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Equitable PCI v Ku

March 26, 2001


EQUITABLE PCI BANK, formerly EQUITABLE BANKING CORPORATION
vs.
ROSITA KU
KAPUNAN, J.
SUMMARY: Litigation ensued between Rosita Ku and Equitable. When CA ruled in favor of Rosita, Equitable filed a motion for an
extension of 30 days to file its petition for review as it allegedly received the CA decision on April 25, 2000. However, Rosita argues that
the petition is defective because Bank actually received CA decision on April 24, 2000 when Joel Rosales, an employee of Banks law
firm received it from the Post office and thus Equitable should have filed motion for extension on May 9, 2000 not May 10. Equitable
replied that Joel is not an agent of the bank as expressly mentioned in his affidavit. HELD: Bank filed petition beyond reglementary
period. There was perfection of the agency as Joel Rosales averred in his affidavit that on occasions when I receive mail matters for
said law office, it is only to help them receive their letters promptly, implying that counsel had allowed the practice of Rosales receiving
mail in behalf of the former. There is no showing that counsel had objected to this practice or took steps to put a stop to it. However, in
the interest of justice, the petition was still given due course.
DOCTRINE:

PERFECTION FROM SIDE OF PRINCIPAL: An agency may be express but it may also be implied from the acts of the principal,
from his silence, or lack of action, or his failure to repudiate the agency, knowing that another person is acting on his behalf without
authority.

PERFECTION FROM SIDE OF AGENT: Likewise, acceptance by the agent may also be express, although it may also be implied
from his acts which carry out the agency, or from his silence or inaction according to the circumstances (Art. 1870).
FACTS:

Noddy Dairy Products Inc. incurred a loan from Equitable Banking Corporation (now Equitable PCI Bank)

As security, Rosita Ku, treasurer of Noddy, Inc., and Ku GiokHeng, VP/GM of Noddy Inc. and Rositas father, mortgaged a
residential house and lot located in La Vista, QC which is registered in Rositas name

When Noddy, Inc. failed to pay the loan, Equitable foreclosed the property extrajudicially and was issued a certificate of sale after
winning in the foreclosure sale. Rosita failed to redeem the property so the Register of Deeds canceled the TCT in her name and a
new one was issued in Equitables name.

May 10, 89: Equitable instituted an action for ejectment before MeTC QC against Rositas father Ku GiokHeng.
o It allowed Ku GiokHeng to remain in the property on the condition that the latter pay rent. However, Ku GiokHengs failed
to pay rent thus this action.

Ku GiokHeng denied that there was any lease agreement over the property.

MeTC (Dec. 8, 94): In favor of Equitable and ordered Ku Giok Heng to vacate the premises.
o No right for his continued possession of or stay as title had been duly transferred to Equitable. Buyer in foreclosure sale
becomes the absolute owner of the property purchased if it is not redeemed during the period of 1 year after the
registration of the sale

Ku GiokHeng did not appeal the decision of the MeTC.

Dec. 20, 94: Instead, he and Rosita Ku, filed an action before RTC QC to nullify the decision of the MeTC.

RTC (Sept. 13, 99): No merit; Dismissed complaint and ordered the execution of the MeTC decision.

Rosita filed in CA a special civil action for certiorari assailing the decision of the RTC as she was not made a party to the ejectment
suit and was, therefore, deprived of due process.

CA (Mar. 31, 2000): Agreed with Rosita. Enjoined the eviction of Rosita from the premises.

May 10, 2000: Equitable filed in SC a motion for an extension of 30 days from May 10, 2000 or until June 9, 2000 to file its
petition for review of the CA decision as the Bank has received the CA decision on April 25, 2000.
o April 25, 2000 Received CA Decision (15 days reglementary period to file petition for review OR file motion for
extension)
o May 10,2000 Filed motion for extension for 30 days
o June 9, 2000 w/n 30 days

SC: Granted the motion for a 30-day extension counted from the expiration of the reglementary period and conditioned upon the
timeliness of the filing of the motion for extension.

June 13, 2000: Equitable Bank filed its petition, contending that there was no need to name Rosita Ku as a party in the action for
ejectment since she was not a resident of the premises nor was she in possession of the property.
o FOOTNOTE: The last day to file the petition was on June 9, 2000 but because of the Courts 99 th Anniversary
Celebration, business transactions were suspended on said date per Memorandum Circular No. 03-2000.

Rosita argues that the petition is defective because of non-compliance with reglementary period.
o Bank received CA decision not on April 25, 2000 but on April 24, 2000
o April 24, 2000 - copy was duly delivered to and received by Joel Rosales (Authorized Representative) as evidenced
by a Certification issued by the Manila Central Post Office
o May 10, 2000 When Equitable filed its motion for extension to file petition for review, it was 1 day beyond the
reglementary period for filing the petition for review OR motion to extend w/c must be filed on May 9, 2000 - 15 days from
the receipt of CA decision

Banks Reply: Reiterates its honest representation of having received a copy of CA decision on April 25, 2000. Receipt on April
24, 2000 by Joel Rosales, who was not an agent of its counsels law office cannot be considered receipt of the CA Decision by the
Bank (or its counsel).

Rosales Affidavit

Employee of Unique Industrial & Allied Services, Inc. and assigned with the Equitable PCI Bank, Mail and Courier
Department w/ official duty and responsibility to receive and pick-up from the Manila Central Post Office the various mails,
letters, correspondence, and other mail matters intended for the banks various departments and offices at Equitable Bank
Building
o I am not the constituted agent of Curato-Divina-Mabilog-Nedo-Magturo-Pagaduan Law Office for purposes of
receiving their incoming mail matters; neither am I any such agent of the various other tenants of the said
Building. On occasions when I receive mail matters for said law office, it is only to help them receive their letters
promptly.
o April 24, 2000: Received CA Decision together with other mail matters, and brought them to the Mail and Courier
Department;
o April 25, 2000: After sorting out mail matters, erroneously recorded them on page 422 of logbook as having been received
on April 25, 2000
o April 27, 2000: Decision was sent by the Mail and Courier Department to said Law Office whose receiving clerk opened
the letter and stamped on the Notice of Judgment their actual date of receipt: April 27, 2000
o May 8, 2000: Atty. Roland A. Niedo of said law office inquired as to actual date of receipt of letter, and informed him that
based on logbook, it was received on April 25, 2000.
o Error was caused by an honest mistake.

Bank also argues such receipt did not constitute notice to its counsel, as required by Sec. 2 and 10, Rule 13 of ROC. CA decision
actually received on April 27, 2000.
o SEC. 2. Filing and service defined. Filing is the act of presenting the pleading or other paper of the clerk of court.
Service is the act of providing a party with a copy of the pleading or paper concerned. If any party has appeared by
counsel, service upon him shall be made upon his counsel or one of them, unless service upon the party himself is
ordered by the court. Where one counsel appears for several parties, he shall only be entitled to one copy of any paper
served upon him by the opposite side.
o PLDT vs. NLRC: It was only when the Legal Services Division actually received a copy of the decision that a proper and
valid service may be deemed to have been made.
o Actual receipt by its counsel was actually on April 27, 2000, not April 25, 2000. The motion for extension to file the
petition for review was even filed 2 days before the lapse of the 15-day reglementary period

Assuming the motion for extension was indeed one day late, Bank urges SC to suspend its rules and admit the petition in the
interest of justice.
ISSUES:
1) Whether Joel Rosales can be considered the agent of Banks counsel and thus service to him was considered service to Bank?
(YES) [Whether the act of the law firm in allowing its employee to occasionally receive its mail can be construed to mean an agency
relationship? YES]
2) Whether, in the interest of justice, the rules on reglementary periods can be suspended in this case? (YES)
3) Whether a person can be evicted by virtue of a decision rendered in an ejectment case where she was not joined as a party? (YES)
RATIO:
1) Joel Rosales is an agent of Banks counsel.

Although the Affidavit of Joel Rosales states that he is not the constituted agent of Curato-Divina-Mabilog-Nedo-MagturoPagaduan Law Office, an agency may be express but it may also be implied from the acts of the principal, from his silence, or lack
of action, or his failure to repudiate the agency, knowing that another person is acting on his behalf without authority. (Art. 1869)

Likewise, acceptance by the agent may also be express, although it may also be implied from his acts which carry out the agency,
or from his silence or inaction according to the circumstances (Art. 1870).

CASE AT BAR: Joel Rosales averred that on occasions when I receive mail matters for said law office, it is only to help them
receive their letters promptly, implying that counsel had allowed the practice of Rosales receiving mail in behalf of the
former. There is no showing that counsel had objected to this practice or took steps to put a stop to it.
2) Court gives due course to petition in spite of noncompliance with periods in light of the merits of the petition.

The perfection of an appeal within the period fixed by the rules is mandatory and jurisdictional. But, it is always in the power of this
Court to suspend its own rules, or to except a particular case from its operation, whenever the purposes of justice require it. Strong
compelling reasons such as serving the ends of justice and preventing a grave miscarriage thereof warrant the suspension of the
rules.

The Court proceeded to enumerate cases where the rules on reglementary periods were suspended (6 days; 13 days; 1 day; 7
days; 2 days; tardy appeal).
3) Even if Rosita were a resident of the property, she is nevertheless bound by the judgment of the MeTC in the action for ejectment
despite her being a non-party thereto as the daughter of Ku GiokHeng, the defendant in the action for ejectment.

Generally, no man shall be affected by any proceeding to which he is a stranger, and strangers to a case are not bound by
judgment rendered by the court. (Matuguina vs. CA) Nevertheless, a judgment in an ejectment suit is binding not only upon the
defendants in the suit but also against those not made parties thereto, if they are:
o a) trespassers, squatters or agents of the defendant fraudulently occupying the property to frustrate the judgment;
o b) guests or other occupants of the premises with the permission of the defendant;
o c) transferees pendente lite;
o d) sub-lessees;
o e) co-lessees; or
o f) members of the family, relatives and other privies of the defendant. (Oro Cam Enterprises, Inc. vs. CA)
DISPOSITIVE: Petition GIVEN DUE COURSE and GRANTED. CA decision REVERSED.
o