G.R. No. 213287 , December 06, 2021
METROPOLITAN MANILA DEVELOPMENT AUTHORITY, REPRESENTED BY ITS CHAIRMAN, ATTY. FRANCIS N. TOLENTINO, PETITIONER, VS. HIGH DESERT STOP OVERS, INC., RESPONDENT.

FACTS

The Metropolitan Manila Development Authority (MMDA) entered into three agreements with High Desert Stop Overs, Inc. (HDSOI) for the construction, operation, and maintenance of public passenger stations under the Build-Operate-Transfer (BOT) Law. On August 8, 2006, the MMDA Chairman terminated these agreements. Consequently, HDSOI filed a Complaint for Injunction and Damages. Pending the case, the Metro Manila Council authorized the MMDA Chairman to enter into an amicable settlement. On June 16, 2010, MMDA, through its then Chairman, and HDSOI executed a Memorandum of Agreement (MOA), a compromise agreement, which they submitted to the trial court via a Joint Motion. The trial court approved the compromise agreement and dismissed the case in a Judgment dated July 2, 2010, which became final and executory. Later, HDSOI moved for execution. MMDA, through the Office of the Solicitor General (OSG), opposed, arguing the compromise agreement was entered into without the OSG’s prior notice, consultation, and approval, and that its terms were disadvantageous to the government. The trial court granted the writ of execution, noting the OSG had been served a copy of the judgment and that the MMDA was authorized by its Council to enter the MOA. MMDA’s motion for reconsideration was denied. MMDA, through the OSG, filed a Petition for Annulment of Judgment before the Court of Appeals, alleging the trial court acted without jurisdiction in approving a null and void MOA and that the agreement’s terms failed to protect the government’s interest. The CA dismissed the petition, ruling the grounds alleged did not establish lack of jurisdiction.

ISSUE

Whether the Court of Appeals erred in dismissing the Petition for Annulment of Judgment, specifically on the grounds that the trial court acted without jurisdiction in approving the compromise agreement (MOA) which was allegedly entered into without the prior approval of the Office of the Solicitor General and was disadvantageous to the government.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ Decision. The Court held that a petition for annulment of judgment under Rule 47 of the Rules of Court is based only on the grounds of extrinsic fraud or lack of jurisdiction. The MMDA’s arguments did not establish a lack of jurisdiction. Jurisdiction over the subject matter (the complaint for injunction and damages) and over the parties was vested in the trial court. The claim that the trial court acted without jurisdiction because the MOA lacked OSG approval merely attacked the exercise of jurisdiction, not its existence. The Court found no law, including Republic Act No. 7924 (the MMDA Charter), that requires OSG approval for the MMDA to enter into a compromise agreement. The MMDA’s governing body, the Metro Manila Council, had authorized the Chairman to settle the case. Furthermore, the OSG was notified of the judgment but did not appeal. The alleged disadvantageous terms of the MOA also do not affect the trial court’s jurisdiction. Since the judgment had long become final and the grounds for annulment were absent, the Court upheld the CA’s dismissal of the annulment petition.