G.R. No. L-57256 November 18, 1991
RODOLFO B. INALDO & MANUEL B. INALDO, petitioners, vs. HON. CECILIO F. BALAGOT & JUSTINO R. VIGILIA, respondents.

FACTS

This petition for certiorari assails the CFI Order dated February 9, 1981, which held that while the principal amount for Atty. Justino R. Vigilia’s legal services in the intestate estate proceedings had been paid, interest thereon from 1959 remained unpaid. The claim originated from Special Proceedings No. 54. On May 28, 1974, the court fixed Atty. Vigilia’s fees at P6,358.00 with 6% interest from May 30, 1959. The heirs-administrators (petitioners) moved to vacate this order, but their motion was denied.
Subsequently, on June 4, 1975, the parties entered into a compromise agreement. They agreed that the award be reduced to two-thirds (2/3) of the P6,358.00 principal, payable in two equal installments, and that the petitioners would withdraw their appeal. The court approved this agreement on June 19, 1975. Petitioners paid the first installment of P2,119.33 on June 6, 1975, and the second installment of the same amount on September 8, 1976.

ISSUE

Whether the compromise agreement extinguished the petitioners’ entire obligation, including the accrued interest, thereby rendering the respondent judge’s 1981 order for payment of additional interest a grave abuse of discretion.

RULING

Yes. The Supreme Court granted the petition, set aside the 1981 order, and denied Atty. Vigilia’s motion for further payment. The legal logic is grounded on the interpretation of the compromise agreement and the doctrine of estoppel. A compromise is a contract whereby the parties, by making reciprocal concessions, avoid litigation or put an end to one already commenced. The agreement of June 4, 1975, explicitly stipulated payment of only “two thirds (2/3) of the amount stated” in the 1974 order. This reference pertained solely to the principal sum of P6,358.00, not the interest. The silence of the agreement regarding interest, despite the original order expressly awarding it, signifies that the parties, through reciprocal concession, excluded the interest from the settlement.
Furthermore, Atty. Vigilia’s conduct constituted estoppel. He accepted the two installment payments—each for P2,119.33, which represented exactly half of the reduced principal—without any protest or objection regarding the absence of interest. He waited approximately eight months after full payment of the principal to file a motion claiming interest. His failure to avail of the remedy provided in the compromise agreement itself (which allowed a writ of execution upon default of any term) and his unreasonable delay in asserting the claim demonstrated that he considered the obligation fully satisfied. Therefore, the respondent judge acted with grave abuse of discretion in granting the motion for additional payment long after the compromise had been fully executed.