GR 120107; (January 1998) (Digest)
G.R. No. 120107 January 20, 1998
DANILO P. AGUAS, petitioner, vs. COURT OF APPEALS, Hon. BENJAMIN T. VIANZON, Presiding Judge, Regional Trial Court, Branch 1, Balanga, Bataan, Spouses BUENAVENTURA GREGORIO and CONSTANCIA GREGORIO, Spouses ANTONIO GABAYA and ILUMINADA GABAYA, BALANGA RURAL BANK, INC., Spouses RUFINO REYES and ELSIE RODILL and THE REGISTER OF DEEDS OF BATAAN, respondents.
FACTS
Petitioner Danilo P. Aguas, a lessee since 1957 of a stall in a building owned by the Gregorio spouses and other co-owners, received a letter dated June 25, 1993 from respondent Constancia Gregorio informing him that the property was for sale for P7 million and giving him a preferential right to purchase within one month. Petitioner offered P5 million, and later P5.5 million, but was told to wait for a final decision from the co-owners. However, petitioner later discovered that on June 29, 1993, the Gregorio spouses had already agreed to sell the property to the Gabaya spouses for P5 million, with P1 million earnest money. Subsequently, the Gabaya spouses sold the property to Balanga Rural Bank, which informed petitioner to vacate by December 31, 1993. Petitioner filed a complaint in the Regional Trial Court (Civil Case No. 6215) for injunction, annulment of title, and/or conveyance of property, alleging conspiracy and fictitious deeds of sale grossly undervaluing the property. The trial court issued a temporary restraining order but denied the preliminary injunction. Several private respondents filed a motion to dismiss on the ground that the complaint stated no cause of action, hypothetically admitting petitioner’s material allegations. Petitioner filed a motion to inhibit Judge Benjamin Vianzon, alleging partiality due to his acquaintance with the Bank’s president and the Register of Deeds. The motion for inhibition was denied. Petitioner then filed a petition for certiorari, prohibition, and mandamus with the Court of Appeals, which dismissed the petition. The Court of Appeals ruled that the June 25, 1993 letter created no binding agreement under Article 1479 of the Civil Code due to lack of a separate consideration and because petitioner’s counter-offer indicated no meeting of the minds. It also deemed the inhibition issue moot, citing an order where Judge Vianzon had inhibited himself in a different case.
ISSUE
1. Whether the Court of Appeals erred in ruling on the issue of whether the complaint stated a cause of action, thereby violating petitioner’s right to due process.
2. Whether the Court of Appeals erred in declaring the issue of Judge Vianzon’s inhibition moot and academic.
3. Whether the Court of Appeals erred in not addressing the issue of the trial court’s failure to declare non-answering defendants in default.
RULING
1. The Supreme Court held that the Court of Appeals erred in ruling on the issue of whether the complaint stated a cause of action. The petition for certiorari filed before the Court of Appeals was premature because the trial court had not yet resolved the motion to dismiss; there was no order denying or granting it. Thus, there was no justiciable issue for review regarding the presence or absence of a cause of action. The Court of Appeals should not have ruled on the merits based on facts beyond those hypothetically admitted in the motion to dismiss without a trial.
2. The Supreme Court held that the Court of Appeals erred in declaring the inhibition issue moot. The order of inhibition cited by the Court of Appeals pertained to a different case (Civil Case No. 6140), not to Civil Case No. 6215. The Court ordered Judge Vianzon to inhibit himself from Civil Case No. 6215. A judge must not only be impartial but must also appear to be so. Petitioner alleged that Judge Vianzon had private business dealings with the Register of Deeds, a nominal party, which could create an appearance of impropriety. To facilitate the administration of justice and avoid further delays, inhibition and reraffle of the case were warranted.
3. The Supreme Court held that the issue of the failure to declare non-answering defendants in default should be resolved by the trial court in the proceedings on remand.
The assailed decision of the Court of Appeals was reversed and set aside. The Supreme Court made permanent its earlier order restraining Judge Vianzon from proceeding with Civil Case No. 6215. The case was remanded to the trial court for further proceedings, including the holding of another raffle.