G.R. No. 182814: Mendoza vs. Court of Appeals, 8th Division (July 15, 2015) (CASE DIGEST)

Facts

Petitioners Ligaya Mendoza and Adelia Mendoza obtained a P12,000,000.00 loan from Bangko Kabayan (formerly Ibaan Rural Bank) secured by a Deed of Real Estate Mortgage over 71 parcels of land. Upon default, the private respondent bank filed a Complaint for Judicial Foreclosure. The Regional Trial Court (RTC) rendered a Judgment on the Pleadings on March 7, 2002, ordering the petitioners to pay the principal sum plus interest, or else the properties would be sold at public auction. Petitioners failed to timely appeal or file a motion for reconsideration. The bank filed a Motion for Execution, which the petitioners opposed, claiming their counsel was not duly served with the RTC Judgment until June 13, 2002, making their subsequent Notice of Appeal (filed June 14, 2002) seasonable. The RTC denied the Notice of Appeal, finding that the counsel was negligent in handling her mails and that this negligence bound the petitioners. The Court of Appeals affirmed the RTC, finding a valid service attested to by the postmaster, where the security guard at the counsel’s address received the judgment on March 15, 2002.

Issues

1. Whether there was a valid service of the 7 March 2002 RTC Judgment to the petitioners’ counsel.
2. Whether the Court of Appeals gravely abused its discretion in ruling that the counsel’s failure to ensure proper receipt of judicial notices bound the petitioners.
3. Whether the RTC judgment had attained finality, precluding subsequent appeal or challenge.

Ruling

WHEREFORE, premises considered, the petition is hereby DISMISSED. The assailed Decision dated 29 November 2007 and Resolution dated 28 April 2008 of the Court of Appeals in CA-G.R. SP No. 86745 are hereby AFFIRMED. SO ORDERED.

Essential Elements of Jurisprudence

Controlling Doctrine: The negligence of counsel binds the client, leading to the finality and execution of judgment.

Legal Principles Established:

1. Service on Counsel: When a party appears by attorney in a court action, all notices or orders required must be given to the attorney of record. The official address of record remains valid unless the counsel files a notice of change of address.
2. Presumption of Regularity in Service: Service of notice of judgment is deemed valid when attested to by the postmaster, who enjoys the presumption of regularity in the performance of official duty.
3. Binding Effect of Counsel Negligence (General Rule): The doctrinal rule is that the negligence of the counsel binds the client. The client is bound by the action of his counsel in the conduct of the case and cannot complain that the result might have been different.
4. Counsel’s Duty of Care: A law office is mandated to adopt and arrange matters to ensure that official or judicial communications sent by mail are promptly received by the lawyer assigned to the case. Counsel cannot hide behind the negligence of a security guard or staff.
5. Finality of Judgment: Once a judgment attains finality (due to failure to perfect an appeal within the reglementary period), it becomes immutable and unalterable. This doctrine is grounded on fundamental consideration of public policy and sound practice, preventing endless litigation.
6. Exception (Not Applicable): The only exception to the general rule is when the counsel’s actuations are gross or palpable, resulting in serious injustice or deprivation of due process to the client.

Sample Q&A

Question: A party litigant, M, filed a Petition for Certiorari (Rule 65) before the Supreme Court, arguing that the RTC judgment in a judicial foreclosure case should be nullified because M’s counsel, Atty. G, did not actually receive the RTC decision until months after it was supposedly served via mail to the firm’s address, rendering the subsequent execution void. Evidence shows the mail was received by the building’s security guard on time. M claims the security guard was unauthorized to receive legal documents for Atty. G. Should the Supreme Court grant the Petition and reopen the case?

Answer: No, the Supreme Court should dismiss the Petition for Certiorari (Rule 65) and affirm the finality of the judgment. As a rule, service upon the attorney of record is service upon the client. A law office has the duty to “adopt and arrange matters in order to ensure that official or judicial communications sent by mail would reach the lawyer assigned to the case”. Failure to do so constitutes negligence on the part of the counsel. The Supreme Court consistently holds that the negligence of the counsel binds the client, as recognizing such claims would result in endless litigation. Since the RTC judgment had long attained finality after the expiration of the reglementary period for appeal, it is deemed immutable and unalterable. The case does not fall under the exception where counsel’s negligence is “gross or palpable” resulting in deprivation of due process, as the petitioners were duly given their day in court.

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