELONGED TO PETITIONER.

2.    WHETHER OR NOT THE COURT OF APPEALS ERRED IN NOT GIVING CREDENCE TO THE DECISION OF THE TRIAL COURT AND IN NOT ADOPTING THE SAME IN TOTO.

RULING:

1. Petitioner contends that the Court of Appeals erred in awarding the three (3) parcels of land covered by Tax Declaration Nos. 20323, 20324 and 20325 to private respondent.

Clearly the provision applies to a situation where the same property is sold to different vendees. No such situation obtains in the instant case. As found by the Court of Appeals, the three parcels of land covered by Tax Declaration Nos. 20323, 20324 and 20325 were never sold by SilvinoAlminario to petitioner. There was only one sale--the sale to private respondent Cornelia Tibe as testified by Alminario. Petitioner therefore cannot claim a better right by virtue of his prior registration of the deeds of sale in the Registry of Property as such registration was found to be fraudulent since the three parcels of land were never sold to him to begin with. Thus, in Espiritu v. Valerio [G.R. No. L-18018, December 26, 1963, 9 SCRA 761], where the same parcel of land was allegedly sold to two different parties, the Court held that despite the fact that one deed of sale was registered ahead of the other. Art. 1544 of the Civil Code will not apply where said deed is found to be a forgery and, thus, the sale to the other vendee should prevail.

In the same vein, petitioner cannot invoke the parol evidence rule (which petitioner erroneously referred to as the "best evidence rule") to argue that the affidavits of transfer (Exhibits I-3, K and M) constitute conclusive evidence that petitioner is the absolute owner of the three parcels of land covered by Tax Declaration Nos. 20323, 20324 and 20325 and that the fact that SilvinoAlminario testified that he did not sell said parcels of land to petitioner will not vary the terms of said affidavits. As stated in Rule 130 of the Revised Rules of Court:

Sec. 7. Evidence of written agreements. — When the terms of an agreement have been reduced to writing, it is to be considered as containing all such terms, and, therefore, there can be, between the parties and their successors in interest, no evidence of the terms of the agreement other than the contents of the writing, except in the following cases:

(a) Where a mistake or imperfection of the writing, of its failure to express the true intent and agreement of the parties, or the validity of the agreement is put in issue by the pleadings;

(b) When there is an intrinsic ambiguity in the writing.

The term "agreement" includes wills. (Emphasis supplied.)

In the case at bar, the parol evidence rule finds no application because, precisely, the validity of the affidavits of transfer (Exhibits I-3, K and M) is the very fact in dispute, the action instituted in the court below being one for the annulment of the documents of transfer. To adopt petitioner's theory would render nugatory the remedy founded on the basic rule in the law on contracts that "a contract where consent is given through mistake, violence, intimidation, undue influence, or fraud is voidable" (Art. 1330, Civil Code).

2. As his second assignment of error, petitioner contends that the Court of Appeals erred in not giving credence to the decision of the trial court and in not adopting the same in toto. Thus, while previously petitioner asked the Court of Appeals to modify the decision or the trial court which awarded him only three (3) parcels of land and awarded the other three (3) parcels of land to private respondent, by awarding him all six (6) parcels of land, now, with the second assignment of error, he wants this Court to reinstate the decision of the trial court from which he appealed.

His prayer causes even more confusion. In his petition (entitled 'Appeal By Certiorari'), petitioner prayed "that defendant-appellant be declared as the real and absolute owner of the properties declared and described in Tax Declaration Nos. 20323,20324 and 20325 and that plaintiff appellant been joined to deliver the ownership and possession of the same also to defendant-appellant plus costs of suit." [Rollo, p. 9]. However, in his brief he prayed "that a new decision be promulgated reversing the previous decision of the Court of Appeals by adoptingintoto the decision of the trial court."

Petitioner's change of theory at midstream takes him nowhere.

Consequently, as the decision of the Court of Appeals is based on its finding of preponderance of evidence in the record and is in accord with law and jurisprudence, this Court finds no cogent reason to overrule the decision.

WHEREFORE, the instant petition is denied and the decision of the Court of Appeals is affirmed in toto.

SO ORDERED.