GR 141182; (October, 2001) (Digest)
G.R. No. 141182; October 9, 2001
HEIRS OF PEDRO CUETO, Represented by ASUNCION CUETO, petitioner, vs. HON. COURT OF APPEALS and CONSOLACION COMPUESTO, respondents.
FACTS
The petitioners, Heirs of Pedro Cueto, sought to set aside the Decision of the Court of Appeals which affirmed the ruling of the Department of Agrarian Reform Adjudication Board (DARAB). The DARAB declared private respondent Consolacion Compuesto as the bona fide tenant of the landowner Pedro Cueto over a riceland in Camarines Sur. The DARAB ordered the heirs to return physical possession of the landholding to Compuesto and to cease disturbing her cultivation.
While the petition for review on certiorari was pending resolution before the Supreme Court, the parties, including the Heirs of the Spouses Zacarias and Coleta Buenaagua who were also involved, entered into a Compromise Agreement dated March 20, 2001. They subsequently filed a Joint Manifestation with Motion seeking the Court’s approval of said agreement.
ISSUE
Whether the Compromise Agreement entered into by the parties should be approved by the Supreme Court.
RULING
Yes, the Supreme Court approved the Compromise Agreement. The legal logic is grounded in the principle of party autonomy and the favored status of compromise settlements in judicial proceedings to expedite the termination of litigation. Article 2037 of the Civil Code provides that a compromise has upon the parties the effect and authority of res judicata, and courts are generally inclined to approve such agreements if they are not contrary to law, morals, good customs, and public policy.
The Court examined the terms of the agreement and found them to be in order. The agreement provided for an amicable settlement where the landholding would be divided equally between respondent Compuesto and the Heirs of the Buenaaguas. It also stipulated the manner of division, the sharing of segregation expenses, and a scheme for the payment of just compensation to the petitioners-heirs through a combination of a fixed sum and a share of net harvests until fully paid. The parties mutually waived all claims against each other. Since the agreement was voluntarily entered into by the parties with the assistance of their respective counsels and its terms were not contrary to law or public policy, the Court upheld it. The approval of the compromise effectively superseded the prior proceedings and rendered a decision on the merits based on the agreed terms, enjoining the parties to comply in good faith.