G.R. No. 101847 May 27, 1993
LOURDES NAVARRO AND MENARDO NAVARRO, petitioners, vs. COURT OF APPEALS, JUDGE BETHEL KATALBAS-MOSCARDON, Presiding Judge, Regional Trial Court of Bacolod City, Branch 52, Sixth Judicial Region and Spouses OLIVIA V. YANSON AND RICARDO B. YANSON, respondents.

FACTS

On July 23, 1976, private respondent Olivia V. Yanson filed a complaint for “Delivery of Personal Properties With Damages” with an application for a writ of replevin against petitioner Lourdes Navarro. The case was docketed as Civil Case No. 716 (12562). The complaint was later amended to include their respective spouses as parties. The writ of replevin was approved, and the properties were recovered by private respondents. On April 30, 1990, the Regional Trial Court rendered a decision declaring the chattels recovered via replevin as belonging to the plaintiff, ordering the defendant to reimburse P6,500.00 for a vehicle, and to return other unlisted equipment. Petitioners received the decision on January 10, 1991, and filed a motion for extension to file a motion for reconsideration on January 16, 1991, which was initially granted but later vacated by the trial judge citing the Habaluyas ruling proscribing such extensions. The decision was declared final and executory. A writ of execution was issued and satisfied by petitioners’ payment of P6,500.00. Petitioners then filed a petition for annulment of judgment with the Court of Appeals, claiming the trial judge erred in not finding a partnership. The Court of Appeals dismissed the petition, stating judgments may only be annulled on grounds of extrinsic fraud, that an erroneous judgment is not necessarily void, and that appeal was the proper remedy. Petitioners elevated the case to the Supreme Court via a petition for review.

ISSUE

Whether the Court of Appeals correctly dismissed the petition for annulment of judgment.

RULING

Yes, the Court of Appeals correctly dismissed the petition. The Supreme Court affirmed the appellate court’s resolution. A judgment may be annulled only on the ground of extrinsic or collateral fraud, which petitioners failed to allege. The proper remedy against the trial court’s judgment was appeal, which petitioners lost by filing a prohibited motion for extension of time to file a motion for reconsideration, leading to the decision becoming final and executory. The writ of execution had already been satisfied. Petitioners’ arguments focused on factual issues regarding the existence of a partnership, which were extensively discussed and resolved by the trial court. The Supreme Court found the trial court’s factual premises sufficient to negate the existence of a partnership as defined under Article 1767 of the Civil Code, noting lack of proof of a partnership constitution and that co-possession and sharing of proceeds are not conclusive of a partnership. Since the petition for annulment raised issues already directly litigated and passed upon by the trial court, and absent any extrinsic fraud, the Court of Appeals acted properly in dismissing it. The petition was dismissed and the Resolution of the Court of Appeals was affirmed.